1
EXHIBIT 4.4
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KAISER ALUMINUM & CHEMICAL CORPORATION,
as Issuer,
KAISER ALUMINA AUSTRALIA CORPORATION,
ALPART JAMAICA INC.,
KAISER FINANCE CORPORATION,
KAISER JAMAICA CORPORATION,
KAISER MICROMILL HOLDINGS, LLC,
KAISER SIERRA MICROMILLS, LLC,
KAISER TEXAS MICROMILL HOLDINGS, LLC and
KAISER TEXAS SIERRA MICROMILLS, LLC,
as Subsidiary Guarantors,
AND
FIRST TRUST NATIONAL ASSOCIATION
as Trustee
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INDENTURE
Dated as of December 23, 1996
----------------------------------------
$50,000,000
10 7/8% [Series C] and/or [Series D] Senior Notes due 2006
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2
RECONCILIATION AND TIE SHEET*
between
PROVISIONS OF THE TRUST INDENTURE ACT OF 1939
and
INDENTURE DATED AS OF DECEMBER 23, 1996
between
KAISER ALUMINUM & CHEMICAL CORPORATION
KAISER ALUMINA AUSTRALIA CORPORATION,
ALPART JAMAICA INC.,
KAISER FINANCE CORPORATION,
KAISER JAMAICA CORPORATION,
KAISER MICROMILL HOLDINGS, LLC,
KAISER SIERRA MICROMILLS, LLC,
KAISER TEXAS MICROMILL HOLDINGS, LLC and
KAISER TEXAS SIERRA MICROMILLS, LLC
and
FIRST TRUST NATIONAL ASSOCIATION, TRUSTEE
Sections Sections of
of Act Indenture
- ------ ---------
310(a)(1) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.09
310(a)(2) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.09
310(a)(3) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Inapplicable
310(a)(4) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Inapplicable
310(a)(5) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.09
310(b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.08, 7.10
310(c) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Inapplicable
311(a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.13(a), 7.13(c)
311(b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.13(b), 7.13(c)
311(c) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Inapplicable
312(a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5.01, 5.02(a)
312(b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5.02(b)
312(c) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5.02(c)
313(a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5.04(a)
313(b)(1) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Inapplicable
313(b)(2) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5.04(b)
313(c) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5.04(c)
313(d) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5.04(d)
314(a)(1) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5.03(a)
314(a)(2) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5.03(b)
314(a)(3) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5.03(c)
314(a)(4) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5.03(d)
314(b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Inapplicable
314(c)(1) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14.05
314(c)(2) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14.05
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Sections Sections of
of Act Indenture
- ------ ---------
314(c)(3) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Inapplicable
314(d) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Inapplicable
314(e) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14.05
314(f) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Omitted
315(a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.01
315(b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6.07
315(c) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.01
315(d) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.01
315(e) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6.08
316(a)(1) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6.06, 8.04
316(a)(2) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Omitted
316(b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6.04
316(c) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8.05
317(a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6.02
317(b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4.04(a)
318(a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14.07
318(c) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14.07
- -----------------------------
* This Reconciliation and Tie Sheet is not a part of the Indenture.
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TABLE OF CONTENTS
Page
ARTICLE ONE
DEFINITIONS
SECTION 1.01. Certain terms defined . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
SECTION 1.02. References are to Indenture . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
SECTION 1.03. Other definitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
ARTICLE TWO
ISSUE, DESCRIPTION, EXECUTION, REGISTRATION
AND EXCHANGE OF NOTES
SECTION 2.01. Designation, amount, authentication and delivery of Notes . . . . . . . . . . . . . . . . . . 37
SECTION 2.02. Form of Notes and Trustee's certificate . . . . . . . . . . . . . . . . . . . . . . . . . . . 38
SECTION 2.03. Date of Notes and denominations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
SECTION 2.04. Execution of Notes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40
SECTION 2.05. Exchange and transfer of Notes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40
SECTION 2.06. Temporary Notes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44
SECTION 2.07. Mutilated, destroyed, lost or stolen Notes . . . . . . . . . . . . . . . . . . . . . . . . . 44
SECTION 2.08. Cancellation of surrendered Notes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45
SECTION 2.09. Restrictive Legends . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45
SECTION 2.10. Book-Entry Provisions for Global Note and Regulation S Temporary
Global Note . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47
ARTICLE THREE
REDEMPTION AND PURCHASES OF NOTES
SECTION 3.01. Redemption prices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48
SECTION 3.02. Notice of redemption; selection of Notes . . . . . . . . . . . . . . . . . . . . . . . . . . 48
SECTION 3.03. When Notes called for redemption become due and payable . . . . . . . . . . . . . . . . . . . 49
SECTION 3.04. Cancellation of redeemed Notes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50
SECTION 3.05. Purchase of Notes at option of the holder upon Change of Control . . . . . . . . . . . . . . 50
SECTION 3.06. Effect of Change of Control Purchase Notice . . . . . . . . . . . . . . . . . . . . . . . . . 52
SECTION 3.07. Deposit of Change of Control Purchase Price . . . . . . . . . . . . . . . . . . . . . . . . . 53
SECTION 3.08. Covenant to comply with securities laws upon purchase of Notes . . . . . . . . . . . . . . . 53
SECTION 3.09. Repayment to the Company . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 53
ARTICLE FOUR
PARTICULAR COVENANTS OF THE COMPANY
SECTION 4.01. Payments on the Notes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 54
SECTION 4.02. Maintenance of office or agency for registration of transfer,
exchange and payment of Notes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 54
SECTION 4.03. Appointment to fill a vacancy in the office of Trustee . . . . . . . . . . . . . . . . . . . 54
SECTION 4.04. Provision as to paying agent . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 54
SECTION 4.05. Maintenance of corporate existence . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55
SECTION 4.06. Officers' Certificate as to default and statement as to compliance . . . . . . . . . . . . . 56
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Page
SECTION 4.07. Usury laws . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 56
SECTION 4.08. Restrictions on transactions with Affiliates and Unrestricted Subsidiaries. . . . . . . . . . 56
SECTION 4.09. Limitations on Restricted Payments, Restricted Investments and
Unrestricted Subsidiary Investments . . . . . . . . . . . . . . . . . . . . . . . . . . 58
SECTION 4.10. Limitation on Indebtedness and Preferred Stock . . . . . . . . . . . . . . . . . . . . . . . 63
SECTION 4.11. Limitation on Liens . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 66
SECTION 4.12. Subsidiary guarantees, etc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 68
SECTION 4.13. Limitation on dividends and other payment restrictions affecting Subsidiaries . . . . . . . . 70
SECTION 4.14. Limitation on Asset Sales . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 70
SECTION 4.15. Limitations on Unrestricted Subsidiaries . . . . . . . . . . . . . . . . . . . . . . . . . . 73
ARTICLE FIVE
NOTEHOLDERS' LISTS AND REPORTS BY THE
COMPANY AND THE TRUSTEE
SECTION 5.01. Company to furnish Trustee information as to names and addresses
of noteholders . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 74
SECTION 5.02. Preservation and disclosure of lists . . . . . . . . . . . . . . . . . . . . . . . . . . . . 74
SECTION 5.03. Reports by the Company . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 75
SECTION 5.04. Reports by the Trustee. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 76
ARTICLE SIX
REMEDIES OF THE TRUSTEE AND NOTEHOLDERS
ON EVENT OF DEFAULT
SECTION 6.01. Events of Default defined . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 77
SECTION 6.02. Payment of Notes on default; suit therefor . . . . . . . . . . . . . . . . . . . . . . . . . 79
SECTION 6.03. Application of moneys collected by Trustee . . . . . . . . . . . . . . . . . . . . . . . . . 80
SECTION 6.04. Limitation on suits by holders of Notes . . . . . . . . . . . . . . . . . . . . . . . . . . . 81
SECTION 6.05. Proceedings by Trustee; remedies cumulative and continuing; delay or
omission not waiver of default . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 81
SECTION 6.06. Rights of holders of majority in principal amount of Notes to direct
Trustee and to waive defaults . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 82
SECTION 6.07. Trustee to give notice of defaults known to it, but may withhold in
certain circumstances . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 82
SECTION 6.08. Requirement of an undertaking to pay costs in certain suits under
the Indenture or against the Trustee . . . . . . . . . . . . . . . . . . . . . . . . . . 82
SECTION 6.09. Waiver of stay or extension laws . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 83
ARTICLE SEVEN
CONCERNING THE TRUSTEE
SECTION 7.01. Duties and responsibilities of Trustee . . . . . . . . . . . . . . . . . . . . . . . . . . . 83
SECTION 7.02. Reliance on documents, opinions, etc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 84
SECTION 7.03. No responsibility for recitals, etc . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 85
SECTION 7.04. Trustee, paying agent or Note registrar may own Notes . . . . . . . . . . . . . . . . . . . . 85
SECTION 7.05. Moneys received by Trustee to be held in trust without interest . . . . . . . . . . . . . . . 85
SECTION 7.06. Compensation and expenses of Trustee . . . . . . . . . . . . . . . . . . . . . . . . . . . . 85
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SECTION 7.07. Right of Trustee to rely on Officers' Certificate where no other evidence
specifically prescribed . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 86
SECTION 7.08. Conflicting interest of Trustee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 86
SECTION 7.09. Requirements for eligibility of Trustee . . . . . . . . . . . . . . . . . . . . . . . . . . . 91
SECTION 7.10. Resignation or removal of Trustee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 91
SECTION 7.11. Acceptance by successor to Trustee; notice of succession of a Trustee . . . . . . . . . . . . 92
SECTION 7.12. Successor to Trustee by merger, consolidation or succession to business;
notice by Trustee of change in its location . . . . . . . . . . . . . . . . . . . . . . 92
SECTION 7.13. Limitations on rights of Trustee as a creditor . . . . . . . . . . . . . . . . . . . . . . . 93
ARTICLE EIGHT
CONCERNING THE NOTEHOLDERS
SECTION 8.01. Evidence of action by noteholders . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 96
SECTION 8.02. Proof of execution of instruments and of holding of Notes . . . . . . . . . . . . . . . . . . 96
SECTION 8.03. Who may be deemed owners of Notes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 97
SECTION 8.04. Notes owned by Company or controlled by controlling persons disregarded
for certain purposes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 97
SECTION 8.05. Record date for action by noteholders . . . . . . . . . . . . . . . . . . . . . . . . . . . . 97
SECTION 8.06. Instruments executed by noteholders bind future holders . . . . . . . . . . . . . . . . . . . 98
ARTICLE NINE
NOTEHOLDERS' MEETINGS
SECTION 9.01. Purposes for which meetings may be called . . . . . . . . . . . . . . . . . . . . . . . . . . 98
SECTION 9.02. Manner of calling meetings; record date . . . . . . . . . . . . . . . . . . . . . . . . . . . 99
SECTION 9.03. Call of meeting by Company or noteholders . . . . . . . . . . . . . . . . . . . . . . . . . . 99
SECTION 9.04. Who may attend and vote at meetings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 99
SECTION 9.05. Regulations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 99
SECTION 9.06. Manner of voting at meetings and record to be kept . . . . . . . . . . . . . . . . . . . . . 100
SECTION 9.07. Exercise of rights of Trustee and noteholders not to be hindered or delayed . . . . . . . . . 100
ARTICLE TEN
SUPPLEMENTAL INDENTURES
SECTION 10.01. Purposes for which supplemental indentures may be entered into
without consent of noteholders . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 101
SECTION 10.02. Modification of Indenture with consent of holders of a majority
in principal amount of Notes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 102
SECTION 10.03. Effect of supplemental indentures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 102
SECTION 10.04. Notes may bear notation of changes by supplemental indentures . . . . . . . . . . . . . . . 103
SECTION 10.05. Officers' Certificate and Opinion of Counsel . . . . . . . . . . . . . . . . . . . . . . . . 103
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ARTICLE ELEVEN
CONSOLIDATION, MERGER AND SALE
SECTION 11.01. Company may consolidate, etc., on certain terms . . . . . . . . . . . . . . . . . . . . . . 103
SECTION 11.02. Successor corporation to be substituted . . . . . . . . . . . . . . . . . . . . . . . . . . 104
SECTION 11.03. Opinion of Counsel . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 105
ARTICLE TWELVE
SATISFACTION AND DISCHARGE OF INDENTURE;
UNCLAIMED MONEYS
SECTION 12.01. Satisfaction and discharge of Indenture . . . . . . . . . . . . . . . . . . . . . . . . . . 105
SECTION 12.02. Application by Trustee of funds deposited for payment of Notes . . . . . . . . . . . . . . . 106
SECTION 12.03. Repayment of moneys held by paying agent . . . . . . . . . . . . . . . . . . . . . . . . . . 106
SECTION 12.04. Repayment of moneys held by Trustee . . . . . . . . . . . . . . . . . . . . . . . . . . . . 106
SECTION 12.05. Reinstatement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 106
ARTICLE THIRTEEN
IMMUNITY OF INCORPORATORS, STOCKHOLDERS, OFFICERS
AND DIRECTORS
SECTION 13.01. Incorporators, stockholders, officers and directors of Company
exempt from individual liability . . . . . . . . . . . . . . . . . . . . . . . . . . . . 107
ARTICLE FOURTEEN
MISCELLANEOUS PROVISIONS
SECTION 14.01. Successors and assigns of Company bound by Indenture . . . . . . . . . . . . . . . . . . . . 108
SECTION 14.02. Acts of board, committee or officer of successor corporation valid . . . . . . . . . . . . . 108
SECTION 14.03. Required notices or demands may be served by mail; waiver . . . . . . . . . . . . . . . . . 108
SECTION 14.04. Indenture and Notes to be construed in accordance with the laws of
the State of New York . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 109
SECTION 14.05. Evidence of compliance with conditions precedent . . . . . . . . . . . . . . . . . . . . . . 109
SECTION 14.06. Payments due on Saturdays, Sundays and holidays . . . . . . . . . . . . . . . . . . . . . . 109
SECTION 14.07. Provisions required by Trust Indenture Act of 1939 to control . . . . . . . . . . . . . . . 109
SECTION 14.08. Provisions of the Indenture and Notes for the sole benefit of the
parties and the noteholders . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 109
SECTION 14.09. Severability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 109
SECTION 14.10. Indenture may be executed in counterparts; acceptance by Trustee . . . . . . . . . . . . . . 109
SECTION 14.11. Article and Section headings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 110
SECTION 14.12. No Adverse Interpretation of Other Instruments . . . . . . . . . . . . . . . . . . . . . . . 110
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ARTICLE FIFTEEN
GUARANTEE OF NOTES
SECTION 15.01. Guarantee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 110
SECTION 15.02. Guarantee senior in respect of Subordinated Notes . . . . . . . . . . . . . . . . . . . . . 111
SECTION 15.03. Subsidiary Guarantors may consolidate, etc., on certain terms . . . . . . . . . . . . . . . 111
SECTION 15.04. Application of certain terms and provisions to the Subsidiary Guarantors. . . . . . . . . . 112
SECTION 15.05. Release of Guarantee. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 112
SIGNATURES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
EXHIBIT A-1 REGULATION S NOTE PROVISIONS
EXHIBIT A-2 FORM OF CERTIFICATE FOR EXCHANGE OR REGISTRATION OF TRANSFER
FROM REGULATION S GLOBAL NOTE
SCHEDULE A - SCHEDULE OF LIENS SECURING INDEBTEDNESS IN EXCESS OF
$5,000,000
SCHEDULE B - REAL PROPERTY CONSTITUTING PERMITTED COLLATERAL
SCHEDULE C - CERTAIN INDEBTEDNESS IN EXCESS OF $10,000,000
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THIS INDENTURE, dated as of the 23 day of December, 1996,
among KAISER ALUMINUM & CHEMICAL CORPORATION, a corporation duly organized and
existing under the laws of the State of Delaware (hereinafter referred to as
the "Company"), as Issuer, KAISER ALUMINA AUSTRALIA CORPORATION, KAISER FINANCE
CORPORATION, ALPART JAMAICA INC., KAISER JAMAICA CORPORATION, KAISER MICROMILL
HOLDINGS, LLC, KAISER SIERRA MICROMILLS, LLC, KAISER TEXAS MICROMILL HOLDINGS,
LLC and KAISER TEXAS SIERRA MICROMILLS, LLC, as Subsidiary Guarantors, and
FIRST TRUST NATIONAL ASSOCIATION, a national banking association (hereinafter
referred to as the "Trustee"), as Trustee.
W I T N E S S E T H:
WHEREAS, the Company has duly authorized an issue of its 10
7/8% Series C Senior Notes due 2006 (hereinafter referred to as the "Initial
Notes"), for an aggregate principal amount of up to fifty million dollars
($50,000,000), to be issued as registered Initial Notes without coupons, to be
authenticated by the certificate of the Trustee, to be payable on October 15,
2006, and to be redeemable and purchasable as hereinafter provided; and the
Company has duly authorized an issue of its 10 7/8% Series D Senior Notes due
2006 to be issued in exchange for the Initial Notes pursuant to the
Registration Rights Agreement (hereinafter referred to as the "Exchange Notes"
and together with the Initial Notes, the "Notes"); and, to provide the terms
and conditions upon which the Notes are to be authenticated, issued and
delivered, the Company has duly authorized the execution and delivery of this
Indenture;
WHEREAS, the payment of the principal of, premium, if any,
Change of Control Purchase Price, Asset Sale Purchase Price and interest on,
the Notes is hereby expressly designated, and the monetary obligations of the
Company under the Notes shall hereafter constitute for all purposes, Senior
Indebtedness of the Company under the terms of the 12 3/4% Note Indenture (as
hereinafter defined);
WHEREAS, the Guarantee (as hereinafter defined) of each
Subsidiary Guarantor in respect of the Notes is hereby expressly designated,
and the monetary obligations of such Subsidiary Guarantor under the Notes shall
hereafter constitute for all purposes Senior Indebtedness of such Subsidiary
Guarantor under the terms of the 12 3/4% Note Indenture, to the extent that
such Subsidiary Guarantor is a guarantor under the 12 3/4% Note Indenture;
WHEREAS, the Company has duly delivered written notice to
the trustee under the 12 3/4% Note Indenture designating the Notes and each
Guarantee as Senior Indebtedness thereunder;
WHEREAS, the Notes and the Trustee's certificate of
authentication to be borne by the Notes are to be substantially in the
following forms, respectively:
10
[FORM OF FACE OF NOTE]
No. [Principal Amount]
Issue Date: CUSIP
KAISER ALUMINUM & CHEMICAL CORPORATION
10 7/8% [SERIES C] AND/OR [SERIES D] SENIOR NOTE DUE 2006
KAISER ALUMINUM & CHEMICAL CORPORATION, a corporation duly
organized and existing under the laws of the State of Delaware (herein referred
to as the "Company"), for value received, hereby promises to pay to
____________________, or registered assigns, the principal sum of
____________________ DOLLARS on October 15, 2006, at the office or agency of
the Company in the Borough of Manhattan, the City of New York, State of New
York, in such coin or currency of the United States of America as at the time
of payment is legal tender for the payment of public and private debts, and to
pay to the registered holder hereof, as hereinafter provided, interest on said
principal sum at the rate per annum specified in the title of this Note, in
like coin or currency, semiannually on April 15 and October 15 in each year.
Interest shall accrue from the most recent date to which interest has been paid
or duly provided for or, if no interest has been paid or duly provided for,
from December 23, 1996; provided, that, in the case of authentication between
the record date for any interest payment date and such interest payment date,
this Note shall be dated the date of its authentication but shall bear interest
from such interest payment date, subject to certain exceptions. The interest
so payable on any April 15 or October 15 will, subject to certain exceptions
provided in the Indenture hereinafter referred to, be paid to the person in
whose name this Note is registered at the close of business on the April 1 or
October 1, as the case may be, next preceding such April 15 or October 15
whether or not such April 1 or October 1 is a Business Day. Interest shall be
computed on the basis of a 360-day year of twelve 30-day months. Payment of
interest shall be made at the office or agency of the Company maintained for
such purpose within the City and State of New York or, at the option of the
Company, by check mailed by first-class mail to the address of the person
entitled thereto at such address as shall appear on the registry books of the
Company; provided that all payments with respect to this Note, if the holder of
this Note has given wire transfer instructions (which instructions must be
received by the Company at least 5 Business Days prior to the relevant date of
payment) to the Company, will be required to be made by wire transfer of
immediately available funds to the account specified by the holder of this
Note; provided, that such payments (other than interest payments) may be
conditioned upon surrender of this Note.
As provided in the Indenture, this Note shall be deemed to
be a contract made under the laws of the State of New York, and for all
purposes shall be governed by and construed in accordance with the laws of such
State.
Reference is made to the further provisions of this Note set
forth on the reverse hereof. Such further provisions shall for all purposes
have the same effect as though fully set forth at this place.
This Note shall not be valid or become obligatory for any
purpose until the certificate of authentication hereon shall have been signed
by the Trustee under the Indenture referred to on the reverse hereof.
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IN WITNESS WHEREOF, KAISER ALUMINUM & CHEMICAL CORPORATION
has caused this instrument to be duly executed under its corporate seal.
Dated
KAISER ALUMINUM & CHEMICAL
CORPORATION
By:
-----------------------------
Name:
Title:
[Corporate Seal]
Attest:
- ----------------------------
Secretary
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[FORM OF TRUSTEE'S CERTIFICATE OF AUTHENTICATION]
This is one of the Notes described in the within-mentioned Indenture.
FIRST TRUST NATIONAL ASSOCIATION
as Trustee
By:
-----------------------------
Authorized Signatory
[FORM OF REVERSE OF NOTE]
KAISER ALUMINUM & CHEMICAL CORPORATION
10 7/8% [SERIES C] AND/OR [SERIES D] SENIOR NOTE DUE 2006
This Note is one of a duly authorized issue of Notes of the
Company known as its 10 7/8% [Series C] and/or [Series D] Senior Notes due 2006
(herein referred to as the "Notes"), limited to an aggregate principal amount
of fifty million dollars ($50,000,000), all issued or to be issued under and
pursuant to an indenture, dated as of December 23, 1996 (herein referred to as
the "Indenture"), duly executed and delivered between the Company, the
Subsidiary Guarantors (as defined in the Indenture) and First Trust National
Association, as trustee (herein referred to as the "Trustee"), to which
Indenture and all indentures supplemental thereto reference is hereby made for
a description of the respective rights, limitations of rights, obligations,
duties and immunities thereunder of the Trustee, the Company, the Subsidiary
Guarantors and the holders of the Notes. All terms used in this Note which are
defined in the Indenture shall have the meanings assigned to them in the
Indenture.
In case an Event of Default, as defined in the Indenture,
shall have occurred and be continuing, the principal amount of this Note plus
any accrued and unpaid interest to the date of acceleration may be declared,
and upon such declaration shall become, due and payable, in the manner, with
the effect and subject to the conditions provided in the Indenture. The
Indenture provides that in certain events such declaration and its consequences
may be waived by the holders of a majority of the aggregate principal amount of
the Notes then outstanding or outstanding on the record date, if any, fixed
therefor in accordance with the provisions of the Indenture. It is also
provided in the Indenture that the holders of a majority of the aggregate
principal amount of the Notes at the time or on any such record date
outstanding may on behalf of the holders of all of the Notes waive, prior to
such declaration, any past default under the Indenture and its consequences,
except a default in the payment of the principal of, premium, if any, Change of
Control Purchase Price, Asset Sale Purchase Price or interest on any of the
Notes or a default in respect of a covenant or provision in the Indenture which
under Article Ten of the Indenture cannot be modified or amended without the
consent of the holder of each outstanding Note.
Payment of the Notes is guaranteed on a senior basis by
Kaiser Alumina Australia Corporation, Alpart Jamaica Inc., Kaiser Finance
Corporation, Kaiser Jamaica Corporation, Kaiser Micromill
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Holdings, LLC, Kaiser Sierra Micromills, LLC, Kaiser Texas Micromill Holdings,
LLC and Kaiser Texas Sierra Micromills, LLC and, under certain circumstances
set forth in the Indenture, may be guaranteed by certain other Subsidiaries and
Non-Affiliate Joint Ventures of the Company. Under certain circumstances set
forth in the Indenture, each of the Subsidiary Guarantors may be released from
their respective obligations under the Indenture and the Notes.
The Indenture contains provisions permitting the Company and
the Trustee, with the consent of the holders of not less than a majority of the
aggregate principal amount of the Notes then outstanding or outstanding on the
record date, if any, fixed therefor in accordance with the provisions of the
Indenture, 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
modifying in any manner the rights of the holders of the Notes; provided,
however, that, as provided in Section 10.02 of the Indenture, without the
consent of each holder of an outstanding Note affected, no such supplemental
indenture shall, inter alia, (i) extend the stated maturity of any Note, reduce
the interest rate, extend the time or alter the manner of payment of interest
thereon, or reduce the principal amount thereof, or alter the timing of or
reduce any premium payable upon the redemption thereof, or reduce the amount
payable thereon in the event of acceleration or the amount thereof payable in
bankruptcy, or (ii) reduce the aforesaid percentage of aggregate principal
amount of Notes, the consent of the holders of which is required for any such
supplemental indenture.
Any such consent or waiver by the registered holder of this
Note (unless effectively revoked as provided in the Indenture) shall be
conclusive and binding upon such holder and upon all future holders of this
Note and of any Note issued in exchange or substitution herefor, irrespective
of whether or not any notation of such consent or waiver is made upon this Note
or such other Note.
No reference herein to the Indenture and no provision of
this Note or of the Indenture shall alter or impair the obligation of the
Company, which is absolute and unconditional, to pay the principal of, premium,
if any, Change of Control Purchase Price, Asset Sale Purchase Price and
interest on this Note at the place, at the respective times, at the rate and in
the currency herein prescribed.
The Notes are issuable as fully registered Notes without
coupons in denominations of $1,000 and any integral multiple of $1,000. At the
office or agency to be maintained by the Company referred to on the face
hereof, and in the manner and subject to the limitations provided in the
Indenture, Notes may be exchanged for a like aggregate principal amount of
Notes in other authorized denominations, without payment of any charge other
than a sum sufficient to reimburse the Company for any tax or other
governmental charge incident thereto. Principal of, premium, if any, Change of
Control Purchase Price, Asset Sale Purchase Price and interest on this Note are
payable at the office or agency of the Company referred to on the face hereof,
except that, at the option of the Company, payment of interest hereon may be
made by check mailed by first-class mail to the address of the person entitled
thereto at such address as shall appear on the registry books of the Company;
provided that all payments with respect to this Note, if the holder of this
Note has given wire transfer instructions (which instructions must be received
by the Company at least 5 Business Days prior to the relevant date of payment)
to the Company, will be required to be made by wire transfer of immediately
available funds to the accounts specified by the holder of this Note; provided,
that such payments (other than interest payments) may be conditioned upon
surrender of this Note.
The Notes are subject to redemption on or after October 15,
2001, at the option of the Company, in whole or in part on any date prior to
maturity, upon mailing by first-class mail a notice of such
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redemption not less than 15 nor more than 60 days prior to the date fixed for
redemption to the holders of Notes to be redeemed in whole or in part at their
addresses as they shall appear upon the registry books of the Company, all as
provided in the Indenture. Any such notice which is mailed in the manner
hereinabove provided shall be conclusively presumed to have been duly given,
whether or not the holder receives the notice.
The table below shows the redemption prices (expressed as a
percentage of principal amount) on the dates shown below. If redeemed during
the 12-month period beginning October 15, the redemption price shall be:
Redemption
Year Price
---- -----------
2001 . . . . . . . . . . . . . . . . . . 105.437%
2002 . . . . . . . . . . . . . . . . . . 103.625%
2003 . . . . . . . . . . . . . . . . . . 101.813%
2004 and thereafter . . . . . . . . . . 100.00%
in each case together with accrued and unpaid interest to (but not including)
the date fixed for redemption.
Subject to the terms and conditions of the Indenture, if any Change of
Control (as defined in the Indenture) occurs on or prior to maturity, the
Company shall offer to purchase from each holder all or any part of the
holder's Notes for which a Change of Control Purchase Notice shall have been
delivered as provided in the Indenture and not withdrawn, on the date that is
30 Business Days after the occurrence of such Change of Control (the "Change of
Control Purchase Date"), for a Change of Control Purchase Price equal to 101%
of the principal amount thereof plus accrued and unpaid interest to (but not
including) the Change of Control Purchase Date, which Change of Control
Purchase Price shall be paid in cash.
Holders have the right to withdraw any Change of Control Purchase
Notice by delivering to the Trustee a written notice of withdrawal in
accordance with the provisions of the Indenture.
If cash sufficient to pay the Change of Control Purchase Price of all
Notes or portions thereof to be purchased on the Change of Control Purchase
Date is deposited with the Trustee as of the Change of Control Purchase Date,
interest shall cease to accrue (whether or not this Note is delivered to the
Trustee or any other office or agency maintained for such purpose) on such
Notes (or portions thereof) on and after the Change of Control Purchase Date,
and the holders thereof shall have no other rights as such (other than the
right to receive the Change of Control Purchase Price, upon surrender of such
Notes).
Subject to the terms and conditions of the Indenture, the Company
shall apply the Net Cash Proceeds (as defined in the Indenture) of Asset Sales
(as defined in the Indenture), under certain circumstances described in the
Indenture, to (x) the prepayment of Indebtedness (as defined in the Indenture)
in respect of or under the Credit Agreement (as defined in the Indenture) and
the Specified Pari Passu Indebtedness (as defined in the Indenture) unless the
holders thereof elect not to receive such
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prepayment and (y) an offer to purchase (an "Asset Sale Offer") the then
outstanding Notes, on any Business Day occurring no later than 175 days after
the receipt by the Company (or any of its Subsidiaries, if applicable) of such
Net Cash Proceeds, at a price equal to 100% of the principal amount thereof
together with accrued and unpaid interest, if any, to but not including the
Asset Sale Purchase Date (as defined in the Indenture). Such Asset Sale Offer
with respect to the Notes shall be in an aggregate principal amount (the "Asset
Sale Offer Amount") equal to the Net Cash Proceeds (rounded down to the nearest
$1,000) from the Asset Sales to which the Asset Sale Offer relates multiplied
by a fraction, the numerator of which is the principal amount of the Notes
outstanding (determined as of the close of business on the day immediately
preceding the date notice of such Asset Sale Offer is mailed) and the
denominator of which is the principal amount of the Notes outstanding plus the
aggregate principal amount of Indebtedness under the Credit Agreement and the
Specified Pari Passu Indebtedness outstanding (determined as of the close of
business on the day immediately preceding the date notice of such Asset Sale
Offer is mailed). If (x) no Indebtedness is outstanding in respect of or under
the Credit Agreement or the Specified Pari Passu Indebtedness or (y) the
holders of such Indebtedness entitled to receive payment elect not to receive
the payments provided for in the previous sentence, or (z) the application of
such Net Cash Proceeds results in the complete prepayment of such Indebtedness,
then in each case any remaining portion of such Net Cash Proceeds will be
required to be applied to an Asset Sale Offer to purchase the Notes.
Upon surrender of this Note, the transfer of this Note is registrable
by the registered holder hereof in person or by his attorney duly authorized in
writing on the registry books of the Company at the office or agency to be
maintained by the Company referred to on the face hereof, subject to the terms
of the Indenture but without payment of any charge other than a sum sufficient
to reimburse the Company for any tax or other governmental charge incident
thereto. Upon any such registration of transfer, a new Note or Notes of
authorized denomination or denominations, for the same aggregate principal
amount, will be issued to the transferee in exchange herefor.
Prior to due presentation for registration of transfer, the Company,
the Trustee, any paying agent and any Note registrar may deem and treat the
person in whose name this Note shall be registered upon the registry books of
the Company as the absolute owner of this Note (whether or not this Note shall
be overdue and notwithstanding any notation of ownership or other writing
hereon), for the purpose of receiving payment of or on account of the principal
hereof, premium, if any, Change of Control Purchase Price, Asset Sale Purchase
Price and interest due hereon and for all other purposes, and neither the
Company nor the Trustee nor any paying agent nor any Note registrar shall be
affected by any notice to the contrary. All such payments shall be valid and
effectual to satisfy and discharge the liability on this Note to the extent of
the sum or sums so paid.
No recourse shall be had for the payment of the principal of, premium,
if any, Change of Control Purchase Price, Asset Sale Purchase Price or the
interest on this Note, or 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, stockholder, officer or
director, as such, past, present or future, of the Company or of 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.
7
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ASSIGNMENT FORM
To assign this Note, fill in the form below:
I or we assign and transfer this Note to:
----------------------------------
----------------------------------
(Insert assignee's soc.
sec. or tax I.D. no.)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
(Print or type assignee's name, address and zip code)
and irrevocably appoint
- --------------------------------------------------------------------------------
agent
- --------------------------------------------------------------------------
to transfer this Note on the books of the Company. The agent may substitute
another to act for him.
Date: Your Signature:
----------------------- ------------------------------
------------------------------
(Sign exactly as your name(s) appear(s) on the Note)
Signature Guarantee:
---------------------------------------------
(bank, trust company or member firm
of the New York Stock Exchange)
8
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OPTION OF HOLDER TO ELECT PURCHASE
Upon an offer by the Company to purchase all or any part of this Note pursuant
to Section 3.05 or 4.14 of the Indenture, please check the appropriate box
below if you wish to elect to have all or any part of this Note so purchased.
Section 3.05___
Section 4.14___
If you wish to have only part of this Note purchased by the Company
pursuant to Section 3.05 or Section 4.14 of the Indenture, state the principal
amount you elect to have purchased:
$___________________
Date: Signature:
--------------- --------------------------------
--------------------------------
(Sign exactly as your name(s) appear(s) on the face of this Note)
Signature Guarantee:
-------------------------------------------
(bank, trust company or member firm
of the New York Stock Exchange)
9
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[In connection with any transfer of this Note occurring prior
to the date which is the earlier of (i) the date of the declaration by the SEC
of the effectiveness of a registration statement under the Securities Act of
1933, as amended (the "Securities Act of 1933"), covering resales of this Note
(which effectiveness shall not have been suspended or terminated at the date of
the transfer) and (ii) the third anniversary of the Issue Date (or such shorter
period permitted under Rule 144(k) under the Securities Act of 1933) (or a
successor clause)), the undersigned confirms that it has not utilized any
general solicitation or general advertising in connection with the transfer:
[Check One]
(1) ___ to the Company; or
(2) ___ pursuant to and in compliance with Rule 144A under the
Securities Act of 1933, as amended; or
(3) ___ to an institutional "accredited investor" (as defined in Rule
501(a)(1), (2), (3) or (7) under the Securities Act of 1933); or
(4) ___ outside the United States to a "Non-U.S. person" in compliance
with Rule 904 of Regulation S under the Securities Act of 1933;
or
(5) ___ pursuant to an effective registration statement under the
Securities Act of 1933; or
(6) ___ pursuant to another available exemption from the registration
requirements of the Securities Act of 1933.
Unless one of the boxes is checked, the Trustee will refuse to register any of
the Notes evidenced by this certificate in the name of any person other than
the registered Holder thereof, provided, that if box (3), (4) or (6) is
checked, the Company or the Trustee may require, prior to registering any such
transfer of the Notes, in its sole discretion, such written legal opinions,
certifications (including an investment letter in the case of box (3) or (4)),
and other information as the Trustee, Note registrar or the Company has
reasonably requested to confirm that such transfer is being made pursuant to an
exemption from, or in a transaction not subject to, the registration
requirements of the Securities Act of 1933.
If none of the foregoing boxes are checked, the Trustee or Note registrar shall
not be obligated to register this Note in the name of any person other than the
Holder hereof unless and until the conditions to any such transfer of
registration set forth herein and in Section 2.05 of the Indenture shall have
been satisfied.
Dated:__________________________ Signed:
______________________________
(Sign exactly as name appears
on the other side of this
Security)
Signature
Guarantee:______________________________________________________________________
TO BE COMPLETED BY PURCHASER IF (2) ABOVE IS CHECKED
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The undersigned represents and warrants that it is purchasing
this Note for its own account or an account with respect to which it exercises
sole investment discretion and that it and any such account is a "qualified
institutional buyer" within the meaning of Rule 144A under the Securities Act
of 1933, as amended, and is aware that the sale to it is being made in reliance
on Rule 144A and acknowledges that it has received such information regarding
the Company as the undersigned has requested pursuant to Rule 144A or has
determined not to request such information and that it is aware that the
transferor is relying upon the undersigned's foregoing representations in order
to claim the exemption from registration provided by Rule 144A.
Date:________________________
______________________________
NOTICE: To be executed by
an executive officer](1)
- -------------------------
(1) Only to be included on Notes constituting Restricted Securities.
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AND WHEREAS, all acts and things necessary to make the Notes, when
executed by the Company and authenticated and delivered by the Trustee as in
this Indenture provided, the valid, binding and legal obligations of the
Company, and to constitute these presents a valid indenture and agreement
according to its terms, have been done and performed, and the execution and
delivery of this Indenture and the issuance hereunder of the Notes have in all
respects been duly authorized, and the Company and the Subsidiary Guarantors,
in the exercise of the legal right and power vested in them, execute and
deliver this Indenture and the Company proposes to make, execute, issue and
deliver the Notes;
THEREFORE, in consideration of the premises and of the purchase and
acceptance of the Notes by the holders thereof, the Company, each Subsidiary
Guarantor and the Trustee each covenants and agrees, for the equal and
proportionate benefit of the respective holders from time to time of the Notes,
as follows:
ARTICLE ONE
DEFINITIONS
SECTION 1.01. Certain terms defined. The terms defined in this
Section 1.01 (except as herein otherwise expressly provided or unless the
context otherwise requires), for all purposes of this Indenture and of any
indenture supplemental hereto, shall have the respective meanings specified in
this Section 1.01. All other terms used in this Indenture which are defined in
the Trust Indenture Act of 1939 (as defined herein) or which are by reference
therein defined in the Securities Act of 1933 (as defined herein) (except as
herein otherwise expressly provided or unless the context otherwise requires)
shall have the meanings assigned to such terms in said Trust Indenture Act and
in said Securities Act of 1933 as they were in force at the date of the
execution and delivery of this Indenture.
9 7/8% Notes: The term "9 7/8% Notes" shall mean the Company's 9 7/8%
Senior Notes due 2002, as amended from time to time, issued pursuant to the 9
7/8% Note Indenture.
9 7/8% Note Indenture: The term "9 7/8% Note Indenture" shall mean
the indenture, dated as of February 17, 1994, among the Company, as issuer, the
parties named therein (including in any amendment or supplement thereto) as
subsidiary guarantors, and First Trust National Association, a national banking
association, as trustee, as heretofore or hereafter amended or supplemented
from time to time in accordance with the terms thereof.
10 7/8% Notes: The term "10 7/8% Notes" shall mean the Company's 10
7/8% Senior Notes due 2006 and the Company's 10 7/8% Series B Senior Notes due
2006, as amended from time to time, issued pursuant to the 10 7/8% Note
Indenture.
10 7/8% Note Indenture: The term "10 7/8% Note Indenture" shall mean
the indenture, dated as of October 23, 1996, among the Company, as issuer, the
parties named therein (including in any amendment or supplement thereto) as
subsidiary guarantors, and First Trust National Association, a national banking
association, as trustee, as heretofore or hereafter amended or supplemented
from time to time in accordance with the terms thereof.
12 3/4% Notes: The term "12 3/4% Notes" shall mean the Company's 12
3/4% Senior Subordinated Notes due 2003, as amended from time to time, issued
pursuant to the 12 3/4% Note Indenture.
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12 3/4% Note Indenture: The term "12 3/4% Note Indenture" shall mean
the Indenture, dated as of February 1, 1993, among the Company, as issuer, the
parties named therein (including in any amendment or supplement thereto) as
subsidiary guarantors, and State Street Bank and Trust Company, a Massachusetts
trust company, as successor to The First National Bank of Boston, as trustee,
as heretofore or hereafter amended or supplemented from time to time in
accordance with the terms thereof.
14 1/4% Senior Subordinated Notes: The term "14 1/4% Senior
Subordinated Notes" shall mean the Company's 14 1/4% Senior Subordinated Notes
Due 1995, as amended, which were retired in 1993 and are no longer outstanding
as of the date of this Indenture.
14 1/4% Senior Subordinated Note Indenture: The term "14 1/4% Senior
Subordinated Note Indenture" shall mean the 14 1/4% Senior Subordinated Note
Indenture, dated as of December 21, 1989, among the Company, as issuer, the
parties named therein as and, if applicable, thereafter becoming, subsidiary
guarantors, and The Bank of New York, a New York banking corporation, as
trustee, as amended or supplemented from time to time in accordance with the
terms thereof.
Affiliate: The term "Affiliate" shall mean any other Person directly
or indirectly controlling or controlled by or under direct or indirect common
control with a specified Person; provided, however, that the term Affiliate
shall not (other than for purposes of Section 3.07) include the Company, any
Subsidiary of the Company, any Unrestricted Subsidiary of the Company or any
Non-Affiliate Joint Venture of the Company so long as no Affiliate of the
Company has any direct or indirect interest therein, except through the
Company, its Subsidiaries, its Unrestricted Subsidiaries and/or its
Non-Affiliate Joint Ventures. For the purpose of this definition, control when
used with respect to any specified Person means the possession of the power to
direct the management and policies of such Person, directly or indirectly,
whether through the ownership of voting securities, by contract or otherwise;
and the terms controlling and controlled have meanings correlative to the
foregoing. The fact that an Affiliate of a Person is a partner of a law firm
that renders services to such Person or its Affiliates does not (other than for
purposes of Section 3.07) mean that the law firm is an Affiliate of such
Person.
Agent Member: The term "Agent Member" shall have the meaning set
forth in Section 2.10 hereof.
AJI: The term "AJI" shall mean Alpart Jamaica Inc., a Delaware
corporation, and its successors.
Alpart: The term "Alpart" shall mean Alumina Partners of Jamaica, a
Delaware general partnership, and its successors.
Asset Sale: The term "Asset Sale" shall mean any sale, transfer or
other disposition (including, without limitation, dispositions pursuant to a
merger, consolidation or sale and leaseback transaction) of any assets (other
than cash or Cash Equivalents) on or after the date of the initial issuance of
the Notes by the Company or any of its Subsidiaries to any Person other than
the Company, any of its Subsidiaries or any Non-Affiliate Joint Venture;
provided, however, that solely for the purposes of the definition of
Consolidated Cash Flow Available for Fixed Charges, the term Asset Sale shall
exclude dispositions pursuant to a sale and leaseback transaction if the lease
under such sale and leaseback transaction is required to be classified and
accounted for as a Capitalized Lease Obligation; and provided, further, that
the term Asset Sale shall not include a Refinancing Sale and Leaseback
Transaction; and provided, further, that the following sales, transfers or
other dispositions of assets shall not be an "Asset Sale" hereunder:
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(A) in the ordinary course of business of the Company and its
Subsidiaries, which may include sales, transfers or other dispositions
to Unrestricted Subsidiaries;
(B) in a single transaction or group of related transactions,
the gross proceeds of which (exclusive of indemnities) do not exceed
$10,000,000 (such proceeds, to the extent non-cash, to be determined
in good faith by the Board of Directors of the Company);
(C) resulting from the creation, incurrence or assumption of
(but not any foreclosure with respect to) any Lien not prohibited by
Section 4.11;
(D) in connection with any consolidation or merger of the
Company or any Subsidiary Guarantor or sale of all or substantially
all of the property of the Company or any Subsidiary Guarantor in
compliance with the provisions of Article Eleven, Section 15.03(a) or
Section 15.03(b)(i) hereof, as the case may be;
(E) by a Subsidiary to its stockholders not prohibited by this
Indenture;
(F) which are Restricted Investments, Restricted Payments or
Unrestricted Subsidiary Investments permitted by Section 4.09; or
(G) which consist of extensions, modifications, renewals or
exchanges of Restricted Investments pursuant to clause (b) of the
definition thereof, so long as neither the Company nor any of its
Subsidiaries receives any cash proceeds as a result of such
transaction.
Attributable Debt: The term "Attributable Debt" shall mean, with
respect to a Refinancing Sale and Leaseback Transaction, as of the date of
consummation of such transaction, the greater of (a) the Fair Market Value of
the property subject to such Refinancing Sale and Leaseback Transaction and (b)
the present value (discounted at the interest rate borne by the Notes,
compounded semi-annually) of the total obligations of the lessee for rental
payments during the remaining term of the lease included in such Refinancing
Sale and Leaseback Transaction (including any period for which such lease has
been extended).
Bank: The term "Bank" shall mean any of the financial institutions
that are, or from time to time become, lenders under the Credit Agreement.
Bank Agent: The term "Bank Agent" shall mean BankAmerica Business
Credit, Inc., as agent under the Credit Agreement, and any successor agent
appointed under the Credit Agreement or any agent under any agreement or
agreements pursuant to which Indebtedness under the Credit Agreement has been
Refinanced (or successively Refinanced) and as to whom the Company has notified
the Trustee and the noteholders pursuant to the terms of this Indenture.
Bank Guarantors: The term "Bank Guarantors" shall mean each of the
following Persons, as long as such Person guarantees any Indebtedness under the
Credit Agreement: Akron Holding Company, an Ohio corporation, Kaiser Aluminum &
Chemical Investment, Inc., a Delaware corporation, Kaiser Aluminum Properties,
Inc., a Delaware corporation, Kaiser Aluminum Technical Services, Inc., a
California corporation, Oxnard Forge Die Company, Inc., a California
corporation, Kaiser Aluminium International, Inc., a Delaware corporation, KAC,
KFC, each of their respective successors, each Subsidiary Guarantor and each
Non-Recourse Guarantor so long as such Non-Recourse Guarantor does
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not constitute a Subsidiary Guarantor and would not be required to become a
Subsidiary Guarantor hereunder.
Board of Directors: The term "Board of Directors," when used with
reference to the Company, shall mean the Board of Directors of the Company, or
the executive committee of the Board of Directors of the Company, or any other
duly authorized committee of the Board of Directors of the Company.
Board Resolution: The term "Board Resolution" shall mean, with
respect to any Person, a copy of a resolution certified by the Secretary or an
Assistant Secretary of such Person to have been duly adopted by the Board of
Directors of such Person and to be in full force and effect on the date of such
certification, and delivered to the Trustee.
Business Day: The term "Business Day" shall mean a day other than a
Saturday, a Sunday or a day in The City of New York, New York, Houston, Texas
or San Francisco, California on which banking institutions are authorized or
obligated by law, regulation or executive order to be closed.
Capital Stock: The term "Capital Stock" shall mean, with respect to
any Person, any and all shares, interests, participations or other equivalents
(however designated) of capital stock, partnership interests or other undivided
ownership interests in such Person, and warrants, options and similar rights
(other than debt securities convertible into capital stock) to acquire such
capital stock, partnership interests or other undivided ownership interests in
such Person.
Capitalized Lease Obligations: The term "Capitalized Lease
Obligations" shall mean, with respect to any Person, the obligations of such
Person to pay rent or other amounts under any lease of (or other agreement
conveying the right to use) real or personal property, which obligations are
required to be classified and accounted for as a capital lease obligation on a
balance sheet of such Person under GAAP and, for purposes of this Indenture,
the amount of such obligations at any date shall be the amount of the liability
thereof at such date, determined in accordance with GAAP.
CARIFA Financing: The term "CARIFA Financing" shall mean the
$60,000,000 CBI Industrial Revenue Bonds, Caribbean Basin Projects Financing
Authority CBI Industrial Revenue Bonds 1991 Series A and Series B (Alumina
Partners of Jamaica Project) issued pursuant to that certain Bond Purchase
Agreement dated as of December 1, 1991, among the Caribbean Basin Projects
Financing Authority, Alumina Partners of Jamaica and PaineWebber Incorporated
of Puerto Rico, any Refinancings thereof, and any letters of credit supporting
such bonds or any Refinancings thereof.
Cash Equivalents: The term "Cash Equivalents" shall mean, with
respect to any Person:
(A) Government Securities having maturities of not more than one
year from the date of acquisition,
(B) certificates of deposit of any commercial bank incorporated
under the laws of the United States, or any state, territory or commonwealth
thereof, of recognized standing having capital and unimpaired surplus in excess
of $100,000,000 and whose short-term commercial paper rating at the time of
acquisition is at least A-2 or the equivalent by Standard & Poor's Corporation
or at least P-2 or the equivalent by Moody's Investors Services, Inc. (any such
bank, an "Approved Bank"), which certificates of deposit have maturities of not
more than one year from the date of acquisition,
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(C) repurchase obligations with a term of not more than 31 days for
underlying securities of the types described in clauses (A) , (B) and (D) of
this definition entered into with any Approved Bank,
(D) commercial paper or finance company paper issued by any Person
incorporated under the laws of the United States, or any state thereof, and
rated at least A-2 or the equivalent by Standard & Poor's Corporation or at
least P-2 or the equivalent by Moody's Investors Services, Inc., and in each
case maturing not more than one year from the date of acquisition, and
(E) investments in money market funds that are registered under the
Investment Company Act of 1940, which have net assets of at least $100,000,000
and at least 85% of whose assets consist of investments or other obligations of
the type described in clauses (A) through (D) above.
Center for Technology: The term "Center for Technology" shall mean
the Company's facilities located in Pleasanton, California.
Certificated Notes: The term "Certificated Notes" shall have the
meaning set forth in Section 2.02 hereof.
Commission: The term "Commission" shall mean the United States
Securities and Exchange Commission.
Common Stock: The term "Common Stock" shall mean the Company's common
stock, par value $.01 per share, as it exists on the date of this Indenture.
Company: The term "Company" shall mean Kaiser Aluminum & Chemical
Corporation, a Delaware corporation, and, subject to the provisions of Article
Eleven, shall also include its successors and assigns.
Consolidated Amortization Expense: The term "Consolidated
Amortization Expense" shall mean, with respect to any Person for any period,
the amortization expense (including without limitation goodwill, deferred
financing charges and other intangible items) of such Person and its
Subsidiaries for such period, determined on a consolidated basis in accordance
with GAAP.
Consolidated Cash Flow Available for Fixed Charges: The term
"Consolidated Cash Flow Available for Fixed Charges" shall mean (without
duplication), with respect to any Person for any period, the sum of the amounts
for such period of (i) Consolidated Net Income, (ii) Consolidated Fixed
Charges, (iii) Consolidated Income Tax Expense (other than income taxes
(including credits) with respect to items of Net Income not included in the
definition of Consolidated Net Income), (iv) Consolidated Depreciation Expense,
(v) Consolidated Amortization Expense and (vi) any other non-cash items
reducing Consolidated Net Income, minus any non-cash items increasing
Consolidated Net Income, all as determined on a consolidated basis for such
Person and its Subsidiaries in accordance with GAAP; provided, however, that
(x) if, during such period, such Person or any of its Subsidiaries shall have
engaged in any Asset Sale, Consolidated Cash Flow Available for Fixed Charges
of such Person and its Subsidiaries for such period shall be reduced by an
amount equal to the Consolidated Cash Flow Available for Fixed Charges (if
positive) directly attributable to the assets that are the subject of such
Asset Sale for such period, or increased by an amount equal to the Consolidated
Cash Flow Available for Fixed Charges (if negative) directly attributable to
the assets that are the subject of such Asset Sale for such period and (y) if,
during such period, such Person or any of its Subsidiaries shall have acquired
any material assets out of the
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ordinary course of business, Consolidated Cash Flow Available for Fixed Charges
shall be calculated on a pro forma basis as if such asset acquisition and
related financing had occurred at the beginning of such period.
Consolidated Depreciation Expense: The term "Consolidated
Depreciation Expense" shall mean, with respect to any Person for any period,
the depreciation and depletion expense (including without limitation the
amortization expense associated with Capitalized Lease Obligations) of such
Person and its Subsidiaries for such period, determined on a consolidated basis
in accordance with GAAP.
Consolidated Fixed Charge Coverage Ratio: The term "Consolidated
Fixed Charge Coverage Ratio" shall mean, with respect to any Person as of the
date of the transactions giving rise to the need to calculate the Consolidated
Fixed Charge Coverage Ratio (the "Transaction Date"), the ratio of (i) the
aggregate amount of Consolidated Cash Flow Available for Fixed Charges of such
Person for the four fiscal quarters immediately prior to the Transaction Date
for which financial information in respect thereof is available to (ii) the
aggregate Consolidated Fixed Charges of such Person for the fiscal quarter in
which the Transaction Date occurs and the three fiscal quarters immediately
subsequent to such fiscal quarter to be accrued during such period (based upon
the pro forma amount of Indebtedness to be outstanding on the Transaction
Date), assuming for the purposes of this measurement that the interest rates on
which floating interest rate obligations of such Person are based equal such
rates in effect on the Transaction Date; provided, however, that if the Company
or any of its Subsidiaries has incurred Interest Hedging Obligations which
would have the effect of changing the interest rate on any Indebtedness for
such four quarter period (or any portion thereof), the resulting rate shall be
used for such four quarter period or portion thereof; and provided, further,
that any Consolidated Fixed Charges with respect to Indebtedness incurred or
for which such Person otherwise becomes liable during the fiscal quarter in
which the Transaction Date occurs shall be calculated as if such Indebtedness
was so incurred on the first day of the fiscal quarter in which the Transaction
Date occurs.
Consolidated Fixed Charges: The term "Consolidated Fixed Charges"
shall mean (without duplication), with respect to any Person for any period,
the sum of:
(i) the interest expense of such Person and its Subsidiaries
for such period, determined on a consolidated basis in accordance with
GAAP (less, to the extent included therein, the portion of the
interest expense required to be funded or economically borne by the
Company's minority partners in the Company's joint ventures);
(ii) all fees, commissions, discounts and other charges of such
Person and its Subsidiaries for such period, determined on a
consolidated basis in accordance with GAAP, with respect to letters of
credit and bankers' acceptances and the costs (net of benefits)
associated with Interest Hedging Obligations;
(iii) the aggregate amount of dividends paid or other similar
distributions made by such Person and its Subsidiaries during such
period with respect to preferred stock (including preference stock) of
such Person or its Subsidiaries determined on a consolidated basis in
accordance with GAAP; and
(iv) amortization or write-off of debt discount in connection
with any Indebtedness of such Person and its Subsidiaries, determined
on a consolidated basis in accordance with GAAP (excluding, to the
extent otherwise included, the amortization or write-off of any
deferred
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financing costs in connection with the amendment or refinancing of the
Credit Agreement and the predecessor credit agreement).
Consolidated Income Tax Expense: The term "Consolidated Income Tax
Expense" shall mean (without duplication), with respect to any Person for any
period, the aggregate of the income tax expense (net of applicable credits) of
such Person and its Subsidiaries for such period, determined on a consolidated
basis in accordance with GAAP.
Consolidated Net Income: The term "Consolidated Net Income" shall
mean, with respect to any Person for any period, the aggregate of the Net
Income of such Person and its Subsidiaries for such period taken as a single
accounting period, all as determined on a consolidated basis in accordance with
GAAP, excluding (in each case to the extent otherwise included):
(i) extraordinary gains but not extraordinary losses and
excluding gains from extinguishment of debt;
(ii) the Net Income of any Person that is not a Subsidiary of
such Person or that is accounted for on the equity method of
accounting, except to the extent of the amount of dividends or other
distributions (other than dividends or distributions of Capital Stock)
actually paid to such Person or any of its Subsidiaries by such other
Person during such period;
(iii) except to the extent included by clause (ii), the Net
Income of any Person accrued prior to the date it becomes a Subsidiary
of such Person 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;
(iv) the Net Income of any Subsidiary of such Person during
such period (A) to the extent that the declaration or payment of
dividends or similar distributions by such 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
or (B) in the case of a foreign Subsidiary or a Subsidiary with
significant foreign source income, to the extent such Net Income has
not been distributed to such Person and such distribution would result
in a material tax liability not otherwise deducted from the
calculation of Consolidated Net Income whether or not such deduction
is required by GAAP;
(v) net after tax gains from Asset Sales (but not excluding the
net after tax losses from Asset Sales);
(vi) interest income arising from the Existing Intercompany
Note, except to the extent such interest income is actually received
by the Company in cash; and
(vii) the Net Income of any Unrestricted Subsidiary, whether or
not paid or distributed to the Company or one of its Subsidiaries;
provided, however, that (1) in determining Consolidated Net Income with respect
to the Company there shall be disregarded (a) any charge with respect to
premiums paid in excess of the principal amount in connection with the
repurchase, defeasance or redemption of the 14 1/4% Senior Subordinated Notes
and (b) the amortization or write-off of any unamortized deferred financing
costs and debt discount (other than
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original issue discount with respect to Indebtedness Incurred after the date
hereof) in connection with the amendment or refinancing of the Credit Agreement
and the predecessor credit agreement and/or the repurchase, defeasance or
redemption of the 14 1/4% Senior Subordinated Notes and (2) the Net Income of
each of the Specified Parties otherwise included in the Consolidated Net Income
of the Company shall not be subject to any of the limitations contained in
clauses (ii) and (iv)(B) of this definition so long as the Company's cash
management and intercompany practices with respect to such entity, as the case
may be, for such period are consistent with past practice.
Consolidated Net Worth: The term "Consolidated Net Worth" shall mean,
with respect to any Person as of any date, the total stockholders' equity of
such Person as of such date, less, to the extent otherwise included, amounts
attributable to Redeemable Stock and, in the case of the Company, the amount
attributable to the Existing Intercompany Note, in each case determined on a
consolidated basis in accordance with GAAP; provided, however, that in
determining Consolidated Net Worth with respect to the Company there shall be
disregarded (i) any charge with respect to premiums paid in excess of the
principal amount in connection with the repurchase, defeasance or redemption of
the 14 1/4% Senior Subordinated Notes and (ii) the amortization or write-off of
any unamortized deferred financing costs or debt discount (other than original
issue discount with respect to Indebtedness Incurred after the date hereof) in
connection with the amendment or refinancing of the Credit Agreement and the
predecessor credit agreement and/or the repurchase, defeasance or redemption of
the 14 1/4% Senior Subordinated Notes.
Credit Agreement: The term "Credit Agreement" shall mean that certain
Credit Agreement, dated as of February 15, 1994, among the Company, KAC, the
financial institutions that are, or from time to time become, parties thereto,
and BankAmerica Business Credit, Inc., as agent, including all related notes,
collateral documents and guarantees, and any agreement (including all related
notes, collateral documents and guarantees) pursuant to which Indebtedness
thereunder has been Refinanced (or successively Refinanced), in each case as
any of the same has been or may be amended, supplemented, restated,
restructured or otherwise modified from time to time (in each case, in whole or
in part).
Currency Hedging Obligation: The term "Currency Hedging Obligation"
with respect to any Person shall mean the monetary obligations of such Person
pursuant to any foreign exchange contract, currency swap agreement, option or
futures contract, forward contract or other similar agreement or arrangement
designed to protect such Person or any of its Subsidiaries against fluctuations
in currency values.
Defaulting Equity Owner: The term "Defaulting Equity Owner" shall
mean, with respect to any Permitted Entity, any Equity Owner who causes an
Equity Owner Default.
Depository: The term "Depository" shall mean The Depository Trust
Company, New York, New York.
Equity Owner: The term "Equity Owner" shall mean, with respect to any
Permitted Entity, any holder of an Ownership Interest in such Permitted Entity.
Equity Owner Default: The term "Equity Owner Default" shall mean,
with respect to any issuance of Permitted Entity Securities to the Equity
Owners of a Permitted Entity, the failure by one or more of such Equity Owners
to acquire such Permitted Entity Securities in an amount corresponding to at
least its Ownership Interest of such Permitted Entity and, as a result thereof,
such Equity Owner
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becomes subject to, directly or indirectly, a dilution of its interest in the
future net income of such Permitted Entity and/or a penalty pursuant to the
terms of the governing documents of such Permitted Entity.
Event of Default: The term "Event of Default" shall mean any event
specified in Section 6.01, continued for the period of time, if any, and after
the giving of notice, if any, therein designated.
Exchange Act: The term "Exchange Act" shall mean the Securities
Exchange Act of 1934, as amended, and the rules and regulations promulgated by
the Securities and Exchange Commission thereunder.
Exchange Notes: The term "Exchange Notes" shall have the meaning
provided in the first paragraph of the recitals hereof.
Existing Intercompany Note: The term "Existing Intercompany Note"
shall mean the Non-Negotiable Intercompany Note, dated December 21, 1989,
issued by KAC to the Company in an initial principal amount of $818,585,280, as
such Non-Negotiable Intercompany Note has been or may be amended.
Fair Market Value: The term "Fair Market Value" shall mean, with
respect to any property other than cash, the fair market value of such property
as determined in good faith by the Board of Directors of the Company, whose
determination shall be evidenced by a Board Resolution; provided, however,
that, in the event the Company makes a payment in the form of or otherwise
transfers property other than cash to, or receives property other than cash
from, an Affiliate in an amount in excess of $10,000,000, or in the event that
the Company makes a payment in the form of or otherwise transfers property
other than cash or Cash Equivalents to, or receives property other than cash or
Cash Equivalents from, an Unrestricted Subsidiary in an amount in excess of
$10,000,000, (which amount shall be calculated excluding the fair market value
of any Principal Products within the scope of the proviso at the end of this
definition) the Company, in addition, shall have received an opinion from an
independent investment banking firm of national standing selected by the
Company to the effect that the Board of Directors' determination of fair market
value is fair; provided that, with respect to any determination of Fair Market
Value of property in connection with an Unrestricted Subsidiary Investment or
the designation of an Unrestricted Subsidiary, such opinion shall not be
required, to the extent that such property consists of Principal Products
(which Principal Products are used by such Unrestricted Subsidiary in its
operations in the ordinary course of business).
GAAP: The term "GAAP" shall mean generally accepted accounting
principles as in effect on December 31, 1992, and used in the preparation of
the Company's consolidated balance sheet at such date and the Company's
statements of consolidated income and cash flows for the year then ended, but
in any event (i) giving effect to, but excluding the effect of any one-time
charge related to the implementation of, Statement of Financial Accounting
Standards No. 106 (Employers' Accounting for Postretirement Benefits Other
Than Pensions) and (ii) giving effect to Statement of Financial Accounting
Standards No. 109 (Accounting for Income Taxes).
Global Note: The term "Global Note" shall have the meaning provided
in Section 2.02.
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Government Securities: The term "Government Securities" shall mean
direct obligations of, or obligations guaranteed by, the United States of
America for the payment of which guarantee or obligations the full faith and
credit of the United States of America is pledged.
Guarantee: The term "Guarantee" shall mean, with respect to any
Subsidiary Guarantor, the guarantee of such Subsidiary Guarantor set forth in
Article Fifteen.
Improvements: The term "Improvements" shall mean any accessories,
accessions, additions, attachments, substitutions, replacements, improvements,
parts and other property now or hereafter affixed to any U.S. Fixed Assets or
used in connection therewith.
Indebtedness: The term "Indebtedness" shall mean, with respect to any
Person at any date, any of the following (without duplication):
(a) the principal amount of all obligations (unconditional or
contingent) of such Person for borrowed money (whether or not recourse
is to the whole of the assets of such person or only to a portion
thereof) and the principal amount of all obligations (unconditional or
contingent) of such Person evidenced by debentures, notes or other
similar instruments (including, without limitation, reimbursement
obligations with respect to letters of credit and bankers'
acceptances);
(b) all obligations of such Person to pay the deferred purchase
price of property or services, except (x) accounts payable and other
current liabilities arising in the ordinary course of business and (y)
compensation, pension obligations and other obligations arising from
employee benefits and employee arrangements;
(c) Capitalized Lease Obligations of such Person;
(d) all Indebtedness of others secured by a Lien on any asset
of such Person, whether or not such Indebtedness is assumed or
guaranteed by such Person;
(e) preferred stock (including preference stock) that is
Redeemable Stock (the amount of the Indebtedness in respect of such
preferred stock to be equal to the aggregate liquidation value
thereof);
(f) all Indebtedness of others guaranteed by such Person;
(g) pension obligations and other similar obligations arising
from employee benefits, to the extent unfunded and assumed by such
Person after the date of the initial issuance of the Notes in the
acquisition, by such Person, of the assets or Capital Stock of another
Person ("Assumed Pension Obligations"); and
(h) all obligations under Refinancing Sale and Leaseback
Transactions;
and the amounts thereof shall be the outstanding balance of any such
unconditional obligations as described in clauses (a) through (f) (other than
clause (d)), and the maximum liability of any such contingent obligations at
such date (other than with respect to clause (d)) and, in the case of clause
(d), the lesser of the fair market value at such date of any asset subject to
any Lien securing the Indebtedness of others and the amount of the Indebtedness
secured and, in the case of clause (g), the amount of
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Assumed Pension Obligations shall be the amount determined by the Company in
good faith as evidenced by a certificate of the Chief Financial Officer of the
Company delivered to the Trustee and, in the case of clause (h), the
Attributable Debt with respect to such Refinancing Sale and Leaseback
Transactions; provided, however, that Indebtedness shall not include:
(A) the obligations of such Person and/or any of its
Subsidiaries to purchase or sell goods, services or technology
utilized in their bauxite, aluminum and alumina business and related
extensions thereof, including on a take-or-pay basis, pursuant to
agreements entered into in the ordinary course of business consistent
with past practice or to fund or guarantee the obligations of National
Refractories & Minerals Corporation or any of its Affiliates in an
aggregate principal amount at any time outstanding not exceeding
$7,500,000;
(B) obligations of such Person arising from the honoring by a
bank or other financial institution of a check, draft or similar
instrument inadvertently (except in the case of daylight overdrafts)
drawn against insufficient funds in the ordinary course of business,
provided that such obligations are extinguished within two Business
Days of their incurrence (or, in the case of foreign overdrafts,
within five Business Days of their incurrence) unless covered by an
overdraft credit line;
(C) obligations of such Person resulting from the endorsement
of negotiable instruments for collection in the ordinary course of
business;
(D) Indebtedness consisting of letters of credit to the extent
collateralized by cash or Cash Equivalents; and
(E) Liens on assets of KAAC granted to secure Indebtedness of
QAL, provided that such Liens are (i) in existence on the date of this
Indenture, (ii) similar in all material respects to Liens in existence
on the date of this Indenture or (iii) not on assets consisting of
cash, Cash Equivalents or fixed assets and such assets are used or to
be used in connection with the business of QAL.
Indenture: The term "Indenture" shall mean this instrument as
originally executed, or, if amended or supplemented as herein provided, as so
amended or supplemented.
Initial Notes: The term "Initial Notes" shall have the meaning
provided in the first paragraph of the recitals hereof.
Institutional Accredited Investor: The term "Institutional Accredited
Investor" shall mean an institution that is an "accredited investor" as that
term is defined in Rule 501(a)(1), (2), (3) or (7) under the Securities Act of
1933.
Interest: The term "interest" shall mean, with respect to the Notes,
interest payable on the Notes at the rate set forth therein, plus any
additional interest payable by the Company and the Subsidiary Guarantors in
respect of the Notes pursuant to the Registration Rights Agreement.
Interest Hedging Obligation: The term "Interest Hedging Obligation"
with respect to any Person shall mean the monetary obligations of such Person
pursuant to any interest rate swap agreement, interest rate collar agreement,
interest rate cap agreement, options or futures contract, forward contract or
other
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agreement or arrangement designed to protect such Person or any of its
Subsidiaries against fluctuations in interest rates.
Issue Date: The term "Issue Date" shall mean the date of first
issuance of the Notes under this Indenture, December 23, 1996.
KAAC: The term "KAAC" shall mean Kaiser Alumina Australia
Corporation, a Delaware corporation, and its successors.
KAC: The term "KAC" shall mean Kaiser Aluminum Corporation, a
Delaware corporation, and its successors.
KFC: The term "KFC" shall mean Kaiser Finance Corporation, a Delaware
corporation, and its successors.
KJC: The term "KJC" shall mean Kaiser Jamaica Corporation, a Delaware
corporation, and its successors.
Lien: The term "Lien" shall mean, with respect to any asset of any
Person, any mortgage, lien, pledge, charge, security interest or encumbrance of
any kind in respect of such asset, whether or not filed, recorded or otherwise
perfected under applicable law (including any conditional sale or other title
retention agreement, any lease in the nature thereof and any agreement to give
any security interest).
Maximum Secured Amount: The term "Maximum Secured Amount" shall mean,
at any time (i) $400,000,000, plus (ii) Net Betterments at such time, plus
(iii) the outstanding amount of Indebtedness relating to the CARIFA Financing,
secured by a Lien on Permitted Collateral, but in no event more than
$43,000,000, minus (iv) in the event of a sale of Permitted Collateral which is
subject to a Lien permitted by clause (i) of Section 4.11(b) of this Indenture,
the amount, if any, of the net proceeds thereof required to be applied to a
permanent repayment or commitment reduction in respect of the Indebtedness
secured by such Lien, minus (v), in the event of the Refinancing of any
Indebtedness secured by a Lien permitted by clause (i) of Section 4.11(b)
hereof, the lesser of (A) the amount of Indebtedness, if any, not secured by
Permitted Collateral which Refinances, in whole or in part, such Indebtedness
secured by a Lien permitted by clause (i) of Section 4.11(b) of this Indenture
and (B) the amount, if any, by which the Maximum Secured Amount immediately
prior to such Refinancing, in whole or in part, of such Indebtedness secured by
a Lien permitted by clause (i) of Section 4.11(b) of this Indenture exceeds the
aggregate amount of Indebtedness which is secured by a Lien on Permitted
Collateral permitted by clause (i) or clause (viii)(a) of Section 4.11(b) of
this Indenture after giving effect to such Refinancing.
MAXXAM: The term "MAXXAM" shall mean MAXXAM Inc., a Delaware
corporation, and its successors.
Merger: The term "Merger" shall mean the merger of a subsidiary of
MAXXAM with and into KAC on October 28, 1988.
Net Betterments: The term "Net Betterments" shall mean the amount, if
any, by which capital expenditures (determined in accordance with GAAP) by the
Company or any of its Subsidiaries in respect of the Permitted Collateral on a
cumulative basis for the period from the date hereof, through the date of
determination exceeds depreciation (determined in accordance with GAAP) in
respect of the Permitted
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Collateral on a cumulative basis for such period (provided, however, that with
respect to any Permitted Collateral existing at the time of the Merger, the
depreciation shall be the historical depreciation before adjustments to reflect
the acquisition of the Company in the Merger), but in no event less than zero,
provided, that in the event any Permitted Collateral ceases to constitute
Permitted Collateral in accordance with the definition thereof, only the amount
of Net Betterments in respect of such Permitted Collateral at such time shall
be included in any subsequent calculation of Net Betterments and provided,
further, that (a) Improvements which are subject to a Lien permitted by clause
(iv), (v) or (vi) of Section 4.11(b) hereof and (b) U.S. Fixed Assets to the
extent subject to a Lien permitted by clause (ix) of Section 4.11(b) hereof
shall not be included in the determination of Net Betterments.
Net Cash Proceeds: The term "Net Cash Proceeds" shall mean cash
payments received (but if received in a currency other than United States
dollars, such payments shall not be deemed received until the earliest time at
which such currency is, or could freely be, converted into United States
dollars) by or on behalf of the Company and/or any of its Subsidiaries
(including any cash payments received by way of deferred payment of principal
pursuant to a note or installment receivable or otherwise or the cash
realization of any non-cash proceeds of any Asset Sale, but, in each case, only
as and when, and to the extent, received) from an Asset Sale, in each case and
without duplication, net of:
(i) all legal, title and recording tax expenses, commissions,
consulting fees, investment banking, broker's and accounting fees and
expenses and fees and expenses incurred in obtaining regulatory
approvals in connection with such Asset Sale;
(ii) the amounts of (A) any repayments of debt secured,
directly or indirectly, by Liens on the assets which are the subject
of such Asset Sale or (B) any repayments of debt associated with such
assets which is due by reason of such Asset Sale (i.e., such
disposition is permitted by the terms of the instruments evidencing or
applicable to such debt, or by the terms of a consent granted
thereunder, on the condition that the proceeds (or portion thereof) of
such disposition be applied to such debt), provided, that this clause
(B) shall not apply with respect to any U.S. Fixed Assets which do not
constitute Permitted Collateral and, in the case of clauses (A) and
(B), other fees, expenses and other expenditures, in each case,
reasonably incurred as a consequence of such repayment of debt
(whether or not such fees, expenses or expenditures are then due and
payable or made, as the case may be);
(iii) all amounts deemed appropriate by the Company (as
evidenced by a signed certificate of the Chief Financial Officer of
the Company delivered to the Trustee) to be provided as a reserve, in
accordance with GAAP ("GAAP Reserves"), against any liabilities
associated with such assets which are the subject of such Asset Sale;
(iv) all foreign, federal, state and local taxes payable
(including taxes reasonably estimated to be payable) in connection
with or as a result of such Asset Sale; and
(v) with respect to Asset Sales by Subsidiaries of the Company,
the portion of such cash payments attributable to Persons holding a
minority interest in such Subsidiary;
provided, in each such case, that such fees and expenses and other amounts are
not payable to an Affiliate or an Unrestricted Subsidiary of the Company
(except for amounts payable pursuant to the Tax Sharing Agreements), and
provided, further, that required redemptions of existing preferred stock
(including preference stock) of the Company outstanding on the date hereof or
issued pursuant to collective
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bargaining arrangements and related employee benefit arrangements in effect on
the date hereof, in each case, from Persons other than Affiliates or
Unrestricted Subsidiaries of the Company, shall be deemed to be a fee, expense
or other expenditure of such Asset Sale. Notwithstanding the foregoing, Net
Cash Proceeds shall not include proceeds received in a foreign jurisdiction
from an Asset Sale of an asset located outside the United States to the extent
(i) such proceeds cannot under applicable law be transferred to the United
States or (ii) such transfer would result (in the good faith determination of
the Board of Directors of the Company set forth in a Board Resolution) in a
foreign tax liability that would be materially greater than if such Asset Sale
occurred in the United States; provided that if, as, and to the extent that any
of such proceeds may lawfully be (in the case of clause (i)) or are (in the
case of clause (ii)) transferred to the United States, such proceeds shall be
deemed to be cash payments that are subject to the terms of this definition of
Net Cash Proceeds. Subject to the provisions of the next preceding sentence,
Net Cash Proceeds shall also include (i) cash distributions actually received
by or on behalf of the Company or any of its Subsidiaries from any
Non-Affiliate Joint Venture or Unrestricted Subsidiary of the Company
representing the proceeds of a transaction by such Non-Affiliate Joint Venture
or Unrestricted Subsidiary of the Company that would constitute an Asset Sale
if such Non-Affiliate Joint Venture or Unrestricted Subsidiary were a
Subsidiary of the Company and (ii) the amount of any reversal of GAAP Reserves
(but only as and when, and to the extent, reversed) which amount is otherwise a
deduction from Net Cash Proceeds.
Net Income: The term "Net Income" shall mean, with respect to any
Person for any period, the net income (loss) of such Person for such period
determined in accordance with GAAP.
Non-Affiliate Joint Venture: The term "Non-Affiliate Joint Venture"
shall mean any joint venture, partnership or other Person (other than the
Company, a Subsidiary of the Company or an Unrestricted Subsidiary of the
Company) in which the Company and/or its Subsidiaries have an ownership
interest equal to or greater than 5% and in which no Affiliate of the Company
has a direct or an indirect ownership interest other than by virtue of the
direct or indirect ownership interest in such Non-Affiliate Joint Venture held
(in the aggregate) by the Company and/or one or more of its Subsidiaries,
provided that such Non-Affiliate Joint Venture is engaged in one or more of the
lines of business in which the Company or its Subsidiaries or its Non-Affiliate
Joint Ventures are engaged in as of the date of this Indenture or reasonably
related extensions of such lines.
Non-Defaulting Equity Owner: The term "Non-Defaulting Equity Owner"
shall mean, with respect to any Permitted Entity, any Equity Owner that is not
a Defaulting Equity Owner.
Non-Recourse Guarantor: The term "Non-Recourse Guarantor" shall mean
a Subsidiary of the Company that guarantees any Indebtedness under the Credit
Agreement, provided that such guarantee is non-recourse to the assets of such
Subsidiary other than to intercompany Indebtedness owed, or from time to time
owing, by the Company to such Subsidiary, and all monetary proceeds therefrom.
Non-U.S. Person: The term "Non-U.S. Person" shall mean a person who
is not a "U.S. person", as defined in Regulation S.
Note or Notes: The terms "Note" or "Notes" shall mean the Initial
Notes and the Exchange Notes.
Noteholder; registered holder: The terms "noteholder," "holder of
Notes," "registered holder" or other similar term shall mean any person who
shall at the time be the registered holder of any Note
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or Notes on the registry books of the Company kept for that purpose in
accordance with the provisions of this Indenture.
Offering Memorandum: The term "Offering Memorandum" shall mean that
certain offering memorandum dated December 18, 1996, relating to the offering
by the Company of the Notes.
Officers' Certificate: The term "Officers' Certificate" shall mean a
certificate of the Company signed on behalf of the Company by the Chairman of
the Board, the President or any Vice President and by the Chief Financial
Officer, the Controller, the Treasurer, an Assistant Treasurer, the Secretary
or an Assistant Secretary of the Company. Each such certificate shall include
the statements provided for in Section 14.05 if and to the extent required by
the provisions thereof.
Opinion of Counsel: The term "Opinion of Counsel" shall mean an
opinion in writing signed by legal counsel, who may be an employee of, or of
counsel to, the Company and who shall be reasonably satisfactory to the
Trustee. Each such opinion shall include the statements provided for in
Section 14.05 if and to the extent required by the provisions thereof.
Outstanding: The term "outstanding," when used with reference to
Notes, shall, subject to the provisions of Section 8.04, mean, as of any
particular time, all Notes authenticated and delivered by the Trustee under
this Indenture, except
(a) Notes theretofore cancelled by the Trustee or delivered to the
Trustee for cancellation;
(b) Notes, or portions thereof, for which the payment of principal,
interest, any redemption price, any Change of Control Purchase Price or any
Asset Sale Purchase Price in the necessary amount shall have been deposited in
trust with the Trustee or with any paying agent (other than the Company) or
shall have been set aside and segregated in trust by the Company (if the
Company shall act as its own paying agent), provided that such Notes shall have
reached their stated maturity or, if such Notes are to be or may be redeemed or
purchased prior to the maturity thereof, notice of such redemption or purchase
shall have been given as in Article Three provided, or provision satisfactory
to the Trustee shall have been made for giving such notice; and
(c) Notes in lieu of or in substitution for which other Notes shall
have been authenticated and delivered pursuant to the terms of Section 2.07,
unless proof satisfactory to the Trustee is presented that any such Notes are
held by bona fide holders in due course.
Ownership Interest: The term "Ownership Interest" shall mean, with
respect to any Equity Owner of a Permitted Entity at the time of the
determination thereof, the proportion held at such time by such Equity Owner of
the outstanding Permitted Entity Securities of such Permitted Entity that are
last entitled to payment upon liquidation or dissolution as provided in the
governing instruments of such Permitted Entity or pursuant to an agreement
among the Equity Owners of such Permitted Entity.
Permitted Collateral: The term "Permitted Collateral" shall mean real
property (as set forth in Schedule B hereto), plant and equipment of the
Company or any of its Subsidiaries located in the United States of America
which, as of the date of issuance of the Notes, secures Indebtedness under the
Credit Agreement (whether or not the Liens on such real property, plant or
equipment are perfected at such time), together with any Improvements thereto
or thereon, any real property that is contiguous to or structurally related to
such real property (the "Contiguous Property"), and any real property, plant or
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equipment, whether owned on the date of the issuance of the Notes or thereafter
acquired, located or used at any time after the date of issuance of the Notes
at a facility (other than the Company's Gramercy alumina refinery and Nevada
micromill) owned, leased, occupied or used by the Company or any of its
Subsidiaries as of the date of issuance of the Notes or on any Contiguous
Property, and any proceeds thereof; provided, that notwithstanding anything to
the contrary contained in this Indenture, any Permitted Collateral which is
released from all Liens thereon securing Indebtedness and which does not become
subject to a new Lien within 60 days of such release securing Indebtedness
which Refinances any of the Indebtedness (in whole or in part) previously
secured by such Permitted Collateral shall not thereafter constitute "Permitted
Collateral" under this Indenture.
Permitted Dividend Encumbrance: The term "Permitted Dividend
Encumbrance" shall mean, with respect to any Person, any consensual
encumbrances or restrictions on the ability of such Person to pay dividends or
make any other distributions on its Capital Stock or pay any Indebtedness owed
to the Company or any Subsidiaries of the Company (or, in the case of a
Permitted Entity, to its Equity Owners) or to make loans or advances or
transfer any of its assets to the Company or any Subsidiary of the Company (or,
in the case of a Permitted Entity, to its Equity Owners) existing under or by
reason of any of:
(i) this Indenture;
(ii) Indebtedness permitted under Section 4.10(b)(ii);
(iii) Indebtedness or other obligations in existence on the
date of this Indenture and customary rights of first refusal with
respect to the Company's and its Subsidiaries' interests in their
respective Subsidiaries, Unrestricted Subsidiaries, Non-Affiliate
Joint Ventures and Permitted Entities;
(iv) applicable law and agreements with foreign governments
with respect to assets located in their jurisdictions;
(v)(A) customary provisions restricting (i) the subletting or
assignment of any lease or (ii) the transfer of copyrighted or
patented materials, (B) provisions in agreements that restrict the
assignment of such agreements or rights thereunder or (C) provisions
of a customary nature contained in the terms of Capital Stock
restricting the payment of dividends and the making of distributions
on Capital Stock;
(vi) Indebtedness or other obligations of any other Person
acquired (whether pursuant to a purchase of stock or assets)
(including any Non-Affiliate Joint Venture of the Company or Permitted
Entity that becomes a Subsidiary of the Company) or applicable to any
assets at the time such Person or assets were acquired by the Company,
its Subsidiaries or a Permitted Entity, in each case which
Indebtedness and obligations (A) were not created in anticipation of
such acquired Person becoming a Subsidiary of the Company or a
Permitted Entity, as the case may be, or such assets being acquired by
the Company, its Subsidiaries or such Permitted Entity, as the case
may be, and (B) which encumbrances and restrictions are not applicable
to any Person or the property or assets of any Person other than the
Person or the property or assets of the Person so acquired (including
the Capital Stock of such Person) or any newly organized entity formed
to effect such acquisition and, in each case, the monetary proceeds
thereof;
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(vii) encumbrances and restrictions with respect to such Person
imposed in connection with an agreement for the sale or disposition of
such Person or its assets;
(viii) encumbrances and restrictions applicable only to (A)
Alpart and its assets and Capital Stock with respect to Indebtedness
permitted to be Incurred by Alpart pursuant to Section 4.10(a), (B)
Alpart, KJC and AJI and their respective assets and Capital Stock with
respect to Indebtedness permitted to be Incurred pursuant to Section
4.10(b)(iii), (C) KAAC and its assets and Capital Stock with respect
to Indebtedness permitted to be Incurred pursuant to Section
4.10(b)(iv) and (D) the Person or Persons that Incurred such
Indebtedness and the Person or Persons that Incurred such Refinancing
Indebtedness and, in each case, such Persons' assets and Capital Stock
with respect to Indebtedness and Refinancing Indebtedness permitted to
be Incurred pursuant to Section 4.10(b)(viii); in each case provided,
that the Board of Directors of the Company has determined in good
faith that such encumbrances and restrictions would not singly or in
the aggregate have a materially adverse effect on the holders of the
Notes;
(ix) Indebtedness of a Person that was a Subsidiary at the time
of Incurrence and the Incurrence of which Indebtedness is permitted by
Section 4.10, provided that such encumbrances and restrictions apply
only to such Subsidiary and its assets, and provided, further, that
the Board of Directors of the Company has determined in good faith, at
the time of creation of each such encumbrance or restriction, that
such encumbrances and restrictions would not singly or in the
aggregate have a materially adverse effect on the holders of the
Notes;
(x) the subordination of (A) any Indebtedness owed by the
Company or any of its Subsidiaries to the Company or any other
Subsidiary to (B) any other Indebtedness of the Company or any of its
Subsidiaries, provided (A) such other Indebtedness is permitted under
this Indenture and (B) the Board of Directors of the Company has
determined in good faith, at the time of creation of each such
encumbrance or restriction, that such encumbrances and restrictions
would not singly or in the aggregate have a materially adverse effect
on the holders of the Notes;
(xi) the subordination of (A) any Indebtedness owed by a
Permitted Entity to its Equity Owners or any other Person to (B) any
other Indebtedness of such Permitted Entity, provided (I) such other
Indebtedness, at the time of the Incurrence thereof, is permitted by
the definition of Permitted Entity and (II) the Board of Directors of
the Company has determined in good faith, at the time of creation of
each such encumbrance or restriction, that such encumbrances and
restrictions would not singly or in the aggregate have a materially
adverse effect on the holders of the Notes;
(xii) Refinancing Indebtedness that is otherwise permitted in
connection with any Refinanced Indebtedness, provided that, in the
case of all Refinancing Indebtedness other than Refinancing
Indebtedness Incurred with respect to Indebtedness permitted under
Section 4.10(b)(ii), any such encumbrances or restrictions shall not
be materially less favorable to the holders of the Notes; and
(xiii) the sale or other disposition of property subject to a
Lien securing Indebtedness, provided that such Lien and such
Indebtedness are otherwise permitted by this Indenture.
Permitted Entity: The term "Permitted Entity" shall mean any Person
(other than a Subsidiary Guarantor) designated as such by a Board Resolution
and as to which (i) the Company, any Subsidiary
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Guarantor or any Permitted Entity owns all or a portion of the Permitted Entity
Securities of such Person; (ii) no more than 10 unaffiliated Equity Owners own
of record any Permitted Entity Securities of such Person; (iii) at all times,
each Equity Owner owns a proportion of each class of Permitted Entity
Securities of such Person outstanding equal to such Equity Owner's Ownership
Interest at such time, other than as a result of an Equity Owner Default; (iv)
no Indebtedness or preferred stock (including preference stock) is or has been
Incurred by such Person that is outstanding other than (x) Permitted Entity
Securities held by Equity Owners and/or (y) if such Person is a Subsidiary of
the Company, Indebtedness permitted to be Incurred by such Subsidiary at the
time of the Incurrence thereof under Sections 4.10(b)(v) and 4.10(b)(xiii); (v)
there exist no consensual encumbrances or restrictions on the ability of such
Person to (x) pay dividends or make any other distributions to its
Non-Defaulting Equity Owners or (y) make loans or advances or transfer any of
its assets to its Non-Defaulting Equity Owners, in each case other than
Permitted Dividend Encumbrances of such Permitted Entity; (vi) the Company, any
Subsidiary Guarantor or any Permitted Entity has the right at any time (whether
by agreement, operation of law or otherwise) to (A) require the Permitted
Entity that it owns an Ownership Interest in to dissolve, liquidate or wind up
its affairs (subject to any right of the other Equity Owners and/or such
Permitted Entity to acquire all of the Permitted Entity Securities owned by
such Equity Owner) and, subject to applicable law, to distribute its remaining
assets to its Equity Owners after payment to creditors or (B) have all of the
Permitted Entity Securities that it owns purchased by such Permitted Entity
and/or other Equity Owners; and (vii) the business engaged in by such Person is
one in which the Company or its Subsidiaries or its Non-Affiliate Joint
Ventures were engaged on the date of this Indenture or reasonably related
thereto or is the business of holding or disposing of Permitted Entity
Securities.
Permitted Entity Securities: The term "Permitted Entity Securities"
shall mean, with respect to any Permitted Entity, any Capital Stock or
Indebtedness (whether or not a security) of such Permitted Entity, other than
Indebtedness permitted to be Incurred by such Permitted Entity pursuant to
clause (iv)(y) of the definition of Permitted Entity, but in any event
including Permitted Indebtedness described in clause (b) of the definition
thereof.
Permitted Indebtedness: The term "Permitted Indebtedness" shall mean:
(a) Indebtedness and preferred stock (including preference
stock) of the Company and its Subsidiaries existing on the date of
this Indenture, including, but not limited to, the 9 7/8% Notes, the
10 7/8% Notes and the 12 3/4% Notes;
(b) Indebtedness (including Redeemable Stock) owed or issued by
the Company to a Subsidiary or owed or issued by a Subsidiary to the
Company, any other Subsidiary of the Company or to any other holder of
Capital Stock of such Subsidiary in proportion to such holder's
ownership interest in such Subsidiary;
(c) Indebtedness and preferred stock (including preference
stock) of a Permitted Entity to the extent not prohibited by clause
(iii) or clause (iv)(x) of the definition thereof;
(d) Indebtedness of the Company and its Subsidiaries by reason
of entering into indemnification agreements and guarantees in
connection with the disposition of assets, provided that the
Indebtedness with respect to such indemnification agreements and
guarantees shall be limited to the amount of the net proceeds of such
disposition;
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(e) guarantees, letters of credit and indemnity agreements
relating to performance and surety bonds incurred in the ordinary
course of business;
(f) Indebtedness of a Subsidiary of the Company (including
undrawn amounts under lines of credit that are subsequently drawn
upon) issued, assumed or guaranteed by such Subsidiary prior to the
date upon which such Subsidiary becomes a Subsidiary of the Company
(excluding Indebtedness incurred by such entity in connection with, or
in contemplation of, its becoming a Subsidiary of the Company),
provided that such Indebtedness and the holders thereof do not, at any
time, have direct or indirect recourse to any property or assets of
the Company and its Subsidiaries other than the property and assets of
such acquired entity and its Subsidiaries, including the Capital Stock
thereof, or any newly organized entity formed to effect such
acquisition, and, in each case, the monetary proceeds thereof;
(g) Indebtedness incurred by the Company in connection with the
purchase, redemption, retirement or other acquisition by the Company
of the USWA Preferred Stock outstanding on the date hereof (plus
additional shares of such USWA Preferred Stock issued as dividends
thereon or on such shares issued as dividends);
(h) Indebtedness of the Company and its captive wholly owned
insurance Subsidiaries in respect of letters of credit in an aggregate
amount not to exceed at any one time outstanding $20,000,000 issued
for the account of the Company or such Subsidiaries in support of
certain self-insurance and reinsurance obligations entered into from
time to time by the Company or such captive wholly owned insurance
Subsidiaries of the Company;
(i) Indebtedness consisting of industrial revenue bonds and
related indemnity agreements; and
(j) prior to the merger of the Company and KAC, Indebtedness in
respect of the Preferred Dividend Intercompany Notes.
Person: The term "Person" shall mean any individual, corporation,
partnership, joint venture, association, joint stock company, trust,
unincorporated organization or government or other agency or political
subdivision thereof.
Preferred Dividend Intercompany Notes: The term "Preferred Dividend
Intercompany Notes" shall mean (i) the intercompany note in respect of the
PRIDES and (ii) any other intercompany note representing a loan by KAC to the
Company from the proceeds of an offering of preferred stock by KAC which loan
shall have a term not in excess of five years from the date of issuance and
shall be in an amount equal to the aggregate dividends scheduled to accrue on
such preferred stock during the term thereof and payable at approximately the
same times and in approximately the same amounts as such dividends are payable,
provided that, (a) the aggregate amount of all such intercompany notes referred
to in this clause (ii) shall not exceed $50,000,000 at any one time outstanding
and (b) the remaining net proceeds from such preferred stock offering shall
have been used by KAC to make a capital contribution to (or to purchase common
stock of) the Company.
Preferred Stock ($100): The term "Preferred Stock ($100)" shall mean
the Company's 4 1/8% Preference Stock, par value $100 per share, 4 3/4%
Preference Stock (1957 Series), par value $100 per
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share, 4 3/4% Preference Stock (1959 Series), par value $100 per share, and 4
3/4% Preference Stock (1966 Series), par value $100 per share.
Principal; principal amount: The terms "principal" or "principal
amount" of a Note shall mean the principal amount of such Note as set forth on
the face of such Note.
Principal Products: The term "Principal Products" shall mean bauxite,
alumina, aluminum, fabricated aluminum products, and other assets related to
the production of the foregoing, used or sold by the Company, its Subsidiaries
and its Unrestricted Subsidiaries in the ordinary course of business.
Private Placement Legend: The term "Private Placement Legend" shall
have the meaning set forth in Section 2.09 hereof.
QAL: The term "QAL" shall mean Queensland Alumina Limited, a
Queensland, Australia corporation, and its successors.
Qualified Institutional Buyer or QIB: The terms "Qualified
Institutional Buyer" or "QIB" shall have the meaning specified in Rule 144A
under the Securities Act of 1933.
Redeemable Stock: The term "Redeemable Stock" shall mean, with
respect to any Person, any preferred Capital Stock of such Person, that, by its
terms (or by the terms of any security into which it is convertible or for
which it is exchangeable at the option of the holder thereof), or upon the
happening of any event, matures or is mandatorily redeemable, in whole or in
part, pursuant to a sinking fund obligation or otherwise, or, at the option of
the holder thereof, is redeemable in whole or in part, or is exchangeable into
a security of a Person other than the issuer of such Capital Stock that is
owned by such Person or its Subsidiaries or into Indebtedness of, or that is
owned by, such Person or its Subsidiaries, in each case on or prior to the
scheduled maturity date of the Notes.
Refinance: The term "Refinance" shall mean to renew, extend, refund,
replace, restructure, refinance, amend or modify any Indebtedness. The term
"Refinancing" shall have a correlative meaning.
Refinancing Sale and Leaseback Transaction: The term "Refinancing
Sale and Leaseback Transaction" shall mean any sale and leaseback transaction
with respect to which the Attributable Debt is at least $100,000,000, and which
is designated by the Company as a Refinancing Sale and Leaseback Transaction in
a notice to the Trustee pursuant to the terms of this Indenture, which notice
shall indicate the Attributable Debt with respect to such Refinancing Sale and
Leaseback Transaction.
Registration Rights Agreement: The term "Registration Rights
Agreement" shall mean that certain registration rights agreement among the
Company, the Subsidiary Guarantors and the Initial Purchaser, to be entered
into on the date hereof.
Regulation S: The term "Regulation S" shall mean Regulation S under
the Securities Act of 1933.
Regulation S Temporary Global Note: The term "Regulation S Temporary
Global Note" shall mean a single temporary global Note in the form of the
Global Note with the additional provisions set forth in Exhibit A-1 hereto that
is deposited with the Trustee and registered in the name of the Depository or
its nominee , representing a series of Notes sold in offshore transactions in
reliance on Regulation S.
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Responsible Officer: The term "responsible officer," when used with
respect to the Trustee, shall mean any officer in its principal corporate trust
office and every other officer and assistant officer to whom any corporate
trust matter is referred because of his knowledge of and familiarity with the
particular subject.
Restricted Investment: The term "Restricted Investment" shall mean,
with respect to any Person, (i) any amount paid, or any property transferred,
in each case, directly or indirectly by such Person for Capital Stock or other
securities of, or as a contribution to, any Affiliate of the Company; (ii) any
direct or indirect loan or advance by such Person to any Affiliate of the
Company other than accounts receivable of such Person relating to the purchase
and sale of inventory, goods or services arising in the ordinary course of
business; (iii) any direct or indirect guarantee by such Person of any
obligations, contingent or otherwise, of any Affiliate of the Company; and (iv)
the acquisition by such Person of, or any investment by such Person in, any
Capital Stock or similar interest of any other Person (other than the Company
or an Unrestricted Subsidiary); provided, however, that the following shall not
be Restricted Investments:
(a) investments in or acquisitions of Capital Stock or similar
interests in any Person (other than a Person in which Affiliates of
the Company have an interest other than through the Company, its
Subsidiaries, its Unrestricted Subsidiaries and its Non-Affiliate
Joint Ventures) that (I) is or becomes, at the time of the acquisition
thereof, a Subsidiary of the Company and is or is to be primarily
engaged in an operating business or (II) is, at the time of the
acquisition thereof, engaged or to be engaged primarily in businesses
in which the Company or its Subsidiaries or its Non-Affiliate Joint
Ventures were engaged on the date of this Indenture or reasonably
related extensions thereof, provided that such securities are not, at
the time of the acquisition thereof (without regard to any exchanges,
modifications or other changes thereto subsequent to such
acquisition), registered under the Exchange Act;
(b) Restricted Investments of such Person existing as of the
date of the 9 7/8% Note Indenture and any extension, modification or
renewal of such Restricted Investment (but not increases thereof,
other than as a result of the accrual or accretion of interest or
original issue discount pursuant to the terms of such Restricted
Investment), or any Restricted Investment made in connection with an
exchange of such Restricted Investment with the issuer thereof;
(c) investments in or acquisitions of Permitted Entity
Securities of any Permitted Entity;
(d) transactions with officers or directors of the Company or
any Subsidiary of the Company entered into in the ordinary course of
business (including compensation or employee benefit arrangements with
any officer or director of the Company or any Subsidiary of the
Company);
(e) investments in or acquisitions of Capital Stock or similar
interests in Persons (other than Affiliates of the Company) received
in the bankruptcy or reorganization of or by such Person or any
exchange of such investment with the issuer thereof or taken in
settlement of or other resolution of claims or disputes, and, in each
case, extensions, modifications and renewals thereof; and
(f) investments in Persons (other than Affiliates of the
Company) received by such Person as consideration from Asset Sales to
the extent not prohibited by Section 4.14 (including, for the
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purposes of this definition, those sales, transfers and other
dispositions described in clause (B) and the transactions described in
clause (D) of such definition) or any exchange of such investment with
the issuer thereof, and extensions, modifications and renewals
thereof.
Restricted Security: The term "Restricted Security" shall have the
meaning assigned to such term in Rule 144(a)(3) under the Securities Act of
1933; provided, however, that the Trustee shall be entitled to request and
conclusively rely on an Opinion of Counsel with respect to whether any Note
constitutes a Restricted Security.
Rule 144A: The term "Rule 144A" shall mean Rule 144A under the
Securities Act of 1933.
Securities Act of 1933: The term "Securities Act of 1933" shall mean
the Securities Act of 1933, as amended, and the rules and regulations
promulgated by the Securities and Exchange Commission thereunder.
Significant Subsidiary: The term "Significant Subsidiary" shall have
the meaning assigned to that term under Regulation S-X of the Securities Act of
1933 as in effect on the date of this Indenture; provided, however, that (i)
each Subsidiary Guarantor on the date of this Indenture shall be deemed to be a
Significant Subsidiary of the Company for so long as such Subsidiary is a
Subsidiary Guarantor, (ii) each of VALCO, KAAC and Alpart, and each Subsidiary
of the Company that, directly or indirectly, holds an interest in VALCO, Alpart
or QAL, and each Subsidiary Guarantor that becomes a Subsidiary Guarantor after
the date of this Indenture (so long as such Subsidiary Guarantor is a
Subsidiary Guarantor) shall be deemed to be a Significant Subsidiary if it
(singly, or, in the case of VALCO, Alpart or QAL, together with the other
Subsidiaries of the Company that hold an interest in such entity) meets the
total assets test of the term "Significant Subsidiary" under Regulation S-X as
in effect on the date of this Indenture, but substituting 5% in such test for
10% and (iii) no Unrestricted Subsidiary shall be deemed to be a Significant
Subsidiary.
Specified Parties: The term "Specified Parties" shall mean each of
AJI, Alpart, KAAC, KJC, VALCO, Kaiser Aluminium International, Inc., a Delaware
corporation, and its successors, Kaiser Bauxite Company, a Nevada corporation,
and its successors, Kaiser Jamaica Bauxite Company, a Jamaican partnership, and
its successors, and Queensland Alumina Security Corporation, a Delaware
corporation, and its successors.
Subsidiary: The term "Subsidiary" shall mean any corporation or other
entity of which more than 50% of the equity interest (which for a corporation
shall be the outstanding stock having ordinary voting power to elect a majority
of the Board of Directors of such corporation, irrespective of whether or not
at the time stock of any other class or classes of such corporation shall have
or might have voting power by reason of the happening of any contingency) is at
the time directly or indirectly owned (either alone or through Subsidiaries or
together with Subsidiaries) by the Company or another Subsidiary; provided,
however, that Queensland Alumina Security Corporation, a Delaware corporation,
shall be deemed not to be a Subsidiary of the Company or any of its
Subsidiaries and shall be deemed to be a Non-Affiliate Joint Venture (for as
long as it meets the definition of Non-Affiliate Joint Venture and for as long
as its operations remain substantially the same), and provided, further, that,
for purposes of the definitions of Asset Sale and Net Cash Proceeds and for
purposes of Section 4.14, each of Alpart and VALCO, so long as it is not a
wholly owned Subsidiary, shall be deemed not to be a Subsidiary of the Company
or any of its Subsidiaries and shall be deemed to be a Non-Affiliate Joint
Venture of the Company (for so long as it meets the definition of Non-Affiliate
Joint Venture). For purposes of this definition, any directors'
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qualifying shares shall be disregarded in determining the ownership of a
Subsidiary. Notwithstanding anything to the contrary contained herein, no
Unrestricted Subsidiary shall be deemed to be a Subsidiary of the Company or of
any Subsidiary or Subsidiaries of the Company.
Subsidiary Guarantors: The term "Subsidiary Guarantors" shall mean
the Persons from time to time named as Subsidiary Guarantors in this Indenture
or that become Subsidiary Guarantors hereunder, and each of their respective
successors, provided, however, that in the event that a Subsidiary Guarantor is
released from its Guarantee in accordance with the terms of this Indenture,
such Subsidiary Guarantor shall without any further action no longer be a
Subsidiary Guarantor for any purpose of this Indenture or the Notes. On the
date of this Indenture, the Subsidiary Guarantors are Kaiser Alumina Australia
Corporation, Kaiser Finance Corporation, Alpart Jamaica Inc., Kaiser Jamaica
Corporation, Kaiser Micromill Holdings, LLC, Kaiser Sierra Micromills, LLC,
Kaiser Texas Micromill Holdings, LLC and Kaiser Texas Sierra Micromills, LLC.
Tax Sharing Agreements: The term "Tax Sharing Agreements" shall mean,
collectively, the tax-sharing agreement between the Company and KAC, dated as
of June 30, 1993, and the tax-sharing agreement between the Company and MAXXAM,
dated as of December 21, 1989, as each is described in the prospectus dated
February 10, 1994, relating to the Offering by the Company of the 9 7/8% Notes
and as each may be amended in accordance with Section 4.08(b)(x) of this
Indenture.
Trust Indenture Act of 1939: The term "Trust Indenture Act of 1939"
shall mean the Trust Indenture Act of 1939 as it was in force at the date of
this Indenture, except as provided by Article Ten.
Trustee; principal office: The term "Trustee" shall mean First Trust
National Association, a national banking association, until a successor
replaces it in accordance with the provisions of Article Seven. The term
"principal office of the Trustee" shall mean the office of the Trustee at which
at any particular time its corporate trust business may be principally
administered, which office at the date hereof is located at First Trust Center,
180 East 5th Street, St. Paul, Minnesota 55101.
U.S. Fixed Assets: The term "U.S. Fixed Assets" shall mean, at any
time, any real property, plant or equipment of the Company or any of its
Subsidiaries located at such time in the United States of America, now owned or
hereafter acquired, together with any fixed assets that are Improvements
thereto or thereon and any fixed assets that are proceeds thereof.
USWA Preferred Stock: The term "USWA Preferred Stock" shall mean the
shares of the Company's Cumulative (1985 Series A) Preference Stock and shares
of the Company's Cumulative (1985 Series B) Preference Stock that have been or
may in the future be issued in connection with the Kaiser Aluminum USWA
Employee Stock Ownership Plan and/or the Kaiser Aluminum Salaried Employee
Stock Ownership Plan.
Unrestricted Subsidiary: The term "Unrestricted Subsidiary" shall
mean each of the Subsidiaries of the Company or any entity which is to become a
Subsidiary of the Company, designated as an "Unrestricted Subsidiary" by a
Board Resolution; but only to the extent that such Subsidiary (i) is not, at
the time of such designation, party to any transaction or series of related
transactions with the Company or any Subsidiary of the Company, unless such
transaction or series of related transactions would be permitted by the
provisions of Section 4.08 of this Indenture and (ii) has, at the time of such
designation, at least one director on its board of directors that is not a
director or executive officer of the Company or any of its Subsidiaries and has
at least one executive officer that is not a director or
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executive officer of the Company or any of its Subsidiaries. Any such
designation by the Board of Directors of the Company shall be evidenced to the
Trustee by filing with the Trustee a certified copy of the Board Resolution
giving effect to such designation and an Officers' Certificate, certifying that
such designation complied with the foregoing conditions and was permitted by
Sections 4.09 and 4.15 of this Indenture. The Board of Directors of the
Company may designate an Unrestricted Subsidiary to be a Subsidiary, provided
that any such redesignation shall be deemed to be an Incurrence by the Company
or its Subsidiaries of the Indebtedness (if any) of such redesignated
Subsidiary, to the extent such Indebtedness does not already constitute
Indebtedness of the Company or one or more of its Subsidiaries, for purposes of
Section 4.10 of this Indenture as of the date of such redesignation, and such
redesignation shall only be permitted if (i) such Indebtedness is permitted
under Section 4.10 and (ii) no Event of Default (or event that, after notice or
lapse of time or both, would become an Event of Default) would be in existence
as a result of such designation.
Unrestricted Subsidiary Investment: The term "Unrestricted Subsidiary
Investment" shall mean with respect to the Company or any Subsidiary of the
Company (such Person being referred to in this definition as the "Investor")
(without duplication), (i) any amount paid, or any property transferred, in
each case, directly or indirectly, by the Investor for Capital Stock or other
securities of, or as a contribution to, an Unrestricted Subsidiary, (ii) any
direct or indirect loan or advance by the Investor to an Unrestricted
Subsidiary other than accounts receivable of the Investor relating to the
purchase and sale of inventory, goods or services arising in the ordinary
course of business, (iii) any direct or indirect guarantee by the Investor of,
or liability (other than liabilities arising by operation of law) of the
Investor for, any obligations, contingent or otherwise, of an Unrestricted
Subsidiary, (iv) any provision of credit support (including any undertaking,
agreement or instrument that would constitute Indebtedness) by the Investor to
or on behalf of an Unrestricted Subsidiary, (v) any Incurrence of Indebtedness
by an Unrestricted Subsidiary, a default with respect to which (including any
rights that the holders thereof may have to take enforcement action against
such Unrestricted Subsidiary) would permit (upon notice, lapse of time or both)
any holder of any Indebtedness of the Investor (other than the Notes,
Indebtedness set forth in Schedule C to this Indenture and Indebtedness in a
principal amount of no more than $10,000,000 in any single case) to declare a
default on such Indebtedness of the Investor or cause the payment thereof to be
accelerated or payable prior to its stated maturity, (vi) any direct or
indirect obligation or liability of the Investor (A) to subscribe for
additional Equity Interests of an Unrestricted Subsidiary or (B) to maintain or
preserve such Unrestricted Subsidiary's financial condition or to cause such
Unrestricted Subsidiary to achieve any specified levels of operating results,
and (vii) the acquisition by the Investor of, or any investment by the Investor
in, any Capital Stock or similar interests of an Unrestricted Subsidiary. The
amount of any Unrestricted Subsidiary Investment, if other than in cash or a
sum certain guaranteed, shall be the Fair Market Value thereof.
Unrestricted Subsidiary Investments Outstanding: The term
"Unrestricted Subsidiary Investments Outstanding" shall mean, at any time of
determination, in respect of any Unrestricted Subsidiary, the amount, if any,
by which (i) the sum of all Unrestricted Subsidiary Investments theretofore
made by the Company or any Subsidiary of the Company in such Unrestricted
Subsidiary after the date hereof, exceeds (ii) the amount of all dividends and
distributions received, directly or indirectly, by the Company or a Subsidiary
of the Company that is a Subsidiary Guarantor from such Unrestricted Subsidiary
in cash or Cash Equivalents during the period that such Person was an
Unrestricted Subsidiary, and all repayments in cash or Cash Equivalents from
such Unrestricted Subsidiary, directly or indirectly, to the Company or one of
its Subsidiaries that is a Subsidiary Guarantor of loans or advances from the
Company or any of its Subsidiaries to such Unrestricted Subsidiary, during the
period that such Person was an Unrestricted Subsidiary, any other reduction
(including as a result of the sale by the Company
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or a Subsidiary of the Company of Capital Stock of an Unrestricted Subsidiary)
received, directly or indirectly, by the Company or a Subsidiary of the Company
that is a Subsidiary Guarantor in cash or Cash Equivalents of Unrestricted
Subsidiary Investments in such Unrestricted Subsidiary during the period that
such Person was an Unrestricted Subsidiary, and any reductions of Unrestricted
Subsidiary Investments in such Unrestricted Subsidiary of the kind referred to
in clauses (iii) through (vi) of the definition of Unrestricted Subsidiary
Investment; provided that the amount of Unrestricted Subsidiary Investments
Outstanding in respect of any Unrestricted Subsidiary shall at no time be a
negative amount. Notwithstanding the foregoing, in the event that the Company
redesignates an Unrestricted Subsidiary as a Subsidiary, the amount of
Unrestricted Subsidiary Investments Outstanding in respect of such Unrestricted
Subsidiary at the time of such redesignation shall continue to constitute
Unrestricted Subsidiary Investments Outstanding and such redesignated
Subsidiary shall not be required to become a Subsidiary Guarantor in connection
with such redesignation.
VALCO: The term "VALCO" shall mean Volta Aluminium Company Limited, a
Ghanaian corporation, and its successors.
SECTION 1.02. References are to Indenture. Unless the context
otherwise requires, all references herein to "Articles," "Sections" and other
subdivisions refer to the corresponding Articles, Sections and other
subdivisions of this Indenture, and the words "herein," "hereof," hereby,"
"hereunder" and words of similar import refer to this Indenture as a whole and
not to any particular Article, Section or other subdivision hereof.
SECTION 1.03. Other definitions.
The following terms are defined in the referenced section of this
Indenture and have the meaning set forth therein for all purposes in this
Indenture (except as otherwise expressly provided or unless the context
otherwise requires):
Term Defined in Section
---- ------------------
"applicants" . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5.02(b)
"Approved Bank" . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.01
"Asset Sale Offer" . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4.14(b)
"Asset Sale Offer Amount" . . . . . . . . . . . . . . . . . . . . . . . . . . 4.14(b)
"Asset Sale Purchase Date" . . . . . . . . . . . . . . . . . . . . . . . . . . 4.14(b)
"Asset Sale Purchase Notice" . . . . . . . . . . . . . . . . . . . . . . . . . 4.14(c)
"Asset Sale Purchase Price" . . . . . . . . . . . . . . . . . . . . . . . . . 4.14(b)
"Change of Control" . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.05(a)
"Change of Control Purchase Date" . . . . . . . . . . . . . . . . . . . . . . 3.05(a)
"Change of Control Purchase Notice" . . . . . . . . . . . . . . . . . . . . . 3.05(c)
"Change of Control Purchase Price" . . . . . . . . . . . . . . . . . . . . . . 3.05(a)
"Controlled Non-Affiliate Joint Venture" . . . . . . . . . . . . . . . . . . . 4.09(a)
"Global Note" . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.02
"Incur" . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4.10(a)
"Notice of Default" . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6.01(c)
"Other Indebtedness" . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4.10(c)
"PRIDES" . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4.09(b)(IX)
"Private Placement Legend . . . . . . . . . . . . . . . . . . . . . . . . . . 2.09
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"record date" . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.03
"Refinanced Indebtedness" . . . . . . . . . . . . . . . . . . . . . . . . . . 4.10(b)(vi)
"Refinancing Indebtedness" . . . . . . . . . . . . . . . . . . . . . . . . . . 4.10(b)(vi)
"Restricted Payment" . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4.09(a)
"Specified Pari Passu Indebtedness" . . . . . . . . . . . . . . . . . . . . . 4.14(b)
"surviving corporation" . . . . . . . . . . . . . . . . . . . . . . . . . . . 11.01(a)
"Twenty-Five Million Threshold" . . . . . . . . . . . . . . . . . . . . . . . 4.14(c)
"Voting Stock" . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.05(a)
The following terms are defined in the referenced section of this
Indenture and have the meaning set forth therein for purposes provided therein,
and such definitions are limited to those sections of this Indenture
specifically referenced:
Defined in Definition Limited
Term Section to Section
---- ---------- ------------------
"amount" . . . . . . . . . . . . . . . 7.08(d) . . . . . . . . . . . . . . . . . 7 .08
"cash transaction" . . . . . . . . . . 7.13(c) . . . . . . . . . . . . . . . . . 7 .13
"Company" . . . . . . . . . . . . . . 7.08(d) . . . . . . . . . . . . . . . . . 7 .08
"Company" . . . . . . . . . . . . . . 7.13(c) . . . . . . . . . . . . . . . . . 7 .13
"defaults" . . . . . . . . . . . . . . 6.07 . . . . . . . . . . . . . . . . . . 6 .07
"defaults" . . . . . . . . . . . . . . 7.13(c) . . . . . . . . . . . . . . . . . 7 .13
"director" . . . . . . . . . . . . . . 7.08(d) . . . . . . . . . . . . . . . . . 7 .08
"dividends" . . . . . . . . . . . . . 7.13(a) . . . . . . . . . . . . . . . . . 7 .13(a)
"executive officer" . . . . . . . . . 7.08(d) . . . . . . . . . . . . . . . . . 7 .08
"in default" . . . . . . . . . . . . . 7.08(c) . . . . . . . . . . . . . . . . . 7 .08(c)(6), (7),
(8) and (9)
"other indenture securities" . . . . . 7.13(c) . . . . . . . . . . . . . . . . . 7 .13
"outstanding" . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7 .08(d)7.08
"person" . . . . . . . . . . . . . . . 7.08(d) . . . . . . . . . . . . . . . . . 7 .08
"security" . . . . . . . . . . . . . 7.08(c) . . . . . . . . . . . . . . . . . 7 .08(c)(6), (7),
(8) and (9)
"security" . . . . . . . . . . . . . . 7.08(d) . . . . . . . . . . . . . . . . . 7 .08 (other
than 7.08(c)(6),
(7), (8) and (9))
"self liquidating paper" . . . . . . . 7.13(c) . . . . . . . . . . . . . . . . . 7 .13
"trust" . . . . . . . . . . . . . . . 7.08(d) . . . . . . . . . . . . . . . . . 7 .08
"voting security" . . . . . . . . . . 7.08(d) . . . . . . . . . . . . . . . . . 7 .08
ARTICLE TWO
ISSUE, DESCRIPTION, EXECUTION, REGISTRATION
AND EXCHANGE OF NOTES
SECTION 2.01. Designation, amount, authentication and delivery of
Notes. The Initial Notes shall be designated as the Company's 10 7/8% Series C
Senior Notes due 2006. The Exchange Notes shall be designated as the Company's
10 7/8% Series D Senior Notes due 2006. Notes for an aggregate principal
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amount of fifty million dollars ($50,000,000), upon the execution of this
Indenture, or from time to time thereafter, may be executed by the Company and
delivered to the Trustee for authentication, and the Trustee shall thereupon
authenticate and deliver said Notes to or upon the written order of the
Company, signed by its Chairman of the Board, President or a Vice President,
without any further corporate action by the Company.
The aggregate principal amount of Notes authorized by this Indenture
is limited to fifty million dollars ($50,000,000) and, except as provided in
this Section 2.01 and in Section 2.07, the Company shall not execute and the
Trustee shall not authenticate or deliver Notes in excess of such aggregate
principal amount. The Trustee shall authenticate Exchange Notes from time to
time for issue only in exchange for a like principal amount of Initial Notes,
in each case upon a written order of the Company. The written order of the
Company shall specify the amount of Notes to be authenticated and the date on
which the Notes are to be authenticated, whether the Notes are to be Initial
Notes or Exchange Notes and whether the Notes are to be issued as Certificated
Notes or a Global Note and such other information as the Trustee may reasonably
request.
Nothing contained in this Section 2.01 or elsewhere in this Indenture,
or in the Notes, is intended to or shall limit execution by the Company or
authentication or delivery by the Trustee of Notes under the circumstances
contemplated by Sections 2.05, 2.06, 2.07, 3.03, 3.05 and 10.04.
SECTION 2.02. Form of Notes and Trustee's certificate. The
definitive Notes and the Trustee's certificate of authentication to be borne by
the Notes shall be substantially in the form set forth in the Recitals of this
Indenture, which are part of this Indenture, and may have such letters, numbers
or other marks of identification or designation and such legends or
endorsements printed, lithographed or engraved thereon as the officers
executing the same may deem appropriate and as are not inconsistent with the
provisions of this Indenture, or as may be required to comply with any law or
with any rule or regulation made pursuant thereto or with any rule or
regulation of any stock exchange on which the Notes may be listed, or to
conform to usage.
Notes offered and sold in reliance on Rule 144A shall be
issued initially in the form of a single, permanent global Note in fully
registered form, without interest coupons, substantially in the form set forth
in the recitals to this Indenture (the "Global Note"), deposited with the
Trustee, as custodian for the Depository, and registered in the name of Cede &
Co., or such other nominee as the Depository may designate, duly executed by
the Company and authenticated by the Trustee as hereinafter provided and shall
bear the legends set forth in Section 2.09 hereof. The aggregate principal
amount of the Global Note may from time to time be increased or decreased by
adjustments made on the records of the Trustee, as custodian for the
Depository, as hereinafter provided.
Notes offered and sold in reliance on Regulation S shall be
issued initially in the form of the Regulation S Temporary Global Note in fully
registered form, which shall be deposited on behalf of the purchasers of the
Notes represented thereby with the Trustee, as custodian for the Depository,
and registered in the name of the Depository or the nominee of the Depository,
duly executed by the Company and authenticated by the Trustee as hereinafter
provided. The 40-day restricted period (as defined in Regulation S) shall be
terminated upon the receipt by the Trustee of (i) a written certificate from
the Depository as to the non-United States beneficial ownership of 100% of the
aggregate principal amount of the Regulation S Temporary Global Note (except to
the extent of any beneficial owners thereof who acquired an interest therein
pursuant to another exemption from registration under the Securities Act of
1933, all as contemplated by Section 2.05(e) hereof), and (ii) an Officers'
Certificate from the
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Company. Following the termination of the 40-day restricted period, beneficial
interests in the Regulation S Temporary Global Note shall be exchanged for
Certificated Notes or beneficial interests in the Global Note pursuant to the
applicable procedures of the Depository. The aggregate principal amount of the
Regulation S Temporary Global Note may from time to time be increased or
decreased by adjustments made on the records of the Trustee, as custodian for
the Depository, as hereinafter provided.
Notes offered and sold in reliance on any other exemption from
registration under the Securities Act of 1933 other than as described in the
preceding paragraph shall be issued, and Notes offered and sold in reliance on
Rule 144A may be issued, in the form of certificated Notes in fully registered
form, without interest coupons, in substantially the form set forth in the
recitals to this Indenture (the "Certificated Notes"). Certificated Notes
shall initially be registered in the name of the Depository or a nominee of the
Depository and be delivered to the Trustee as custodian for the Depository,
duly executed by the Company and authenticated by the Trustee as hereinafter
provided. Beneficial owners of Certificated Notes, however, may request
registration of such Certificated Notes in their names or the names of their
nominees.
SECTION 2.03. Date of Notes and denominations. The Notes shall bear
interest at the rate per annum of 10 7/8%, payable semi-annually on April 15
and October 15, shall mature on October 15, 2006 and shall be issuable as
registered Notes without coupons in denominations of $1,000 and any integral
multiple thereof. The person in whose name any Note is registered at the close
of business on any record date (as hereinbelow defined) with respect to any
interest payment date shall be entitled to receive the interest payable thereon
on such interest payment date notwithstanding the cancellation of such Note
upon any registration of transfer or exchange thereof subsequent to such record
date and prior to such interest payment date, unless such Note shall have been
redeemed on a date fixed for redemption subsequent to such record date and
prior to such interest payment date, or unless an Event of Default shall have
occurred and be continuing as the result of a default in the payment of
interest due on such interest payment date on any Note, in which case such
defaulted interest shall be paid to the person in whose name such Note (or any
Note or Notes issued upon registration of transfer or exchange thereof) is
registered on the record date for the payment of such defaulted interest. The
principal of, premium, if any, Change of Control Purchase Price, Asset Sale
Purchase Price and interest on the Notes shall be payable to the registered
holder thereof at the office or agency to be maintained by the Company in
accordance with the provisions of Section 4.02; provided, however, that payment
of interest may be made at the option of the Company by check mailed by
first-class mail to the address of the person entitled thereto as such address
shall appear on the registry books of the Company; provided that all payments
with respect to any Note, if the holder of such Note has given wire transfer
instructions (which instructions must be received by the Company at least 5
Business Days prior to the relevant date of payment) to the Company, will be
required to be made by wire transfer of immediately available funds to the
account specified by the holder of such Note; provided, that such payments
(other than interest payments) may be conditioned upon surrender of the Notes.
The term "record date" as used in this Section 2.03 with respect to any
interest payment date shall mean the close of business on the April 1 or
October 1, as the case may be, next preceding such interest payment date,
whether or not such April 1 or October 1 is a Business Day, and such term, as
used in this Section 2.03, with respect to the payment of any defaulted
interest shall mean the tenth day next preceding the date fixed by the Company
for the payment of defaulted interest whether or not a Business Day, but in no
case shall such record date be less than ten days after notice thereof shall
have been mailed by or on behalf of the Company to all registered holders of
Notes at their addresses.
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The Notes shall be dated the date of their authentication. Except as
provided in the next sentence, interest shall accrue on the Notes from the most
recent date to which interest has been paid or duly provided for or, if no
interest has been paid or duly provided for, from December 23, 1996. Each Note
authenticated between the record date for any interest payment date and such
interest payment date shall be dated the date of its authentication but shall
bear interest from such interest payment date; provided, however, that if and
to the extent the Company shall default in the payment of the interest due on
such interest payment date, then any Note so authenticated shall bear interest
from the April 15 or October 15, as the case may be, next preceding the date of
such Note to which interest has been paid or duly provided for or, if no
interest has been paid or duly provided for on the Notes, from December 23,
1996.
Interest on the Notes shall be computed on the basis of a 360-day year
comprised of twelve 30-day months.
SECTION 2.04. Execution of Notes. The Notes shall be signed on
behalf of the Company, manually or in facsimile, by its Chairman of the Board
or its President or a Vice President under its corporate seal (which may be in
facsimile) reproduced thereon and attested, manually or in facsimile, by its
Secretary or an Assistant Secretary. Only such Notes as shall bear thereon a
certificate of authentication substantially in the form hereinbefore recited,
signed manually by the Trustee, shall be entitled to the benefits of this
Indenture or be valid or obligatory for any purpose. Such signature by the
Trustee upon any Note executed by the Company shall be conclusive evidence that
the Note so authenticated has been duly authenticated and delivered hereunder
and that the holder is entitled to the benefits of this Indenture.
In case any officer of the Company whose signature appears on any of
the Notes, manually or in facsimile, shall cease to be such officer before such
Notes so signed shall have been authenticated and delivered by the Trustee,
such Notes nevertheless may be authenticated and delivered as though the person
whose signature appears on such Notes had not ceased to be such officer of the
Company; and any Note may be signed, and the corporate seal reproduced thereon
may be attested, on behalf of the Company, manually or in facsimile, by persons
as, at the actual date of the execution of such Note, shall be the proper
officers of the Company, although at the date of the execution of this
Indenture any such person was not such officer.
SECTION 2.05. Exchange and transfer of Notes.
(a) Subject to the other provisions of this Section 2.05:
(1) Notes may be exchanged for a like aggregate principal
amount of Notes in other authorized denominations. Notes to be
exchanged shall be surrendered at the office or agency to be
maintained by the Company in accordance with the provisions of Section
4.02, and the Company shall execute and the Trustee shall authenticate
and deliver in exchange therefor the Note or Notes which the
noteholder making the exchange shall be entitled to receive.
(2) The Company shall keep, at the office or agency to be
maintained by the Company in accordance with the provisions of Section
4.02, a register or registers in which, subject to such reasonable
regulations as it may prescribe, the Company shall register Notes and
shall register the transfer of Notes as in this Article Two provided.
Upon surrender by any noteholder for registration of transfer of any
Note at such office or agency, the Company shall
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execute and the Trustee shall authenticate and deliver in the name of
the transferee or transferees a new Note or Notes for a like aggregate
principal amount.
(3) All Notes presented or surrendered for exchange,
registration of transfer, redemption, purchase or payment shall, if so
required by the Company or the Trustee or any Note registrar (if other
than the Trustee), be accompanied by a written instrument or
instruments of transfer, in form satisfactory to the Company and the
Trustee or the Note registrar (if other than the Trustee), duly
executed by the registered holder or by his attorney duly authorized
in writing and, in every case, each Note presented or surrendered for
registration of transfer shall be accompanied by the assignment form
attached to the Notes, duly executed by the registered holder or by
his attorney duly authorized in writing.
(4) No service charge shall be made for any exchange or
registration of transfer of Notes, but the Company may require payment
of a sum sufficient to cover any tax, assessment or other governmental
charge that may be imposed in relation thereto.
(5) The Company shall not be required to issue, register
the transfer of or exchange any Notes for a period of fifteen days
next preceding any date for the selection of Notes to be redeemed.
The Company shall not be required to register the transfer of or
exchange any Note called or being called for redemption except, in the
case of any Note to be redeemed in part, the portion thereof not to be
so redeemed. The Company shall not be required to register the
transfer of or exchange any Note in respect of which a Change of
Control Purchase Notice or an Asset Sale Purchase Notice has been
given (unless such notice has been withdrawn in accordance with
Section 3.06 or 4.14) except, in the case of any Note to be purchased
in part, the portion thereof not to be so purchased.
(b) Transfers to Non-QIB Institutional Accredited Investors,
Non-U.S. Persons and Certain QIBs. The following provisions shall apply with
respect to the registration of any proposed transfer of a Note to any
Institutional Accredited Investor which is not a QIB, to any Non-U.S. Person or
to any QIB electing to take delivery of Certificated Notes:
(1) the Note registrar shall register on its books and
records the transfer of any Note constituting a Restricted Security if
such transfer is (i) pursuant to a registration statement which has
been declared effective under the Securities Act of 1933, (ii) for as
long as the Notes are eligible for resale pursuant to Rule 144A, to a
person who has checked the box provided for on the form of Note
stating, or has otherwise advised the Company and the Note registrar
in writing, that the sale has been made in compliance with the
provisions of Rule 144A to a transferee who has signed the
certification provided for on the form of Note stating, or has
otherwise advised the Company and the Note registrar in writing, that
it is purchasing the Note for its own account or an account with
respect to which it exercises sole investment discretion and that it
and any such account is a QIB within the meaning of Rule 144A, and is
aware that the sale to it is being made in reliance on Rule 144A and
acknowledges that it has received such information regarding the
Company as it has requested pursuant to Rule 144A or has determined
not to request such information and that it is aware that the
transferor is relying upon its foregoing representations in order to
claim the exemption from registration provided by Rule 144A, (iii)
pursuant to offers and sales to non-U.S. Persons that occur outside
the United States within the meaning of Regulation S under the
Securities Act of 1933, (iv) to an Institutional Accredited Investor
that is acquiring the security for its own account, or for the account
of such an Institutional Accredited
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Investor, for investment purposes and not with a view to or for offer
or sale in connection with, any distribution in violation of the
Securities Act of 1933, or (v) pursuant to another available exemption
from the registration requirements of the Securities Act of 1933,
subject to the Company's and the Trustee's right prior to any such
offer, sale or transfer (A) pursuant to clauses (iii), (iv) or (v) to
require the delivery of an opinion of counsel, certification and/or
other information satisfactory to each of them and (B) in each of the
foregoing cases, to require that an assignment form in the form
appearing on the reverse side of the form of Note is completed and
delivered by the transferor to the Trustee; and
(2) the Note registrar shall register on its books and
records the transfer of any Note other than as described in the
preceding paragraph, upon the completion and delivery of an assignment
form in the form appearing on the reverse side of the form of Note by
the transferor to the Trustee;
(3) if the proposed transferor is an Agent Member holding
a beneficial interest in the Global Note, upon receipt by the Note
registrar of written instructions given in accordance with the
Depository's and the Note registrar's procedures, the Note registrar
shall reflect on its books and records the date and (if the transfer
involves a transfer of a beneficial interest in the Global Note) a
decrease in the principal amount of the Global Note in an amount equal
to the principal amount of the beneficial interest in the Global Note
to be transferred;
(4) if the Notes to be transferred consist of
Certificated Notes, the transferor shall present or surrender such
Certificated Notes to the Note registrar for registration of transfer;
and
(5) subject to this Section 2.05, the Company shall
execute and the Trustee shall authenticate and deliver one or more
Certificated Notes of like tenor and amount to the Notes proposed to
be transferred hereunder.
(c) Transfers to Certain QIBs. The following provisions shall
apply with respect to the registration of any proposed transfer of a
Certificated Note to a QIB electing to take an interest in the Global Note:
(1) the Note registrar shall register on its books and
records the transfer of any Certificated Note constituting a
Restricted Security if such transfer is being made by a proposed
transferor who has checked the box provided for on the form of Note
stating, or has otherwise advised the Company and the Note registrar
in writing, that the sale has been made in compliance with the
provisions of Rule 144A to a transferee who has signed the
certification provided for on the form of Note stating, or has
otherwise advised the Company and the Note registrar in writing, that
it is purchasing the Note for its own account or an account with
respect to which it exercises sole investment discretion and that it
and any such account is a QIB within the meaning of Rule 144A, and is
aware that the sale to it is being made in reliance on Rule 144A and
acknowledges that it has received such information regarding the
Company as it has requested pursuant to Rule 144A or has determined
not to request such information and that it is aware that the
transferor is relying upon its foregoing representations in order to
claim the exemption from registration provided by Rule 144A; and
(2) the Note registrar shall register on its books and
records the transfer of any Note other than as described in the
preceding paragraph, upon the completion and delivery of an
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assignment form in the form appearing on the reverse side of the form
of Note by the transferor to the Trustee; and
(3) upon receipt by the Note registrar of written
instructions given in accordance with the Depository's and the Note
registrar's procedures, the Note registrar shall reflect on its books
and records the date and an increase in the principal amount of the
Global Note in an amount equal to the principal amount of the
Certificated Notes to be transferred, and the Trustee shall cancel the
Certificated Notes so transferred.
(d) Transfers and Exchange of Global Securities. The transfer and
exchange of an interest in the Global Note or beneficial interests therein
shall be effected through the Depository, in accordance with this Indenture
(including applicable restrictions on transfer set forth therein, if any) and
the procedures of the Depository therefor which shall include restrictions on
transfer comparable to those set forth herein to the extent required by the
Securities Act of 1933.
(e) Transfers from the Regulation S Temporary Global Note. If, at
any time, an owner of a beneficial interest in the Regulation S Temporary
Global Note wishes to transfer its beneficial interest in such Regulation S
Temporary Global Note to a Person who is permitted to take delivery thereof in
the form of an interest in the Global Note or to a Person who is taking
delivery of such beneficial interest in the form of Certificated Notes or, upon
expiration of the 40-day restricted period and upon certification of beneficial
ownership of the Notes represented by the Regulation S Temporary Global Note by
non-U.S. Persons or U.S. Persons who purchased such Notes in transactions that
did not require registration under the Securities Act of 1933, to exchange such
beneficial interest for Certificated Notes, such owner shall, subject to the
applicable procedures of the Depository, exchange or cause the exchange of such
interest for an equivalent beneficial interest in the Global Note or for
Certificated Notes as provided in this Section 2.05(e). Upon receipt by the
Trustee of (1) instructions from the Depository, directing the Trustee, as a
Note registrar, to credit or cause to be credited a beneficial interest in the
Global Note or to issue and authenticate Certificated Notes in an amount equal
to the beneficial interest in the Regulation S Temporary Global Note to be
transferred or exchanged, such instructions to contain information regarding
the participant account with the Depository to be credited with such increase
or the name and address of the transferee thereof, as applicable, and (2) a
certificate in the form of Exhibit A-2 attached hereto given by the owner of
such beneficial interest in the Regulation S Temporary Global Note stating (A)
if the transfer is pursuant to Rule 144A, that the Person transferring such
interest in the Regulation S Temporary Global Note reasonably believes that the
Person acquiring such interest in the Global Note is a QIB and is obtaining
such beneficial interest in a transaction meeting the requirements of Rule 144A
and any applicable blue sky or securities laws of any state of the United
States or (B) if the transfer is pursuant to any other exemption from the
registration requirements of the Securities Act of 1933, that the transfer of
such interest has been made in compliance with the transfer restrictions
applicable to the Regulation S Temporary Global Note and pursuant to and in
accordance with the requirements of the exemption claimed, such statement, in
the case of clause (B), to be supported by an Opinion of Counsel from the
transferee or the transferor in form reasonably acceptable to the Company and
to the Note registrar, then the Trustee, as Note registrar, shall instruct the
Depository to reduce or cause to be reduced the aggregate principal amount of
such Regulation S Temporary Global Note and (x) shall instruct the Depository
to increase or cause to be increased the aggregate principal amount of the
Global Note and instruct the Depository to credit or cause to be credited to
the account of the Person specified in such instructions a beneficial interest
in the Global Note or (y) shall issue and authenticate Certificated Notes in an
amount equal to the principal amount of the beneficial interest in the
Regulation S Temporary Global Note to be exchanged or transferred, and the
Trustee, as Note registrar, shall instruct
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the Depository to debit or cause to be debited from the account of the Person
making such transfer the beneficial interest in the Regulation S Temporary
Global Note that is being exchanged or transferred.
(f) Private Placement Legend. Upon the transfer, exchange or
replacement of Notes not bearing the Private Placement Legend, the Note
registrar shall deliver Notes that do not bear the Private Placement Legend.
Upon the transfer, exchange or replacement of Notes bearing the Private
Placement Legend, the Note registrar shall deliver only Notes that bear the
Private Placement Legend unless (i) the requested transfer is after the third
anniversary of the Issue Date (or such shorter period permitted under Rule
144(k) under the Securities Act of 1933 (or any successor provision)), (ii)
such Notes have been sold pursuant to a registration statement which has been
declared effective under the Securities Act of 1933 or (iii) there is delivered
to the Note registrar an Opinion of Counsel reasonably satisfactory to the
Company and the Trustee to the effect that neither such legend nor the related
restrictions on transfer are required in order to maintain compliance with the
provisions of the Securities Act of 1933.
(g) General. By its acceptance of any Note bearing the Private
Placement Legend, each Holder of such Note acknowledges the restrictions on
transfer of such Note set forth in this Indenture and in the Private Placement
Legend and agrees that it will transfer such Note only as provided in this
Indenture.
The Note registrar shall retain copies of all letters, notices
and other written communications received pursuant to Section 2.09 of this
Indenture or this Section 2.05. The Company shall have the right to inspect
and make copies of all such letters, notices or other written communications at
any reasonable time during the Note registrar's normal business hours upon the
giving of reasonable written notice to the Note registrar.
SECTION 2.06. Temporary Notes. Pending the preparation of definitive
Notes, the Company may execute and the Trustee shall authenticate and deliver
temporary Notes (printed, lithographed or typewritten) of any authorized
denomination and substantially in the form of the definitive Notes, but with or
without a recital of specific redemption prices and with such omissions,
insertions and variations as may be appropriate for temporary Notes, all as may
be determined by the Company. Temporary Notes may contain such reference to
any provisions of this Indenture as may be appropriate. Every temporary Note
shall be authenticated by the Trustee upon the same conditions and in
substantially the same manner, and with the same effect, as the definitive
Notes. Without unnecessary delay the Company will execute and deliver to the
Trustee definitive Notes and thereupon any or all temporary Notes may be
surrendered in exchange therefor, at the office or agency to be maintained by
the Company in accordance with the provisions of Section 4.02, and the Trustee
shall authenticate and deliver in exchange for such temporary Notes an equal
aggregate principal amount of definitive Notes. Until so exchanged, the
temporary Notes shall in all respects be entitled to the same benefits under
this Indenture, and shall be subject to the same provisions hereof, as
definitive Notes authenticated and delivered hereunder.
SECTION 2.07. Mutilated, destroyed, lost or stolen Notes. In case
any temporary or definitive Note shall become mutilated or be destroyed, lost
or stolen, the Company, in the case of any mutilated Note shall, and in the
case of any destroyed, lost or stolen Note may, execute, and upon its request
the Trustee shall authenticate and deliver, a new Note bearing a number, letter
or other distinguishing symbol not contemporaneously outstanding in exchange
and substitution for the mutilated Note, or in lieu of and in substitution for
the Note so destroyed, lost or stolen, or, instead of issuing a substituted
Note, if any such Note shall have matured or shall be about to mature or shall
have been selected for redemption or if the Company shall have received a
Change of Control Purchase Notice or an Asset Sale Purchase
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Notice in respect of any such Note (unless such notice has been withdrawn in
accordance with Section 3.06 or 4.14, respectively), the Company may pay the
same without surrender thereof except in the case of a mutilated Note. In
every case the applicant for a substituted Note or for such payment shall
furnish to the Company and to the Trustee such security or indemnity as may be
required by them to save each of them harmless, and, in every case of
destruction, loss or theft, the applicant shall also furnish to the Company and
to the Trustee evidence to their satisfaction of the destruction, loss or theft
of such Note and of the ownership thereof. The Trustee may authenticate any
such substituted Note and deliver the same, or the Trustee or any paying agent
of the Company may make any such payment, upon the written request or
authorization of any officer of the Company. Upon the issuance of any
substituted Note, the Company may require the payment of a sum sufficient to
cover any tax, assessment or other governmental charge that may be imposed in
relation thereto and any other expenses connected therewith.
Every substituted Note issued pursuant to the provisions of this
Section 2.07 shall constitute an additional contractual obligation of the
Company whether or not the destroyed, lost or stolen Note shall be found at any
time, and shall be entitled to all the benefits of this Indenture equally and
proportionately with any and all other Notes duly issued hereunder.
All Notes shall be held and owned upon the express condition that the
foregoing provisions are exclusive with respect to the replacement or payment
of mutilated, destroyed, lost or stolen Notes, and shall preclude (to the
extent lawful) 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 2.08. Cancellation of surrendered Notes. All Notes
surrendered for the purpose of payment, redemption, purchase by the Company at
the option of the holder, exchange, substitution or registration of transfer,
shall, if surrendered to the Company or any paying agent or Note registrar, be
delivered to the Trustee and the same, together with Notes surrendered to the
Trustee for cancellation, shall be cancelled by it, and no Notes shall be
issued in lieu thereof except as expressly permitted by any of the provisions
of this Indenture. The Trustee shall destroy cancelled Notes and shall deliver
certificates of destruction thereof to the Company. If the Company shall
purchase or otherwise acquire any of the Notes, however, such purchase or
acquisition shall not operate as a payment, redemption or satisfaction of the
indebtedness represented by such Notes unless and until the Company, at its
option, shall deliver or surrender the same to the Trustee for cancellation.
SECTION 2.09. Restrictive Legends. Each Global Note and Certificated
Note that constitutes a Restricted Security shall bear the following legend
(the "Private Placement Legend") on the face thereof until the third
anniversary of the Issue Date (or such shorter period permitted by Rule 144(k)
under the Securities Act of 1933 (or any successor provision)), unless
otherwise agreed by the Company and the Holder thereof:
THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES
ACT OF 1933, AS AMENDED (THE "SECURITIES ACT OF 1933") OR ANY STATE
SECURITIES LAWS. NEITHER THIS SECURITY NOR ANY INTEREST OR
PARTICIPATION HEREIN MAY BE REOFFERED, SOLD, ASSIGNED, TRANSFERRED,
PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH
REGISTRATION OR UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT
TO, REGISTRATION. THE HOLDER OF THIS SECURITY BY ITS ACCEPTANCE
HEREOF AGREES TO
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OFFER, SELL OR OTHERWISE TRANSFER SUCH SECURITY PRIOR TO THE DATE
WHICH IS THREE YEARS (OR SUCH SHORTER PERIOD PERMITTED UNDER RULE
144(K) UNDER THE SECURITIES ACT OF 1933 (OR A SUCCESSOR CLAUSE)) AFTER
THE LATER OF THE ORIGINAL ISSUE DATE HEREOF AND THE LAST DATE ON WHICH
THE COMPANY OR ANY AFFILIATE OF THE COMPANY WAS THE OWNER OF THIS
SECURITY (OR ANY PREDECESSOR OF THIS SECURITY) (THE "RESALE
RESTRICTION TERMINATION DATE") ONLY (A) TO THE COMPANY, (B) PURSUANT
TO A REGISTRATION STATEMENT WHICH HAS BEEN DECLARED EFFECTIVE UNDER
THE SECURITIES ACT OF 1933, (C) FOR AS LONG AS THE NOTES ARE ELIGIBLE
FOR RESALE PURSUANT TO RULE 144A, TO A PERSON IT REASONABLY BELIEVES
IS A "QUALIFIED INSTITUTIONAL BUYER" AS DEFINED IN RULE 144A UNDER THE
SECURITIES ACT OF 1933 THAT PURCHASES FOR ITS OWN ACCOUNT OR FOR THE
ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN
THAT THE TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, (D) PURSUANT
TO OFFERS AND SALES TO NON-U.S. PERSONS WHO MAKE CERTAIN
REPRESENTATIONS TO THE TRUSTEE WHICH OFFERS AND SALES OCCUR OUTSIDE
THE UNITED STATES WITHIN THE MEANING OF REGULATION S UNDER THE
SECURITIES ACT OF 1933, (E) TO AN INSTITUTIONAL "ACCREDITED INVESTOR"
WITHIN THE MEANING OF SUBPARAGRAPH (a)(1),(2),(3) OR (7) OF RULE 501
UNDER THE SECURITIES ACT OF 1933 THAT IS ACQUIRING THE SECURITY FOR
ITS OWN ACCOUNT OR FOR THE ACCOUNT OF SUCH AN INSTITUTIONAL
"ACCREDITED INVESTOR" FOR INVESTMENT PURPOSES AND NOT WITH A VIEW TO,
OR FOR OFFER OR SALE IN CONNECTION WITH, ANY DISTRIBUTION IN VIOLATION
OF THE SECURITIES ACT OF 1933, AND WHO MAKES CERTAIN REPRESENTATIONS
TO THE TRUSTEE OR (F) PURSUANT TO ANOTHER AVAILABLE EXEMPTION FROM THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT OF 1933, SUBJECT TO
THE COMPANY'S AND THE TRUSTEE'S RIGHT PRIOR TO ANY SUCH OFFER, SALE OR
TRANSFER (i) PURSUANT TO CLAUSES (D), (E) OR (F) PRIOR TO THE RESALE
RESTRICTION TERMINATION DATE TO REQUIRE THE DELIVERY OF AN OPINION OF
COUNSEL, CERTIFICATION AND/OR OTHER INFORMATION SATISFACTORY TO THE
COMPANY AND THE TRUSTEE AND (ii) IN EACH OF THE FOREGOING CASES, TO
REQUIRE THAT A CERTIFICATE OF TRANSFER IN THE FORM APPEARING ON THE
OTHER SIDE OF THIS SECURITY IS COMPLETED AND DELIVERED BY THE
TRANSFEROR TO THE TRUSTEE.
Each Global Note shall also bear the following legend on the face
thereof:
UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR INTERESTS IN
THE GLOBAL NOTE OR NOTES IN DEFINITIVE FORM, THIS SECURITY MAY NOT BE
TRANSFERRED EXCEPT AS A WHOLE BY THE DEPOSITORY TO A NOMINEE OF THE
DEPOSITORY, OR BY ANY SUCH NOMINEE OF THE DEPOSITORY TO THE DEPOSITORY
OR ANOTHER NOMINEE OF THE DEPOSITORY, OR BY THE DEPOSITORY OR ANY SUCH
NOMINEE TO A SUCCESSOR DEPOSITORY OR A NOMINEE OF SUCH
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SUCCESSOR DEPOSITORY. UNLESS THIS CERTIFICATE IS PRESENTED BY AN
AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK
CORPORATION ("DTC"), TO THE COMPANY OR ITS AGENT FOR REGISTRATION OF
TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS
REGISTERED IN THE NAME OF CEDE & CO. OR SUCH OTHER NAME AS MAY BE
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT
HEREON IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS MAY BE
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 AND TRANSFERS OF PORTIONS OF THIS
GLOBAL SECURITY SHALL BE LIMITED TO TRANSFERS MADE IN ACCORDANCE WITH
THE RESTRICTIONS SET FORTH IN SECTION 2.05 OF THE INDENTURE.
SECTION 2.10. Book-Entry Provisions for Global Note and Regulation S
Temporary Global Note.
(a) Each of the Global Note and the Regulation S Temporary Global
Note initially shall (i) be registered in the name of the Depository or the
nominee of such Depository, (ii) be delivered to the Trustee as custodian for
such Depository and (iii) bear legends as set forth in Section 2.09 and Exhibit
A-1, as applicable, of this Indenture.
Members of, or participants in, the Depository ("Agent
Members") shall have no rights under this Indenture with respect to the Global
Note or the Regulation S Temporary Global Note, as applicable, held on their
behalf by the Depository, or the Trustee as its custodian, or under the Global
Note or the Regulation S Temporary Global Note, as applicable, and the
Depository may be treated by the Company, the Trustee and any agent of the
Company or the Trustee as the absolute owner of the Global Note and the
Regulation S Temporary Global Note for all purposes whatsoever.
Notwithstanding the foregoing, nothing herein shall prevent the Company, the
Trustee or any agent of the Company or the Trustee from giving effect to any
written certification, proxy or other authorization furnished by the Depository
or impair, as between the Depository and its Agent Members, the operation of
customary practices governing the exercise of the rights of a holder of any
Note.
(b) Transfers of the Global Note or the Regulation S Temporary
Global Note shall be limited to transfers in whole, but not in part, to the
Depository, its successors or their respective nominees. Interests of
beneficial owners in the Global Note or Regulation S Temporary Global Note may
be transferred or exchanged for Certificated Notes in accordance with the rules
and procedures of the Depository and the provisions of Section 2.05 of this
Indenture. In addition, Certificated Notes shall be transferred to all
beneficial owners in exchange for their beneficial interests (1) in the Global
Note, if (i) the Depository notifies the Company that it is unwilling or unable
to continue as Depository for the Global Note and a successor depositary is not
appointed by the Company within 90 days of such notice or (ii) an Event of
Default has occurred and is continuing and the Note registrar has received a
written
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request from the Depository to issue Certificated Notes and (2) the Regulation
S Temporary Global Note, upon (i) the expiration of the 40-day restricted
period and (ii) certification of beneficial ownership of the Notes represented
by the Regulation S Temporary Global Note by non-U.S. Persons or U.S. Persons
who purchased such Notes in transactions that did not require registration
under the Securities Act of 1933.
(c) In connection with any transfer or exchange of a portion of
the beneficial interest in the Global Note or Regulation S Temporary Global
Note to beneficial owners pursuant to paragraph (b) above, the Note registrar
shall (if one or more Certificated Notes are to be issued) reflect on its books
and records the date and a decrease in the principal amount of the Global Note
or Regulation S Temporary Global Note, as applicable, in an amount equal to the
principal amount of the beneficial interest in the Global Note or Regulation S
Temporary Global Note, as applicable, to be transferred, and the Company shall
execute, and the Trustee shall authenticate and deliver, one or more
Certificated Notes of like tenor and amount.
(d) In connection with the transfer of the entire Global Note or
Regulation S Temporary Global Note to beneficial owners pursuant to paragraph
(b) above, the Global Note shall be deemed to be surrendered to the Trustee for
cancellation, and the Company shall execute, and the Trustee shall authenticate
and deliver to each beneficial owner identified by the Depository in exchange
for its beneficial interest in the Global Note, an equal aggregate principal
amount of Certificated Notes of authorized denominations.
(e) Any Certificated Note constituting a Restricted Security
delivered in exchange for an interest in the Global Note or Regulation S
Temporary Global Note, as applicable, pursuant to paragraph (b), (c) or (d)
above shall, except as otherwise provided by paragraph (e) of Section 2.05 of
this Indenture, bear the Private Placement Legend.
(f) The Holder of the Global Note or the Regulation S Temporary
Global Note may grant proxies and otherwise authorize any person, including
Agent Members and persons that may hold interests through Agent Members, to
take any action which a Holder is entitled to take under this Indenture or the
Notes.
ARTICLE THREE
REDEMPTION AND PURCHASES OF NOTES
SECTION 3.01. Redemption prices. The Company may, at its option,
redeem at any time all or from time to time any part of the Notes, on any date
prior to maturity at the redemption prices specified in the Notes, together
with accrued and unpaid interest thereon to but excluding the date fixed for
redemption and in the manner set forth in this Article Three. The Company,
however, shall not have the right to redeem any of the Notes prior to October
15, 2001.
SECTION 3.02. Notice of redemption; selection of Notes. In case the
Company shall desire to exercise such right to redeem all or, as the case may
be, any part of the Notes in accordance with the right reserved so to do, the
Company, or, at the Company's request, the Trustee in the name and at the
expense of the Company, shall fix a date for redemption and give notice of such
redemption to holders of the Notes to be redeemed as hereinafter in this
Section 3.02 provided.
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Notice of redemption shall be given to the holders of Notes to be
redeemed as a whole or in part by mailing by first-class mail a notice of such
redemption not less than fifteen nor more than sixty days prior to the date
fixed for redemption to their last addresses as they shall appear upon the
registry books of the Company, but any failure to give such notice by mailing
to the holder of any Note designated for redemption as a whole or in part, or
any defect therein, shall not affect the validity of the proceedings for the
redemption of any other Notes.
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.
Each such notice of redemption shall specify the total principal
amount to be redeemed, the date fixed for redemption and the redemption price
at which Notes are to be redeemed, and shall state that payment of the
redemption price of the Notes to be redeemed will be made at the office or
agency to be maintained by the Company in accordance with the provisions of
Section 4.02, upon presentation and surrender of such Notes, that interest
accrued to but not including the date fixed for redemption will be paid as
specified in said notice, and that on and after said date interest thereon will
cease to accrue and that the only remaining right of the noteholder is to
receive payment of the redemption price plus such accrued interest upon
surrender. If less than all the Notes are to be redeemed, the notice of
redemption to each holder also shall state the aggregate principal amount of
Notes to be redeemed and shall identify the Notes of such holder to be
redeemed. In case any Note is redeemed in part only, the notice which relates
to such Note shall state the portion of the principal amount thereof to be
redeemed (which shall be $1,000 or an integral multiple thereof), and shall
state that on and after the date fixed for redemption, upon surrender of such
Note, the holder will receive, without charge, a new Note or Notes of
authorized denominations in the principal amount thereof remaining unredeemed.
Each notice shall give the name and address of each paying agent.
On or prior to the date fixed for redemption specified in the notice
of redemption given as provided in this Section 3.02, the Company will deposit
with the Trustee or with one or more paying agents (or, if the Company is
acting as its own paying agent, set aside, segregate and hold in trust as
provided in Section 4.04(c)) an amount of money sufficient to redeem on the
date fixed for redemption all the Notes or portions of Notes so called for
redemption (other than Notes or portions thereof called for redemption on that
date which have been delivered by the Company to the Trustee for cancellation)
at the applicable redemption price, together with accrued interest to but not
including the date fixed for redemption.
If less than all the Notes then outstanding are to be redeemed, the
Company shall give the Trustee, at least twenty-five days (or such shorter
period acceptable to the Trustee) in advance of the date fixed for redemption,
notice of the aggregate principal amount of Notes to be redeemed, and thereupon
the Trustee shall select in such manner as it shall deem appropriate and fair,
in its discretion, the Notes or portions thereof to be redeemed and shall
thereafter promptly notify the Company of the Notes or portions thereof to be
redeemed within a sufficient period of time in order that the notice provision
in Section 3.02 may be satisfied.
SECTION 3.03. When Notes called for redemption become due and
payable. If the giving of notice of redemption shall have been completed as
provided in Section 3.02, the Notes or portions of Notes 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
(but not including) the date fixed for redemption, and on and after such date
fixed for redemption (unless the Company shall default
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in the payment of such Notes at the redemption price, together with interest
accrued to (but not including) the date fixed for redemption) interest on the
Notes or portions of Notes so called for redemption shall cease to accrue
whether or not such Notes are presented for payment and such Notes or portions
thereof shall be deemed not to be outstanding hereunder and shall not be
entitled to any right or benefit hereunder except to receive payment of the
redemption price plus accrued interest to but not including the redemption
date. On presentation and surrender of such Notes for redemption at said place
of payment in said notice specified on or after the date fixed for redemption,
the said Notes shall be paid and redeemed by the Company at the applicable
redemption price, together with interest accrued to (but not including) the
date fixed for redemption. If the date fixed for redemption is an interest
payment date, such payment shall not include accrued interest, which interest
shall be paid in the usual manner otherwise provided for herein. Upon
presentation of any Note which is redeemed in part only, the Company shall
execute and register and the Trustee shall authenticate and deliver to the
holder thereof at the expense of the Company, a new Note or Notes in principal
amount equal to the unredeemed portion of the Note so presented.
SECTION 3.04. Cancellation of redeemed Notes. All Notes surrendered
to the Trustee, upon redemption pursuant to the provisions of this Article
Three, shall be forthwith cancelled by it.
SECTION 3.05. Purchase of Notes at option of the holder upon Change
of Control.
(a) If on or prior to maturity, there shall have occurred a Change
of Control, the Company shall offer to purchase each Note at a purchase price
in cash equal to 101% of the principal amount thereof plus accrued and unpaid
interest to (but not including) the Change of Control Purchase Date (the
"Change of Control Purchase Price"), on the date that is thirty Business Days
after the occurrence of the Change of Control (the "Change of Control Purchase
Date"), subject to the satisfaction by or on behalf of the holder of the
requirements set forth in Section 3.05(c). Following a Change of Control, the
Company shall not be obligated to purchase any Notes pursuant to this Section
3.05(a) or give any notice under Section 3.05(b) with respect to any subsequent
Change of Control. The Company's obligation to purchase Notes as provided
hereunder shall for all purposes hereof be satisfied by, and shall cease upon,
the deposit of funds with the Trustee as provided for in Section 3.07.
A "Change of Control" shall be deemed to have occurred at such time as
MAXXAM, directly or indirectly, shall cease to have (other than by reason of
the existence of a Lien but including by reason of the foreclosure of or other
realization upon a Lien) direct or indirect sole beneficial ownership (as
defined under Regulation 13d-3 of the Exchange Act as in effect on the date of
this Indenture) of at least 40% of the total Voting Stock, on a fully diluted
basis, of the Company; provided, however, that such ownership by MAXXAM,
directly or indirectly, of 30% or greater, but less than 40%, of the total
Voting Stock, on a fully diluted basis, of the Company shall not be a Change of
Control if MAXXAM, through direct representation or through persons nominated
by it, controls a majority of the Board of Directors of the Company necessary
to effectuate any actions by the Board of Directors of the Company; and
provided, further, that the foregoing minimum percentages shall be deemed not
satisfied if any person or group (as defined in Section 13(d)(3) of the
Exchange Act as in effect on the date of this Indenture) shall, directly or
indirectly, own more of the total Voting Stock entitled to vote generally in
the election of directors of the Company than MAXXAM.
"Voting Stock" means, with respect to any person, the capital stock of
such person having general voting power under ordinary circumstances to elect
at least a majority of the board of directors, managers
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or trustees of such person (irrespective of whether or not at the time capital
stock of any other class or classes shall have or might have voting power by
reason of the happening of any contingency).
(b) Within ten Business Days after the occurrence of a Change of
Control, the Company shall mail a written notice of Change of Control by
first-class mail to the Trustee and to each holder (and to beneficial owners as
required by applicable law, including without limitation, Rule 13e-4 of the
Exchange Act, if applicable) and shall cause a copy of such notice to be
published in a daily newspaper of national circulation. The notice shall
include a form of Change of Control Purchase Notice (as described below) to be
completed by the holder and shall state:
(1) the events causing a Change of Control and the date of
such Change of Control;
(2) the date by which the Change of Control Purchase Notice
pursuant to this Section 3.05 must be given;
(3) the Change of Control Purchase Date;
(4) the Change of Control Purchase Price;
(5) the name and address of the Trustee and the office or
agency referred to in Section 4.02;
(6) that the Notes must be surrendered to the Trustee or the
office or agency referred to in Section 4.02 to collect payment;
(7) that the Change of Control Purchase Price for any Note
as to which a Change of Control Purchase Notice has been duly given
and not withdrawn will be paid promptly following the later of the
Change of Control Purchase Date and the time of surrender of such Note
as described in (6);
(8) the procedures the holder must follow to exercise rights
under this Section 3.05 and a brief description of those rights; and
(9) the procedures for withdrawing a Change of Control
Purchase Notice.
(c) To accept the offer to purchase Notes described in Section
3.05(a), a holder must deliver a written notice of purchase (a "Change of
Control Purchase Notice") to the Trustee or to the office or agency referred to
in Section 4.02 at any time prior to the close of business on the Business Day
immediately preceding the Change of Control Purchase Date, stating:
(1) the name of the holder, the principal amount of Notes,
the certificate number or numbers of the Note or Notes which the
holder will deliver to be purchased and a statement that the offer to
purchase is being accepted;
(2) the portion of the principal amount of the Note which
the holder will deliver to be purchased, which portion must be $1,000
or an integral multiple thereof; and
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(3) that such Note shall be purchased on the Change of
Control Purchase Date pursuant to the terms and conditions specified
in the Notes.
The delivery of the Note, by hand or by registered mail prior to, on
or after the Change of Control Purchase Date (together with all necessary
endorsements), to the Trustee or to the office or agency referred to in Section
4.02 shall be a condition to the receipt by the holder of the Change of Control
Purchase Price therefor; provided, however, that such Change of Control
Purchase Price shall be so paid pursuant to this Section 3.05 only if the Note
so delivered to the Trustee or such office or agency shall conform in all
respects to the description thereof set forth in the related Change of Control
Purchase Notice; and provided, further that the Company shall have no
obligation to purchase any Notes with respect to which the Change of Control
Purchase Notice has not been received by the Company prior to the close of
business on the Business Day immediately preceding the Change of Control
Purchase Date.
In the event that the offer to purchase described in Section 3.05(a)
shall be accepted in accordance with the terms hereof, the Company shall
purchase from the holder thereof, pursuant to this Section 3.05, a portion of a
Note if the principal amount of such portion is $1,000 or an integral multiple
of $1,000. Provisions of this Indenture that apply to the purchase of all of a
Note also apply to the purchase of such portion of such Note.
Any purchase by the Company contemplated pursuant to the provisions of
this Section 3.05 shall be consummated by the delivery by the Trustee or other
paying agent of the consideration to be received by the holder promptly
following the later of the Change of Control Purchase Date and the time of
delivery of the Note.
Notwithstanding anything herein to the contrary, any holder delivering
to the Trustee or to the office or agency referred to in Section 4.02, the
Change of Control Purchase Notice contemplated by this Section 3.05(c) shall
have the right to withdraw such Change of Control Purchase Notice by delivery
of a written notice of withdrawal to the Trustee or to such office or agency in
accordance with Section 3.06 at any time prior to the close of business on the
Business Day next preceding the Change of Control Purchase Date.
SECTION 3.06. Effect of Change of Control Purchase Notice. Upon
receipt by the Company of the Change of Control Purchase Notice specified in
Section 3.05(c), the holder of the Note in respect of which such Change of
Control Purchase Notice was given shall (unless such Change of Control Purchase
Notice is withdrawn as specified in the following paragraph) thereafter be
entitled to receive solely the Change of Control Purchase Price with respect to
such Note. Such Change of Control Purchase Price shall be due and payable as
of the Change of Control Purchase Date and shall be paid to such holder
promptly following the later of (x) the Change of Control Purchase Date
(provided the conditions in Section 3.05(c), as applicable, have been
satisfied) and (y) the date of delivery of such Note to the Trustee or to the
office or agency referred to in Section 4.02 by the holder thereof in the
manner required by Section 3.05(c).
A Change of Control Purchase Notice may be withdrawn by means of a
written notice of withdrawal delivered to the office of the Trustee or to the
office or agency referred to in Section 4.02 at any time on or prior to the
close of business on the Business Day next preceding the Change of Control
Purchase Date, specifying:
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(1) the certificate number or numbers of the Note or Notes in
respect of which such notice of withdrawal is being submitted;
(2) the principal amount of the Note or Notes with respect to which
such notice of withdrawal is being submitted; and
(3) the principal amount, if any, of such Note or Notes which
remains subject to the original Change of Control Purchase Notice, and which
has been or will be delivered for purchase by the Company.
There shall be no purchase of any Notes pursuant to Section 3.05 if
there has occurred (prior to, on or after, as the case may be, the giving, by
the holders of such Notes, of the required Change of Control Purchase Notice),
and is continuing an Event of Default (other than a default in the payment of
the Change of Control Purchase Price with respect to such Notes).
SECTION 3.07. Deposit of Change of Control Purchase Price. On or
prior to the Change of Control Purchase Date, the Company shall deposit with
the Trustee (or, if the Company or a Subsidiary or an Affiliate of either of
them is acting as paying agent, shall segregate and hold in trust as provided
in Section 4.04(c)) an amount of cash in immediately available funds sufficient
to pay the aggregate Change of Control Purchase Price of all the Notes or
portions thereof which are to be purchased on the Change of Control Purchase
Date. Upon such deposit, the Company shall be deemed to have satisfied its
obligations to purchase Notes pursuant to Section 3.05. If cash sufficient to
pay the Change of Control Purchase Price of all Notes or portions thereof to be
purchased on the Change of Control Purchase Date is deposited with the Trustee
as of the Change of Control Purchase Date, interest shall cease to accrue
(whether or not any such Note is delivered to the Trustee or any other office
or agency maintained for such purpose) on such Notes (or portions thereof) on
and after the Change of Control Purchase Date, and the holders thereof shall
have no other rights as such (other than the right to receive the Change of
Control Purchase Price, upon surrender of such Notes).
SECTION 3.08. Covenant to comply with securities laws upon purchase
of Notes. In connection with any offer to purchase or any purchase of
securities under Section 3.05 hereof, the Company shall (i) comply with Section
14(e) under the Exchange Act (or any successor provision thereof), if
applicable, and (ii) otherwise comply with all Federal and state securities
laws regulating the purchase of the Notes so as to permit the rights and
obligations under Section 4.05 to be exercised in the time and in the manner
specified in Sections 4.05 and 4.06.
SECTION 3.09. Repayment to the Company. The Trustee shall return to
the Company any cash, together with interest or dividends, if any, thereon
(subject to the provisions of Section 7.05) held by it for the payment of the
Change of Control Purchase Price of the Notes that remain unclaimed as provided
in Section 12.04 hereof; provided, however, that to the extent that the
aggregate amount of cash deposited by the Company pursuant to Section 3.07
exceeds the aggregate Change of Control Purchase Price of the Notes or portions
thereof to be purchased on the Change of Control Purchase Date, then promptly
after the Change of Control Purchase Date, the Trustee shall return any such
excess to the Company together with interest or dividends, if any, thereon
(subject to the provisions of Section 7.05).
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ARTICLE FOUR
PARTICULAR COVENANTS OF THE COMPANY
The Company covenants as follows:
SECTION 4.01. Payments on the Notes. The Company will duly and
punctually pay or cause to be paid the principal of, premium, if any, Change of
Control Purchase Price, Asset Sale Purchase Price and interest on each of the
Notes at the time and place such amounts may become due and payable and in the
manner provided in the Notes and this Indenture.
SECTION 4.02. Maintenance of office or agency for registration of
transfer, exchange and payment of Notes. So long as any of the Notes shall
remain outstanding, the Company will maintain an office or agency in the
Borough of Manhattan, City of New York, State of New York, where the Notes may
be surrendered for exchange or registration of transfer as in this Indenture
provided, and where notices and demands to or upon the Company in respect to
the Notes or of this Indenture may be served, and where the Notes may be
presented or surrendered for payment, redemption or purchase. The Company may
also from time to time designate one or more other offices or agencies where
the Notes may be presented or surrendered for any or all such purposes and may
from time to time rescind such designations; provided, however, that no such
designation or rescission shall in any manner relieve the Company of its
obligation to maintain an office or agency in the Borough of Manhattan, City of
New York, State of New York for such purposes. The Company will give to the
Trustee notice of the location of any such office or agency and of any change
of location thereof. In case the Company 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, such surrenders, presentations and demands may
be made and notices may be served at the principal office of the Trustee in St.
Paul, Minnesota, and the Company hereby appoints the Trustee its agent to
receive at the aforesaid office all such surrenders, presentations, notices and
demands.
SECTION 4.03. Appointment to fill a vacancy in the office of Trustee.
The Company, whenever necessary to avoid or fill a vacancy in the office of
Trustee, will appoint, in the manner provided in Section 7.10, a Trustee, so
that there shall at all times be a Trustee hereunder.
SECTION 4.04. Provision as to paying agent.
(a) If the Company 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 4.04,
(1) that it will hold all sums held by it as such agent for
the payment of the principal of, premium, if any, Change of Control
Purchase Price, Asset Sale Purchase Price or interest on the Notes
(whether such sums have been paid to it by the Company or by any other
obligor on the Notes) in trust for the benefit of the holders of the
Notes, and will notify the Trustee of the receipt of sums to be so
held,
(2) that it will give the Trustee notice of any failure by
the Company (or by any other obligor on the Notes) to make any payment
of the principal of, premium, if any, Change of
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Control Purchase Price, Asset Sale Purchase Price or interest on the
Notes when the same shall be due and payable, and
(3) that it will at any time during the continuance of any
Event of Default specified in subsection (a) or (b) of Section 6.01,
upon the written request of the Trustee, deliver to the Trustee all
sums so held in trust by it.
If any obligations under the Credit Agreement are outstanding, the
Company will notify the Bank Agent of the name and address of any paying agent
other than the Company or the Trustee.
(b) If the Company shall not act as its own paying agent, it will,
prior to each due date of the principal of, premium, if any, Change of Control
Purchase Price, Asset Sale Purchase Price or interest on any Notes, deposit
with such paying agent a sum sufficient to pay the principal, premium, if any,
Change of Control Purchase Price, Asset Sale Purchase Price or interest so
becoming due, such sum to be held in trust for the benefit of the holders of
Notes entitled to such principal, premium, if any, Change of Control Purchase
Price, Asset Sale Purchase Price or interest, and (unless such paying agent is
the Trustee) the Company will promptly notify the Trustee of its failure so to
act.
(c) If the Company shall act as its own paying agent, it will, on or
before each due date of the principal of, premium, if any, Change of Control
Purchase Price, Asset Sale Purchase Price or interest on the Notes, set aside,
segregate and hold in trust for the benefit of the persons entitled thereto, a
sum sufficient to pay such principal, premium, if any, Change of Control
Purchase Price, Asset Sale Purchase Price or interest so becoming due and will
notify the Trustee of any failure to take such action.
(d) Anything in this Section 4.04 to the contrary notwithstanding,
the Company 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 it, or by any paying agent hereunder,
as required by this Section 4.04, such sums to be held by the Trustee upon the
trusts herein contained.
(e) Anything in this Section 4.04 to the contrary notwithstanding,
the agreement to hold sums in trust as provided in this Section 4.04 is subject
to the provisions of Sections 12.03 and 12.04.
SECTION 4.05. Maintenance of corporate existence. Subject to Article
11, so long as any of the Notes shall remain outstanding, the Company will at
all times (except as otherwise provided or permitted in this Section 4.05 or
elsewhere in this Indenture) do or cause to be done all things necessary to
preserve and keep in full force and effect its corporate existence and the
corporate existence of each Subsidiary; provided, however, that nothing herein
shall require the Company to continue the corporate existence of any Subsidiary
other than a Subsidiary Guarantor (so long as any such Subsidiary is a
Subsidiary Guarantor) if in the judgment of the Company it shall be necessary,
advisable or in the interest of the Company to discontinue the same; and
provided, further, that any Subsidiary Guarantor may:
(a) merge or consolidate with or into the Company or any other
Subsidiary Guarantor or transfer all or substantially all of its property to
the Company or any other Subsidiary Guarantor;
(b) merge or consolidate with or into any other Person or transfer
all or substantially all of its property to any other Person as provided in
Section 15.03; and
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(c) liquidate or dissolve under the laws of its jurisdiction of
formation, provided that such Subsidiary Guarantor is wholly owned directly by
the Company and/or another Subsidiary Guarantor.
SECTION 4.06. Officers' Certificate as to default and statement as to
compliance. The Company will, so long as any of the Notes are outstanding:
(a) deliver to the Trustee, promptly upon becoming aware of any
Event of Default or any event which after the passage of time or notice would
become an Event of Default, an Officers' Certificate specifying such event or
Event of Default;
(b) deliver to the Trustee within one hundred and twenty days after
the end of each fiscal year of the Company, beginning with the fiscal year
ending December 31, 1996, a statement as to compliance signed on behalf of the
Company by the Chairman of the Board or the President or any Vice President and
by the Chief Financial Officer, Treasurer or Controller of the Company stating
as to each signer thereof that:
(1) a review of the activities of the Company during such
year and of performance under this Indenture has been made under his
supervision, and
(2) to the best of his knowledge, based on such review,
there is no Event of Default or event which with notice or the passage
of time would become an Event of Default which has occurred and is
continuing, or, if there is such an event or Event of Default,
specifying each such event or Event of Default known to him and the
nature and status thereof; and
(c) deliver to the Trustee within five days after becoming aware of
the occurrence thereof written notice of any acceleration which, with the
giving of notice and the lapse of time, would be an Event of Default within the
meaning of Section 6.01(d).
SECTION 4.07. Usury laws. The Company, to the extent it may lawfully
do so, will not voluntarily claim, and will actively resist any attempts to
claim, the benefit of any usury laws against any holder of the Notes.
SECTION 4.08. Restrictions on transactions with Affiliates and
Unrestricted Subsidiaries.
(a) The Company shall not, and shall not permit any of its
Subsidiaries or its Non-Affiliate Joint Ventures to, enter into any transaction
or series of related transactions with any Affiliate or Unrestricted Subsidiary
of the Company, unless:
(i) the terms thereof are no less favorable to the Company,
such Subsidiary or such Non-Affiliate Joint Venture, as the case may
be, than those that could reasonably be expected to be obtained in a
comparable transaction with an unrelated Person,
(ii) such transaction or series of related transactions shall
have been approved as meeting such standard, in good faith, by a
majority of the independent members of the Board of Directors of the
Company evidenced by a Board Resolution and
(iii) if the amount of such transaction or the aggregate
amount of such series of related transactions is greater than
$10,000,000 (which amount shall be calculated excluding the amount
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of Principal Products transferred to or from an Unrestricted
Subsidiary in accordance with the proviso at the end of this clause
(iii)), the Company, such Subsidiary and/or such Non-Affiliate Joint
Venture, as the case may be, shall have received an opinion that such
transaction or series of related transactions is fair to the Company,
such Subsidiary and/or such Non-Affiliate Joint Venture, as the case
may be, from a financial point of view, from an independent investment
banking firm of national standing selected by the Company, provided
that, in the case of this clause (iii), the Company, such Subsidiary
and/or such Non-Affiliate Joint Venture shall not be required to
procure any such opinion to the extent that such transaction involves
the purchase or sale for cash of Principal Products from or to an
Unrestricted Subsidiary (which Principal Products are used by the
purchaser thereof in its operations in the ordinary course of
business).
The Company shall deliver to the Trustee, within 60 days after the end of each
fiscal quarter of the Company, an Officers' Certificate which (x) shall specify
the aggregate dollar amount of transactions (other than transactions referred
to in Section 4.08(b) or in the proviso at the end of clause (iii) of this
Section 4.08(a)) with Affiliates or Unrestricted Subsidiaries of the Company
occurring during such fiscal quarter, and (y) with respect to any transaction
with an Affiliate or Unrestricted Subsidiary of the Company, or series of
related transactions (other than transactions referred to in Section 4.08(b) or
in the proviso at the end of clause (iii) of this Section 4.08(a)) with
Affiliates or Unrestricted Subsidiaries of the Company, occurring during such
fiscal quarter, shall briefly describe such transaction or transactions.
(b) The provisions contained in the foregoing paragraphs of this
Section 4.08 shall not apply to:
(i) the making of any Restricted Payments, Restricted
Investments and Unrestricted Subsidiary Investments otherwise
permitted by Section 4.09 (other than 4.09(b)(IV)),
(ii) the making of payments permitted by the Tax Sharing
Agreements,
(iii) the making of payments to MAXXAM for reimbursement for
actual services provided thereby to the Company or its Subsidiaries or
Non-Affiliate Joint Ventures based on actual costs and an allocable
share of overhead expenses,
(iv) compensation (in the form of reasonable director's fees
and reimbursement or advancement of reasonable out-of-pocket expenses)
paid to any director of the Company or its Subsidiaries or
Non-Affiliate Joint Ventures for services rendered in such person's
capacity as a director and indemnification and directors' and
officers' liability insurance in connection therewith,
(v) compensation, indemnification and other benefits paid or
made available to officers and employees of the Company or its
Subsidiaries or Non-Affiliate Joint Ventures for services actually
rendered, comparable to those generally paid or made available by
entities engaged in the same or similar businesses (including
reimbursement or advancement of reasonable out-of-pocket expenses and
directors' and officers' liability insurance),
(vi) loans to officers, directors and employees of the
Company or its Subsidiaries for business or personal purposes and
other loans and advances to such officers, directors and employees for
travel, entertainment, moving and other relocation expenses, in each
case made
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in the ordinary course of business and consistent with past practices
of the Company and its Subsidiaries,
(vii) any amendment to the Existing Intercompany Note that
extends the maturity thereof or reduces the interest rate thereon, or
any other amendment thereto that does not materially adversely affect
the holders of the Notes,
(viii) the dividend by the Company of all or any portion of the
Existing Intercompany Note and accrued interest thereon,
(ix) any merger, consolidation, transfer or sale permitted by
Section 11.01(b), and
(x) any amendment to the Tax Sharing Agreements, provided
that a majority of the independent members of the Board of Directors
of the Company evidenced by a Board Resolution determines that such
amendment would not materially adversely affect the holders of the
Notes. SECTION 4.09. Limitations on Restricted Payments, Restricted
Investments and Unrestricted Subsidiary
Investments.
(a) The Company shall not, directly or indirectly, (i) declare or
pay any dividend or make any distribution in respect of its Capital Stock
(other than dividends payable in Capital Stock of the Company other than
Redeemable Stock), (ii) make or permit any of its Subsidiaries to make any
payment on account of the purchase, redemption or other acquisition or
retirement of any Capital Stock of the Company other than through the issuance
solely of Capital Stock of the Company (other than Redeemable Stock) or rights
thereto, provided that any Subsidiary of the Company may purchase Capital Stock
of the Company from the Company or from any other Subsidiary of the Company
(which purchase shall not be a Restricted Payment or a Restricted Investment),
(iii) make or permit any of its Subsidiaries to make any voluntary purchase,
redemption or other acquisition or retirement for value of any Indebtedness
that is subordinated (pursuant to its terms) in right and priority of payment
to the Notes or any Subsidiary Guarantor's obligations under its Guarantee, as
the case may be, other than purchases, redemptions or other acquisitions or
retirements of Permitted Indebtedness described in clause (b) of the definition
thereof or purchases, redemptions or other acquisitions otherwise permitted by
the terms of this Indenture (each of the foregoing in clauses (i), (ii) and
(iii), a "Restricted Payment"), (iv) to the extent the Company or its
Subsidiaries exercise actual control over a Non-Affiliate Joint Venture
existing on the date of this Indenture or formed or acquired after the date of
this Indenture (each a "Controlled Non-Affiliate Joint Venture"), permit such
Controlled Non-Affiliate Joint Venture to make any Restricted Investment, (v)
make or permit any of its Subsidiaries to make any Restricted Investment or
(vi) make or permit any of its Subsidiaries to make any Unrestricted Subsidiary
Investment, unless at the time of, and after giving effect to, each such
Restricted Payment, Restricted Investment or Unrestricted Subsidiary
Investment:
(A) no Event of Default (and no event that, after notice or
lapse of time or both, would become an Event of Default) shall have
occurred and be continuing (or would occur and be continuing after
giving effect thereto); and
(B) the Consolidated Fixed Charge Coverage Ratio of the
Company is greater than 2.0 to 1; and
(C) the sum of:
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(x) the aggregate amount expended for all Restricted
Payments after December 31, 1992,
(y) the aggregate amount expended for all Restricted
Investments after the date of the 9 7/8% Note Indenture (less
the amount of (1) such Restricted Investments returned in cash,
or in property if made in property, (2) any guarantee that
constitutes a Restricted Investment, to the extent it has been
released, and (3) any direct liabilities or obligations to be
assumed or discharged in connection with such Restricted
Investments (in either case without recourse to the Company, any
of its Subsidiaries or any Controlled Non-Affiliate Joint
Venture) if such liability or obligation had been a liability or
obligation of the Company, any of its Subsidiaries or any
Controlled Non-Affiliate Joint Venture), and
(z) the aggregate amount of Unrestricted Subsidiary
Investments Outstanding
(in each case, the amount expended for such Restricted Payments,
Restricted Investments and Unrestricted Subsidiary Investments or the
amount of any Restricted Investments returned, if paid or returned in
property other than in cash or a sum certain guaranteed, to be the
Fair Market Value of such property), would not exceed the sum of:
(I) 50% of the Consolidated Net Income of the Company (or,
if the aggregate Consolidated Net Income of the Company for any such
period shall be a deficit, minus 100% of such deficit) accrued on a
cumulative basis for the period (taken as one accounting period) from
January 1, 1993 to the end of the Company's most recently ended fiscal
quarter for which financial statements are available at the time such
Restricted Payment, Restricted Investment or Unrestricted Subsidiary
Investment is being made,
(II) the aggregate net proceeds, including the Fair Market
Value of property other than cash, received by the Company as capital
contributions to the Company after December 31, 1992, or from the
issue or sale (other than to a Non-Affiliate Joint Venture or to a
Subsidiary or an Unrestricted Subsidiary of the Company), after
December 31, 1992, of Capital Stock other than Redeemable Stock
(including Capital Stock, other than Redeemable Stock, issued upon the
conversion of, or in exchange for, indebtedness or Redeemable Stock,
and including upon exercise of warrants or options or other rights to
purchase such Capital Stock, issued after December 31, 1992), or from
the issue or sale, after December 31, 1992 of any debt or other
security of the Company convertible or exercisable into such Capital
Stock that has been so converted or exercised, and
(III) 50% of any dividends or other distributions consisting
of cash or Cash Equivalents received, directly or indirectly, by the
Company or a Subsidiary of the Company that is a Subsidiary Guarantor
after the date of this Indenture from any Unrestricted Subsidiary to
the extent that such dividends or other distributions are not required
to reduce the amount of the Unrestricted Subsidiary Investments
Outstanding in respect of such Unrestricted Subsidiary to zero;
provided, however, that in no event shall the Company make, or permit
any of its Subsidiaries to make, a Restricted Payment, Restricted
Investment or Unrestricted Subsidiary Investment pursuant to this
Section 4.09(a) to or in MAXXAM or any Affiliate of MAXXAM if, after
giving effect thereto, (A) the aggregate amount of all Restricted
Payments, Restricted Investments (less
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the amount of (1) such Restricted Investments returned in cash, or in
property if made in property, (2) any guarantee that constitutes a
Restricted Investment, to the extent it has been released, and (3) any
direct liabilities or obligations to be assumed or discharged in
connection with such Restricted Investments (in either case without
recourse to the Company, any of its Subsidiaries or any Controlled
Non-Affiliate Joint Venture) if such liability or obligation had been
a liability or obligation of the Company, any of its Subsidiaries or
any Controlled Non-Affiliate Joint Venture) and Unrestricted
Subsidiary Investments Outstanding made pursuant to this Section
4.09(a) in any calendar year to or in MAXXAM or any Affiliate of
MAXXAM, less (B) the aggregate amount of such Restricted Payments and
Restricted Investments made to or in KAC in such calendar year which
are distributed or paid within thirty days thereafter by KAC to its
holders of Common Stock other than MAXXAM and any Affiliate of MAXXAM,
would exceed (C) $75,000,000; and provided, further, that
notwithstanding the foregoing, the Company may make any such
Restricted Payment, Restricted Investment or Unrestricted Subsidiary
Investment to or in MAXXAM or any Affiliate of MAXXAM if, after giving
pro forma effect thereto, the Company's senior debt rating would be
Baa3 (or the equivalent) or better by Moody's Investors Service, Inc.
(or a successor rating agency) or BBB (or the equivalent) or better by
Standard & Poor's Corporation (or a successor rating agency).
(b) The foregoing provisions of this Section 4.09 shall not be
violated by reason of:
(I) the payment of any dividend or distribution or the
redemption of any securities within 60 days after the date of
declaration of such dividend or distribution or the giving of the
formal notice by the Company of such redemption, if at said date of
declaration of such dividend or distribution or the giving of the
formal notice of such redemption, such dividend, distribution or
redemption would have complied with Section 4.09(a);
(II) the retirement of any shares of the Company's Capital
Stock by exchange for, or out of the proceeds of, the substantially
concurrent sale (other than to a Non-Affiliate Joint Venture or to a
Subsidiary or an Unrestricted Subsidiary of the Company) of other
shares of its Capital Stock other than Redeemable Stock or out of the
proceeds of a substantially concurrent capital contribution to the
Company, provided, however, that, to the extent the proceeds are so
used, a sale of Capital Stock or capital contribution permitted by
this clause (II) shall be excluded in determining the aggregate net
proceeds received by the Company referred to under clause (II) of
Section 4.09(a);
(III) the payments provided for by clauses (ii), (iii), (iv)
and (v) and the transactions described in clauses (vi), (vii), (viii)
and (ix) (so long as, in the case of clause (ix), immediately
following such transaction, the Consolidated Net Worth of the entity
that survives such transaction is not materially lower than the
Consolidated Net Worth of the Company immediately prior to such
transaction) of Section 4.08(b);
(IV) the voluntary purchase, redemption or other acquisition
or retirement for value of Indebtedness that is subordinated (pursuant
to its terms) in right and priority of payment to the Notes or any
Subsidiary Guarantor's obligation under its Guarantee, as the case may
be, to the extent that the aggregate amount expended (exclusive of
amounts expended pursuant to clauses (V) and (VIII) of this Section
4.09(b)) for all such voluntary purchases, redemptions or other
acquisitions or retirements after the date of the 9 7/8% Note
Indenture (the amount expended for such purchases, redemptions or
other acquisitions or retirements, if paid in property other than
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in cash or a sum certain guaranteed, to be the Fair Market Value of
such property) does not exceed the aggregate net proceeds, including
the Fair Market Value of property other than cash, received by the
Company or any Subsidiary Guarantor from the issue or sale (other than
an issuance or sale to the Company, a Non-Affiliate Joint Venture or a
Subsidiary or Unrestricted Subsidiary of the Company), after the date
of the 9 7/8% Note Indenture, of Indebtedness that is subordinated
(pursuant to its terms) in right and priority of payment to the Notes
or such Subsidiary Guarantor's obligation under its Guarantee, as the
case may be, and that is otherwise permitted to be incurred pursuant
to this Indenture, provided, that, to the extent the proceeds of
Indebtedness so subordinated to the Notes or any Subsidiary
Guarantor's obligation under its Guarantee, as the case may be, are so
used, the net proceeds of issuance of any such Indebtedness upon
conversion into Capital Stock shall not be included in determining the
aggregate net proceeds received by the Company referred to under
clause (II) of Section 4.09(a);
(V) the voluntary purchase, redemption or other acquisition
or retirement for value of any Indebtedness that is subordinated
(pursuant to its terms) in right and priority of payment to the Notes
or any Subsidiary Guarantor's obligation under its Guarantee, as the
case may be, by exchange for, or out of the proceeds of, the
substantially concurrent sale (other than to a Non-Affiliate Joint
Venture or to a Subsidiary or an Unrestricted Subsidiary of the
Company) of Capital Stock (other than Redeemable Stock) of the
Company, provided, however, that, to the extent the proceeds are so
used, the issuance of Capital Stock as permitted by this clause (V)
shall not be included in determining the aggregate net proceeds
received by the Company referred to under clause (II) of Section
4.09(a);
(VI) the payment of dividends on, and the purchase,
redemption, retirement or other acquisition of, the USWA Preferred
Stock or the Preferred Stock ($100), provided that no such payment is
made, directly or indirectly, to an Affiliate of the Company;
(VII) the payment to KAC of an amount not to exceed $300,000
in any fiscal year for the payment of KAC's reasonable out-of-pocket
expenses, provided that no part of such amount is paid directly or
indirectly to any other Affiliate of the Company and that, at the time
of each such payment, the Company is in compliance with clause (A) of
Section 4.09(a);
(VIII) Restricted Payments, Restricted Investments and
Unrestricted Subsidiary Investments after February 1, 1993, other than
Restricted Payments, Restricted Investments and Unrestricted
Subsidiary Investments permitted by Section 4.09(a) or clauses (I)
through (VII) of Section 4.09(b), in an aggregate amount such that the
sum of:
(x) the aggregate amount expended for all such
Restricted Payments after February 1, 1993 made pursuant to this
clause (VIII);
(y) the aggregate amount of all Restricted Investments
made after February 1, 1993 pursuant to this clause (VIII) (less
the amount of (1) such Restricted Investments returned in cash,
or in property if made in property, (2) any guarantee that
constitutes a Restricted Investment, to the extent it has been
released, and (3) any direct liabilities or obligations to be
assumed or discharged in connection with such Restricted
Investments (in either case without recourse to the Company, any
of its Subsidiaries or any Controlled Non-Affiliate Joint
Venture) if such liability or obligation had been a liability or
obligation of the Company, any of its Subsidiaries or any
Controlled Non-Affiliate Joint Venture); and
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(z) the aggregate amount of Unrestricted Subsidiary
Investments Outstanding made pursuant to this clause (VIII)
(in each case, the amount expended for such Restricted Payments,
Restricted Investments and Unrestricted Subsidiary Investments or the
amount of any Restricted Investments returned, if paid or returned in
property other than in cash or a sum certain guaranteed, to be the
Fair Market Value of such property) would not exceed $50,000,000,
provided that at the time of each such Restricted Payment, Restricted
Investment or Unrestricted Subsidiary Investment made pursuant to this
clause (VIII), no Event of Default (and no event that, after notice or
lapse of time or both, would become an Event of Default) shall have
occurred and be continuing (or would occur and be continuing after
giving effect thereto); and provided, further, that in no event shall
the Company make, or permit any of its Subsidiaries to make, a
Restricted Payment, Restricted Investment or Unrestricted Subsidiary
Investment pursuant to this clause (VIII) to or in MAXXAM or any
Affiliate of MAXXAM if, after giving effect thereto, (A) the aggregate
amount of all Restricted Payments, Restricted Investments (less the
amount of (1) such Restricted Investments returned in cash, or in
property if made in property, (2) any guarantee that constitutes a
Restricted Investment, to the extent it has been released, and (3) any
direct liabilities or obligations to be assumed or discharged in
connection with such Restricted Investments (in either case without
recourse to the Company, any of its Subsidiaries or any Controlled
Non-Affiliate Joint Venture) if such liability or obligation had been
a liability or obligation of the Company, any of its Subsidiaries or
any Controlled Non-Affiliate Joint Venture) and Unrestricted
Subsidiary Investments Outstanding made pursuant to this clause (VIII)
to or in MAXXAM or any Affiliate of MAXXAM, less (B) the aggregate
amount of such Restricted Payments and Restricted Investments made to
or in KAC which are distributed or paid within thirty days thereafter
by KAC to its holders of Common Stock other than MAXXAM and Affiliates
of MAXXAM, would exceed (C) $20,000,000; and
(IX) in the event that the Company merges with or into KAC and
the Preferred Dividend Intercompany Notes are extinguished, the
payment of dividends on shares of KAC's Preferred Redeemable Increased
Dividend Equity Securities, 8.255% PRIDES, Convertible Preferred Stock
(the "PRIDES") and any other preferred stock of KAC the proceeds of
which gave rise to a Preferred Dividend Intercompany Note, in an
aggregate amount not to exceed the outstanding principal amount of
such Preferred Dividend Intercompany Notes at the time of such merger.
No payments and other transfers made under clauses (II) through (VII) and (IX)
of this Section 4.09(b) shall reduce the amount available for Restricted
Payments, Restricted Investments and Unrestricted Subsidiary Investments under
Section 4.09(a); payments and other transfers made under clauses (I) and (VIII)
of this Section 4.09(b) shall reduce the amount available for Restricted
Payments, Restricted Investments and Unrestricted Subsidiary Investments under
Section 4.09(a).
The Board of Directors of the Company may designate any Subsidiary to
be an Unrestricted Subsidiary if such designation would not cause an Event of
Default (or event that, after notice or lapse of time or both, would become an
Event of Default). For purposes of making such determination, all outstanding
Unrestricted Subsidiary Investments by the Company and its Subsidiaries in the
Unrestricted Subsidiary so designated will be deemed to be Unrestricted
Subsidiary Investments Outstanding at the time of such designation and will
reduce the amount available for Restricted Payments, Restricted Investments and
Unrestricted Subsidiary Investments under Section 4.09(a). All such
Unrestricted Subsidiary Investments Outstanding will be deemed to have been
made at the time of such designation
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and to be in an amount equal to the greater of (A) the net book value of such
Unrestricted Subsidiary Investments at the time of such designation and (B) the
Fair Market Value of such Unrestricted Subsidiary Investments at the time of
such designation. Such designation will only be permitted if such Unrestricted
Subsidiary Investments would be permitted at such time and if such Subsidiary
otherwise meets the definition of an Unrestricted Subsidiary.
SECTION 4.10. Limitation on Indebtedness and Preferred Stock.
(a) The Company shall not, and shall not permit any of its
Subsidiaries to, directly or indirectly, create, incur, issue, assume,
guarantee or become liable with respect to, or extend the maturity of or become
liable for the payment of, contingently or otherwise (collectively, "Incur"),
any preferred stock (including preference stock) or Indebtedness, except that,
without duplication, the Company, the Subsidiary Guarantors and Alpart may
Incur preferred stock (including preference stock) or Indebtedness (including,
without duplication, guarantees of Indebtedness of the Company and its
Subsidiaries otherwise permitted by this Indenture) if after giving effect
thereto and the receipt and application of the proceeds therefrom, and assuming
that the full amount of Indebtedness permitted to be Incurred under Section
4.10(b)(ii) (after taking into account any reduction in such amount as set
forth in such Section 4.10(b)(ii)) has been Incurred (assuming, for purposes of
this calculation, an interest rate on such additional Indebtedness equal to the
weighted average interest rate on the Indebtedness then outstanding under
Section 4.10(b)(ii)), the Consolidated Fixed Charge Coverage Ratio of the
Company is greater than 2.0 to 1; provided, however, that Indebtedness of
Alpart Incurred pursuant to this clause (a) shall not exceed an aggregate of
$150,000,000 at any one time outstanding, plus an amount equal to the
reasonable fees and expenses in connection with the Incurrence of such
Indebtedness.
(b) Notwithstanding the foregoing paragraph (a) of this Section
4.10, the following shall be permitted:
(i) the Company and the Subsidiary Guarantors may Incur
Indebtedness in respect of the Notes;
(ii) the Company and the Subsidiary Guarantors may Incur
Indebtedness (without duplication), and the Bank Guarantors may
guarantee such Indebtedness, under the Credit Agreement, in connection
with Refinancing Sale and Leaseback Transactions or otherwise, in an
aggregate amount at any one time outstanding not to exceed
$400,000,000, as reduced from time to time by any permanent reduction
in such amount as set forth in a Board Resolution;
(iii)(A) Alpart may Incur Indebtedness in an aggregate amount
not to exceed $150,000,000 at any one time outstanding and (B) the
Company, KJC and AJI (without duplication) may Incur Indebtedness in
an aggregate amount not to exceed at any one time outstanding the
product of (I) $150,000,000 multiplied by (II) the Company's
then percentage ownership interest in Alpart; provided, however,
that the aggregate Indebtedness (without duplication) Incurred
pursuant to clauses (A) and (B) of this clause (b)(iii) may not
exceed $150,000,000 at any one time outstanding; and provided, further,
that in each case the proceeds of such Indebtedness
are used solely for capital improvements and expenditures, expansion
and working capital with respect to Alpart and/or to reimburse the
partners of Alpart for advances to Alpart used solely for capital
improvements and expenditures, expansion and working capital with
respect to Alpart, plus in each case an amount equal to the reasonable
fees and expenses in connection with the Incurrence of such
Indebtedness;
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(iv) the Company and/or KAAC (without duplication) may
Incur Indebtedness in an amount not to exceed $75,000,000 at any one
time outstanding, the proceeds of which are used solely for capital
improvements and expenditures, expansion and working capital with
respect to QAL and/or to reimburse the stockholders of QAL for
advances to QAL used solely for capital improvements and expenditures,
expansion and working capital with respect to QAL, plus an amount
equal to the reasonable fees and expenses in connection with the
Incurrence of such Indebtedness;
(v) VALCO may Incur Indebtedness, and the Company may
guarantee such Indebtedness, in an aggregate amount (without
duplication) not to exceed $25,000,000 at any one time outstanding,
the proceeds of which are used solely for capital improvements and
expenditures, expansion and working capital with respect to VALCO
and/or to reimburse the shareholders of VALCO for advances to VALCO
used solely for capital improvements and expenditures, expansion and
working capital, plus an amount equal to the reasonable fees and
expenses in connection with the Incurrence of such Indebtedness;
(vi) the Company and its Subsidiaries may Incur
Indebtedness ("Refinancing Indebtedness") that serves to Refinance, in
whole or in part, the Indebtedness permitted by clauses (a) and (b) of
this Section 4.10 (the "Refinanced Indebtedness"), or any one or more
successive Refinancings of any thereof; provided, however, that:
(A) such Refinancing Indebtedness is in an
aggregate amount not to exceed the aggregate amount of such
Refinanced Indebtedness (including accrued interest thereon
and undrawn amounts under credit arrangements otherwise
permitted to be Incurred pursuant to this Indenture), the
amount of any premium required to be paid in connection with
such Refinancing pursuant to the terms of such Refinanced
Indebtedness or the amount of any reasonable and customary
premium determined by the Company to be necessary to
accomplish such Refinancing by means of a redemption, tender
offer, privately negotiated transaction, defeasance or other
similar transaction, and an amount equal to the reasonable
fees and expenses in connection with the Incurrence of such
Refinancing Indebtedness;
(B) neither the Company nor any of its
Subsidiaries is an obligor of such Refinancing Indebtedness,
except to the extent that such Person (I) was an obligor of
such Refinanced Indebtedness or (II) is otherwise permitted,
at the time such Refinancing Indebtedness is Incurred, to be
an obligor of such Refinancing Indebtedness; and
(C) in the case of any Refinanced Indebtedness
that is subordinated (pursuant to its terms) in right and
priority of payment to the Notes or any Subsidiary Guarantor's
obligation under its Guarantee, as the case may be, such
Refinancing Indebtedness (I) has a final maturity and weighted
average maturity at least as long as such Refinanced
Indebtedness and (II) is subordinated (pursuant to its terms)
in right and priority of payment to the Notes or such
Subsidiary Guarantor's obligation under its Guarantee, as the
case may be, at least to the same extent as such Refinanced
Indebtedness;
(vii) the Company may Incur Capitalized Lease Obligations
not exceeding $50,000,000 at any one time outstanding in connection
with the sale and leaseback of all or a portion of the
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Company's interest in the Center for Technology, provided that the Net
Cash Proceeds therefrom are applied as provided by Section 4.14;
(viii) the Company and its Subsidiaries may Incur
Indebtedness, without duplication, the proceeds of which are used,
directly or indirectly, (A) to finance the construction, acquisition
and/or retrofitting of (I) a bauxite mine or mines and/or related
facilities, (II) an alumina refinery or refineries, and/or related
facilities, (III) an aluminum smelter or smelters and/or related
facilities, and/or (IV) a fabrication plant or plants and/or related
facilities (and, in each case, any direct or indirect interests
therein; collectively, the "Facilities") and the reasonable fees and
expenses in connection with the Incurrence of such Indebtedness, in an
aggregate amount not to exceed $150,000,000 in any fiscal year
(without cumulation of unused amounts to successive years); provided,
however, that the aggregate amount of Indebtedness Incurred pursuant
to subclause (A)(IV) of this clause (viii) shall not exceed
$75,000,000 in any fiscal year (without cumulation of unused amounts
to successive years), (B) to Refinance, in whole or in part, any
Indebtedness permitted by this clause (viii) (including Indebtedness
owed to the Company or a Subsidiary of the Company), or any one or
more successive Refinancings of any thereof, provided, however, that
such Refinancing Indebtedness is in an aggregate amount not to exceed
the aggregate amount of such Refinanced Indebtedness, the amount of
any premium required to be paid in connection with such Refinancing
pursuant to the terms of such Refinanced Indebtedness or the amount of
any reasonable and customary premium determined by the Company to be
necessary to accomplish such Refinancing by means of a redemption,
tender offer, privately negotiated transaction, defeasance, or other
similar transaction, and an amount equal to the reasonable fees and
expenses in connection with the Incurrence of such Refinancing
Indebtedness and/or (C) to provide working capital in connection with
or in respect of any of the Facilities and the reasonable fees and
expenses in connection with the Incurrence of such Indebtedness,
provided that (x) the amount of such Indebtedness that may be Incurred
pursuant to this subclause (C) shall not exceed $40,000,000 in any
fiscal year (without cumulation of unused amounts to successive
years), and provided, further, that the aggregate amount of any
Indebtedness Incurred pursuant to subclauses (A) and (C) of this
clause (viii) shall not exceed $150,000,000 in any fiscal year
(without cumulation of unused amounts to successive years), and (y)
for purposes of computing the amount of Indebtedness Incurred pursuant
to this clause (viii) at any time in any fiscal year, the amount of
Indebtedness Incurred by any Subsidiary of the Company pursuant to
this clause (viii) under lines of credit and/or revolving credit
agreements in such fiscal year to such time shall not be deemed to
exceed the amount of the net borrowings (i.e., aggregate borrowings
during such fiscal year less aggregate repayments during such fiscal
year) by such Subsidiary under lines of credit and/or revolving credit
agreements to such time;
(ix) [intentionally omitted];
(x) the Company and its Subsidiaries may Incur preferred
stock (including preference stock) that is not Redeemable Stock;
provided, however, that in the case of preferred stock (including
preference stock) Incurred by any Subsidiary of the Company that is
not a Subsidiary Guarantor, such preferred stock shall be issued pro
rata to the holders of Capital Stock of such Subsidiary;
(xi) the Company and its Subsidiaries may Incur preferred
stock (including preferred stock and preference stock that is
Redeemable Stock), provided that such preferred stock or
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preference stock is issued to the Company, any of its Subsidiaries or
pro rata to the holders of Capital Stock of any such Subsidiary;
(xii) the Company and its Subsidiaries may Incur Permitted
Indebtedness; and
(xiii) the Company and its Subsidiaries may Incur
Indebtedness in an amount at any one time outstanding not to exceed
$75,000,000, provided that the amount of such Indebtedness that may be
Incurred by Subsidiaries of the Company (other than Subsidiary
Guarantors that are not Permitted Entities) shall not exceed
$50,000,000 at any one time outstanding, and provided, further, that,
to the extent any such Indebtedness is Incurred from a Bank or an
affiliate thereof, the Bank Guarantors may guarantee such
Indebtedness.
(c) Notwithstanding the foregoing, no Subsidiary of the Company
shall assume, guarantee or in any other manner become liable with respect to
any Indebtedness of the Company or a Subsidiary Guarantor (other than such
Subsidiary) ("Other Indebtedness") which is subordinated (pursuant to its
terms) in right and priority of payment to any other Indebtedness of the
Company or such Subsidiary Guarantor, unless such Subsidiary also assumes,
guarantees or otherwise becomes liable with respect to the Notes on a
substantially similar basis for so long as such Subsidiary is liable with
respect to such Other Indebtedness; provided, however, that if such Other
Indebtedness is subordinated (pursuant to its terms) in right and priority of
payment to the Notes or any Subsidiary Guarantor's obligation under its
Guarantee, as the case may be, any such assumption, guarantee or other
liability of such Subsidiary with respect to such Other Indebtedness shall be
subordinated to such Subsidiary's assumption, guarantee or other liability with
respect to the Notes to the same extent as such subordinated Indebtedness is
subordinated to the Notes or such Subsidiary Guarantor's obligation under its
Guarantee, as the case may be; and provided, further, that this paragraph shall
not be applicable to any assumption, guarantee or other liability of any
Subsidiary of the Company which existed at the time such Person became a
Subsidiary of the Company and was not Incurred in connection with, or in
contemplation of, such Person becoming a Subsidiary of the Company, or any
Refinancing Indebtedness in connection therewith complying with Section
4.10(b)(vi) (provided, that the guarantee of such Refinancing Indebtedness is
on substantially the same terms as the guarantee of the Refinanced
Indebtedness). In the event that any Subsidiary of the Company (other than a
Subsidiary Guarantor) is required to guarantee the Notes pursuant to the next
preceding sentence, the Company shall cause such Subsidiary to (a) execute and
deliver to the Trustee a supplemental indenture in form and substance
reasonably satisfactory to the Trustee pursuant to which such Subsidiary shall
be named as an additional Subsidiary Guarantor for so long as such Subsidiary
Guarantor is so obligated with respect to such Other Indebtedness and (b)
deliver to the Trustee an Opinion of Counsel reasonably satisfactory to the
Trustee that such supplemental indenture has been duly executed and delivered
by such Person.
(d) For the purpose of determining compliance with this Section
4.10, in the event that any Indebtedness is permitted to be Incurred pursuant
to more than one clause of Section 4.10(b), the Incurrence of such Indebtedness
shall not limit the amount of Indebtedness otherwise permitted to be Incurred,
and shall not be required to be included under more than one such clause.
SECTION 4.11. Limitation on Liens.
(a) The Company shall not, and shall not permit any of its
Subsidiaries to, create, incur, assume or suffer to exist any Lien upon any of
their respective U.S. Fixed Assets to secure, directly or
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indirectly, any Indebtedness, unless the Notes are equally and ratably secured
on a senior basis for so long as such secured Indebtedness is so secured.
(b) Notwithstanding anything to the contrary, this Section 4.11
shall not prohibit:
(i) Liens on the Permitted Collateral securing
outstanding Indebtedness permitted by this Indenture in an aggregate
principal amount not to exceed the Maximum Secured Amount at the time
such Indebtedness is Incurred;
(ii) Liens in existence on the date of this Indenture
after giving effect thereto which Liens, if such Liens secure a single
or related items of Indebtedness in a principal amount in excess of
$5,000,000, are referred to in Schedule A hereto;
(iii) Liens in favor of the Company or any Subsidiary
Guarantor;
(iv) Liens on U.S. Fixed Assets of a person existing at
the time such person is merged into or consolidated with the Company
or any Subsidiary of the Company, provided, that such Liens were in
existence prior to the contemplation of such merger or consolidation
and do not extend to any other U.S. Fixed Assets of the Company or any
Subsidiary of the Company;
(v) Liens on U.S. Fixed Assets existing at the time of
acquisition thereof by the Company or any Subsidiary of the Company,
provided, that such Liens were in existence prior to the contemplation
of such acquisition and do not extend to any other U.S. Fixed Assets
of the Company or any Subsidiary of the Company;
(vi) Liens securing Indebtedness permitted by clauses
(vii) and (viii) of Section 4.10(b), provided, that such Liens do not
extend to any U.S. Fixed Assets other than the Center for Technology
in the case of clause (vii) and the applicable Facility or Facilities
in the case of clause (viii), and, in each case, together with any
Improvements thereto or thereon and any proceeds thereof;
(vii) Liens securing Indebtedness permitted by clause (e)
of the definition of Permitted Indebtedness;
(viii) Liens securing the Indebtedness permitted by clauses
(iii), (iv) or (v) of Section 4.10(b), provided that such Liens do not
extend to any U.S. Fixed Assets other than (a) Permitted Collateral
(in which case the principal amount of such Indebtedness shall be
included in the calculation of the Maximum Secured Amount for purposes
of clause (i) of this paragraph and such Liens shall only be permitted
if the requirements of clause (i) are satisfied) and (b) the Capital
Stock and assets of Alpart, KJC and AJI in the case of clause (iii),
the Capital Stock and assets of KAAC in the case of clause (iv), and
the Capital Stock and assets of VALCO in the case of clause (v), plus,
in each case, the proceeds thereof;
(ix) Liens securing Indebtedness consisting of Capitalized
Lease Obligations, mortgage financings, industrial revenue bonds or
other monetary obligations, in each case incurred for the purpose of
financing all or any part of the purchase price or cost of
construction or installation of U.S. Fixed Assets used in the business
of the Company and its Subsidiaries, or repairs, additions or
Improvements to such U.S. Fixed Assets, provided, that such Liens (a)
secure
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Indebtedness in an amount not in excess of the original purchase price
or the original cost of any such U.S. Fixed Assets or repair, addition
or Improvement thereto (plus an amount equal to the reasonable fees
and expenses in connection with the Incurrence of such Indebtedness),
(b) do not extend to any other U.S. Fixed Assets (other than
Improvements thereto or thereon and any proceeds thereof) of the
Company or any Subsidiary of the Company (and, in the case of a
repair, addition or Improvement, such Lien extends only to the U.S.
Fixed Assets (and Improvements thereto or thereon) repaired, added to
or improved), and (c) secure Indebtedness incurred no later than 180
days after the acquisition or final completion of such construction,
repair, addition or Improvement;
(x) Liens securing any Refinancings (in whole or in part)
of any Indebtedness secured by the Liens described in clauses (ii),
(iv), (v), (vi), (viii) or (ix) of this paragraph, and any successive
Refinancings of any thereof (together with any increased amount of
such Indebtedness specifically permitted pursuant to Section 4.10(b)
(to cover the reasonable fees and expenses incurred in connection with
a Refinancing)), provided that each such Lien (unless otherwise
permitted by this paragraph) does not extend to any additional U.S.
Fixed Assets (other than Improvements thereto or thereon and any
proceeds thereof);
(xi) Liens on U.S. Fixed Assets securing Indebtedness in
an aggregate principal amount not to exceed $10,000,000; and
(xii) Liens on any U.S. Fixed Assets consisting of
easements, covenants, restrictions, exceptions, reservations and
similar matters which do not materially impair the use of such U.S.
Fixed Assets for the uses for which it is held and which Liens are
granted to secure Indebtedness secured by Liens permitted by the
foregoing clauses (i) through (xi).
(c) For purposes of this Section 4.11, the Notes will be
considered equally and ratably secured on a senior basis with any other Lien if
the Lien securing the Notes is of at least equal priority and covers the same
U.S. Fixed Assets as such other Lien, provided, that if the Indebtedness
secured by such other Lien is expressly subordinated in right and priority of
payment by its terms to the Notes, the Lien securing the Notes will be senior
to such other Lien.
(d) For the purpose of determining compliance with this Section
4.11, in the event that any Lien is permitted pursuant to more than one clause
of Section 4.11(b), such Lien shall not limit any other Lien otherwise
permitted, and shall not be required to be included under more than one such
clause.
SECTION 4.12. Subsidiary guarantees, etc.
(a) If the Company or any Subsidiary Guarantor shall transfer or
cause to be transferred, in one or a series of related transactions, any
property or assets (including, without limitation, businesses, divisions, real
property, assets or equipment) to any Subsidiary of the Company or to any
Non-Affiliate Joint Venture of the Company, the Company shall cause such
transferee Subsidiary or Non-Affiliate Joint Venture to (i) execute and deliver
to the Trustee a supplemental indenture in form and substance reasonably
satisfactory to the Trustee pursuant to which such transferee Subsidiary or
Non-Affiliate Joint Venture shall be named as an additional Subsidiary
Guarantor and (ii) deliver to the Trustee an Opinion of Counsel reasonably
satisfactory to the Trustee that such supplemental indenture has been duly
executed and delivered by such Person.
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(b) The provisions set forth in the immediately preceding
paragraph shall not apply to the following transfers of property or assets by
the Company or any Subsidiary Guarantor:
(A) transfers of property or assets (other than cash) to
Subsidiaries of the Company and Non-Affiliate Joint Ventures, provided
that such transfer is made in exchange for cash in an amount equal to
the Fair Market Value of such property or assets;
(B) transfers of property or assets to Subsidiary
Guarantors;
(C) the use of the proceeds of Indebtedness described in
Sections 4.10(b)(iii), (iv), (v) and (viii);
(D) transfers to Alpart of the proceeds of Indebtedness
described in Section 4.10(a) to the extent that Alpart is an obligor
or guarantor of such Indebtedness;
(E) the provision of, and the payment for, goods and
services, working capital and technology to Subsidiaries of the
Company and Non-Affiliate Joint Ventures, in each case in the ordinary
course of the businesses in which the Company or its Subsidiaries or
its Non-Affiliate Joint Ventures were engaged on the date of this
Indenture or reasonably related extensions thereof;
(F) transfers of assets to a Subsidiary of the Company
immediately prior to the sale of such Subsidiary;
(G) transfers of cash or Cash Equivalents to
Non-Affiliate Joint Ventures engaged or to be engaged in the business
of bauxite mining and/or alumina refining and/or aluminum smelting
and/or fabrication and/or reasonably related extensions thereof;
(H) transfers of cash, Cash Equivalents, property or
other assets to a Permitted Entity in exchange for Permitted Entity
Securities of such Permitted Entity if, immediately after giving
effect to such transfer, such Permitted Entity remains a Permitted
Entity;
(I) transfers of Capital Stock or other equity interests
to the issuer of such Capital Stock or other equity interests such
that immediately after giving effect to such transfer and related
transfers, the proportional beneficial ownership by the transferor of
the class of Capital Stock or equity interests so transferred is not
reduced; and
(J) other transfers of assets, provided that the
aggregate amount thereof (if other than cash, such amount shall be the
Fair Market Value of such asset at the time of such transfer), less
the aggregate amount of such assets returned to the Company or any
Subsidiary Guarantor (if returned other than in cash, the amount of
such assets shall be the Fair Market Value of such assets at the time
so returned), does not exceed, in the aggregate, the greater of (i)
$25,000,000 or (ii) 5% of the Company's Consolidated Net Worth,
calculated after giving effect to such transfers and returns.
(c) If any of the Company's existing or future Subsidiaries (other
than a Bank Guarantor) or existing or future Non-Affiliate Joint Ventures shall
guarantee, directly or indirectly, or become a direct obligor with respect to,
Indebtedness under the Credit Agreement or any Refinancings thereof, the
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Company shall cause each such Subsidiary or Non-Affiliate Joint Venture to (A)
execute and deliver to the Trustee a supplemental indenture in form and
substance reasonably satisfactory to the Trustee pursuant to which such
Subsidiary or Non-Affiliate Joint Venture shall be named as an additional
Subsidiary Guarantor for as long as such Subsidiary or Non- Affiliate Joint
Venture is so obligated with respect to such Indebtedness and (B) deliver to
the Trustee an Opinion of Counsel reasonably satisfactory to the Trustee that
such supplemental indenture has been duly executed and delivered by such
Person.
(d) Sections 4.12(a) and (b) shall not apply to any Restricted
Investment or Restricted Payment otherwise permitted by Section 4.09.
(e) The Company shall not permit any Permitted Entity to cease to
be a Permitted Entity except:
(i) pursuant to a liquidation or dissolution of such
Permitted Entity or a transfer of all or substantially all of the
properties and assets of such Permitted Entity to its Equity Owners in
proportion to their interests, including by way of merger or
consolidation of such Permitted Entity with or into its sole Equity
Owner;
(ii) pursuant to a sale in compliance with Section 4.14 of
all of the Permitted Entity Securities of such Permitted Entity held
directly or indirectly by the Company or any Subsidiary Guarantor; or
(iii) if such Permitted Entity becomes a Subsidiary
Guarantor.
(f) Notwithstanding anything in this Section 4.12 to the contrary,
VALCO shall be permitted to merge with or into, or distribute substantially all
of its assets and liabilities to, a Permitted Entity, provided that, at the
time of such merger or distribution, such Permitted Entity has no more than
$50,000 of assets other than Capital Stock or other similar interests in VALCO.
Upon the consummation of any transaction contemplated by this clause (f), the
entity surviving such merger or distribution shall not be required (i) to
become a Subsidiary Guarantor pursuant to this Section 4.12 or (ii) if such
entity has no assets except as contemplated in this clause (f) or meets the
conditions of this Section 4.12, to remain a Permitted Entity pursuant to this
Section 4.12.
SECTION 4.13. Limitation on dividends and other payment restrictions
affecting Subsidiaries. The Company shall not, and shall not permit its
Subsidiaries to, create or otherwise suffer to exist any consensual
encumbrances or restrictions on the ability of any Subsidiary to pay dividends
or make any other distributions on its Capital Stock or pay any Indebtedness
owed to the Company or any Subsidiaries of the Company or to make loans or
advances or transfer any of its assets to the Company or any Subsidiary of the
Company; provided, however that this Section 4.13 shall not prohibit Permitted
Dividend Encumbrances.
SECTION 4.14. Limitation on Asset Sales.
(a) The Company shall not, and shall not permit any of its
Subsidiaries to, consummate any Asset Sale unless at least 75% of the
consideration therefor received by the Company or such Subsidiary (exclusive of
indemnities) is in the form of cash or Cash Equivalents, provided that this
sentence shall not apply to the sale or disposition of assets as a result of a
foreclosure (or a secured party taking ownership of such assets in lieu of
foreclosure) or as a result of an involuntary proceeding in which the
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Company cannot, directly or through its Subsidiaries, direct the type of
proceeds received. The amount of (i) any liabilities of the Company or any
Subsidiary of the Company that are actually assumed by the transferee in such
Asset Sale, or for which the Company and its Subsidiaries are fully released,
shall be deemed to be cash for purposes of determining the percentage of cash
consideration received by the Company or its Subsidiaries and (ii) any notes or
other obligations received by the Company or any Subsidiary of the Company from
such transferee that are immediately converted (or are converted within thirty
days of the related Asset Sale) by the Company or such Subsidiary into cash
shall be deemed to be cash for purposes of determining the percentage of cash
consideration received by the Company or its Subsidiaries.
(b) The Company shall apply any Net Cash Proceeds received after
the date of this Indenture to (A) the prepayment of Indebtedness in respect of
or under the Credit Agreement and any other Indebtedness of the Company (other
than the Notes) entitled to receive payment pursuant to the terms thereof
(excluding Indebtedness that is subordinated by its terms to the Notes or the
Guarantee thereof) (the "Specified Pari Passu Indebtedness"), unless the
holders thereof elect not to receive such prepayment and (B) an offer to
purchase (an "Asset Sale Offer") the then outstanding Notes, on any Business
Day occurring no later than 175 days after the receipt by the Company (or any
of its Subsidiaries, if applicable) of such Net Cash Proceeds (the "Asset Sale
Purchase Date," which date shall be deferred to the extent necessary to permit
the Asset Sale Offer to remain open for the period required by applicable law),
at a price (the "Asset Sale Purchase Price") equal to 100% of the principal
amount thereof together with accrued and unpaid interest, if any, to but not
including the Asset Sale Purchase Date pursuant to the provisions set forth
below. Such Asset Sale Offer with respect to the Notes shall be in an
aggregate principal amount (the "Asset Sale Offer Amount") equal to the Net
Cash Proceeds (rounded down to the nearest $1,000) from the Asset Sales to
which the Asset Sale Offer relates multiplied by a fraction, the numerator of
which is the principal amount of the Notes outstanding (determined as of the
close of business on the day immediately preceding the date notice of such
Asset Sale Offer is mailed) and the denominator of which is the principal
amount of the Notes outstanding plus the aggregate principal amount of
Indebtedness under the Credit Agreement and the Specified Pari Passu
Indebtedness outstanding (determined as of the close of business on the day
immediately preceding the date notice of such Asset Sale Offer is mailed). If
(x) no Indebtedness is outstanding in respect of or under the Credit Agreement
or the Specified Pari Passu Indebtedness or (y) the holders of such
Indebtedness entitled to receive payment elect not to receive the payments
provided for in the previous sentence, or (z) the application of such Net Cash
Proceeds results in the complete prepayment of such Indebtedness, then in each
case any remaining portion of such Net Cash Proceeds will be required to be
applied to an Asset Sale Offer to purchase the Notes.
(c) Notice of an Asset Sale Offer shall be mailed by the Company
to all holders at their last registered address within 145 days of the receipt
by the Company or any of its Subsidiaries of such Net Cash Proceeds. The Asset
Sale Offer shall remain open from the time of mailing until the last Business
Day before the Asset Sale Purchase Date, but in no event for a period less than
twenty-four days or less than that required by applicable law. The notice
shall state:
(1) that the Asset Sale Offer is being made pursuant to
this Section 4.14;
(2) the Asset Sale Offer Amount, the purchase price and
the Asset Sale Purchase Date;
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(3) the name and address of the Trustee and that Notes
must be surrendered to the Trustee to collect the purchase price;
(4) that any Note not tendered or accepted for payment
will continue to accrue interest;
(5) that any Note accepted for payment pursuant to the
Asset Sale Offer shall cease to accrue interest on and after the Asset
Sale Purchase Date;
(6) that each holder electing to have a Note purchased
pursuant to an Asset Sale Offer will be required to surrender the
Note, with the form entitled "Option of Holder to Elect Purchase" on
the reverse of the Note (the "Asset Sale Purchase Notice") completed,
to the Trustee at the address specified in the notice at least five
Business Days before the Asset Sale Purchase;
(7) that holders will be entitled to withdraw their
election if the Trustee receives, not later than one Business Day
prior to the Asset Sale Purchase Date, a telegram, telex, facsimile
transmission or letter setting forth the name of the holder, the
principal amount of the Notes the holder delivered for purchase, the
certificate number of each Note the holder delivered for purchase and
a statement that such holder is withdrawing his, her or its election
to have such Notes purchased;
(8) that if Notes in a principal amount in excess of the
Asset Sale Offer Amount are surrendered pursuant to the Asset Sale
Offer, the Company shall purchase Notes on a pro rata basis (with such
adjustments as may be deemed appropriate by the Company so that only
Notes in denominations of $1,000 or integral multiples thereof shall
be acquired); and
(9)(x) that Notes may be purchased in whole or in part (in
denominations of $1,000 or integral multiples thereof) and (y) that
holders whose Notes are purchased only in part will be issued new
Notes equal in principal amount to the unpurchased portion of the
Notes surrendered.
On or before the Asset Sale Purchase Date, the Company shall (i)
accept for payment Notes (having denominations of $1,000 or integral multiples
thereof) surrendered pursuant to the Asset Sale Offer (on a pro rata basis if
required pursuant to paragraph (c)(8) above), (ii) deposit by 10:30 a.m. New
York City time, on the Asset Sale Purchase Date, with the Trustee money in
immediately available funds sufficient to pay the Asset Sale Purchase Price of
all Notes or portions thereof so accepted and (iii) deliver Notes so accepted
to the Trustee together with an Officers' Certificate stating the Notes or
portions thereof accepted for payment by the Company. The Trustee shall
promptly mail or deliver to holders of Notes so accepted payment in an amount
equal to the purchase price, and the Company shall execute and the Trustee
shall promptly authenticate and mail or deliver to such holders a new Note
equal in principal amount to any unpurchased portion of the Note surrendered.
Any Notes not so accepted shall be promptly mailed or delivered to the holder
thereof. The Company will publicly announce the results of the Asset Sale
Offer on, or as soon as practicable after, the Asset Sale Purchase Date.
Notwithstanding the foregoing, the Company shall not be required to
make an Asset Sale Offer until the aggregate amount of Net Cash Proceeds so to
be applied pursuant to this Section 4.14 exceeds $25,000,000 (the "Twenty-Five
Million Threshold") and then the total amount of such Net Cash Proceeds shall
be required to be so applied in accordance with this Section 4.14. The Company
may
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credit against its obligation to offer to repurchase Notes pursuant to this
Section 4.14 the principal amount of Notes acquired or held by the Company
subsequent to the date of the Asset Sale giving rise to such Asset Sale Offer
and surrendered for cancellation or redeemed or called for redemption
subsequent to such date and not previously used to satisfy any obligation of
the Company to redeem or offer to purchase Notes. In no event shall any Net
Cash Proceeds that are applied to an Asset Sale Offer be required to be applied
to more than one Asset Sale Offer.
(d) Notwithstanding the provisions of clauses (a) and (b) of this
Section 4.14, the Company shall have no obligation to make an Asset Sale Offer
pursuant to this Section 4.14, if, and to the extent, the Company or any of its
Subsidiaries commits within 140 days of the receipt of such Net Cash Proceeds
to reinvest (whether by acquisition of an existing business or expansion,
including, without limitation, capital expenditures) such Net Cash Proceeds in
one or more of the lines of business (including capital expenditures) in which
the Company or its Subsidiaries or its Non-Affiliate Joint Ventures were
engaged on the date of this Indenture or reasonably related extensions of such
lines of business, provided that such Net Cash Proceeds are substantially so
utilized no later than the last day of the twelfth consecutive month (or, in
the event the amount of such Net Cash Proceeds from a single Asset Sale or
series of related Asset Sales exceeds $200,000,000, the twenty-fourth
consecutive month) following the month in which such Net Cash Proceeds are
received.
(e) Notwithstanding the foregoing, if an Asset Sale consists of a
sale of (i) all or a portion of the property, plant or equipment of the
Company's Gramercy alumina refinery or Nevada micromill, whether now owned or
hereafter acquired, or any proceeds thereof or (ii) any U.S. Fixed Assets
acquired after the date of this Indenture which do not constitute Permitted
Collateral, the Company shall make an Asset Sale Offer with the Net Cash
Proceeds received from such Asset Sale (without regard to the Twenty-Five
Million Threshold) to the extent the Company has not committed within 140 days
of the receipt of such Net Cash Proceeds to reinvest (whether by acquisition of
an existing business or expansion, including, without limitation, capital
expenditures) such Net Cash Proceeds in U.S. Fixed Assets (other than Permitted
Collateral), provided that such Net Cash Proceeds are substantially so utilized
no later than the last day of the twelfth consecutive month (or, in the event
the amount of such Net Cash Proceeds from a single Asset Sale or series of
related Asset Sales exceeds $200,000,000, the twenty-fourth consecutive month)
following the month in which such Net Cash Proceeds are received.
SECTION 4.15. Limitations on Unrestricted Subsidiaries. (i) The
Company shall not permit any of its Unrestricted Subsidiaries to guarantee or
otherwise directly or indirectly provide credit support for any Indebtedness of
the Company or any of its Subsidiaries, (ii) in the event that an Unrestricted
Subsidiary of the Company Incurs Indebtedness that does not involve an
Unrestricted Subsidiary Investment by the Company or any of its Subsidiaries in
such Unrestricted Subsidiary pursuant to the definition of "Unrestricted
Subsidiary Investment," the Company will cause such Unrestricted Subsidiary to
notify the lenders thereof in writing that such lenders will not have any
recourse to the stock or assets of the Company or any of its Subsidiaries and
(iii) the Company shall cause each of its Unrestricted Subsidiaries to have at
all times at least one director on its board of directors that is not a
director or executive officer of the Company or any of its Subsidiaries and to
have at all times at least one executive officer that is not a director or
executive officer of the Company or any of its Subsidiaries (except for any
period not exceeding 30 days following the death or resignation of any such
director or executive officer).
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ARTICLE FIVE
NOTEHOLDERS' LISTS AND REPORTS BY THE
COMPANY AND THE TRUSTEE
SECTION 5.01. Company to furnish Trustee information as to names and
addresses of noteholders. The Company will furnish or cause to be furnished to
the Trustee:
(a) semi-annually, not more than fifteen days after each record
date for the payment of interest, a list, in such form as the Trustee may
reasonably require, of the names and addresses of the noteholders as of such
record date as the case may be, and
(b) at such other times as the Trustee may request in writing,
within thirty days after the receipt by the Company of any such request, a list
of similar form and content as of a date not more than fifteen days prior to
the time such list is furnished;
provided, however, that so long as the Trustee is the Note registrar, no such
list shall be required to be furnished. Any such list may be dated as of a
date not more than fifteen days prior to the time such information is furnished
or caused to be furnished, and need not include information received after such
date.
SECTION 5.02. Preservation and disclosure of lists.
(a) The Trustee shall preserve, in as current a form as is
reasonably practicable, all information as to the names and addresses of the
holders of Notes (1) contained in the most recent list furnished to it as
provided in Section 5.01 and (2) received by it in the capacity of paying agent
(if so acting) or Note registrar.
The Trustee may destroy any list furnished to it as provided in
Section 5.01 upon receipt of a new list so furnished.
(b) In case three or more holders of Notes (hereinafter referred
to as "applicants") apply in writing to the Trustee, and furnish to the Trustee
reasonable proof that each such applicant has owned a Note for a period of at
least six months preceding the date of such application, and such application
states that the applicants desire to communicate with other holders of Notes
with respect to their rights under this Indenture or under the Notes, and is
accompanied by a copy of the form of proxy or other communication which such
applicants propose to transmit, then the Trustee shall, within five Business
Days after the receipt of such application, at its election either
(1) afford such applicants access to the information
preserved at the time by the Trustee in accordance with the provisions
of subsection (a) of this Section 5.02, or
(2) inform such applicants as to the approximate number
of holders of Notes whose names and addresses appear in the
information preserved at the time by the Trustee in accordance with
the provisions of subsection (a) of this Section 5.02, and as to the
approximate cost of mailing to such noteholders the form of proxy or
other communication, if any, specified in such application.
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If the Trustee shall elect not to afford such applicants access to
such information, the Trustee shall, upon the written request of such
applicants, mail to each noteholder whose name and address appears in the
information preserved at the time by the Trustee in accordance with the
provisions of subsection (a) of this Section 5.02, a copy of the form of proxy
or other communication which is specified in such request, with reasonable
promptness after a tender to the Trustee of the material to be mailed and of
payment, or provision for the payment, of the reasonable expenses of mailing,
unless within five days after such tender, the Trustee shall mail to such
applicants and file with the Commission, together with a copy of the material
to be mailed, a written statement to the effect that, in the opinion of the
Trustee, such mailing would be contrary to the best interests of the holders of
Notes or would be in violation of applicable law. Such written statement shall
specify the basis of such opinion. After opportunity for hearing upon the
objections specified in the written statement so filed, the Commission may, and
if demanded by the Trustee or by such applicants shall, enter an order either
sustaining one or more of such objections or refusing to sustain any of them.
If the Commission shall enter an order refusing to sustain any of such
objections, or if, after the entry of an order sustaining one or more of such
objections, the Commission shall find, after notice and opportunity for
hearing, that all objections so sustained have been met, and shall enter an
order so declaring, the Trustee shall mail copies of such material to all
noteholders with reasonable promptness after the entry of such order and the
renewal of such tender; otherwise the Trustee shall be relieved of any
obligation or duty to such applicants respecting their application.
(c) Each and every holder of the Notes, by receiving and holding
the same, agrees with the Company and the Trustee that neither the Company nor
the Trustee nor any paying agent nor the Note registrar shall be held
accountable by reason of the disclosure of any such information as to the names
and addresses of the holders of Notes in accordance with the provisions of
subsection (b) of this Section 5.02, regardless of the source from which such
information was derived, and that the Trustee shall not be held accountable by
reason of mailing any material pursuant to a request made under said subsection
(b), nor shall any such disclosure be deemed a violation of existing law, or
any law hereafter enacted which does not specifically refer to Section 312 of
the Trust Indenture Act of 1939.
SECTION 5.03. Reports by the Company.
(a) The Company covenants and agrees to file with the Trustee
within fifteen days after the Company is required to file the same with the
Commission, copies of the annual reports and of the information, documents and
other reports (or copies of such portions of any of the foregoing as the
Commission may from time to time by rules and regulations prescribe) which the
Company may be required to file with the Commission pursuant to Section 13 or
Section 15(d) of the Exchange Act. If the Company is not subject to the
requirements of Section 13 or 15(d) of the Exchange Act, the Company shall
nonetheless file with the Commission and the Trustee copies of such annual
reports and such information, documents and other reports as it would file if
it were subject to the requirements of Section 13 or 15(d) of the Exchange Act.
(b) The Company covenants and agrees to file with the Trustee and
the Commission, in accordance with the rules and regulations prescribed from
time to time by the Commission, such additional information, documents, and
reports with respect to compliance by the Company with the conditions and
covenants provided for in this Indenture as may be required from time to time
by such rules and regulations, including, in the case of annual reports,
certificates or opinions of independent public accountants, conforming to the
requirements of Section 14.05, as to compliance with conditions or covenants,
compliance with which is subject to verification by accountants.
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(c) The Company covenants and agrees to transmit to the holders of
Notes within thirty days after the filing thereof with the Trustee, in the
manner and to the extent provided in subsection (c) of Section 5.04 with
respect to reports pursuant to subsection (a) of said Section 5.04, such
summaries of any information, documents and reports required to be filed by the
Company pursuant to subsections (a) and (b) of this Section 5.03 as may be
required by rules and regulations prescribed from time to time by the
Commission.
(d) The Company covenants and agrees to furnish to the Trustee,
not less often than annually, a brief certificate from the principal executive
officer, principal financial officer or principal accounting officer as to his
or her knowledge of the Company's compliance with all conditions and covenants
under this Indenture. For purposes of this paragraph (d), such compliance
shall be determined without regard to any period of grace or requirement of
notice provided under this Indenture.
(e) For so long as any Restricted Securities remain outstanding,
the Company and the Subsidiary Guarantors covenant and agree to furnish to the
Holders of the Notes and to securities analysts and prospective investors, upon
their request, the information required to be delivered pursuant to Rule
144A(d)(4) under the Securities Act of 1933.
SECTION 5.04. Reports by the Trustee.
(a) On or before May 15, 1997, and on or before May 15 in every
year thereafter, so long as any Notes are outstanding hereunder, the Trustee,
if required to do so by the provisions of the Trust Indenture Act of 1939,
shall transmit to the noteholders, as hereinafter in this Section 5.04
provided, a brief report dated as of March 15 of the year in which such report
is made with respect to any of the following events which may have occurred
within the previous 12 months (but if no such event has occurred within such
period no report need be transmitted):
(1) any change to its eligibility under Section 7.09 and
its qualifications under Section 7.08;
(2) the creation of or any material change to a
relationship specified in paragraphs (1) through (10) of Section
7.08(c);
(3) the character and amount of any advances (and if the
Trustee elects so to state, the circumstances surrounding the making
thereof) made by the Trustee (as such) which remain unpaid on the date
of such report, and for the reimbursement of which it claims or may
claim a lien or charge, prior to that of the Notes, on any property or
funds held or collected by it as Trustee, except that the Trustee
shall not be required (but may elect) to state such advances if such
advances so remaining unpaid aggregate not more than 0.5% of the
principal amount of the Notes outstanding on the date of such report;
(4) the amount, interest rate, and maturity date of all
other indebtedness owing by the Company (or by any other obligor on
the Notes) to the Trustee in its individual capacity, on the date of
such report, with a brief description of any property held as
collateral security therefor, except an indebtedness based upon a
creditor relationship arising in any manner described in paragraph
(2), (3), (4) or (6) of subsection (b) of Section 7.13;
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(5) any change to the property and funds, if any,
physically in the possession of the Trustee (as such) on the date of
such report; and
(6) any action taken by the Trustee in the performance of
its duties under this Indenture which it has not previously reported
and which in its opinion materially affects the Notes, except action
in respect of a default, notice of which has been or is to be withheld
by it in accordance with the provisions of Section 6.07.
(b) The Trustee shall transmit to the noteholders, as hereinafter
provided, a brief report with respect to the character and amount of any
advances (and if the Trustee elects so to state, the circumstances surrounding
the making thereof) made by the Trustee (as such) since the date of the last
report transmitted pursuant to the provisions of subsection (a) of this Section
5.04 (or if no such report has yet been so transmitted, since the date of
execution of this Indenture), for the reimbursement of which it claims or may
claim a lien or charge prior to that of the Notes on property or funds held or
collected by it as Trustee, and which it has not previously reported pursuant
to this subsection, except that the Trustee shall not be required (but may
elect) to report such advances if such advances remaining unpaid at any time
aggregate 10% or less of the principal amount of Notes outstanding at such
time, such report to be transmitted within ninety days after such time.
(c) Reports pursuant to this Section 5.04 shall be transmitted by
mail (i) to all holders of Notes, as the names and addresses of such holders
appear upon the registry books of the Company, (ii) to all noteholders who
have, within the two years preceding such transmission, filed their names and
addresses with the Trustee for that purpose, and, (iii) except in the case of
reports pursuant to Section 5.04(b), to all holders of Notes whose names and
addresses have been furnished to or obtained by the Trustee pursuant to Section
5.01.
(d) A copy of each such report shall, at the time of such
transmission to noteholders, be filed by the Trustee with each stock exchange
(if any) upon which the Notes are listed or admitted for trading and also with
the Commission. The Company will notify the Trustee when and as the Notes
become listed on any stock exchange.
ARTICLE SIX
REMEDIES OF THE TRUSTEE AND NOTEHOLDERS
ON EVENT OF DEFAULT
SECTION 6.01. Events of Default defined. In case one or more of the
following Events of Default shall have occurred and be continuing:
(a) default in the payment of any installment of interest upon any
of the Notes as and when the same shall become due and payable, and continuance
of such default for a period of thirty days; or
(b) default in the payment of the principal of, Change of Control
Purchase Price, Asset Sale Purchase Price, or premium, if any, on any of the
Notes as and when the same shall become due and payable either at maturity,
upon redemption or purchase by the Company pursuant to Article Three, by
declaration or otherwise; or
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(c) failure on the part of the Company, duly to observe or perform
in any material respect any other of the covenants or agreements on the part of
the Company in the Notes or in this Indenture for a period of sixty days after
the date on which written notice of such failure, which notice must specify the
failure, demand it be remedied and state that the notice is a "Notice of
Default," shall have been given to the Company by the Trustee by registered
mail, which notice the Trustee shall give upon receipt of requests to do so by
the holders of at least 25% of the aggregate principal amount of the Notes at
the time outstanding, or to the Company and the Trustee by the holders of at
least 25% of the aggregate principal amount of the Notes at the time
outstanding; or
(d) a default under any mortgage, indenture, or instrument under
which there may be issued or by which there may be secured or evidenced any
indebtedness for money borrowed by the Company or any Subsidiary, whether such
indebtedness now exists or shall hereafter be created, in an aggregate
principal amount exceeding $25,000,000, which default (a) in the case of a
failure to make payment on any such indebtedness, shall not have been waived,
cured or otherwise ceased to exist within 30 days thereafter, or (b) in the
case of any default other than a payment default referred to in clause (a),
shall have resulted in such indebtedness becoming or being declared due and
payable prior to the date on which it would otherwise have become due and
payable, or with respect to which the principal amount remains unpaid upon its
stated maturity; or
(e) a final judgment which, together with other outstanding final
judgments against the Company and its Significant Subsidiaries, exceeds an
aggregate of $25,000,000 (to the extent such judgments are not covered by valid
and collectible insurance from solvent unaffiliated insurers) shall be entered
against the Company and/or its Significant Subsidiaries and (i) within 30 days
after entry thereof, judgments exceeding such amount shall not have been
discharged, settled or bonded or execution thereof stayed pending appeal or,
within 30 days after the expiration of any such stay, such judgments exceeding
such amount shall not have been discharged, settled or bonded or execution
thereof stayed or (ii) an enforcement proceeding shall have been commenced (and
not discharged, settled or bonded or execution thereof stayed) by any creditor
upon judgments exceeding such amount; or
(f) a court having jurisdiction in the premises shall have entered
a decree or order for relief against the Company 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 Company or for all or any substantial
part of its property, or ordering the winding-up or liquidation of its affairs,
and such decree or order shall have remained unstayed and in effect for a
period of ninety consecutive days; or
(g) the Company shall have commenced a voluntary case under any
applicable bankruptcy, insolvency or other similar law now or hereafter in
effect, or shall have consented to the entry of an order for relief in an
involuntary case under any such law, or shall have consented to the appointment
of or taking possession by a receiver, liquidator, assignee, trustee,
custodian, sequestrator (or similar official) of the Company or for all or any
substantial part of its property, or shall have made an assignment for the
benefit of creditors, or shall have taken any corporate action in furtherance
of any of the foregoing; or
(h) the Guarantee of any Subsidiary Guarantor shall be held to be
unenforceable or invalid by a final non- appealable order or judgment issued by
a court of competent jurisdiction or shall cease for any reason to be in full
force and effect with respect to such Subsidiary Guarantor, or any Subsidiary
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Guarantor or any Person acting by or on behalf of any Subsidiary Guarantor
shall deny or disaffirm its obligations under its Guarantee;
then, in the case of an Event of Default specified in clause (a), (b), (c),
(d), (e) or (h), and in each and every such case, unless the principal of all
the Notes shall have already become due and payable, either the Trustee or the
holders of not less than 25% of the aggregate principal amount of the Notes
then outstanding hereunder, by notice in writing to the Company (and to the
Trustee if given by noteholders), may, and the Trustee shall if requested to do
so by the holders of not less than 25% of the aggregate principal amount of the
Notes then outstanding hereunder, declare the principal amount and accrued
interest to the date of declaration of all the Notes to be due and payable
immediately. Upon any such declaration the same shall become and shall be
immediately due and payable, anything in this Indenture or in the Notes
contained to the contrary notwithstanding. If an Event of Default specified in
clause (f) or (g) above occurs, such amount shall ipso facto become and be
immediately due and payable without any declaration or other act on the part of
the Trustee or any noteholder.
SECTION 6.02. Payment of Notes on default; suit therefor. The
Company covenants that (1) in case default shall be made in the payment of any
installment of interest on any of the Notes, as and when the same shall become
due and payable, and such default shall have continued for a period of thirty
days, or (2) in case default shall be made in the payment of the principal of,
and premium, if any, Change of Control Purchase Price or Asset Sale Purchase
Price on any of the Notes when the same shall have become due and payable,
whether upon maturity of the Notes or upon redemption or purchase by the
Company pursuant to Article Three or upon declaration or otherwise then, upon
demand of the Trustee, the Company will pay to the Trustee, for the benefit of
the holders of the Notes, the whole amount that then shall have become due and
payable on all such Notes for such amounts, as the case may be, with interest
upon the overdue principal, premium, if any, Change of Control Purchase Price
or Asset Sale Purchase Price, as the case may be, and installments of interest
(to the extent permitted by law) at the rate of interest borne by the Notes;
and, in addition thereto, such further amount as shall be sufficient to cover
the costs and expenses of collection, including a reasonable compensation to
the Trustee, its agents, attorneys and counsel, and any expense or liabilities
incurred by the Trustee hereunder other than through its negligence or bad
faith.
In case the Company 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 actions or proceedings at law or in
equity for the collection of the sums so due and unpaid, and may prosecute any
such action or proceeding to judgment or final decree, and may enforce any such
judgment or final decree against the Company or any other obligor upon the
Notes, and collect in the manner provided by law out of the property of the
Company or any other obligor upon the Notes wherever situated the moneys
adjudged or decreed to be payable.
In case there shall be pending proceedings for the bankruptcy or for
the reorganization of the Company or any other obligor upon the Notes under any
applicable bankruptcy, insolvency or similar law or in case a receiver or
trustee shall have been appointed for the property of the Company or such other
obligor, or in case of any other similar judicial proceedings relative to the
Company or any other obligor upon the Notes, or to creditors or property of the
Company or such other obligor, the Trustee, irrespective of whether the
principal, Change of Control Purchase Price or Asset Sale Purchase Price, as
the case may be, of the Notes 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
6.02, shall be entitled and empowered by intervention in such proceedings or
otherwise,
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to file and prove a claim or claims for the whole amount of principal, premium,
if any, Change of Control Purchase Price, Asset Sale Purchase Price and
interest owing and unpaid in respect of the Notes, and to file such other
papers or documents as may be necessary or advisable in order to have the
claims of the Trustee and of the noteholders allowed in any judicial proceeding
relative to the Company or any other obligor upon the Notes, its creditors, or
its property, and to collect and receive any moneys or other property payable
or deliverable on any such claims, and to distribute the same after the
deduction of its reasonable charges and expenses; and any receiver, assignee or
trustee in bankruptcy or reorganization is hereby authorized by each of the
noteholders to make such payments to the Trustee, and, in the event that the
Trustee shall consent to the making of such payments directly to the
noteholders, to pay to the Trustee any amount due it for compensation and
expenses, including reasonable counsel fees incurred by it up to the date of
such distribution. To the extent that such payment of reasonable compensation,
expenses, liabilities and counsel fees out of the estate in any such
proceedings shall be denied for any reason, payment of the same shall be
secured by a lien on, and shall be paid out of, any and all distributions,
dividends, moneys, securities and other property which the holders of the Notes
may be entitled to receive in such proceedings, whether in liquidation or under
any plan of reorganization or arrangement or otherwise.
All rights of action and of asserting claims under this Indenture, or
under any of the Notes, may be enforced by the Trustee without the possession
of any of the Notes, or the production thereof on any trial or other proceeding
relative thereto, and any such suit or proceeding 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 reasonable expenses,
disbursements and compensation of the Trustee, its agents and attorneys, shall
be for the ratable benefit of the holders of the Notes.
SECTION 6.03. Application of moneys collected by Trustee. Any moneys
collected by the Trustee pursuant to Section 6.02 shall be applied to the
payment of all amounts due the Trustee pursuant to Section 7.06 and thereafter
in the order following, at the date or dates fixed by the Trustee for the
distribution of such moneys, upon presentation of the several Notes, and
stamping thereon the payment, if only partially paid, and upon surrender
thereof if fully paid:
FIRST: In case no principal of, Change of Control Purchase
Price or Asset Sale Purchase Price on the outstanding Notes shall have
become due and be unpaid, to the payment of interest on the Notes, in
the order of the maturity of the installments of such interest, with
interest upon the overdue installments of interest (so far as
permitted by law and to the extent that such interest has been
collected by the Trustee) at the rate of interest borne by the Notes,
such payments to be made ratably to the persons entitled thereto,
without discrimination or preference;
SECOND: In case any principal of, Change of Control Purchase
Price or Asset Sale Purchase Price on the outstanding Notes shall have
become due, by declaration or otherwise, to the payment of the whole
amount then owing and unpaid upon the Notes for principal, premium, if
any, Change of Control Purchase Price, Asset Sale Purchase Price and
interest, as the case may be, with interest on the overdue principal,
premium, if any, Change of Control Purchase Price, Asset Sale Purchase
Price and installments of interest (so far as permitted by law and to
the extent that such interest has been collected by the Trustee), as
the case may be, at the rate of interest borne by the Notes; and in
case such moneys shall be insufficient to pay in full the whole amount
so due and unpaid upon the Notes, then to the payment of such
principal, premium, if any, Change of Control Purchase Price, Asset
Sale Purchase Price and interest, without preference or priority of
any one such applicable amount over another, or of any installment of
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interest over any other installment of interest, ratably to the
aggregate of such principal, premium, if any, Change of Control
Purchase Price, Asset Sale Purchase Price and accrued and unpaid
interest; and
THIRD: To the payment of the remainder, if any, to the
Company, its successors or assigns, or to whosoever may be lawfully
entitled to receive the same, or as a court of competent jurisdiction
may direct.
SECTION 6.04. Limitation on suits by holders of Notes. No holder of
any Note shall have any right by virtue or by availing of any provision of this
Indenture to institute any suit, action or proceeding or to seek any remedy in
equity or at law upon or under or with respect to this Indenture or the Notes
or for the appointment of a receiver or trustee, or for any other remedy,
unless such holder previously shall have given to the Trustee written notice of
default and of the continuance thereof, as hereinabove provided, and unless
also the holders of not less than 25% of the aggregate principal amount of the
Notes then outstanding shall have made written request upon the Trustee to
institute such action, suit or proceeding or to seek such remedy 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 sixty days after its receipt
of such notice, request and offer of indemnity, shall have neglected or refused
to institute any such action, suit or proceeding and no direction inconsistent
with such written request shall have been given to the Trustee pursuant to
Section 6.06; it being understood and intended, and being expressly covenanted
by the taker and holder of every Note with every other taker and holder and the
Trustee, that no one or more holders of Notes 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 the holders of any other of such
Notes, 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
Notes. For the protection and enforcement of the provisions of this Section
6.04, each and every noteholder and the Trustee shall be entitled to such
relief as can be given either at law or in equity.
Notwithstanding any other provisions in this Indenture, however, the
right of any holder of any Note to receive payment of the principal of,
premium, if any, Change of Control Purchase Price, Asset Sale Purchase Price
and interest, as the case may be, on such Note, on or after the respective due
dates expressed in such Note, or to institute suit for the enforcement of any
such payment on or after such respective dates or to demand purchase of its
Notes pursuant to Article Three or Section 4.14, shall not be impaired or
affected without the consent of such holder.
SECTION 6.05. Proceedings by Trustee; remedies cumulative and
continuing; delay or omission not waiver of default. In case of a default
hereunder, 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 by suit in equity or by action at law or by proceeding 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. All powers and remedies
given by this Article Six to the Trustee or to the noteholders shall, to the
extent permitted by law, be deemed cumulative and not exclusive of any thereof
or of any other powers and remedies available to the Trustee or the holders of
the Notes, by judicial proceedings or otherwise, to enforce the performance or
observance of the covenants and agreements contained in this Indenture, and no
delay or omission of the Trustee or of any holder of any of the Notes to
exercise any
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right or power accruing upon any default occurring and continuing as aforesaid
shall impair any such right or power, or shall be construed to be a waiver of
any such default or an acquiescence therein; and, subject to the provisions of
Section 6.04, every power and remedy given by this Article Six or by law to the
Trustee or to the noteholders may be exercised from time to time, and as often
as shall be deemed expedient, by the Trustee or by the noteholders.
SECTION 6.06. Rights of holders of majority in principal amount of
Notes to direct Trustee and to waive defaults. The holders of a majority of
the aggregate principal amount of the Notes at the time outstanding (determined
as provided in Section 8.04), or, if a record date is set in accordance with
Section 8.05, as of such record date, 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; provided,
however, that subject to the provisions of Section 7.01, the Trustee shall have
the right to decline to follow any such direction if the Trustee shall
determine that the action so directed may not lawfully be taken, or if the
Trustee in good faith shall, by a responsible officer or officers of the
Trustee, determine that the proceedings so directed would be illegal or involve
it in personal liability or be unjustly prejudicial to the noteholders not
joining therein, and provided further that 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
noteholders. Prior to the declaration of the maturity of the Notes as provided
in Section 6.01, the holders of a majority of the aggregate principal amount of
the Notes at the time outstanding (determined as provided in Sections 8.04 and
8.05) may on behalf of the holders of all of the Notes waive any past default
hereunder and its consequences, except a default in the payment of principal
of, premium, if any, Change of Control Purchase Price, Asset Sale Purchase
Price or interest on any of the Notes or a default under Article Four or any
other covenant or provision of this Indenture which under Article Ten cannot be
modified or amended without the consent of the holder of each outstanding Note.
In the case of any such waiver the Company, the Trustee and the holders of the
Notes 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.
SECTION 6.07. Trustee to give notice of defaults known to it, but may
withhold in certain circumstances. The Trustee shall, within ninety days after
the occurrence of a default hereunder, give to the noteholders, in the manner
and to the extent provided in subsection (c) of Section 6.04 with respect to
reports pursuant to subsection (a) of Section 6.04, notice of such defaults
known to the Trustee unless such defaults shall have been cured or waived
before the giving of such notice (the term "defaults" for the purposes of this
Section 6.07 being hereby defined to be the events specified in clauses (a),
(b), (c), (d), (e), (f), (g) and (h) of Section 6.01, not including any periods
of grace provided for in clauses (a), (c), (d) and (e), respectively, and
irrespective of the giving of notice specified in clauses (c) and (d));
provided that, except in the case of default in the payment of the principal
of, premium, if any, Change of Control Purchase Price, Asset Sale Purchase
Price or interest on any of the Notes, the Trustee shall be protected in
withholding such notice if and so long as the board of directors, the executive
committee, or a trust committee of directors and/or responsible officers of the
Trustee in good faith determines that the withholding of such notice is in the
interest of the noteholders.
SECTION 6.08. Requirement of an undertaking to pay costs in certain
suits under the Indenture or against the Trustee. All parties to this
Indenture agree, and each holder of any Note by his acceptance thereof shall be
deemed to have agreed, that any court may in its discretion require, in any
suit for the enforcement of any right or remedy under this Indenture, or in any
suit against the Trustee for any action taken, suffered or omitted by it as
Trustee, the filing by any party litigant in such suit of an undertaking
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to pay the costs of such suit, and that such court may in its discretion assess
reasonable costs, including reasonable attorneys' fees, against any party
litigant in such suit, having due regard to the merits and good faith of the
claims or defenses made by such party litigant; but the provisions of this
Section 6.08 shall not apply to any suit instituted by the Trustee, to any suit
instituted by any noteholder, or group of noteholders, holding in the aggregate
more than 10% of the aggregate principal amount of the Notes outstanding, or to
any suit instituted by any noteholder for the enforcement of the payment of the
principal of, premium, if any, Change of Control Purchase Price, Asset Sale
Purchase Price or interest on any Note on or after the due date expressed in
such Note.
SECTION 6.09. Waiver of stay or extension laws. The Company
covenants (to the extent that it may lawfully do so) that it will not at any
time insist upon, or plead, or in any manner whatsoever claim or take the
benefit or advantage of, any stay or extension law wherever enacted, now or at
any time hereafter in force, which may affect the covenants or the performance
of this Indenture; and the Company (to the extent that it may lawfully do so)
hereby expressly waives all benefits or advantage of any such law and covenants
that it will not hinder, delay or impede the execution of any power herein
granted to the Trustee, but will suffer and permit the execution of every such
power as though no such law had been enacted.
ARTICLE SEVEN
CONCERNING THE TRUSTEE
SECTION 7.01. Duties and responsibilities of Trustee. 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 duties as are specifically set forth in this Indenture. 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; provided, however, that
(a) prior to the occurrence of an Event of Default and after the
curing or waiving of all Events of Default which may have occurred:
(1) 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
(2) 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 certificates or opinions furnished to the Trustee and conforming
to the requirements of this Indenture; but in the case of any such
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;
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(b) the Trustee shall not be liable for any error of judgment made
in good faith by a responsible officer or 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, suffered 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 Notes at the time outstanding (determined as provided in Section 8.04 or
8.05) 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.
None of the provisions contained in this Indenture shall require the
Trustee to expend or risk its own funds or otherwise incur personal financial
liability in the performance of any of its duties hereunder or in the exercise
of any of its rights or powers, if there is reasonable ground for believing
that the repayment of such funds or adequate indemnity against such risk or
liability is not reasonably assured to it.
SECTION 7.02. Reliance on documents, opinions, etc. Subject to the
provisions of Section 7.01:
(a) the Trustee may rely and shall be protected in acting or
refraining from acting upon any resolution, certificate, statement, instrument,
opinion, report, notice, request, consent, order, approval, bond, note 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 Company
mentioned herein shall be sufficiently evidenced by an instrument signed in the
name of the Company by the Chairman of the Board, the President or any Vice
President and the Secretary or any Assistant Secretary or the Treasurer or any
Assistant Treasurer (unless other evidence in respect thereof be herein
specifically prescribed); and any resolution of the Board of Directors of the
Company may be evidenced to the Trustee by a copy thereof certified by the
Secretary or any Assistant Secretary of the Company;
(c) the Trustee may consult with counsel and the advice of such
counsel or any Opinion of Counsel shall be full and complete authorization and
protection in respect of any action taken, suffered or omitted by it 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 rights or powers vested in it by this Indenture at the request, order or
direction of any of the noteholders, pursuant to the provisions of this
Indenture, unless such noteholders shall have offered to the Trustee reasonable
security or indemnity against the costs, expenses and liabilities which may be
incurred therein or thereby; but nothing herein contained shall, however,
relieve the Trustee of the obligation, upon the occurrence of an Event of
Default (which has not been cured or waived), to exercise such of the rights
and powers vested in it by this Indenture, and to 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;
(e) the Trustee shall not be liable for any action taken, suffered
or omitted by it in good faith and believed by it to be authorized or within
the discretion or rights or powers conferred upon it by this Indenture;
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(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, bond, note 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 Notes then outstanding (determined as
provided in Section 8.04 or 8.05); provided, however, 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 from the
noteholders reasonable indemnity against such expenses or liability as a
condition to so proceeding. The reasonable expenses of every such examination
shall be paid by the Company or, if paid by the Trustee, shall be repaid by the
Company upon demand; and
(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.
SECTION 7.03. No responsibility for recitals, etc. The recitals
contained herein and in the Notes (other than the certificate of authentication
on the Notes) shall be taken as the statements of the Company, 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
Notes. The Trustee shall not be accountable for the use or application by the
Company of any of the Notes or of the proceeds of such Notes, or for the use or
application of any moneys paid over by the Trustee in accordance with any
provision of this Indenture, or for the use or application of any moneys
received by any paying agent other than the Trustee.
SECTION 7.04. Trustee, paying agent or Note registrar may own Notes.
The Trustee, any paying agent or Note registrar, in its individual or any other
capacity, may become the owner or pledgee of Notes with the same rights it
would have if it were not Trustee, paying agent or Note registrar.
SECTION 7.05. Moneys received by Trustee to be held in trust without
interest. Subject to the provisions of Section 12.04, 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 law or by any national securities
exchanges on which the Notes are listed or admitted for trading. The Trustee
shall be under no liability for interest on any moneys received by it hereunder
except such as it may agree with the Company to pay thereon.
SECTION 7.06. Compensation and expenses of Trustee. The Company
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 Company will pay or reimburse the Trustee upon its request for
all reasonable expenses, disbursements and advances incurred or made by the
Trustee in connection with the acceptance or administration of its trust under
this Indenture (including the reasonable compensation and the expenses and
disbursements of its counsel and of all persons not regularly in its employ)
except any such expense, disbursement or advance as may arise from its
negligence or bad faith. The Company also covenants to indemnify the Trustee
for, and to hold it harmless against, any loss, liability or expense incurred
without negligence or bad faith on the part of the Trustee or its agents and
arising out of or in connection with the acceptance or administration of this
trust, including the costs and expenses of defending itself against any claim
of liability under this Indenture in connection with the exercise of its powers
or duties
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hereunder. The obligations of the Company under this Section 7.06 to
compensate the Trustee and to pay or reimburse the Trustee for expenses,
disbursements and advances shall constitute additional indebtedness hereunder
and shall survive the satisfaction and discharge of this Indenture or
resignation or removal of the Trustee. Such additional indebtedness shall be
secured by a Lien 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 Notes.
SECTION 7.07. Right of Trustee to rely on Officers' Certificate where
no other evidence specifically prescribed. Subject to the provisions of
Section 7.01, whenever in the administration of the provisions of this
Indenture, the Trustee shall deem it necessary or desirable that a matter be
proved or established prior to taking, 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 bad faith 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 bad faith 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 in reliance thereon.
SECTION 7.08. Conflicting interest of Trustee.
(a) If the Trustee has or shall acquire any conflicting interest,
as defined in this Section 7.08, then, within ninety days after ascertaining
that it has such conflicting interest, and if the default (as defined in
Section 7.08(c)) to which such conflicting interest relates has not been cured
or duly waived or otherwise eliminated before the end of such ninety-day
period, the Trustee shall either eliminate such conflicting interest or, except
as otherwise provided in this Section 7.08, resign in the manner and with the
effect specified in Section 7.10, and the Company shall take prompt steps to
have a successor appointed in the manner provided in Section 7.10.
(b) In the event that the Trustee shall fail to comply with the
provisions of subsection (a) of this Section 7.08, the Trustee shall, within
ten days after the expiration of such ninety-day period, transmit notice of
such failure to the noteholders in the manner and to the extent provided in
subsection (c) of Section 5.04 with respect to reports pursuant to subsection
(a) of Section 5.04.
(c) For the purposes of this Section 7.08, the Trustee shall be
deemed to have a conflicting interest if the Notes are in default (defined as
the occurrence of any event specified in Section 6.01, but exclusive of any
period of grace or requirement of notice) and
(1) the Trustee is trustee under another indenture under
which any other securities, or certificates of interest or
participation in any other securities, of the Company are outstanding,
unless such other indenture is a collateral trust indenture under
which the only collateral consists of Notes issued under this
Indenture, provided that there shall be excluded from the operation of
this paragraph any indenture or indentures under which other
securities, or certificates of interest or participation in other
securities, of the Company are outstanding if (i) this Indenture and
such other indenture or indentures are wholly unsecured and such other
indenture or indentures are hereafter qualified under the Trust
Indenture Act of 1939, unless the Commission shall have found and
declared by order pursuant to Subsection (b) of Section 305 or
Subsection (c) of Section 307 of the Trust Indenture Act of 1939 that
differences exist between the provisions of this Indenture and the
provisions of such other indenture or indentures which are so likely
to involve a material conflict of interest as to make it necessary in
the public interest or for the
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protection of investors to disqualify the Trustee from acting as such
under this Indenture and such other indenture or indentures, or (ii)
the Company shall have sustained the burden of proving, on application
to the Commission and after opportunity for hearing thereon, that the
trusteeship under this Indenture and such other indenture is not so
likely to involve a material conflict of interest as to make it
necessary in the public interest or for the protection of investors to
disqualify the Trustee from acting as such under one of such
indentures;
(2) the Trustee or any of its directors or executive
officers is an underwriter for the Company;
(3) the Trustee directly or indirectly controls or is
directly or indirectly controlled by or is under direct or indirect
common control with an underwriter for the Company;
(4) the Trustee or any of its directors or executive
officers is a director, officer, partner, employee, appointee, or
representative of the Company, or of an underwriter (other than the
Trustee itself) for the Company who is currently engaged in the
business of underwriting, except that (A) one individual may be a
director and/or an executive officer of the Trustee and a director
and/or an executive officer of the Company, but may not be at the same
time an executive officer of both the Trustee and the Company; (B) if
and so long as the number of directors of the Trustee in office is
more than nine, one additional individual may be a director and/or an
executive officer of the Trustee and a director of the Company; and
(C) the Trustee may be designated by the Company or by any underwriter
for the Company to act in the capacity of transfer agent, registrar,
custodian, paying agent, fiscal agent, escrow agent, or depositary, or
in any other similar capacity, or, subject to the provisions of
paragraph (1) of this subsection (c), to act as trustee whether under
an indenture or otherwise;
(5) ten percent or more of the voting securities of the
Trustee is beneficially owned either by the Company or by any
director, partner, or executive officer thereof, or 20 percent or more
of such voting securities is beneficially owned, collectively, by any
two or more of such persons; or 10 percent or more of the voting
securities of the Trustee is beneficially owned either by an
underwriter for the Company or by any director, partner, or executive
officer thereof, or is beneficially owned, collectively, by any two or
more such persons;
(6) the Trustee is the beneficial owner of, or holds as
collateral security for an obligation which is in default, (A) five
percent or more of the voting securities, or 10 percent or more of any
other class of security, of the Company, not including the Notes
issued under this Indenture and securities issued under any other
indenture under which the Trustee is also trustee, or (B) 10 percent
or more of any class of security of an underwriter for the Company;
(7) the Trustee is the beneficial owner of, or holds as
collateral security for an obligation which is in default, five
percent or more of the voting securities of any person who, to the
knowledge of the Trustee, owns 10 percent or more of the voting
securities of, or controls directly or indirectly or is under direct
or indirect common control with, the Company;
(8) the Trustee is the beneficial owner of, or holds as
collateral security for an obligation which is in default, 10 percent
or more of any class of security of any person who, to the knowledge
of the Trustee, owns 50 percent or more of the voting securities of
the Company;
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(9) the Trustee owns on the date of default upon the
Notes (defined as the occurrence of any event specified in Section
6.01, but exclusive of any period of grace or requirement of notice)
or any anniversary of such default while such default upon the Notes
remains outstanding, in the capacity of executor, administrator,
testamentary or inter vivos trustee, guardian, committee or
conservator, or in any other similar capacity, an aggregate of 25 per
cent or more of the voting securities, or of any class of security, of
any person, the beneficial ownership of a specified percentage of
which would have constituted a conflicting interest under paragraph
(6), (7), or (8) of this subsection (c). As to any such securities of
which the Trustee acquired ownership through becoming executor,
administrator, or testamentary trustee of an estate which included
them, the provisions of the preceding sentence shall not apply, for a
period of two years from the date of such acquisition, to the extent
that such securities included in such estate do not exceed 25 percent
of such voting securities or 25 percent of any such class of security.
Promptly after the dates of any such default upon the Notes and
annually in each succeeding year that the Notes remain in default, the
Trustee shall make a check of its holdings of such securities in any
of the above-mentioned capacities as of such dates. If the Company
fails to make payment in full of principal of, premium, if any, Change
of Control Purchase Price, Asset Sale Purchase Price or interest on
any of the Notes when and as the same becomes due and payable and such
failure continues for 30 days thereafter, the Trustee shall make a
prompt check of its holdings of such securities in any of the
above-mentioned capacities as of the date of the expiration of such
30-day period, and after such date, notwithstanding the foregoing
provisions of this paragraph (9), all such securities so held by the
Trustee, with sole or joint control over such securities vested in it,
shall, but only so long as such failure shall continue, be considered
as though beneficially owned by the Trustee for the purposes of
paragraphs (6), (7) and (8) of this subsection (c); or
(10) except under the circumstances described in
paragraphs (1), (3), (4), (5) or (6) of Section 311(b) of the Trust
Indenture Act of 1939, the Trustee shall become a creditor of the
Company.
The specifications of percentages in paragraphs (5) to (9), inclusive,
of this subsection (c) shall not be construed as indicating that the ownership
of such percentages of the securities of a person is or is not necessary or
sufficient to constitute direct or indirect control for the purpose of
paragraph (3) or (7) of this subsection (c).
For the purposes of paragraphs (6), (7), (8) and (9) of this
subsection (c) only, (A) the terms "security" and "securities" shall include
only such securities as are generally known as corporate securities, but shall
not include any note or other evidence of indebtedness issued to evidence an
obligation to repay moneys lent to a person by one or more banks, trust
companies or banking firms, or any certificate of interest or participation in
any such note or evidence of indebtedness; (B) an obligation shall be deemed to
be "in default" when a default in payment of principal shall have continued for
thirty days or more and shall not have been cured; and (C) the Trustee shall
not be deemed to be the owner or holder of (i) any security which it holds as
collateral security (as trustee or otherwise) for an obligation which is not in
default as defined in clause (B) above, or (ii), any security which it holds as
collateral security under this Indenture, irrespective of any default
hereunder, or (iii) any security which it holds as agent for collection, or as
custodian, escrow agent, or depositary, or in any similar representative
capacity.
Except as above provided, the word "security" or "securities" as used
in this Indenture, shall mean any note, stock, treasury stock, bond, note,
evidence of indebtedness, certificate of interest or
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participation in any profit-sharing agreement, collateral-trust certificate,
preorganization certificate or subscription, transferable share, investment
contract, voting-trust certificate, certificate of deposit for a security,
fractional undivided interest in oil, gas, or other mineral rights, or, in
general, any interest or instrument commonly known as a "security," or any
certificate of interest or participation in, temporary or interim certificate
for, receipt for, guarantee of, or warrant or right to subscribe to or
purchase, any of the foregoing.
Except in the case of a default in the payment of the principal of or
interest on the Notes, or in the payment of any sinking or purchase fund
installment, the Trustee shall not be required to resign as provided by this
Section 7.08 if the Trustee shall have sustained the burden of proving, on
application to the Commission and after opportunity for hearing thereon, that
(i) the default under this Indenture may be cured or waived during a reasonable
period and under the procedures described in such application, and (ii) a stay
of the Trustee's duty to resign will not be inconsistent with the interests of
holders of the Notes. The filing of such an application shall automatically
stay the performance of the duty to resign until the Commission orders
otherwise.
Any resignation of the Trustee shall become effective only upon the
appointment of a successor trustee and such successor's acceptance of such an
appointment.
(d) For the purposes of this Section 7.08:
(1) The term "underwriter" when used with reference to
the Company shall mean every person, who, within one year prior to the
time as of which the determination is made, has purchased from the
Company with a view to, or has offered or sold for the Company in
connection with, the distribution of any security of the Company
outstanding at such time, or has participated or has had a direct or
indirect participation in any such undertaking, or has participated or
has had a participation in the direct or indirect underwriting of any
such undertaking, but such term shall not include a person whose
interest was limited to a commission from an underwriter or dealer not
in excess of the usual and customary distributors' or sellers'
commission.
(2) The term "director" shall mean any director of a
corporation or any individual performing similar functions with
respect to any organization whether incorporated or unincorporated.
(3) The term "person" shall mean an individual, a
corporation, a partnership, an association, a joint-stock company, a
trust, an unincorporated organization, or a government or political
subdivision thereof. As used in this paragraph, the term "trust"
shall include only a trust where the interest or interests of the
beneficiary or beneficiaries are evidenced by a security.
(4) The term "voting security" shall mean any security
presently entitling the owner or holder thereof to vote in the
direction or management of the affairs of a person, or any security
issued under or pursuant to any trust, agreement or arrangement
whereby a trustee or trustees or agent or agents for the owner or
holder of such security are presently entitled to vote in the
direction or management of the affairs of a person.
(5) The term "Company" shall mean any obligor upon the
Notes.
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(6) The term "executive officer" shall mean the
president, every vice-president, every trust officer, the cashier, the
secretary, and the treasurer of a corporation, and any individual
customarily performing similar functions with respect to any
organization whether incorporated or unincorporated, but shall not
include the chairman of the board of directors.
The percentages of voting securities and other securities specified in
this Section 7.08 shall be calculated in accordance with the following
provisions:
(A) A specified percentage of the voting securities of
the Trustee, the Company or any other person referred to in this
Section 7.08 (each of whom is referred to as a "person" in this
paragraph) means such amount of the outstanding voting securities of
such person as entitles the holder or holders thereof to cast such
specified percentage of the aggregate votes which the holders of all
the outstanding voting securities of such person are entitled to cast
in the direction or management of the affairs of such person.
(B) A specified percentage of a class of securities of a
person means such percentage of the aggregate amount of securities of
the class outstanding.
(C) The term "amount," when used in regard to securities,
means the principal amount if relating to evidences of indebtedness,
the number of shares if relating to capital shares, and the number of
units if relating to any other kind of security.
(D) The term "outstanding" means issued and not held by
or for the account of the issuer. The following securities shall not
be deemed outstanding within the meaning of this definition:
(i) securities of an issuer held in a sinking
fund relating to securities of the issuer of the same class;
(ii) securities of an issuer held in a sinking
fund relating to another class of securities of the issuer, if
the obligation evidenced by such other class of securities is
not in default as to principal or interest or otherwise;
(iii) securities pledged by the issuer thereof as
security for an obligation of the issuer not in default as to
principal or interest or otherwise; and
(iv) securities held in escrow if placed in
escrow by the issuer thereof;
provided, however, that any voting securities of an issuer shall be
deemed outstanding if any person other than the issuer is entitled to
exercise the voting rights thereof.
(E) A security shall be deemed to be of the same class as
another security if both securities confer upon the holder or holders
thereof substantially the same rights and privileges, provided,
however, that, in the case of secured evidences of indebtedness, all
of which are issued under a single indenture, differences in the
interest rates or maturity dates of various series thereof shall not
be deemed sufficient to constitute such series different classes, and
provided, further, that, in the case of unsecured evidences of
indebtedness, differences in the interest rates
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or maturity dates thereof shall not be deemed sufficient to constitute
them securities of different classes, whether or not they are issued
under a single indenture.
SECTION 7.09. Requirements for eligibility of Trustee. The Trustee
hereunder shall at all times be a corporation organized and doing business
under the laws of the United States or any State or territory thereof or of the
District of Columbia or a corporation or other person permitted to act as the
Trustee by the Commission (pursuant to the requirements of Section 310(a)(1) of
the Trust Indenture Act of 1939), authorized under such laws to exercise
corporate trust powers, having a combined capital and surplus of at least
$25,000,000, and subject to supervision or examination by Federal, State,
Territorial, or District of Columbia authority. If such corporation publishes
reports of condition at least annually, pursuant to law or to the requirements
of the aforesaid supervising or examining authority, then for the purposes of
this Section 7.09, 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. The Trustee shall not be an obligor
upon the Notes or a person directly or indirectly controlling, controlled by,
or under common control with such obligor. In addition, the Trustee shall at
all times be approved to serve as transfer agent and registrar by any
securities exchange on which the Notes are listed or admitted for trading. In
case at any time the Trustee shall cease to be eligible in accordance with the
provisions of this Section 7.09, the Trustee shall resign immediately in the
manner and with the effect specified in Section 7.10.
SECTION 7.10. Resignation or removal of Trustee.
(a) The Trustee, or any trustee hereafter appointed, may at any
time resign by giving written notice of such resignation to the Company and to
the noteholders, such notice to the noteholders to be given, by mailing (by
first-class mail) the notice to their addresses as they shall appear on the
registry books of the Company within thirty days after such notice is given to
the Company. Upon receiving such notice of resignation and evidence
satisfactory to it of such mailing, the Company shall promptly appoint a
successor trustee by written instrument, in duplicate, executed by order of the
Board of Directors of the Company, 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 thirty days after the mailing of such notice of resignation, the
resigning Trustee may petition any court of competent jurisdiction for the
appointment of a successor trustee, or any noteholder who has been a bona fide
holder of a Note or Notes for at least six months may, subject to the
provisions of Section 6.08, on behalf of himself and all others similarly
situated, petition any such court 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.
(b) In case at any time any of the following shall occur:
(1) the Trustee shall fail to comply with the provisions
of subsection (a) of Section 7.08 after written request therefor by
the Company or by any noteholder who has been a bona fide holder of a
Note or Notes for at least six months, or
(2) the Trustee shall cease to be eligible in accordance
with the provisions of Section 7.09 and shall fail to resign after
written request therefor by the Company or by any such noteholder, or
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(3) the Trustee shall become incapable of acting, or
shall be adjudged a bankrupt or insolvent, or a receiver 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 Company may remove the Trustee and appoint a
successor trustee by written instrument, in duplicate, executed by order of the
Board of Directors of the Company, one copy of which instrument shall be
delivered to the Trustee so removed and one copy to the successor trustee, or,
subject to the provisions of Section 6.08, any noteholder who has been a bona
fide holder of a Note or Notes 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.
(c) Any resignation or removal of the Trustee and appointment of
any successor trustee pursuant to any of the provisions of this Section 7.10
shall become effective upon acceptance of appointment by the successor trustee
as provided in Section 7.11.
SECTION 7.11. Acceptance by successor to Trustee; notice of
succession of a Trustee. Any successor trustee appointed as provided in
Section 7.10 shall execute, acknowledge and deliver to the Company 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 the 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
Company or of the successor trustee, the trustee ceasing to act shall, upon
payment of any amounts then due it pursuant to the provisions of Section 7.06,
execute and deliver an instrument transferring to such successor trustee all
the rights and powers of the trustee so ceasing to act. Upon request of any
such successor trustee, the Company shall execute any and all instruments in
writing for more fully and certainly vesting in and confirming to such
successor trustee of such rights and powers. Any trustee ceasing to act shall,
nevertheless, retain a lien upon all property or funds held or collected by
such trustee to secure any amounts then due it pursuant to the provisions of
Section 7.06.
No successor trustee shall accept appointment as provided in this
Section 7.11 unless at the time of such acceptance, such successor trustee
shall be qualified under the provisions of Section 7.08 and eligible under the
provisions of Section 7.09.
Upon acceptance of appointment by a successor trustee as provided in
this Section 7.11, the Company shall mail to the noteholders by first-class
mail notice thereof. If the Company fails to mail such notice within thirty
days after acceptance of appointment by the successor trustee, the successor
trustee shall, in its discretion, cause such notice to be mailed at the expense
of the Company.
SECTION 7.12. Successor to Trustee by merger, consolidation or
succession to business; notice by Trustee of change in its location. 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 or 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 without the execution or filing of any paper
or any further act on the part of any of the parties hereto, anything herein
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to the contrary notwithstanding, provided such corporation shall be qualified
under the provisions of Section 7.08 and eligible under the provisions of
Section 7.09.
In case at the time such successor to the Trustee shall succeed to the
trusts created by this Indenture any of the Notes 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 Notes so
authenticated; and in case at that time any of the Notes shall not have been
authenticated, any successor to the Trustee may authenticate such Notes either
in the name of any predecessor hereunder or in the name of the successor
Trustee; and in all such cases such certificates shall have the full force
which it is anywhere in the Notes or in this Indenture provided that the
certificate of the Trustee shall have; provided, however, that the right to
adopt the certificate of authentication of any predecessor Trustee or
authenticate Notes in the name of any predecessor Trustee shall apply only to
its successor, or successors by merger, conversion or consolidation.
The Trustee will give the Company prompt notice of any change in the
location of the Trustee's principal office.
SECTION 7.13. Limitations on rights of Trustee as a creditor.
(a) Subject to the provisions of subsection (b) of this Section 7.13,
if the Trustee shall be or shall become a creditor, directly or indirectly,
secured or unsecured, of the Company or of any other obligor on the Notes
within three months prior to a default, as defined in subsection (c) of this
Section 7.13, or subsequent to such a default, then, unless and until such
default shall be cured or waived, the Trustee shall set apart and hold in a
special account for the benefit of, the Trustee individually, the holders of
the Notes, and the holders of other indenture securities (as defined in
subsection (c) of this Section 7.13)
(1) an amount equal to any and all reductions in the
amount due and owing upon any claim as such creditor in respect of
principal or interest, effected after the beginning of such three
months' period, and valid as against the Company and its other
creditors, except any such reduction resulting from the receipt or
disposition of any property described in paragraph (2) of this
subsection, or from the exercise of any right of set-off which the
Trustee could have exercised if a petition in bankruptcy had been
filed by or against the Company upon the date of such default; and
(2) all property received by the Trustee in respect of
any claims as such creditor, either as security therefor, or in
satisfaction or composition thereof, or otherwise, after the beginning
of such three months' period, or an amount equal to the proceeds of
any such property if disposed of, subject, however, to the rights, if
any, of the Company and its other creditors in such property or such
proceeds.
Nothing herein contained, however, shall affect the right of the
Trustee
(A) to retain for its own account (i) payments made on
account of any such claim by any person (other than the Company) who
is liable thereon, and (ii) the proceeds of the bona fide sale of any
such claim by the Trustee to a third person, and (iii) distributions
made in cash, securities, or other property in respect of claims filed
against the Company in bankruptcy or receivership or in proceedings
for reorganization pursuant to any applicable bankruptcy, insolvency
or similar law;
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(B) to realize, for its own account, upon any property
held by it as security for any such claim, if such property was so
held prior to the beginning of such three months' period;
(C) to realize, for its own account, but only to the
extent of the claim hereinafter mentioned, upon any property held by
it as security for any such claim, if such claim was created after the
beginning of such three months' period and such property was received
as security therefor simultaneously with the creation thereof, and if
the Trustee shall sustain the burden of proving that at the time such
property was so received the Trustee had no reasonable cause to
believe that a default, as defined in subsection (c) of this Section
7.13, would occur within three months; or
(D) to receive payment on any claim referred to in
paragraph (B) or (C), against the release of any property held as
security for such claim as provided in such paragraph (B) or (C), as
the case may be, to the extent of the fair value of such property.
For the purposes of paragraphs (B), (C) and (D) above, property
substituted after the beginning of such three months' period for property held
as security at the time of such substitution shall, to the extent of the fair
value of the property released, have the same status as the property released,
and to the extent that any claim referred to in any of such paragraphs is
created in renewal of or in substitution for or for the purpose of repaying or
refunding any preexisting claim of the Trustee as such creditor, such claim
shall have the same status as such preexisting claim.
If the Trustee shall be required to account, the funds and property
held in such special account and the proceeds thereof shall be apportioned
between the Trustee, the noteholders, and the holders of other indenture
securities in such manner that the Trustee, the noteholders and the holders of
other indenture securities realize, as a result of payments from such special
account and payments of dividends on claims filed against the Company in
bankruptcy or receivership or in proceedings for reorganization pursuant to
applicable law, the same percentage of their respective claims, figured before
crediting to the claim of the Trustee anything on account of receipt by it from
the Company of the funds and property in such special account and before
crediting to the respective claims of the Trustee, the noteholders, and the
holders of other indenture securities dividends on claims filed against the
Company in bankruptcy or receivership or in proceedings for reorganization
pursuant to applicable law, but after crediting thereon receipts on account of
the indebtedness represented by their respective claims from all sources other
than from such dividends and from the funds and property so held in such
special account. As used in this paragraph, with respect to any claim, the
term "dividends" shall include any distribution with respect to such claim in
bankruptcy or receivership or in proceedings for reorganization pursuant to
applicable law, whether such distribution is made in cash, securities, or other
property, but shall not include any such distribution with respect to the
secured portion, if any, of such claim. The court in which such bankruptcy,
receivership or proceeding for reorganization is pending shall have
jurisdiction (i) to apportion between the Trustee, the noteholders, and the
holders of other indenture securities, in accordance with the provisions of
this paragraph, the funds and property held in such special account and the
proceeds thereof, or (ii) in lieu of such apportionment, in whole or in part,
to give to the provisions of this paragraph due consideration in determining
the fairness of the distributions to be made to the Trustee, the noteholders
and the holders of other indenture securities with respect to their respective
claims, in which event it shall not be necessary to liquidate or to appraise
the value of any securities or other property held in such special account or
as security for any such claim, or to make a specific allocation of such
distributions as between the secured and unsecured portions of such claims, or
otherwise to apply the provisions of this paragraph as a mathematical formula.
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Any trustee who has resigned or been removed after the beginning of
such three months' period shall be subject to the provisions of this subsection
(a) as though such resignation or removal had not occurred. If any trustee has
resigned or been removed prior to the beginning of such three months' period,
it shall be subject to the provisions of this subsection (a) if and only if the
following conditions exist:
(i) the receipt of property or reduction of claim which
would have given rise to the obligation to account, if such trustee
had continued as trustee, occurred after the beginning of such three
months' period; and
(ii) such receipt of property or reduction of claim
occurred within three months after such resignation or removal.
(b) There shall be excluded from the operation of subsection (a)
of this Section 8.13 a creditor relationship arising from
(1) the ownership or acquisition of securities issued
under any indenture, or any security or securities having a maturity
of one year or more at the time of acquisition by the Trustee;
(2) advances authorized by a receivership or bankruptcy
court of competent jurisdiction, or by this Indenture, for the purpose
of preserving any property which shall at any time be subject to the
lien of this Indenture or of discharging tax liens or other prior
liens or encumbrances thereon, if notice of such advance and of the
circumstances surrounding the making thereof is given to the
noteholders at the time and in the manner provided in Section 5.04
with respect to reports pursuant to subsections (a) and (b) thereof,
respectively;
(3) disbursements made in the ordinary course of business
in the capacity of trustee under an indenture, transfer agent,
registrar, custodian, paying agent, fiscal agent or depositary, or
other similar capacity;
(4) an indebtedness created as a result of services
rendered or premises rented; or an indebtedness created as a result of
goods or securities sold in a cash transaction as defined in
subsection (c) of this Section 7.13;
(5) the ownership of stock or of other securities of a
corporation organized under the provisions of Section 25(a) of the
Federal Reserve Act, as amended, which is directly or indirectly a
creditor of the Company; or
(6) the acquisition, ownership, acceptance or negotiation
of any drafts, bills of exchange, acceptances or obligations which
fall within the classification of self-liquidating paper as defined in
subsection (c) of this Section 7.13.
(c) As used in this Section 7.13:
(1) the term "default" shall mean any failure to make
payment in full of the principal of, premium, if any, Change of
Control Purchase Price, Asset Sale Purchase Price or interest
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upon any of the Notes or upon the other indenture securities when and
as any such amounts become due and payable.
(2) the term "other indenture securities" shall mean
securities upon which the Company is an obligor (as defined in the
Trust Indenture Act of 1939) outstanding under any other indenture (A)
under which the Trustee is also trustee, (B) which contains provisions
substantially similar to the provisions of subsection (a) of this
Section 7.13, and (C) under which a default exists at the time of the
apportionment of the funds and property held in said special account.
(3) the term "cash transaction" shall mean any
transaction in which full payment for goods or securities sold is made
within seven days after delivery of the goods or securities in
currency or in checks or other orders drawn upon banks or bankers and
payable upon demand.
(4) the term "self-liquidating paper" shall mean any
draft, bill of exchange, acceptance or obligation which is made,
drawn, negotiated or incurred by the Company for the purpose of
financing the purchase, processing, manufacture, shipment, storage or
sale of goods, wares or merchandise and which is secured by documents
evidencing title to, possession of, or lien upon, the goods, wares or
merchandise or the receivables or proceeds arising from the sale of
the goods, wares or merchandise previously constituting the security,
provided the security is received by the Trustee simultaneously with
the creation of the creditor relationship with the Company arising
from the making, drawing, negotiating or incurring of the draft, bill
of exchange, acceptance or obligation.
(5) the term "Company" shall mean any obligor upon the
Notes.
ARTICLE EIGHT
CONCERNING THE NOTEHOLDERS
SECTION 8.01. Evidence of action by noteholders. Whenever in this
Indenture it is provided that the holders of a specified percentage in
aggregate principal amount of the Notes may take any action (including the
making of any demand or request, the giving of any notice, consent, or waiver
or the taking of any other action), the fact that the holders of such specified
percentage, determined as of the time such action was taken or, if a record
date was set with respect thereto pursuant to Section 8.05, as of such record
date, have joined therein may be evidenced (a) by any instrument or any number
of instruments of similar tenor executed by noteholders in person or by agent
or proxy appointed in writing, or (b) by the record of the holders of Notes
voting in favor thereof at any meeting of noteholders duly called and held in
accordance with the provisions of Article Nine, or (c) by a combination of such
instrument or instruments and any such record of such a meeting of noteholders.
SECTION 8.02. Proof of execution of instruments and of holding of
Notes. Subject to the provisions of Sections 7.01, 7.02 and 9.05, proof of the
execution of any instrument by a noteholder or his agent or proxy shall be
sufficient if made 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.
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The ownership of Notes shall be proved by the register of such Notes,
or by a certificate of the registrar thereof.
The Trustee may accept such other proof or require such additional
proof of any matter referred to in this Section 8.02 as it shall deem
reasonable.
The record of any noteholders' meeting shall be proved in the manner
provided in Section 9.06.
SECTION 8.03. Who may be deemed owners of Notes. Prior to due
presentation for registration of transfer, the Company, the Trustee, any paying
agent and any Note registrar may deem and treat the person in whose name any
Note shall be registered upon the books of the Company as the absolute owner of
such Note (whether or not such Note shall be overdue and notwithstanding any
notation of ownership or other writing thereon) for the purposes of receiving
payment of or on account of the principal of, premium, if any, Change of
Control Purchase Price, Asset Sale Purchase Price and interest on such Note and
for all other purposes; and neither the Company nor the Trustee nor any paying
agent nor any Note registrar shall be affected by any notice to the contrary.
All such payments so made to, or upon the order of, any such holder 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 Note.
SECTION 8.04. Notes owned by Company or controlled by controlling
persons disregarded for certain purposes. In determining whether the holders
of the requisite aggregate principal amount of Notes have concurred in any
demand, direction, request, notice, consent, waiver or other action under this
Indenture, Notes which are owned by the Company or any other obligor on the
Notes or by any person directly or indirectly controlling or controlled by or
under direct or indirect common control with the Company or any other obligor
on the Notes shall be disregarded and deemed not to be outstanding for the
purpose of any such determination, provided that for the purposes of
determining whether the Trustee shall be protected in relying on any such
demand, direction, request, notice, consent or waiver, only Notes which the
Trustee knows are so owned shall be so disregarded. Notes so owned which have
been pledged in good faith may be regarded as outstanding for the purposes of
this Section 8.04, if the pledgee shall establish to the satisfaction of the
Trustee the pledgee's right to vote such Notes and that the pledgee is not a
person directly or indirectly controlling or controlled by or under direct or
indirect common control with the Company or any such other obligor. In case of
a dispute as to such right, any decision by the Trustee taken upon the advice
of counsel shall be full protection to the Trustee.
SECTION 8.05. Record date for action by noteholders. Whenever in
this Indenture it is provided that holders of a specified percentage in
aggregate principal amount of the Notes may take any action (including the
making of any demand or request, the giving of any direction, notice, consent
or waiver or the taking of any other action), other than any action taken at a
meeting of noteholders called pursuant to Article Nine, the Company, pursuant
to a resolution of its Board of Directors, or the holders of at least 10% in
aggregate principal amount of the Notes then outstanding, may request the
Trustee to fix a record date for determining noteholders entitled to notice of
and to take any such action. In case the Company or the holders of Notes in
the amount above specified shall desire to request noteholders to take any such
action and shall request the Trustee to fix a record date with respect thereto
by written notice setting forth in reasonable detail the noteholder action to
be requested, the Trustee shall promptly (but in any event within five days of
receipt of such request) fix a record date which shall be a Business Day not
less than fifteen nor more than twenty days after the date on which the Trustee
receives such request. If the Trustee shall fail to fix a record date as
hereinabove provided, then the Company or the holders of Notes in the amount
above specified may fix the same by mailing notice thereof (the record
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date so fixed to be a Business Day not less than fifteen nor more than twenty
days after the date on which such written notice shall be given) to the
Trustee. If a record date is fixed according to this Section 8.05, only
persons shown as noteholders on the registry books of the Company at the close
of business on the record date so fixed shall be entitled to take the requested
action and the taking of any such action by the holders on the record date of
the required percentage of the aggregate principal amount of the Notes shall be
binding on all noteholders, provided that the taking of the requested action by
the holders on the record date of the percentage in aggregate principal amount
of the Notes specified in this Indenture in connection with such action shall
have been evidenced to the Trustee, as provided in Section 8.01, not later than
one hundred eighty days after such record date.
SECTION 8.06. Instruments executed by noteholders bind future
holders. At any time prior to (but not after) the evidencing to the Trustee,
as provided in Section 8.01, of the taking of any action by the holders of the
percentage in aggregate principal amount of the Notes specified in this
Indenture in connection with such action, any holder of a Note which is shown
by the evidence to be included in the Notes the holders of which have consented
to such action may, by filing written notice with the Trustee at its principal
office and upon proof of holding as provided in Section 8.02, revoke such
action so far as concerns such Note. Except as aforesaid any such action taken
by the holder of any Note and any direction, demand, request, waiver, consent,
vote or other action of the holder of any Note which by any provisions of this
Indenture is required or permitted to be given shall be conclusive and binding
upon such holder and upon all future holders and owners of such Note, and of
any Note issued in lieu thereof, irrespective of whether or not any notation in
regard thereto is made upon such Note. Any action taken by the holders of the
percentage in aggregate principal amount of the Notes specified in this
Indenture in connection with such action shall be conclusively binding upon the
holders of all the Notes.
ARTICLE NINE
NOTEHOLDERS' MEETINGS
SECTION 9.01. Purposes for which meetings may be called. A meeting
of noteholders may be called at any time and from time to time pursuant to the
provisions of this Article Nine for any of the following purposes:
(1) to give any notice to the Company or to the Trustee, or to
give any directions to the Trustee, or to consent to the waiving of any default
hereunder and its consequences, or to take any other action authorized to be
taken by noteholders pursuant to any of the provisions of Article Six;
(2) to remove the Trustee and appoint a successor trustee pursuant
to the provisions of Article Seven;
(3) to consent to the execution of an indenture or indentures
supplemental hereto pursuant to the provisions of Section 10.02; or
(4) to take any other action authorized to be taken by or on
behalf of the holders of any specified aggregate principal amount of the Notes
under any other provisions of this Indenture or under applicable law.
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SECTION 9.02. Manner of calling meetings; record date. The Trustee
may at any time call a meeting of noteholders to take any action specified in
Section 9.01 to be held at such time and at such place in the Borough of
Manhattan, City of New York, State of New York, as the Trustee shall determine.
Notice of every meeting of the noteholders, setting forth the time and the
place of such meeting and in general terms the action proposed to be taken at
such meeting shall be mailed not less than twenty nor more than sixty days
prior to the date fixed for the meeting to such noteholders at their addresses
as such addresses appear on the registry books of the Company. For the purpose
of determining noteholders entitled to notice of any meeting of noteholders,
the Trustee shall fix in advance a date as the record date for such
determination, such date to be a Business Day not more than ten days prior to
the date of the mailing of such notice as hereinabove provided. Only persons
in whose name any Note shall be registered upon the registry books of the
Company at the close of business on a record date fixed by the Trustee as
aforesaid, or by the Company or the noteholders as in Section 9.03 provided,
shall be entitled to notice of the meeting of noteholders with respect to which
such record date was so fixed.
SECTION 9.03. Call of meeting by Company or noteholders. In case at
any time the Company, pursuant to a resolution of its Board of Directors, or
the holders of at least 10% in aggregate principal amount of the Notes then
outstanding, shall have requested the Trustee to call a meeting of noteholders
to take any action authorized in Section 9.01 by written request setting forth
in reasonable detail the action proposed to be taken at the meeting, and the
Trustee shall not have mailed notice of such meeting within twenty days after
receipt of such request, then the Company or the holders of Notes in the amount
above specified, as the case may be, may fix the record date with respect to,
and determine the time and the place in said Borough of Manhattan, City of New
York, State of New York, for, such meeting and may call such meeting to take
any action authorized in Section 9.01, by mailing notice thereof as provided in
Section 9.02. The record date fixed as provided in the preceding sentence
shall be set forth in a written notice to the Trustee and shall be a Business
Day not less than fifteen nor more than twenty days after the date on which
such notice is sent to the Trustee.
SECTION 9.04. Who may attend and vote at meetings. Only persons
entitled to receive notice of a meeting of noteholders and their respective
proxies duly appointed by an instrument in writing shall be entitled to vote at
such meeting. The only persons who shall be entitled to be present or to speak
at any meeting of noteholders shall be the persons entitled to vote at such
meeting and their counsel and any representatives of the Trustee and its
counsel and any representatives of the Company and its counsel. When a
determination of noteholders entitled to vote at any meeting of noteholders has
been made as provided in this Section, such determination shall apply to any
adjournment thereof.
SECTION 9.05. Regulations. Notwithstanding any other provisions of
this Indenture, the Trustee may make such reasonable regulations as it may deem
advisable for any meeting of noteholders, in regard to proof of the holding of
Notes and of the appointment of proxies, and in regard to the appointment and
duties of inspectors of votes, the submission and examination of proxies,
certificates and other evidence of the right to vote, and such other matters
concerning the conduct of the meeting as it shall think fit. Except as
otherwise permitted or required by any such regulations, the holding of Notes
shall be proved in the manner specified in Section 8.02.
The Trustee shall, by an instrument in writing, appoint a temporary
chairman of the meeting, unless the meeting shall have been called by the
Company or by noteholders as provided in Section 9.03, in which case the
Company or the noteholders calling the meeting, as the case may be, shall in
like manner appoint a temporary chairman. A permanent chairman and a permanent
secretary of the meeting
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shall be elected by a vote of the holders of a majority in principal amount of
the Notes represented at the meeting and entitled to vote.
Subject to the provisions of Section 8.04, at any meeting each
noteholder or proxy entitled to vote thereat shall be entitled to one vote for
each $1,000 principal amount of Notes held or represented by him; provided,
however, that no vote shall be cast or counted at any meeting in respect of any
Note challenged as not outstanding and ruled by the chairman of the meeting to
be not outstanding. The chairman of the meeting shall have no right to vote
other than by virtue of Notes held by him or instruments in writing as
aforesaid duly designating him as the person to vote on behalf of other
noteholders. Any meeting of noteholders duly called pursuant to the provisions
of Section 9.02 or 9.03 may be adjourned from time to time, and the meeting may
be held as so adjourned without further notice.
At any meeting of noteholders, the presence of persons who held, or
who are acting as proxy for persons who held, an aggregate principal amount of
Notes on the record date for such meeting sufficient to take action on the
business for the transaction of which such meeting was called shall constitute
a quorum, but, if less than a quorum is present, the persons holding or
representing a majority in aggregate principal amount of the Notes represented
at the meeting may adjourn such meeting with the same effect, for all intents
and purposes, as though a quorum had been present.
SECTION 9.06. Manner of voting at meetings and record to be kept.
The vote upon any resolution submitted to any meeting of noteholders shall be
by written ballots on each of which shall be subscribed the signature of the
noteholder or proxy casting such ballot, the principal amount and, if
practicable, the identifying number or numbers of the Notes held or represented
in respect of which such ballot is cast. The permanent chairman of the meeting
shall appoint two inspectors of votes who shall count all votes cast at the
meeting for or against any resolution and who shall make and file with the
secretary of the meeting their verified written reports in duplicate of all
votes cast at the meeting. A record in duplicate of the proceedings of each
meeting of noteholders shall be prepared by the secretary of the meeting and
there shall be attached to said record the original reports of the inspectors
of votes on any vote by ballot taken thereat and affidavits by one or more
persons having knowledge of the facts setting forth a copy of the notice of the
meeting and showing that said notice was mailed as provided in Section 9.02.
The record shall show the aggregate principal amount and, if practicable, the
identifying numbers of the Notes voting in favor of or against any resolution.
Each counterpart of such record shall be signed and verified by the affidavits
of the permanent chairman and secretary of the meeting and one of the
counterparts shall be delivered to the Company and the other to the Trustee to
be preserved by the Trustee.
Any counterpart record so signed and verified shall be conclusive
evidence of the matters therein stated and shall be the record referred to in
clause (b) of Section 8.01.
SECTION 9.07. Exercise of rights of Trustee and noteholders not to be
hindered or delayed. Nothing in this Article Nine shall be deemed or construed
to authorize or permit, by reason of any call of a meeting of noteholders or
any rights expressly or impliedly conferred hereunder to make such call, any
hindrance or delay in the exercise of any right or rights conferred upon or
reserved to the Trustee or to the noteholders under any of the provisions of
this Indenture or of the Notes.
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ARTICLE TEN
SUPPLEMENTAL INDENTURES
SECTION 10.01. Purposes for which supplemental indentures may be
entered into without consent of noteholders. The Company, when authorized by a
Board Resolution, and the Trustee may from time to time and at any time enter
into an indenture or indentures supplemental hereto (which shall comply with
the provisions of the Trust Indenture Act of 1939 as then in effect) for one or
more of the following purposes:
(a) to comply with Article Eleven and Sections 4.10(c), 4.12(a),
4.12(c) and 15.03;
(b) to add to the covenants of the Company such further covenants,
restrictions or conditions as its Board of Directors shall consider to be for
the protection of the holders of Notes, and to make the occurrence, or the
occurrence and continuance, of a default in any of such additional covenants,
restrictions or conditions a default or an Event of Default permitting the
enforcement of all or any of the several remedies provided in this Indenture as
herein set forth; provided, however, that in respect of any such additional
covenant, restriction or condition 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 default or may limit the remedies available to
the Trustee upon such default.
(c) to cure any ambiguity or to correct or supplement any
provision contained herein or in any supplemental indenture which may be
defective or inconsistent with any other provision contained herein or in any
supplemental indenture, or to comply with any requirements of the Commission in
order to effect or maintain the qualification of this Indenture under the Trust
Indenture Act of 1939, or to make such other provisions in regard to matters or
questions arising under this Indenture or any supplemental indenture as shall
not adversely affect the rights of the holders of the Notes;
(d) to provide for the issuance under this Indenture of Notes,
whether or not then outstanding, in coupon form (including Notes registrable as
to principal only) and to provide for exchangeability of such Notes with Notes
issued hereunder in fully registered form and to make all appropriate changes
for such purpose; and
(e) to comply with the requirements of the New York Stock Exchange
or any other national securities exchange on which the Notes may be issued or
admitted for trading, provided such changes do not adversely affect the rights
of any holder of Notes.
The Trustee is hereby authorized to join with the Company in the
execution and delivery of any such supplemental indenture, to make any further
appropriate agreement and stipulations which may be therein contained and to
accept the conveyance, transfer, mortgage, pledge or assignment of, any
property thereunder, provided that if any such supplemental indenture affects
the Trustee's own rights, duties or immunities under this Indenture or
otherwise, the Trustee may in its discretion, but shall not be obligated to,
enter into such supplemental indenture.
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Any supplemental indenture authorized by the provisions of this
Section 10.01 may be executed by the Company and the Trustee without the
consent of the holders of any of the Notes at the time outstanding,
notwithstanding any of the provisions of Section 10.02.
SECTION 10.02. Modification of Indenture with consent of holders of a
majority in principal amount of Notes. With the consent (evidenced as provided
in Section 8.01) of the holders of not less than a majority in aggregate
principal amount of the Notes at the time outstanding (determined as provided
in Sections 8.04 and 8.05), or, if a record date is set with respect to such
consent in accordance with Section 8.05, as of such record date, the Company,
when authorized by a Board Resolution, and the Trustee may from time to time
and at any time enter into an indenture or indentures supplemental hereto
(which shall comply with the provisions of the Trust Indenture Act of 1939 as
then in effect) 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 of modifying in any manner the rights of the holders
of the Notes; provided, however, that without the consent of each holder of an
outstanding Note affected, no such supplemental indenture shall (i) extend the
stated maturity of any Note, reduce the interest rate, extend the time or alter
the manner of payment of interest thereon, reduce the principal amount thereof
or alter the timing of or reduce any premium payable upon the redemption
thereof or the amount payable thereon in the event of acceleration or the
amount thereof payable in bankruptcy, or (ii) reduce the aforesaid percentage
of aggregate principal amount of Notes, the consent of the holders of which is
required for any such supplemental indenture.
Upon the request of the Company, accompanied by a copy of a Board
Resolution authorizing the execution of any such supplemental indenture, and
upon the filing with the Trustee of evidence of the consent of noteholders as
aforesaid, the Trustee shall join with the Company in the execution and
delivery of such supplemental indenture, provided that if such supplemental
indenture affects the Trustee's own rights, duties or immunities under this
Indenture or otherwise, the Trustee may in its discretion, but shall not be
obligated to, enter into such supplemental indenture.
It shall not be necessary for the consent of the noteholders under
this Section 10.02 to approve the particular form of any proposed supplemental
indenture, but it shall be sufficient if such consent shall approve the
substance thereof.
Promptly after the execution and delivery by the Company and the
Trustee of any supplemental indenture pursuant to the provisions of this
Section 10.02, the Company shall mail a notice to the noteholders, setting
forth in general terms the substance of such supplemental indenture. Any
failure of the Company to mail such notice, or any defect therein, shall not,
however, in any way impair or affect the validity of any such supplemental
indenture.
SECTION 10.03. Effect of supplemental indentures. Upon the execution
and delivery of any supplemental indenture pursuant to the provisions of this
Article Ten, this Indenture shall be and be deemed to be modified and amended
in accordance therewith and the respective rights, limitation of rights,
obligations, duties and immunities under this Indenture of the Trustee, the
Company and the holders of Notes 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.
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SECTION 10.04. Notes may bear notation of changes by supplemental
indentures. Notes authenticated and delivered after the execution and delivery
of any supplemental indenture pursuant to the provisions of this Article Ten,
or after any action taken at a noteholders' meeting pursuant to Article Nine,
may bear a notation in form approved by the Trustee as to any matter provided
for in such supplemental indenture or as to any action taken at any such
meeting. If the Company shall so determine, new Notes so modified as to
conform, in the opinion of the Trustee and the Company, to any modification of
this Indenture contained in any such supplemental indenture may be prepared by
the Company, authenticated by the Trustee and delivered in exchange for the
Notes then outstanding upon surrender of such Notes. Failure to make the
appropriate notation or issue a new Note shall not affect the validity and
effect of such supplemental indenture or noteholders' meeting.
SECTION 10.05. Officers' Certificate and Opinion of Counsel. The
Trustee may receive upon its request and, subject to the provisions of Sections
7.01 and 7.02, may rely upon an Officers' Certificate and an Opinion of Counsel
as conclusive evidence that any such indenture complies with the provisions of
this Article Ten.
ARTICLE ELEVEN
CONSOLIDATION, MERGER AND SALE
SECTION 11.01. Company may consolidate, etc., on certain terms.
(a) Nothing contained in this Indenture or in any of the Notes
shall prevent any consolidation or merger of the Company with or into any other
corporation or corporations (whether or not affiliated with the Company) or
successive consolidations or mergers in which the Company or its successor or
successors shall be a party or parties, or shall prevent any sale or conveyance
of all or substantially all the property of the Company to any other
corporation (whether or not affiliated with the Company) whether in a single
transaction or series of related transactions; provided, however, and the
Company hereby covenants and agrees, that any such consolidation, merger, sale
or conveyance shall be upon the condition that (i) immediately after giving
effect to such consolidation, merger, sale or conveyance, the corporation
(whether the Company or such other corporation) formed by or surviving any such
consolidation or merger, or to which such sale or conveyance shall have been
made, whether the Company or such other corporation (the "surviving
corporation"), shall not be in default in the performance or observance of any
of the terms, covenants and conditions of this Indenture to be kept or
performed by the Company, (ii) the surviving corporation (if other than the
Company) shall be a corporation organized under the laws of The United States
of America or any State thereof, (iii) immediately after giving effect to such
consolidation, merger, sale or conveyance, the surviving corporation (whether
the Company or such other corporation) could incur $1.00 of Indebtedness
pursuant to Section 4.10(a), (iv) the surviving corporation (if other than the
Company) shall expressly assume the due and punctual payment of the principal
of, premium, if any, Change of Control Purchase Price, Asset Sale Purchase
Price and interest on all of the Notes, according to their tenor, and the due
and punctual performance and observance of all the covenants and conditions of
this Indenture to be performed or observed by the Company, by supplemental
indenture complying with the requirements of Article Ten, satisfactory in form
to the Trustee, executed and delivered to the Trustee by such corporation and
(v) immediately after giving effect to such consolidation, merger, sale or
conveyance, the surviving corporation (whether the Company or such other
corporation) shall have a Consolidated Net Worth equal to or greater than the
Consolidated Net Worth of the Company immediately prior to such transaction.
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If at any time there be any consolidation or merger or sale or conveyance of
property to which the covenant of this Section 11.01 is applicable, then, in
any such event, the surviving corporation will promptly deliver to the Trustee:
(1) an Officers' Certificate stating that as of the time
immediately after the effective date of any such transaction the
covenants contained in this Section 11.01 have been complied with; and
(2) an Opinion of Counsel stating that such covenants
have been complied with and that any instrument or instruments
executed in the performance of such covenants comply with the
requirements thereof.
(b) Notwithstanding the foregoing Section 11.01(a), (i) the
Company may consolidate or merge with or into, or sell or convey all or
substantially all of its property to, KAC; provided, however, that the
surviving corporation (if other than the Company) shall expressly assume by
supplemental indenture complying with the requirements of Article Ten,
satisfactory in form to the Trustee, the due and punctual payment of the
principal of, premium, if any, Change of Control Purchase Price, Asset Sale
Purchase Price and interest on all of the Notes, according to their tenor, and
the due and punctual performance and observance of all the covenants and
conditions of this Indenture to be performed or observed by the Company and
(ii) the Company may consolidate or merge with or into, or sell or convey all
or substantially all of its property to, a Subsidiary Guarantor; provided, that
the surviving corporation (if other than the Company) shall expressly assume by
supplemental indenture complying with the requirements of Article Ten,
satisfactory in form to the Trustee, the due and punctual payment of the
principal of, premium, if any, Change of Control Purchase Price, Asset Sale
Purchase Price and interest on all of the Notes, according to their tenor, and
the due and punctual performance and observance of all the covenants and
conditions of this Indenture to be performed or observed by the Company.
SECTION 11.02. Successor corporation to be substituted. In case of
any such consolidation, merger, sale or conveyance and upon the assumption by
the successor corporation, in the manner hereinabove provided, of the due and
punctual payment of the principal of, premium, if any, Change of Control
Purchase Price, Asset Sale Purchase Price and interest on all of the Notes and
the due and punctual performance and observance of all of the covenants and
conditions of this Indenture to be performed or observed by the Company, such
successor corporation shall succeed to and be substituted for the Company, with
the same effect as if it had been named herein as the party of the first part
and the Company shall be relieved of all its obligations and duties under this
Indenture and the Notes. Such successor corporation thereupon may cause to be
signed, and may issue either in its own name or in the name of the Company, any
or all of the Notes issuable hereunder which theretofore shall not have been
signed by the Company and delivered to the Trustee; and, upon the order of such
successor corporation (instead of the Company) and subject to all the terms,
conditions and limitations in this Indenture prescribed, the Trustee shall
authenticate and shall deliver any Notes which previously shall have been
signed and delivered by the officers of the Company to the Trustee for
authentication, and any Notes which such successor corporation thereafter shall
cause to be signed and delivered to the Trustee for that purpose. All the
Notes so issued shall in all respects have the same legal rank and benefit
under this Indenture as the Notes theretofore or thereafter issued in
accordance with the terms of this Indenture as though all of such Notes had
been issued at the date of the execution hereof.
In case of any such consolidation, merger, sale or conveyance such
changes in phraseology and form (but not in substance) may be made in the Notes
thereafter to be issued as may be appropriate.
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SECTION 11.03. Opinion of Counsel. The Trustee, subject to the
provisions of Sections 7.01 and 7.02, may receive upon its request and rely on
an Opinion of Counsel as conclusive evidence that any such consolidation,
merger, sale or conveyance, and any such assumption, complies with the
provisions of this Article Eleven.
ARTICLE TWELVE
SATISFACTION AND DISCHARGE OF INDENTURE;
UNCLAIMED MONEYS
SECTION 12.01. Satisfaction and discharge of Indenture. If at any
time
(a) the Company shall deliver to the Trustee for cancellation all
Notes theretofore authenticated and delivered, other than (1) any Notes which
shall have been destroyed, lost or stolen and which shall have been replaced or
paid as provided in Section 2.07 or (2) any Note for the payment of the
principal of which money has theretofore been deposited in trust or segregated
and held in trust by the Company and thereafter repaid to the Company or
discharged from such trust, as provided in Section 12.04, and not theretofore
cancelled, or
(b) (1) all the Notes not theretofore cancelled or delivered to
the Trustee for cancellation shall have become due and payable, or are by their
terms to become due and payable within one year or are to be or may be called
for redemption within one year under arrangements satisfactory to the Trustee
for the giving of notice of redemption and (2) the Company has deposited with
the Trustee, in trust, money or non-callable Government Securities maturing as
to principal and interest in such amounts and at such times as are sufficient
(in the opinion of a nationally recognized firm of independent certified
accountants expressed in a written certification thereof delivered to the
Trustee), without consideration of any reinvestment of such interest, to pay at
maturity or upon redemption all of such Notes (other than any Notes which shall
have been destroyed, lost or stolen and which shall have been replaced or paid
as provided in Section 2.07) not theretofore cancelled or delivered to the
Trustee for cancellation, including principal, premium, if any, Change of
Control Purchase Price, Asset Sale Purchase Price and interest due or to become
due to such date of maturity or date fixed for redemption, as the case may be,
and if in either case the Company shall also pay or cause to be paid all other
sums payable hereunder by the Company, then this Indenture shall cease to be of
further effect and the Trustee, on demand of the Company accompanied by an
Officers' Certificate and an Opinion of Counsel complying with Section 14.05
and at the cost and expense of the Company, shall execute proper instruments
acknowledging satisfaction of and discharging this Indenture, except for those
provisions which expressly survive as provided below; the Company, however,
hereby agreeing to reimburse the Trustee for any costs or expenses theretofore
and thereafter reasonably and properly incurred by the Trustee in connection
with this Indenture or the Notes.
Notwithstanding the foregoing, the Company's obligations in Sections
2.05, 2.07, 4.01, 4.02, 4.04, 5.01, 5.02, 7.06, 12.03 and 12.04 shall survive
until the Notes are no longer outstanding. Thereafter, only the Company's
obligations in Sections 7.06, 12.03 and 12.04 shall survive.
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After a deposit made pursuant to this Section 12.01, the Trustee upon
request shall acknowledge in writing the discharge of the Company's obligations
under the Notes and this Indenture, except for those surviving obligations
specified above.
SECTION 12.02. Application by Trustee of funds deposited for payment
of Notes. All amounts deposited with the Trustee pursuant to Section 12.01
shall be held in trust and applied by it to the payment, either directly or
through any paying agent (including the Company acting as its own paying
agent), to the holders of the particular Notes, 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, premium, if any, Change of Control
Purchase Price, Asset Sale Purchase Price and interest.
SECTION 12.03. 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 Company, be paid to the Trustee and thereupon such paying
agent shall be released from all further liability with respect to such moneys.
SECTION 12.04. Repayment of moneys held by Trustee. The Trustee
shall promptly pay to the Company upon written request any excess money or
securities held by it at any time. Any moneys deposited with the Trustee or
any paying agent for the payment of the principal of, premium, if any, Change
of Control Purchase Price, Asset Sale Purchase Price or interest on any Notes
and not applied but remaining unclaimed by the holders of Notes for two years
after the date upon which such payment shall have become due, shall be promptly
repaid (together with any interest earned thereon) to the Company by the
Trustee or by such paying agent; and thereupon the Trustee and such paying
agent shall be released from all further liability with respect to such moneys,
and the holder of any of the Notes entitled to receive such payment shall
thereafter look only to the Company for the payment thereof, provided, however,
that the Trustee or such paying agent, before being required to make any such
repayment, may, at the expense of the Company, mail to the holders of Notes at
their last known address or cause to be published once in a newspaper published
in the English language, customarily published on each Business Day and of
general circulation in the Borough of Manhattan, City of New York, State of New
York, a notice that such money remains unclaimed and that, after a date
specified therein, which shall not be less than thirty days from the date of
such mailing or publication, any unclaimed balance of such money then remaining
will be paid to the Company.
SECTION 12.05. Reinstatement. If the Trustee is unable to apply any
money or securities deposited by the Company with the Trustee in accordance
with Section 12.01 by reason of any legal proceeding or by reason of any order
or judgment of any court or governmental authority enjoining, restraining or
otherwise prohibiting such application, then the Company's obligations under
this Indenture and the Notes shall be revived and reinstated as though no
deposit had occurred pursuant to Section 12.01 until such time as the Trustee
is permitted to apply all such money or securities deposited by the Company
with the Trustee in accordance with Section 12.01; provided that if the Company
has made any payment of principal of, premium, if any, Change of Control
Purchase Price, Asset Sale Purchase Price or interest on any Notes because of
the reinstatement of its obligations, the Company shall be subrogated to the
rights of the holders of such Notes to receive such payment from the money or
securities deposited by the Company and held by the Trustee.
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ARTICLE THIRTEEN
IMMUNITY OF INCORPORATORS, STOCKHOLDERS, OFFICERS
AND DIRECTORS
SECTION 13.01. Incorporators, stockholders, officers and directors of
Company exempt from individual liability. No recourse under or upon any
obligation, covenant or agreement of this Indenture or any indenture
supplemental hereto or of any Note, or for any claim based thereon or otherwise
in respect thereof, shall be had against any incorporator, stockholder, officer
or director, as such, past, present or future, of the Company or of any
successor corporation, either directly or through the Company or any successor
corporation, whether by virtue of any constitution, statute or rule of law, or
by the enforcement of any assessment or penalty or otherwise; it being
expressly understood that this Indenture and the obligations issued hereunder
are solely corporate obligations, and that no such personal liability whatever
shall attach to, or is or shall be incurred by, the incorporators,
stockholders, officers or directors, as such, of the Company or of any
successor corporation, or any of them, because of the creation of the
indebtedness hereby authorized, or under or by reason of the obligations,
covenants or agreements contained in this Indenture or in any of the Notes or
implied therefrom; and that any and all such personal liability of every name
and nature, either at common law or in equity or by constitution or statute,
of, and any and all such rights and claims against, every such incorporator,
stockholder, officer or director, as such, because of the creation of the
indebtedness hereby authorized, or under or by reason of the obligations,
covenants or agreements contained in this Indenture or in any of the Notes or
implied therefrom are hereby expressly waived and released as a condition of,
and as a consideration for, the execution of this Indenture and the issue of
such Notes.
ARTICLE FOURTEEN
MISCELLANEOUS PROVISIONS
SECTION 14.01. Successors and assigns of Company bound by Indenture.
All the covenants, stipulations, promises and agreements in this Indenture
contained by or in behalf of the Company shall bind its successors and assigns,
whether so expressed or not.
SECTION 14.02. Acts of board, committee or officer of successor
corporation valid. Any act or proceeding by any provision of this Indenture
authorized or required to be done or performed by any board, committee or
officer of the Company shall and may be done and performed with like force and
effect by the like board, committee or officer of any corporation that shall at
the time be the lawful sole successor of the Company.
SECTION 14.03. Required notices or demands may be served by mail;
waiver. Any notice or demand which by any provisions of this Indenture is
required or permitted to be given or served by the Trustee or by the holders of
Notes to or on the Company may be given or served by being deposited postage
prepaid (except as provided in Section 6.01(c)) by first class mail in a post
office letter box addressed (until another address is filed by the Company with
the Trustee for such purpose), as follows: Kaiser Aluminum & Chemical
Corporation, 5847 San Felipe, Suite 2600, Houston, Texas 77057, Attention:
Secretary. Any notice, direction, request or demand by any noteholder to or
upon the Trustee
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shall be deemed to have been sufficiently given or made, for all purposes, if
given or made at the principal office of the Trustee, to the attention of the
Corporate Trust Department.
Any notice or communication to a noteholder shall be mailed by
first-class mail to his address shown on the Company's registry. Failure to
mail a notice or communication to a noteholder or any defect in it shall not
affect its sufficiency with respect to other noteholders. If a notice or
communication is mailed in the manner so provided within the time prescribed,
it is duly given, whether or not the addressee receives it.
Where this Indenture provides for notice in any manner, such notice
may be waived in writing by the person entitled to receive such notice, either
before or after the event or action relating thereto, and such waiver shall be
equivalent of such notice. Waivers of notice by noteholders shall be filed
with the Trustee, but such filing shall not be a condition precedent to the
validity of any action taken in reliance upon such waiver.
In case, by reason of the suspension of regular mail service or as a
result of a strike, work stoppage or similar activity, or any act of God or any
other cause, it shall be impractical to mail any notice as required by this
Indenture, then any manner of giving such notice as shall be made with the
approval of the Trustee shall constitute sufficient giving of notice hereunder.
SECTION 14.04. Indenture and Notes to be construed in accordance with
the laws of the State of New York. THIS INDENTURE AND EACH NOTE SHALL BE
DEEMED TO BE A CONTRACT MADE UNDER THE LAWS OF THE STATE OF NEW YORK, AND FOR
ALL PURPOSES SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF
SAID STATE WITHOUT REGARD TO THE PRINCIPLES OF THE CONFLICT OF LAWS PROVISIONS
THEREOF.
SECTION 14.05. Evidence of compliance with conditions precedent.
Upon any demand, request or application by the Company to the Trustee to take
any action under any of the provisions of this Indenture, the Company shall
furnish to the Trustee an Officers' Certificate stating that all conditions
precedent, if any, 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 demand, request or application as to which
the furnishing of such document 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 (other than those provided for in Section 5.03(d)) 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 (1) a statement that the person making such certificate
or opinion has read such covenant or condition; (2) a brief statement as to the
nature and scope of the examination or investigation upon which the statements
or opinions contained in such certificate or opinion are based; (3) a statement
that, in the opinion of such person, he has made such examination or
investigation as is necessary to enable him to express an informed opinion as
to whether or not such covenant or condition has been complied with; and (4) a
statement as to whether or not, in the opinion of such person, such condition
or covenant has been complied with.
Any certificate, statement or opinion of an officer of the Company may
be based, insofar as it relates to legal matters, upon a certificate or opinion
of or representations by counsel, unless such officer
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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. Any certificate, statement or opinion of counsel may
be based, insofar as it relates to factual matters, information with respect to
which is in the possession of the Company, upon the certificate, statement or
opinion of or representations by an officer or officers of the Company or public
officials, unless such counsel knows that the certificate, statement or opinion
or representations with respect to the matters upon which his certificate,
statements or opinion may be based as aforesaid are erroneous.
Any certificate, statement or opinion of an officer of the Company 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 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 of opinion may be based as
aforesaid 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 14.06. Payments due on Saturdays, Sundays and holidays. In
any case where the date of payment of principal of, premium, if any, Change of
Control Purchase Price, Asset Sale Purchase Price or interest on the Notes or
the date fixed for redemption or purchase of any Note shall not be a Business
Day, then payment of principal, premium, if any, Change of Control Purchase
Price, Asset Sale Purchase Price or interest 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 payment or the date fixed for redemption or purchase,
and no interest shall accrue on or after such original date of payment or such
original date fixed for redemption or purchase.
SECTION 14.07. Provisions required by Trust Indenture Act of 1939 to
control. If and to the extent that any provision of this Indenture limits,
qualifies or conflicts with the duties imposed by operation of the following
sentence, the imposed duties shall control. The provisions of Sections 310 to
317, inclusive, of the Trust Indenture Act of 1939 that impose duties on any
person (including provisions automatically deemed included in this Indenture
unless this Indenture provides that such provisions are excluded) are a part of
and govern this Indenture, whether or not physically contained herein.
SECTION 14.08. Provisions of the Indenture and Notes for the sole
benefit of the parties and the noteholders. Nothing in this Indenture or in
the Notes, expressed or implied, shall give or be construed to give any person,
firm or corporation, other than the parties hereto and the holders of the
Notes, any legal or equitable right, remedy or claim under or in respect of
this Indenture, or under any covenant, condition or provision herein contained;
all its covenants, conditions and provisions being for the sole benefit of the
parties hereto and of the holders of the Notes.
SECTION 14.09. Severability. In case any one or more of the
provisions contained in this Indenture or in the Notes shall for any reason be
held to be invalid, illegal or unenforceable in any respect, such invalidity,
illegality or unenforceability shall not affect any other provisions of this
Indenture or of such Notes, but this Indenture and such Notes shall be
construed as if such invalid or illegal or unenforceable provision had never
been contained herein or therein.
SECTION 14.10. Indenture may be executed in counterparts; acceptance
by Trustee. 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. First Trust National Association
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hereby accepts the trusts in this Indenture declared and provided, upon the
terms and conditions hereinabove set forth.
SECTION 14.11. Article and Section headings. The Article and Section
references herein and in the Table of Contents are for convenience only and
shall not affect the construction hereof.
SECTION 14.12. No Adverse Interpretation of Other Instruments. This
Indenture shall not be used to interpret another indenture, loan or debt
agreement of the Company or any Subsidiary or Affiliate of the Company. Any
such indenture, loan or debt agreement may not be used to interpret this
Indenture.
ARTICLE FIFTEEN
GUARANTEE OF NOTES
SECTION 15.01. Guarantee. Subject to the provisions of this Article
Fifteen, each Subsidiary Guarantor, jointly and severally, hereby
unconditionally guarantees to each holder of a Note authenticated and delivered
by the Trustee (i) the due and punctual payment of the principal of, premium,
if any, Change of Control Purchase Price, Asset Sale Purchase Price and
interest on such Note, when and as the same shall become due and payable,
whether at maturity, by acceleration or otherwise, the due and punctual payment
of interest on the overdue principal of, premium, Change of Control Purchase
Price, Asset Sale Purchase Price and interest, if any, on the Notes, to the
extent lawful, and the due and punctual performance of all other obligations of
the Company to the holders of the Notes or the Trustee all in accordance with
the terms of such Note and of this Indenture and (ii) in the case of any
extension of time of payment or renewal of any Notes or any of such other
obligations, that the same will be promptly paid in full when due or performed
in accordance with the terms of the extension or renewal, at stated maturity,
by acceleration or otherwise. Each Subsidiary Guarantor hereby agrees that its
obligations hereunder shall be absolute and unconditional, irrespective of, and
shall be unaffected by, any invalidity, irregularity or unenforceability of any
such Note or this Indenture, any failure to enforce the provisions of any such
Note or this Indenture, any waiver, modification or indulgence granted to the
Company with respect thereto, by the holder of such Note or the Trustee, or any
other circumstances which may otherwise constitute a legal or equitable
discharge of a surety or guarantor. Each Subsidiary Guarantor hereby waives
diligence, presentment, filing of claims with a court in the event of merger or
bankruptcy of the Company, any right to require a proceeding first against the
Company, the benefit of discussion, protest or notice with respect to any such
Note or the indebtedness evidenced thereby and all demands whatsoever, and
covenants that this Guarantee will not be discharged as to any such Note except
by payment in full of the principal thereof, premium, if any, Change of Control
Purchase Price, Asset Sale Purchase Asset and interest thereon or as provided
in Sections 12.01, 15.03 and 15.05. Each Subsidiary Guarantor further agrees
that, as between such Subsidiary Guarantor, on the one hand, and the holders of
Notes and the Trustee, on the other hand, (i) the maturity of the obligations
guaranteed hereby may be accelerated as provided in Article Six for the
purposes of this Guarantee, notwithstanding any stay, injunction or other
prohibition preventing such acceleration in respect of the obligations
guaranteed hereby, and (ii) in the event of any declaration of acceleration of
such obligations as provided in Article Six, such obligations (whether or not
due and payable) shall, subject to the other provisions of this Article
Fifteen, forthwith become due and payable by such Subsidiary Guarantor for the
purpose of this Guarantee. In addition, without limiting the foregoing
provisions, upon the effectiveness of an acceleration under Article Six, the
Trustee shall promptly make a demand for payment on the Notes under the
Guarantee provided for in this Article Fifteen.
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Each Subsidiary Guarantor shall be subrogated to all rights of the
holder of any Notes against the Company in respect of any amounts paid to the
holder of Notes by such Subsidiary Guarantor pursuant to the provisions of this
Guarantee; provided, that such Subsidiary Guarantor shall not be entitled to
enforce, or to receive any payments arising out of or based upon, such right of
subrogation until the principal of, premium, if any, Change of Control Purchase
Price, Asset Sale Purchase Price and interest on all Notes shall have been paid
in full.
SECTION 15.02. Guarantee senior in respect of Subordinated Notes.
Each Subsidiary Guarantor, for itself, its successors and assigns, hereby
acknowledges that the Guarantee issued hereunder in respect of the Notes shall
hereafter constitute for all purposes Senior Indebtedness of such Subsidiary
Guarantor under the terms of the 12 3/4% Note Indenture to the extent that such
Subsidiary Guarantor is a guarantor under the 12 3/4% Note Indenture.
SECTION 15.03. Subsidiary Guarantors may consolidate, etc., on
certain terms.
(a) Notwithstanding any other provision of this Indenture (i) a
Subsidiary Guarantor may consolidate or merge with or into, or sell or convey
all or substantially all of its property to, the Company, provided, that the
surviving corporation (if other than the Company) shall expressly assume by
supplemental indenture complying with the requirements of Article Ten,
satisfactory in form to the Trustee, the due and punctual payment of the
principal of, premium, if any, Change of Control Purchase Price, Asset Sale
Purchase Price and interest on all of the Notes, according to their tenor, and
the due and punctual performance and observance of all the covenants and
conditions of this Indenture to be performed or observed by the Company and
(ii) a Subsidiary Guarantor may consolidate or merge with or into, or sell or
convey all or substantially all of its property to, any other Subsidiary
Guarantor.
(b) Nothing contained in this Indenture or in any of the Notes
shall prevent any consolidation or merger of any Subsidiary Guarantor with or
into any other corporation or corporations (whether or not affiliated with such
Subsidiary Guarantor), or successive consolidations or mergers in which such
Subsidiary Guarantor or its successor or successors shall be a party or
parties, or shall prevent any sale or conveyance of the property of any
Subsidiary Guarantor as an entirety or substantially as an entirety to any
other corporation (whether or not affiliated with such Subsidiary Guarantor)
authorized to acquire and operate the same, whether in a single transaction or
a series of related transactions; provided, however, that each Subsidiary
Guarantor hereby covenants and agrees that any such consolidation, merger, sale
or conveyance shall be upon the condition that: (i) in the event that the
surviving corporation is a Subsidiary of the Company, then (A) such surviving
corporation (if other than such Subsidiary Guarantor) shall be a corporation
organized under the laws of the United States of America or any State thereof,
(B) such surviving corporation (if other than such Subsidiary Guarantor) shall
assume the due and punctual performance and observance of all of the covenants
and conditions of this Indenture to be performed by such Subsidiary Guarantor
by supplemental indenture complying with the requirements of Article Ten,
satisfactory in form to the Trustee, executed and delivered to the Trustee, (C)
immediately after giving effect to such consolidation, merger, sale or
conveyance, the Company could incur $1.00 of Indebtedness pursuant to Section
4.10(a) and (D) immediately after giving effect to such consolidation, merger,
sale or conveyance, the surviving corporation (whether such Subsidiary
Guarantor or such other corporation) shall have a Consolidated Net Worth equal
to or greater than the Consolidated Net Worth of such Subsidiary Guarantor
immediately prior to such transaction; and (ii) in the event that the surviving
corporation is not a Subsidiary of the Company, then such consolidation,
merger, sale or conveyance shall otherwise have been made in compliance with
the terms of this Indenture (including, without limitation, Section 4.14). In
the event that the surviving corporation is a Subsidiary of the Company, (I)
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such Subsidiary Guarantor shall deliver to the Trustee an Officers' Certificate
and an Opinion of Counsel, each stating that such merger, consolidation or
transfer and such supplemental indenture comply with this Section 15.03(b) and
that all conditions precedent herein provided relating to such transaction have
been complied with and (II) in case of any such consolidation, merger, sale or
conveyance and upon the assumption by the surviving corporation (if other than
such Subsidiary Guarantor), by supplemental indenture executed and delivered to
the Trustee and satisfactory in form to the Trustee, of the due and punctual
performance of all the covenants and conditions of this Indenture to be
performed by such Subsidiary Guarantor, such surviving corporation shall
succeed to and be substituted for such Subsidiary Guarantor, with the same
effect as if it had been named herein as such Subsidiary Guarantor and in the
case of any such sale or conveyance, such Subsidiary Guarantor (if not the
surviving corporation) shall be relieved of all of its obligations and duties
under this Indenture and the Notes.
SECTION 15.04. Application of certain terms and provisions to the
Subsidiary Guarantors.
(a) For purposes of any provision of this Indenture which provides
for the delivery by any Subsidiary Guarantor of an Officer's Certificate and/or
an Opinion of Counsel, the definitions of such terms in Section 1.01 shall
apply to such Subsidiary Guarantor as if references therein to the Company were
references to such Subsidiary Guarantor.
(b) The Subsidiary Guarantors shall comply with all reporting
requirements of Section 5.03 as if references therein to the Company were
references to the Subsidiary Guarantors.
(c) Any request, direction, order or demand which by any provision
of this Indenture is to be made by any Subsidiary Guarantor, shall be
sufficient if evidenced as described in Section 7.02 as if references therein
to the Company were references to such Subsidiary Guarantor.
(d) 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 Notes to or on any Subsidiary Guarantor may be given or served as described
in Section 14.03 as if references therein to the Company were references to
such Subsidiary Guarantor.
(e) Upon any demand, request or application by any Subsidiary
Guarantor to the Trustee to take any action under this Indenture, such
Subsidiary Guarantor shall furnish to the Trustee such certificates and
opinions as are required in Section 14.05 as if all references therein to the
Company were references to such Subsidiary Guarantor.
SECTION 15.05. Release of Guarantee.
(a) If at any time any Subsidiary Guarantor ceases to be a Bank
Guarantor, is not a Subsidiary Guarantor under the 12 3/4% Note Indenture, the
10 7/8% Note Indenture and the 9 7/8% Note Indenture and no Event of Default
(or event or condition which with the giving of notice or the passage of time
would be an Event of Default) then exists and is continuing, and either (x)
such Subsidiary Guarantor has not Incurred any Indebtedness or preferred stock
(including preference stock) after the date hereof that is then outstanding
other than Indebtedness Incurred pursuant to Section 4.10(a) (but only to the
extent such Indebtedness is also Indebtedness of Alpart), Section 4.10(b)(iii)
or Section 4.10(b)(iv) and, in each case, permitted refinancings thereof, or
(y) the Notes are then rated Baa3 (or the equivalent) or better by Moody's
Investors Service, Inc. (or a successor rating agency) or BBB- (or the
equivalent) or better by Standard & Poor's Corporation (or a successor rating
agency), then such Person shall cease to be a
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Subsidiary Guarantor hereunder upon the delivery of the Officers' Certificate
and Opinion of Counsel set forth in paragraph (b) of this Section 15.05.
Thereafter, the Guarantee given by such Subsidiary Guarantor shall no longer
have any force or effect and such Person shall be relieved of all of its
obligations and duties under this Indenture and the Notes.
(b) Upon any Subsidiary Guarantor ceasing to be a Bank Guarantor,
the Company may, at its option, deliver to the Trustee an Officers' Certificate
and an Opinion of Counsel, each stating that such Subsidiary Guarantor is no
longer a Bank Guarantor, is not a Subsidiary Guarantor under the 9 7/8% Note
Indenture, the 10 7/8% Note Indenture or the 12 3/4% Note Indenture and that no
Event of Default (or event or condition which with the giving of notice or the
passage of time would become an Event of Default) exists and is continuing and
that all conditions precedent herein provided relating to Section 15.05(a) have
been complied with.
(c) Upon the sale or disposition (by merger or otherwise,
including, without limitation, pursuant to Section 15.03(b)(ii)) of a
Subsidiary Guarantor (or the Company's or a Subsidiary's interest therein) by
the Company or a Subsidiary of the Company to a Person that is not the Company
or a Subsidiary of the Company and which sale or disposition is otherwise in
compliance with the terms of this Indenture (including, without limitation,
Section 4.14), the obligations of such Subsidiary Guarantor under its Guarantee
shall be deemed released without any further action required on the part of the
Trustee, such Subsidiary Guarantor, the Company or any holder of the Notes,
provided that any guarantee of such Subsidiary Guarantor with respect to the
Credit Agreement, the 12 3/4% Notes, the 10 7/8% Notes and the 9 7/8% Notes,
and any renewals, extensions, refundings, replacements, restructurings or
refinancings, amendments and modifications thereof, if any, has been or is
simultaneously released. At the request of the Company, the Trustee shall
execute and deliver an appropriate instrument evidencing any such release.
(d) Upon the designation by the Board of Directors of the Company
of a Subsidiary Guarantor as an Unrestricted Subsidiary in compliance with the
terms of this Indenture, the obligations of such Subsidiary Guarantor under its
Guarantee shall be deemed released without any further action required on the
part of the Trustee, such Subsidiary Guarantor, the Company or any holder of
the Notes; provided, however, that, any guarantee of such Subsidiary Guarantor
with respect to the Credit Agreement, the 12 3/4% Notes, the 10 7/8% Notes and
the 9 7/8% Notes, and any renewals, extensions, refundings, replacements,
restructurings or refinancings, amendments and modifications thereof, if any,
has been or is simultaneously released.
(e) Upon the release of any Subsidiary Guarantor from its
Guarantee pursuant to any provision of this Indenture, each other Subsidiary
Guarantor not so released shall remain liable for the full amount of principal
of, and interest on, the Notes as and to the extent provided in this Indenture.
At the request of the Company, the Trustee shall execute and deliver an
appropriate instrument evidencing any such release.
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IN WITNESS WHEREOF, each of KAISER ALUMINUM & CHEMICAL CORPORATION,
KAISER ALUMINA AUSTRALIA CORPORATION, ALPART JAMAICA INC., KAISER FINANCE
CORPORATION, KAISER JAMAICA CORPORATION, KAISER MICROMILL HOLDINGS, LLC, KAISER
SIERRA MICROMILLS, LLC, KAISER TEXAS MICROMILL HOLDINGS, LLC and KAISER TEXAS
SIERRA MICROMILLS, LLC, has caused this Indenture to be signed and acknowledged
by its Chairman of the Board, its President or one of its Vice Presidents, and
its corporate seal to be affixed hereunto, and the same to be attested by one
of its Vice Presidents; and FIRST TRUST NATIONAL ASSOCIATION has caused this
Indenture to be signed and acknowledged by one of its Vice Presidents or
Assistant Vice Presidents, has caused its corporate seal to be affixed
hereunto, and the same to be attested by one of its Assistant Secretaries, all
as of the day and year first written above.
KAISER ALUMINUM & CHEMICAL CORPORATION
By: /s/ KAREN A. TWITCHELL
____________________________________
Name: Karen A. Twitchell
Title: Treasurer
[SEAL]
Attest: Byron L. Wade
KAISER ALUMINA AUSTRALIA CORPORATION
By: /s/ KAREN A. TWITCHELL
____________________________________
Name: Karen A. Twitchell
Title: Treasurer
[SEAL]
Attest: Byron L. Wade
ALPART JAMAICA INC.
By: /s/ KAREN A. TWITCHELL
____________________________________
Name: Karen A. Twitchell
Title: Treasurer
[SEAL]
Attest: Byron L. Wade
123
KAISER FINANCE CORPORATION
By: /s/ KAREN A. TWITCHELL
____________________________________
Name: Karen A. Twitchell
Title: Treasurer
[SEAL]
Attest: Byron L. Wade
KAISER JAMAICA CORPORATION
By: /s/ KAREN A. TWITCHELL
____________________________________
Name: Karen A. Twitchell
Title: Treasurer
[SEAL]
Attest:
KAISER MICROMILL HOLDINGS, LLC
By: /s/ JOSEPH A. BONN
____________________________________
Name: Joseph A. Bonn
Title: Manager
[SEAL]
Attest: Anthony R. Pierno
KAISER SIERRA MICROMILLS, LLC
By: /s/ KAREN A. TWITCHELL
____________________________________
Name: Karen A. Twitchell
Title: Treasurer
[SEAL]
Attest: Byron L. Wade
124
KAISER TEXAS MICROMILL HOLDINGS, LLC
By: /s/ KAREN A. TWITCHELL
____________________________________
Name: Karen A. Twitchell
Title: Treasurer
[SEAL]
Attest: Byron L. Wade
KAISER TEXAS SIERRA MICROMILLS, LLC
By: /s/ KAREN A. TWITCHELL
____________________________________
Name: Karen A. Twitchell
Title: Treasurer
[SEAL]
Attest: Byron L. Wade
FIRST TRUST NATIONAL ASSOCIATION, as Trustee
By: /s/ RICHARD H. PROKOSCH
____________________________________
Name: Richard H. Prokosch
Title: Trust Officer
[SEAL]
Attest:
125
Exhibit A-1
(Back of Regulation S Temporary Global Note)
10 7/8% [Series C] and/or [Series D] Senior Note due 2006
THE RIGHTS ATTACHING TO THIS REGULATION S TEMPORARY GLOBAL
NOTE, AND THE CONDITIONS AND PROCEDURES GOVERNING ITS EXCHANGE FOR CERTIFICATED
NOTES, ARE AS SPECIFIED IN THE INDENTURE (AS DEFINED HEREIN).
NEITHER THE HOLDER NOR THE BENEFICIAL OWNERS OF THIS
REGULATION S TEMPORARY GLOBAL NOTE SHALL BE ENTITLED TO RECEIVE PAYMENT OF
INTEREST HEREON.
UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR
INTERESTS IN THE GLOBAL NOTE OR NOTES IN DEFINITIVE FORM, THIS NOTE MAY NOT BE
TRANSFERRED EXCEPT AS A WHOLE BY THE DEPOSITORY TO A NOMINEE OF THE DEPOSITORY,
OR BY ANY SUCH NOMINEE OF THE DEPOSITORY TO THE DEPOSITORY OR ANOTHER NOMINEE
OF THE DEPOSITORY OR BY THE DEPOSITORY OR ANY SUCH NOMINEE TO A SUCCESSOR
DEPOSITORY OR A NOMINEE OF SUCH SUCCESSOR DEPOSITORY. UNLESS THIS CERTIFICATE
IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A
NEW YORK CORPORATION, ("DTC"), TO THE COMPANY OR ITS AGENT FOR REGISTRATION OF
TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE
NAME OF CEDE & CO. OR SUCH OTHER NAME AS MAY BE REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC (AND ANY PAYMENT HEREON IS MADE TO CEDE & CO. OR TO SUCH
OTHER ENTITY AS MAY BE 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 AND TRANSFERS OF PORTIONS OF THIS
GLOBAL SECURITY SHALL BE LIMITED TO TRANSFERS MADE IN ACCORDANCE WITH THE
RESTRICTIONS SET FORTH IN SECTION 2.05 OF THE INDENTURE.
THE NOTES EVIDENCED HEREBY HAVE NOT BEEN REGISTERED UNDER THE
UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT OF
1933"), OR ANY STATE SECURITIES LAWS. NEITHER THIS SECURITY NOR ANY INTEREST
OR PARTICIPATION HEREIN MAY BE REOFFERED, SOLD, ASSIGNED TRANSFERRED, PLEDGED,
ENCUMBERED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION OR
UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO REGISTRATION. THE
HOLDER OF THIS SECURITY OR ANY INTEREST OR PARTICIPATION HEREIN BY ITS
ACCEPTANCE HEREOF AGREES TO OFFER, SELL OR OTHERWISE TRANSFER SUCH SECURITY,
INTEREST OR PARTICIPATION PRIOR TO THE DATE WHICH IS THREE YEARS (OR SUCH
SHORTER PERIOD PERMITTED UNDER RULE 144(K) UNDER THE SECURITIES ACT OF 1933 (OR
A SUCCESSOR CLAUSE)) AFTER THE LATER OF THE ORIGINAL ISSUE DATE HEREOF AND THE
LAST DATE ON WHICH THE COMPANY OR ANY AFFILIATE OF THE COMPANY WAS THE OWNER OF
THIS SECURITY (OR ANY PREDECESSOR OF THIS SECURITY) (THE "RESALE RESTRICTION
TERMINATION DATE") ONLY (1) BY THE INITIAL INVESTOR (A) TO THE COMPANY, (B)
PURSUANT TO A REGISTRATION STATEMENT WHICH HAS BEEN DECLARED EFFECTIVE UNDER
THE SECURITIES ACT OF 1933, (C) FOR SO LONG AS THE NOTES ARE ELIGIBLE FOR
RESALE
126
PURSUANT TO RULE 144A, TO A PERSON IT REASONABLY BELIEVES IS A "QUALIFIED
INSTITUTIONAL BUYER" AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT OF 1933
THAT PURCHASES FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED
INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN THAT THE TRANSFER IS BEING MADE IN
RELIANCE ON RULE 144A, (D) PURSUANT TO OFFERS AND SALES TO NON-U.S. PERSONS WHO
MAKE CERTAIN REPRESENTATIONS TO THE TRUSTEE WHICH OFFERS AND SALES OCCUR
OUTSIDE THE UNITED STATES WITHIN THE MEANING OF REGULATION S UNDER THE
SECURITIES ACT OF 1933, OR (E) PURSUANT TO ANOTHER AVAILABLE EXEMPTION FROM THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT OF 1933, AND (2) BY SUBSEQUENT
INVESTORS, AS SET FORTH IN (1) ABOVE AND, IN ADDITION, TO AN INSTITUTIONAL
"ACCREDITED INVESTOR" WITHIN THE MEANING OF SUBPARAGRAPH (A)(1), (2), (3) OR
(7) OF RULE 501 UNDER THE SECURITIES ACT OF 1933 THAT IS ACQUIRING THE SECURITY
FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF SUCH AN INSTITUTIONAL "ACCREDITED
INVESTOR" FOR INVESTMENT PURPOSES AND NOT WITH A VIEW TO, OR FOR OFFER OR SALE
IN CONNECTION WITH, ANY DISTRIBUTION IN VIOLATION OF THE SECURITIES ACT OF
1933, AND WHO MAKES CERTAIN REPRESENTATIONS TO THE TRUSTEE, SUBJECT TO THE
COMPANY'S AND THE TRUSTEE'S RIGHT PRIOR TO ANY SUCH OFFER, SALE OR TRANSFER
PURSUANT TO CLAUSES (D), (E) OR (2) PRIOR TO THE RESALE RESTRICTION TERMINATION
DATE TO REQUIRE THE DELIVERY OF AN OPINION OF COUNSEL, CERTIFICATION AND/OR
OTHER INFORMATION SATISFACTORY TO THE COMPANY AND THE TRUSTEE, AND, IN EACH
CASE, IN ACCORDANCE WITH ALL APPLICABLE SECURITIES LAWS OF THE STATES OF THE
UNITED STATES AND (B) THE HOLDER WILL, AND EACH SUBSEQUENT HOLDER IS REQUIRED
TO, NOTIFY ANY PURCHASER FROM IT OF THE NOTES EVIDENCED HEREBY OF THE RESALE
RESTRICTIONS SET FORTH IN (A) ABOVE.
Until this Regulation S Temporary Global Note is exchanged for
interests in the Global Notes or for Certificated Notes, the Holder hereof
shall not be entitled to receive payments of interest hereon; until so
exchanged in full, this Regulation S Temporary Global Note shall in all other
respects be entitled to the same benefits as other Notes under the Indenture.
This Regulation S Temporary Global Note is exchangeable in
whole or in part for interests in the Global Note or for Certificated Notes
only (i) on or after the termination of the 40-day restricted period (as
defined in Regulation S) and (ii) upon presentation of certificates required by
Article 2 of the Indenture. Upon exchange of this Regulation S Temporary
Global Note in full for interests in the Global Note or Certificated Notes, the
Trustee shall cancel this Regulation S Temporary Global Note.
This Regulation S Temporary Global Note shall not become valid
or obligatory until the certificate of authentication hereon shall have been
duly manually signed by the Trustee in accordance with the Indenture. This
Regulation S Temporary Global Note shall be governed by and construed in
accordance with the laws of the State of the New York. All references to "$,"
"Dollars," "dollars" or "U.S. $" are to such coin or currency of the United
States of America as at the time shall be legal tender for the payment of
public and private debts therein.
127
Exhibit A-2
FORM OF CERTIFICATE FOR EXCHANGE OR REGISTRATION OF TRANSFER
FROM REGULATION S GLOBAL NOTE
(Pursuant to Section 2.05(e) of the Indenture)
First Trust National Association
180 E. Fifth Street
St. Paul, MN 55101
Attention: Corporate Trust Division
Re: 10 7/8% [Series C] and/or [Series D] Senior Notes due
2006 of Kaiser Aluminum & Chemical Corporation
Reference is hereby made to the Indenture, dated as of
December 23, 1996 (the "Indenture"), among Kaiser Aluminum & Chemical
Corporation, as issuer (the "Company"), the parties listed therein as
subsidiary guarantors and First Trust National Association, as trustee.
Capitalized terms used but not defined herein shall have the meanings given to
them in the Indenture.
This letter relates to $_______ principal amount of Notes
which are evidenced by one or more Regulation S Temporary Global Notes (CUSIP
__________) and held with the Depository in the name of
____________________________ (the "Transferor"). The Transferor has requested
a transfer of such beneficial interest in the Notes to a Person who will take
delivery thereof in the form of an equal principal amount of Notes evidenced by
(i) the Global Notes (CUSIP ____________), to be held with the Depository or
(ii) Certificated Notes (CUSIP _________).
In connection with such request and in respect of such Notes,
the Transferor hereby certifies that:
[CHECK ONE]
[ ] such transfer is being effected pursuant to and in accordance
with Rule 144A under the United States Securities Act of 1933,
as amended (the "Securities Act"), and, accordingly, the
Transferor hereby further certifies that the Notes are being
transferred to a Person that the Transferor reasonably
believes is purchasing the Notes for its own account, or for
one or more accounts with respect to which such Person
exercises sole investment discretion, and such Person and each
such account is a "qualified institutional buyer" within the
meaning of Rule 144A in a transaction meeting the requirements
of Rule 144A;
[ ] such transfer is being effected pursuant to an effective
registration statement under the Securities Act;
or
[ ] such transfer is being effected pursuant to an exemption from
the registration requirements of the Securities Act other than
Rule 144A,
and the Transferor hereby further certifies that the Notes are being
transferred in compliance with the transfer restrictions applicable to the
Regulation S Temporary Global Note and in accordance with the requirements of
the exemption claimed, which certification is supported by an Opinion of
Counsel, provided by the Transferor or the transferee (a copy of which the
Transferor has attached to this certification) in form reasonably acceptable to
the Company and to the Note registrar, to the effect that such transfer is in
compliance with the Securities Act;
and such Notes are being transferred in compliance with any applicable blue sky
securities laws of any state of the United States.
128
Upon giving effect to this request to exchange a beneficial
interest in Regulation S Temporary Global Notes for a beneficial interest in
Global Notes or for Certificated Notes, as applicable, the resulting beneficial
interest shall be subject to the restrictions on transfer applicable to Global
Notes or Certificated Notes, as applicable, pursuant to the Indenture and the
Securities Act.
This certificate and the statements contained herein are made
for your benefit and the benefit of the Company and the Purchasers of such
Notes being transferred.
__________________________
[Name of Transferor]
By:___________________________________________________________________
Name:
Title:
Dated: _____________, _____
129
SCHEDULE A
SCHEDULE OF LIENS SECURING
INDEBTEDNESS IN EXCESS OF $5,000,000
130
SCHEDULE B
REAL PROPERTY CONSTITUTING
PERMITTED COLLATERAL
131
SCHEDULE C
CERTAIN INDEBTEDNESS IN EXCESS OF $10,000,000