As filed with the Securities and Exchange Commission on November 28, 1997
Registration No. 333-____________
================================================================================
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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Form S-3
REGISTRATION STATEMENT
UNDER THE SECURITIES ACT OF 1933
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PRECISION CASTPARTS CORP.
(Exact name of registrant as specified in its charter)
Oregon 93-0460598
(State or other jurisdiction (I.R.S. Employer
of incorporation or organization) Identification No.)
4650 S.W. Macadam Avenue William D. Larsson
Suite 440 Vice President and Chief
Portland, Oregon 97201 Financial Officer
(503) 417-4800 4650 S.W. Macadam Avenue, Suite 440
(Address, including zip code, and Portland, Oregon 97201
telephone number, including area code, (503) 417-4800
of registrant's principal (Name, address, including zip code,
executive offices) and telephone number, including
area code of agent for service)
--------------------
Copies to:
Gary R. Barnum John L. Savva
Richard C. Josephson Sullivan & Cromwell
Stoel Rives LLP 444 South Flower Street
900 SW Fifth Avenue Los Angeles, California 90071
Portland, Oregon 97204 (213) 955-8000 (phone)
(503) 224-3380 (phone) (213) 683-0457 (fax)
(503) 220-2480 (fax)
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Approximate date of commencement of proposed sale to
the public: As soon as practicable following the effectiveness
of this Registration Statement.
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If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box: [ ]
If any of the securities being registered on this Form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or interest
reinvestment plans, check the following box. [X]
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. [ ] __________
If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [ ] __________
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. [ ]
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CALCULATION OF REGISTRATION FEE
================================================================================
Proposed
Title of Each Class Maximum
of Securities to be Aggregate Amount of
Registered Offering Price (1) Registration Fee
- ------------------- ------------------ -----------------
Debt Securities $300,000,000 $88,500
================================================================================
(1) Determined solely for the purpose of calculating the Registration Fee
pursuant to Rule 457 of the General Rules and Regulations under the
Securities Act of 1933. Or, if any Debt Securities are issued (i) with a
principal amount denominated in one or more foreign currencies or currency
units, such principal amount as shall result in an aggregate initial public
offering price equivalent to $300,000,000 at the time of the initial
offering or (ii) at an original issue discount, such greater principal
amount as shall result in proceeds to the Registrant of $300,000,000.
--------------------
The Registrant hereby amends this Registration Statement on such date or
dates as may be necessary to delay its effective date until the Registrant shall
file a further amendment which specifically states that this Registration
Statement shall thereafter become effective in accordance with Section 8(a) of
the Securities Act of 1933 or until this Registration Statement shall become
effective on such date as the Commission, acting pursuant to said Section 8(a),
may determine.
<PAGE>
- --------------------------------------------------------------------------------
Information contained herein is subject to completion or amendment. A
registration statement relating to these securities has been filed with the
Securities and Exchange Commission. These securities may not be sold nor may
offers to buy be accepted prior to the time the registration statement becomes
effective. This prospectus shall not constitute an offer to sell or the
solicitation of an offer to buy nor shall there by any sale of these securities
in any State in which such offer, solicitation or sale would be unlawful prior
to registration or qualification under the securities laws of any such State.
- --------------------------------------------------------------------------------
SUBJECT TO COMPLETION, DATED NOVEMBER 28, 1997
PROSPECTUS SUPPLEMENT TO PROSPECTUS DATED _____________, 1997
$150,000,000
Precision Castparts Corp.
___% Notes due ____________, 2007
-------------------
Interest on the Notes is payable on _______ and _______ of each year,
commencing _____, 1998. The Notes will be redeemable, in whole or in part, at
the option of the Company at any time at a redemption price equal to the greater
of (i) 100% of the principal amount of such Notes or (ii) the sum of the present
values of the remaining scheduled payments of principal and interest (not
including the portion of any such payments of interest accrued as of the
redemption date) discounted to the redemption date on a semiannual basis
(assuming a 360-day year consisting of twelve 30-day months) at the Adjusted
Treasury Rate (as defined herein), plus, in each case, accrued and unpaid
interest thereon to the redemption date. The Notes will not be entitled to any
sinking fund. The Notes will be represented by one or more Global Debt
Securities registered in the name of The Depository Trust Company ("DTC") or its
nominee. Beneficial interests in the Global Debt Securities will be shown on,
and transfer thereof will be effected only through, records maintained by DTC
and its participants. Except as described herein, Notes in definitive form will
not be issued. The Notes will be issued only in denominations of $1,000 and
integral multiples thereof. See "Description of Notes."
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THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES
COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF THIS
PROSPECTUS SUPPLEMENT OR THE PROSPECTUS TO WHICH IT RELATES.
ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
-------------------
<TABLE>
<CAPTION>
Initial Public Underwriting Proceeds to
Offering Price (1) Discount (2) Company (1)(3)
------------------ ------------ --------------
<S> <C> <C> <C>
Per Note................................... _______% _______% _______%
Total...................................... $ $ $
- --------------
(1) Plus accrued interest from ________, 1997.
(2) The Company has agreed to indemnify the Underwriters against certain
liabilities, including liabilities under the Securities Act of 1933.
(3) Before deducting estimated expenses of $590,250 payable by the Company.
</TABLE>
The Notes offered hereby are offered severally by the Underwriters, as
specified herein, subject to receipt and acceptance by them and subject to their
right to reject any order in whole or in part. It is expected that the Notes
will be ready for delivery in book-entry form only through the facilities of DTC
in New York, New York, on or about _________, 1997, against payment therefor in
immediately available funds.
Goldman, Sachs & Co.
BancAmerica Robertson Stephens
Morgan Stanley Dean Witter
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The date of this Prospectus Supplement is ___________, 1997.
<PAGE>
[PHOTO OF JET AIRCRAFT ENGINE]
CERTAIN PERSONS PARTICIPATING IN THIS OFFERING MAY ENGAGE IN TRANSACTIONS THAT
STABILIZE, MAINTAIN OR OTHERWISE AFFECT THE PRICE OF THE NOTES, INCLUDING
OVER-ALLOTMENT, STABILIZING AND SHORT-COVERING TRANSACTIONS IN THE NOTES, AND
THE IMPOSITION OF A PENALTY BID, IN CONNECTION WITH THE OFFERING. FOR A
DESCRIPTION OF THESE ACTIVITIES, SEE "UNDERWRITING."
S-2
<PAGE>
THE COMPANY
Summary
Precision Castparts Corp. (the "Company") is a worldwide manufacturer of
complex metal components and products. The Company is the market leader in
manufacturing large, complex structural investment castings and is the leading
manufacturer of airfoil castings used in jet aircraft engines. In addition, the
Company has expanded into the industrial gas turbine, fluid management,
industrial metalworking tools and machines, powdered metal and other metal
products markets.
Company Strategy
The Company's strategy consists of the following three key elements:
Increase Operating Efficiency and Technological Advantage. Since fiscal
1993, the Company has significantly reduced overhead costs, improved worker
productivity, shortened production cycle times and enhanced operating margins.
This has primarily been achieved by investing in new technologies and developing
more efficient manufacturing processes. The Company believes it maintains a
proprietary technological advantage in the high quality, high volume
manufacturing of complex metal components and products. In particular, the
Company believes it is currently the only manufacturer in the world that can
precision cast large, complex parts from a variety of metals and alloys in the
volumes and of the qualities that customers require. The Company strives to
maintain its advantage by investing in new technologies and developing new
proprietary manufacturing processes which are difficult for competitors to
duplicate.
Develop New Products and Markets. The Company is aggressively pursuing new
product and market opportunities using the Company's existing metal-forming
technologies. The Company has identified attractive markets, such as industrial
gas turbines, where it believes its skills developed in precision casting can be
leveraged to enhance its market share. In addition, the Company is pursuing
growth opportunities in the manufacture of metal-injection-molded products for
applications including medical, electronics, hand tools and automotive parts.
The Company is also focusing on expanding its international sales, particularly
for its fluid management and general industrial product lines. The Company's
strategy is to continue to identify new products and markets where it can become
the leading supplier by utilizing its core competencies in metals, precision
metalworking and the management of complex manufacturing processes.
Pursue Synergistic Acquisitions. The Company's strategy of acquiring
businesses which leverage the Company's core competencies has led to the
completion of 11 acquisitions since March 1995 including the acquisition of J &
L Fiber Services, Inc. on October 31, 1997. The Company targets acquisitions
that (i) complement its core competencies in metals, precision metalworking and
the management of complex manufacturing processes, (ii) have strong growth
prospects and higher operating margins than its traditional product lines and
(iii) have leading positions in established market niches. The Company seeks to
acquire businesses with established
S-3
<PAGE>
market niches, proprietary technology and the potential for significant growth
and higher operating margins than the Company's traditional product lines. The
Company expects that recent acquisitions, such as PCC Specialty Products and PCC
Flow Technologies, will enhance financial results and reduce the Company's
exposure to the aerospace cycle. See "Management's Discussion and Analysis of
Financial Condition and Results of Operations -- Business Overview and Outlook."
The Company intends to continue focusing on increasing its operating
efficiencies and technological advantage, developing new products and markets,
and pursuing synergistic acquisitions. There is no assurance that the Company's
strategy or any element thereof will be implemented successfully.
Sales History
The Company sells its complex metal components and products into five major
market areas: aerospace, general industrial and energy, industrial gas turbine,
automotive and other markets which include applications for markets such as
medical, firearms and ordnance. The relative size of sales to these markets is
shown below for fiscal 1995, 1996, and 1997. [GRAPHIC OMITTED]
[graphic pie charts depicting Net Sales:
<TABLE>
<CAPTION>
Fiscal 1995 Actual Fiscal 1996 Actual Fiscal 1997 Actual
Net Sales $436.4 million Net Sales $556.8 million Net Sales $972.8 million
- ----------------------------------- ----------------------------------- -----------------------------------
<S> <C> <C> <C> <C> <C>
Aerospace 79% Aerospace 68% Aerospace 53%
General Industrial and Energy 11% General Industrial and Energy 16% General Industrial and Energy 28%
Industrial Gas Turbine 4% Industrial Gas Turbine 4% Industrial Gas Turbine 7%
Automotive 1% Automotive 6% Automotive 7%
Other 5% Other 6% Other 5%]
</TABLE>
S-4
<PAGE>
Products and Markets
The Company's manufacturing of complex metal components and products
includes operations in four principal business areas: precision investment
castings, fluid management products, industrial metalworking tools and machines,
and powdered metal and other metal products.
Precision Investment Castings
The Company is the market leader in manufacturing large, complex structural
investment castings and is the leading manufacturer of airfoil castings used in
jet aircraft engines. The Company manufactures investment castings for every
major jet aircraft engine program in production or under development by its key
customers. The Company is leveraging its experience and expertise in large,
complex structural and airfoil investment castings to manufacture castings for
industrial gas turbine ("IGT") engines used for power generation. In addition,
the Company makes investment castings for use in the automotive, medical
prostheses, satellite launch vehicle and general industrial markets.
Because of the complexity of the manufacturing process and the application
of proprietary technologies, the Company believes it currently is the only
manufacturer that can consistently produce the largest complex structural
investment castings in quantities sufficient to meet its customers' quality and
delivery requirements. The Company's emphasis on low cost, high quality products
and timeliness of delivery has enabled it to become one of the leading suppliers
of structural and airfoil castings for jet aircraft engines and to increase its
market share of IGT airfoil castings. Investment castings accounted for
approximately 66 percent of the Company's net sales in fiscal 1997 and a
majority of these products were sold to the aerospace market.
Trends in the commercial aerospace market are a critical determinant of
demand for the Company's precision investment casting products. Beginning in
1995, demand for investment castings strengthened, primarily due to increased
demand from the commercial aerospace industry, which had been in a cyclical
downturn since 1991. The Company believes the principal causes of the recent
increase in new aircraft orders include increased demand for air travel in Asia,
the recent profitability of U.S. commercial airlines, which is being driven by
increased load factors, and government Stage III noise regulations that require
airlines to modernize their fleets. Airlines are responding to these regulations
by retrofitting existing aircraft or purchasing new jets.
In fiscal 1994, the Company began to focus on the manufacture of airfoil
castings for industrial gas turbines. The Company targeted this market because
it believes (i) the performance and reliability standards it has developed in
the manufacture of aerospace airfoil castings are applicable to the manufacture
of IGT airfoils, (ii) the worldwide market is large, approximately $500 million,
and (iii) the market is principally serviced by a single supplier. The Company's
IGT products consist primarily of airfoil castings for land-based gas turbines
used in electrical power generation and structural and airfoil castings for
aircraft-derivative gas turbine engines used for power generation and other land
and marine-based applications. Sales of products to the IGT
S-5
<PAGE>
market exceeded $68 million in fiscal 1997, more than double the amount in
fiscal 1996, while the first six months of fiscal 1998 include $38 million of
sales to the IGT market.
Fluid Management Products
The Company designs, manufactures, markets and services a broad range of
high quality, precision industrial fluid management products, including fluid
handling industrial valves, industrial pumps and fluid measuring instruments.
The Company's finished fluid management products are manufactured primarily from
castings, forgings and fabricated steel parts. These products are sold worldwide
under well-established brand names, including "General Valve," "NEWCO,"
"TECHNO," "Barber" and "OIC" valves, "Johnston," "PACO" and "Crown" pumps, and
"Water Specialties" and "Penberthy" measuring instruments, to a wide range of
end-user markets.
The Company entered the fluid management market with the acquisition of PCC
Flow Technologies, Inc. (formerly "NEWFLO Corporation") in July 1996. The
manufacturing process for fluid management products requires knowledge of
multiple metal-forming and processing technologies, including casting,
machining, welding, heat treating, assembly and processing of metal components.
Testing procedures, material management and traceability, and quality control
are also important aspects of the Company's operations. Fluid management
products accounted for approximately 17 percent of the Company's net sales in
fiscal 1997 and were sold primarily to the general industrial and energy
markets.
Industrial Metalworking Tools and Machines
The Company maintains the number one or two position in its served markets
for industrial metalworking tools, and has leading market positions in the
manufacture of metalworking machines for general industrial markets. It entered
these markets in March 1995 with the acquisition of PCC Specialty Products, Inc.
(formerly "Quamco, Inc."). The Company has increased its presence in the
industrial metalworking tools and machines markets with three additional
acquisitions since 1995. Industrial metalworking tools and machines include
machine systems used for boring and turning processes primarily in the
automotive and general industrial markets, cold forming dies and related
machinery primarily used in the fastener industry and other metalworking tools
and machinery for industrial manufacturers. The Company believes it has been
able to maintain its leading market positions due to the quality of its
products, the continued development of new technologies to enable the high speed
manufacture of high quality fasteners, brand name recognition and excellent
customer service. Industrial metalworking tools and machines accounted for
approximately 10 percent of the Company's net sales in fiscal 1997 and were sold
primarily to the automotive and general industrial markets.
Powdered Metal and Other Metal Products
The Company is the largest producer of powdered metal parts manufactured by
metal-injection-molding, and is a leading manufacturer of specialty metal gears
and tungsten carbide cutting tools and wear parts that are made from powdered
metal using a compaction and
S-6
<PAGE>
sintering process. In addition, the Company manufactures advanced technology,
lightweight net shape metal-matrix-composite parts that are made by combining
aluminum and silicon carbide ("ALSiC(R)") using a patented pressure-
infiltration-casting-process. The Company believes these businesses have the
potential for rapid growth and complement the Company's core competencies in
metals, precision metalworking and the management of complex manufacturing
processes. Powdered metal and other metal products accounted for approximately 7
percent of the Company's net sales in fiscal 1997 and were sold primarily to the
general industrial and automotive markets.
Recent Developments
On October 31, 1997, the Company acquired J&L Fiber Services, Inc. ("J&L")
of Waukesha, Wisconsin, a world leader in the manufacture of refiner plates for
the pulp and paper industry, for a purchase price, subject to adjustments, of
$108 million. The Company financed the acquisition with borrowings under its
line of credit.
J&L was a subsidiary of Beloit Corporation ("Beloit"), a leading producer
of papermaking machinery. In its served markets, J&L is the market leader in
North America and Latin America and holds the number two market position in
Europe and Asia. The majority of J&L's refiner plate revenues is derived from
the sale of replacement parts for pulp and paper mills.
Refiner plates are metal castings designed to separate wood fibers
efficiently from the other components used in the pulping process. These plates,
containing a high degree of technology and design content, not only transport
pulp through the system, but also perform critical work on the pulp, which has a
direct impact on the ultimate quality of the paper products. J&L designs and
manufactures other metal products used in the pulping process as well, including
screen cylinders, milled bars, conical fillings and fabricated plates. J & L's
existing product portfolio will continue to be marketed by Beloit under a sales
representative agreement.
SELECTED FINANCIAL DATA
The selected consolidated statement of operations and balance sheet data
shown below for, and as of the end of, each of the years in the three-year
period ended March 30, 1997 have been derived from the audited consolidated
financial statements of the Company. The selected consolidated statement of
operations and balance sheet data shown below for, and as of the end of, the six
months ended September 29, 1996 and September 28, 1997 have been derived from
the unaudited consolidated financial statements of the Company which, in the
opinion of management, include all adjustments (consisting of normal recurring
adjustments) necessary for a fair presentation of such interim periods. The pro
forma results for, and as of the end of, the six months ended September 30,
1996, is presented as though material fiscal 1997 acquisitions by the Company
had occurred at the beginning of the period. The pro forma financial data is not
necessarily indicative of the results which would have resulted had such
acquisitions occurred at the beginning of the period, nor is it necessarily
indicative of future results. The selected consolidated financial data should be
read in conjunction with "Management's Discussion and Analysis of Financial
Condition and Results of Operations," and the consolidated financial statements
of the Company incorporated
S-7
<PAGE>
by reference herein. The results for the six months ended September 28, 1997 are
not necessarily indicative of results that may be expected for the year ending
March 29, 1998.
<TABLE>
<CAPTION>
Fiscal Years Six Months Ended
-------------------------------------- --------------------------------------
Sept 29,
1996
------------------------
Pro Sept. 28,
1995 1996 1997 Actual Forma (1) 1997
---------- ---------- ---------- ---------- ---------- ----------
(In thousands, except per share data and number of employees)
<S> <C> <C> <C> <C> <C> <C>
Statement of Operations Data:
Net sales $ 436,400 $ 556,800 $ 972,800 $ 410,900 $ 523,900 $ 635,100
Cost of goods sold 359,500 446,100 765,500 327,300 411,000 497,300
Provision for:
Restructuring charges -- -- 3,400 -- -- --
Selling and administrative expenses 31,600 46,900 91,500 36,000 53,800 60,900
Interest (income) expense, net (1,500) 100 16,700 5,800 14,100 9,500
---------- ---------- ---------- ---------- ---------- ----------
Income before provision for
income taxes 46,800 63,700 95,700 41,800 45,000 67,400
Provision for income taxes 17,800 22,600 39,200 17,200 19,200 27,200
---------- ---------- ---------- ---------- ---------- ----------
Net income $ 29,000 $ 41,100 $ 56,500 $ 24,600 $ 25,800 $ 40,200
========== ========== ========== ========== ========== ==========
</TABLE>
<TABLE>
<CAPTION>
Six Months Ended
------------------------
Sept 29, Sept. 28,
1995 1996 1997 1996 1997
---------- ---------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C>
Balance Sheet Data:
Working capital $ 89,900 $ 125,800 $ 205,200 $ 211,300 $ 232,700
Total assets 406,700 450,500 1,070,100 1,010,700 1,098,800
Total debt 26,000 13,900 300,500 440,300 284,000
Shareholders' investment 258,400 303,100 504,400 328,200 546,700
Other Data:
EBITDA (2) $ 69,200 $ 86,700 $ 151,000 $ 62,500 $ 98,000
EBIT (2) $ 45,300 $ 63,800 $ 115,800 $ 47,600 $ 76,900
Capital expenditures $ 10,900 $ 19,700 $ 52,800 $ 16,800 $ 34,500
Ratio of earnings to fixed charges 53.0 58.9 6.3 8.1 7.3
Percentage of debt to total capital,
including short-term debt 9.1% 4.4% 37.3% 57.3% 34.2%
Current ratio (3) 1.9:1 2.3:1 1.8:1 2.0:1 1.9:1
Sales per employee (4) $ 104 $ 102 $ 127 $ 122 $ 133
Number of employees at end of period 5,166 5,646 9,280 8,631 9,698
- --------------
(1) Pro forma to reflect acquisitions made during the six months ended
September 29, 1996. See the Company's Annual Report on Form 10-K for the
fiscal year ended March 30, 1997, as amended by Form 10-K/A filed July 9,
1997.
(2) EBITDA represents income before interest, income taxes, depreciation,
amortization and restructuring charges. EBIT represents income before
interest, income taxes and restructuring charges. Neither EBITDA nor EBIT
is intended to represent cash flow or any other measure of performance
reported in accordance with generally accepted accounting principles. The
Company has included EBITDA and EBIT as it understands that EBITDA and EBIT
are used by certain investors as measures of a company's ability to service
debt.
S-8
<PAGE>
(3) Current ratio represents the ratio of current assets to current
liabilities.
(4) Sales per employee reflects annualized results for acquisitions made within
the period.
</TABLE>
USE OF PROCEEDS
The net proceeds to the Company from the sale of the Notes are estimated to
be approximately $149.0 million. The Company expects to use approximately $105.3
million of the net proceeds to repay bank indebtedness (bearing interest at ___%
and due on ____) originally incurred to refinance the Company's $100.0 million
principal amount of 13 1/4% Subordinated Notes due 2002 issued by NEWFLO
Corporation (the "NEWFLO Notes"), which were redeemed as of November 15, 1997,
and paid as of November 17, 1997, including the accrued redemption premium on
the NEWFLO Notes of $5.3 million. The remainder of the net proceeds will be used
to retire other indebtedness and for general corporate purposes. See
"Capitalization" below.
CAPITALIZATION
The following table sets forth the consolidated short-term debt and
consolidated capitalization of the Company as of September 28, 1997 and as
adjusted to give effect to the redemption of the NEWFLO Notes and issuance and
sale of the Notes offered hereby and the application of the estimated net
proceeds therefrom as set forth under "Use of Proceeds." The table should be
read in conjunction with the consolidated financial statements of the Company
and related notes thereto incorporated by reference into this Prospectus. See
"Use of Proceeds," and "Selected Financial Data."
<TABLE>
<CAPTION>
September 28, 1997
-----------------------------
Actual As Adjusted (1)
---------- --------------
(In thousands)
<S> <C> <C>
Short-term debt:
Notes payable (2)............................................... $ 17,000 $ --
Current portion of long-term debt............................... 24,500 24,500
---------- ----------
Total short-term debt.................................... $ 41,500 $ 24,500
========== ==========
Long-term debt, excluding current portion:
Credit line (2)................................................ $ 20,000 $ --
Term loan (2).................................................. 110,000 110,000
Senior unsecured notes offered hereby.......................... -- 150,000
NEWFLO Notes (3)............................................... 100,000 --
Other debt..................................................... 12,500 12,500
---------- ----------
Total long-term debt...................................... 242,500 272,500
Total shareholders' investment............................ 546,700 546,700
---------- ----------
Total capitalization ..................................... $ 789,200 $ 819,200
========== ==========
- --------------
S-9
<PAGE>
(1) Adjusted to give effect to the redemption of the NEWFLO Notes, the issuance
and sale of the Notes offered hereby, and the application of the estimated
net proceeds therefrom as described under "Use of Proceeds."
(2) Represents bank debt, committed and uncommitted (in the case of notes
payable), of varying dates of maturity. As of September 28, 1997, the notes
payable bore an effective interest rate per annum of 6.01% and the credit
line bore an effective interest rate per annum of 6.96%. Because of an
interest rate swap, the Company has effectively fixed the interest rate on
the term loan at 6.58% per annum, plus a margin based on the Company's
leverage ratio.
(3) The redemption of the NEWFLO Notes included a redemption premium of
approximately $5.3 million (see "Use of Proceeds," above). An amount equal
to the redemption premium was accrued as a liability in the consolidated
balance sheets of the Company upon the acquisition of PCC Flow Technologies
in July 1996. As a result, the payment of the redemption premium will be
reflected as a reduction to liabilities.
</TABLE>
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Business Overview and Outlook
During fiscal 1997 and the first six months of fiscal 1998, the Company
completed eight acquisitions for a total purchase price of $442.5 million. Also,
during the same time period, the Company experienced significant growth in
aerospace sales resulting from a recovery in that market, and the Company
continued its efforts to improve margins and expand the applications and markets
for its existing technologies.
The eight acquisitions completed in fiscal 1997 and the first six months of
fiscal 1998, along with growth in the Company's existing business operations,
resulted in a 75 percent increase in fiscal 1997 sales compared with fiscal
1996, and a 55 percent increase in the first six months of fiscal 1998 as
compared to the first six months a year ago. The acquisitions were accretive to
earnings, and complemented the Company's core competencies in metals, precision
metalworking and the management of complex manufacturing processes. The
acquisitions also added to the Company's presence in many of its traditional
markets, and in the case of NEWFLO and the follow-on acquisitions of Crown Pump
and OIC Valve, brought new applications and new markets to the Company. The
Company also enhanced its international presence through its acquisitions of
AETC, a company located in the United Kingdom, and Pittler, a company located in
Germany.
As anticipated, benefits of the aerospace industry recovery were realized
in both fiscal 1997 and the first six months of fiscal 1998, with sales to
aerospace customers up 38 percent and 47 percent from the respective prior
periods. While aerospace continues to be the primary market served by the
Company, its diversification into power generation, general industrial, energy
and automotive markets is expected to mitigate the impact of future cyclical
downturns in aerospace.
The Company continues to focus on improving the profitability of each of
its operations by becoming more efficient, by developing new applications for
its existing technologies and by finding new ways to serve customers' needs. In
the last eighteen months, these efforts resulted in continued improvements in
the Company's manufacturing processes and in significant expansion
S-10
<PAGE>
of its market presence in industrial gas turbines. Sales of products to the IGT
market exceeded $68 million in fiscal 1997, more than double the amount in
fiscal 1996, while the first six months of fiscal 1998 include $38 million of
sales to the IGT market.
The Company expects continuing strong demand from aerospace and IGT
customers for the remaining half of fiscal 1998 as well as into fiscal 1999.
This demand will continue to put pressure on the Company's current production
capacity and will require further expansion of its equipment and facilities. The
demand for products sold to the general industrial, energy and automotive
markets, however, is expected to grow modestly worldwide. Through additional
market penetration and development, the Company expects that its sales to these
markets will grow at rates above the underlying economic growth.
Results of Operations
Six Months Ended September 28, 1997 Compared with the Six Months Ended September
29, 1996
Sales of $635.1 million for the first six months of fiscal 1998 increased
$224.2 million, or 55 percent, compared to the first six months a year ago. The
increase was due to improved sales in nearly all business areas, particularly to
the aerospace industry, as well as the impact from acquisitions made in both
fiscal 1997 and 1998. Excluding the effects of the acquisitions, sales increased
$86.0 million or 27 percent.
Cost of goods sold as a percent of sales for the first half of fiscal 1998
was 78 percent, slightly lower than the 80 percent from the first half of last
year. Reflected in the fiscal 1998 results are higher margins contributed by a
number of the acquisitions, partially offset by higher costs related to the
development of industrial gas turbine products.
Selling and administrative costs were $60.9 million for the first six
months, or 10 percent of sales, compared to $36.0 million or 9 percent of sales,
a year ago. This increase reflects the effects of a full six months of fiscal
1997 acquisitions which operate with higher selling costs due to their related
advertising, trade show and sales commission costs.
Net interest expense in the first half of fiscal 1998 was $9.5 million, as
compared with $5.8 million in the first half a year ago. The increase reflects
the lower cash balances and higher debt this year compared with a year ago as a
result of borrowing to fund the fiscal 1997 and 1998 acquisitions, as well as
debt assumed in connection with these acquisitions.
The effective tax rate for the first six months of fiscal 1998 was 40
percent, slightly lower than the last year's effective tax rate of 41 percent.
The decrease reflects the utilization of tax benefits related to prior period
operating losses of a foreign subsidiary, partially offset by higher amounts of
nondeductible goodwill amortization.
S-11
<PAGE>
Net income of $40.2 million in the first six months of fiscal 1998 was 63
percent higher than the $24.6 million earned in the first six months of fiscal
1997.
Fiscal 1997 Compared with Fiscal 1996
Sales of $972.8 million were $416.0 million, or 75 percent, higher than a
year ago. Excluding the effects of fiscal 1997 acquisitions, sales would have
increased approximately 25 percent from last year. The majority of the
improvement came from aerospace operations, which experienced significant
increases in demand during fiscal 1997.
Cost of sales as a percent of sales improved to 79 percent in fiscal 1997
from 80 percent in fiscal 1996. This improvement came from leveraging higher
aerospace sales, implementation of process improvements and the addition of
higher margin businesses as a result of the acquisitions, partially offset by
higher costs related to development of new IGT parts.
In the fourth quarter of fiscal 1997, the Company recorded a $3.4 million
restructuring charge to provide for the cost of moving people and equipment from
PCC Composites in Pennsylvania to AFT in Colorado. In addition, this
restructuring charge provided for the costs associated with closing the
Pennsylvania manufacturing facility. Combining the marketing capabilities,
technical expertise, and manufacturing know-how of the two divisions is expected
to create a stronger, more cost-effective platform for growth in both
metal-matrix and metal-injection-molded products.
Selling and administrative expenses as a percent of sales rose to 9 percent
from 8 percent in the prior year. This increase reflected the higher marketing
requirements and costs associated with distributor channels, commissioned sales
and trade shows of the acquired businesses.
Net interest expense in fiscal 1997 was $16.7 million, compared with $0.1
million in fiscal 1996. This increase reflected the higher level of debt
incurred and assumed during fiscal 1997 to finance acquisitions.
The effective tax rate for the year was 41 percent, compared with 35
percent in the prior year. Fiscal 1997's rate reflected the impact of
non-deductible goodwill resulting from the acquisitions, whereas the fiscal 1996
rate included the favorable impact of $2.6 million of non-recurring tax
adjustments.
Net income in fiscal 1997 was $56.5 million, which was 37 percent higher
than the $41.1 million reported in fiscal 1996, reflecting the impact of fiscal
1997's higher earnings from the Company's base businesses and accretion from
acquisitions.
Fiscal 1996 Compared with Fiscal 1995
Sales of $556.8 million represented a 28 percent increase from the prior
year. Excluding the effects of the components of PCC Specialty Products which
were acquired at the end of fiscal 1995, sales increased $39.1 million, or 9
percent, from fiscal 1995.
S-12
<PAGE>
Cost of sales as a percent of sales improved from 82 percent in fiscal 1995
to 80 percent in fiscal 1996. This improvement came from the addition of PCC
Specialty Products, which generated higher margins compared with other Company
operations.
Selling and administrative costs increased to 8 percent in fiscal 1996 from
7 percent in the prior year. This increase was due to the addition of PCC
Specialty Products, which operated with relatively higher selling costs compared
with other Company operations.
For fiscal year 1996, the effective tax rate was 35 percent, compared to 38
percent in fiscal 1995. The reduction from the prior fiscal year was due to the
favorable impact of $2.6 million of non-recurring tax adjustments recorded in
the third quarter. These adjustments were comprised of $2.2 million from the
settlement of a state tax issue and $0.4 million from research and development
tax credits.
Net income in fiscal 1996 of $41.1 million was 42 percent higher than
fiscal 1995's earnings of $29.0 million.
Liquidity and Capital Resources
Total assets of $1,098.8 million at September 28, 1997 represented a $28.7
million increase from the $1,070.1 at March 30, 1997. Total capitalization
including short-term debt at September 28, 1997 was $830.7 million, consisting
of $284.0 million of debt and $546.7 million of equity. The
debt-to-capitalization ratio including short-term debt at September 28, 1997 was
0.34 compared with 0.37 at the end of the prior fiscal year.
Cash from earnings for the six months ended September 28, 1997 of $63.2
million, plus cash of $6.6 million from the sale of common stock through stock
option exercises, was slightly less than cash requirements which consisted of
$34.5 million of capital expenditures, $16.4 million of debt repayment, $15.7
million of increased working capital, $5.3 million for the acquisition of PCC
Pittler and $2.9 million of cash dividends. The cash flow shortfall was funded
from available cash. As of September 28, 1997, cash and cash equivalents were
$8.7 million.
The Company is a party to a $400 million committed line of credit from a
syndicate of twelve banks, of which $230 million was available at September 28,
1997. The Company also entered into swap and cap agreements to hedge interest
rate exposures on borrowings under this facility.
Capital spending for the remainder of fiscal 1998 is expected to continue
to be significantly larger than fiscal 1997 due to a full year of capital
spending from recently acquired businesses and a continuation of spending for
increased IGT and aerospace manufacturing capacity. Management believes that the
Company can fund the requirements for capital spending, cash dividends and
potential acquisitions from cash balances, the existing line of credit,
additional borrowings or the issuance of stock.
S-13
<PAGE>
Forward Looking Statements
Information included under "Management's Discussion and Analysis of
Financial Condition and Results of Operations," "Company Strategy" and elsewhere
herein relating to projected growth and future results and events constitutes
forward-looking statements and are subject to a number of risks and
uncertainties, including but not limited to fluctuations in the aerospace cycle;
the relative success of the Company's entry into new markets, including the
rapid ramp-up for industrial gas turbine component production; competitive
pricing; the availability and cost of materials and supplies; relations with the
Company's employees; the Company's ability to manage its operating costs and to
integrate acquired businesses in an effective manner; governmental regulations
and environmental matters; and risks associated with international operations.
Any forward-looking statements should be considered in light of these factors
and other factors described in the documents incorporated by reference herein.
DESCRIPTION OF NOTES
General
The Notes will be issued as a series of Debt Securities under the Indenture
dated as of November ___, 1997 (the "Indenture"), between the Company and The
First National Bank of Chicago, as Trustee which is more fully described in the
accompanying Prospectus.
The Notes will be issued as unsecured obligations of the Company in an
aggregate principal amount of $150,000,000 and will mature on ___________, 2007.
The Notes will bear interest from ____________, 1997, payable semi-annually
in arrears on each ________ and _________, commencing __________, 1998, at the
rate set forth on the cover page of this Prospectus Supplement, to the persons
in whose names the Notes are registered on the preceding ___________ and
_____________, respectively.
The principal of, premium, if any, and interest on the Notes will be
payable, the transfer of Notes will be registrable and the Notes may be
presented for exchange, at the office of the Trustee located at Mail Suite 0126,
One First National Plaza, Chicago, Illinois 60670, attention Corporate Trust
Services. So long as the Notes are represented by Book Entry Securities, the
interest payable on the Notes will be paid to Cede & Co., the nominee of DTC, or
its registered assigns as the registered owner of the Book Entry Securities, by
wire transfer of immediately available funds on each of the applicable interest
payment dates, not later than 2:30 p.m. Eastern Standard Time. If the Notes are
no longer represented by Book Entry Securities, payment of interest may, at the
option of the Company, be made by check mailed to the address of the Person
entitled thereto.
No sinking fund is provided for the Notes.
S-14
<PAGE>
Optional Redemption
The Notes will be redeemable, in whole or in part, at the option of the
Company at any time at a redemption price equal to the greater of (i) 100% of
the principal amount of such Notes or (ii) the sum of the present values of the
remaining scheduled payments of principal and interest thereon (not including
the portion of any such payments of interest accrued as of the redemption date)
discounted to the redemption date on a semiannual basis (assuming a 360-day year
consisting of twelve 30-day months) at the Adjusted Treasury Rate (determined on
the third Business Day preceding such redemption date), plus, in each case,
accrued and unpaid interest thereon to the redemption date.
"Adjusted Treasury Rate" means the arithmetic mean of the yields under the
heading "Week Ending" published in the Statistical Release most recently
published prior to the date of determination under the caption "Treasury
Constant Maturities" for the maturity (rounded to the nearest month)
corresponding to the remaining life to maturity, as of the redemption date, of
the principal being redeemed, plus 0.15%. If no maturity set forth under such
heading exactly corresponds to the maturity of such principal, yields for the
two published maturities most closely corresponding to the maturity of such
principal shall be calculated pursuant to the immediately preceding sentence,
and the Adjusted Treasury Rate shall be interpolated or extrapolated from such
yields on a straight-line basis, rounding in each of the relevant periods to the
nearest month.
"Statistical Release" means the statistical release designated "H.15(519)"
or any successor publication which is published weekly by the Federal Reserve
System and which establishes yields on actively-traded United States government
securities adjusted to constant maturities, or, if such statistical release is
not published at the time of any determination under the terms of the Notes,
then such other reasonably comparable index which shall be designated by the
Company.
Notice of any redemption will be mailed at least 30 days but not more than
60 days before the redemption date to each holder of the Notes to be redeemed.
Unless the Company defaults in payment of the redemption price, on and
after the redemption date, interest will cease to accrue on the Notes or
portions thereof called for redemption.
Book-Entry, Delivery and Form
The Notes will be represented by a Book Entry Security that will be
deposited with, or on behalf of, DTC, the Depositary for the Notes, and
registered in the name of Cede & Co., the nominee of DTC.
DTC has advised the Company and the Underwriters as follows: DTC is a
limited-purpose trust company organized under the New York Banking Law, a
"banking organization" within the meaning of the New York Banking Law, a member
of the Federal Reserve System, a "clearing corporation" within the meaning of
the New York Uniform Commercial Code and a "clearing
S-15
<PAGE>
agency" registered pursuant to the provisions of Section 17A of the Securities
Exchange Act of 1934. DTC was created to hold securities of its participating
organizations ("participants") and to facilitate the clearance and settlement of
securities transactions, such as transfers and pledges, among its participants
in such securities through electronic computerized book-entry changes in
accounts of the participants, thereby eliminating the need for physical movement
of securities certificates. Participants include securities brokers and dealers
(including the Underwriters), banks, trust companies, clearing corporations and
certain other organizations, some of whom (and/or their representatives) own
DTC. Access to DTC's book-entry system is also available to others, such as
banks, brokers, dealers and trust companies that clear through or maintain a
custodial relationship with a participant, either directly or indirectly.
Persons who are not participants may beneficially own securities held by DTC
only through participants.
Unless and until they are exchanged in whole or in part for certificated
notes, in definitive form, the Book Entry Security may not be registered for
transfer or exchange except as a whole by DTC to a nominee of DTC or by a
nominee of DTC to DTC or another nominee of DTC or by DTC or any such nominee to
a successor depository or a nominee of such successor depository.
A further description of DTC's procedures with respect to the Notes is set
forth in the accompanying Prospectus under the heading "Description of Debt
Securities--Book Entry Debt Securities."
Defeasance
The Notes will be subject to defeasance and covenant defeasance as
described under "Defeasance of Offered Debt Securities or Certain Covenants in
Certain Circumstances" in the accompanying Prospectus.
UNDERWRITING
Subject to the terms and conditions set forth in the Underwriting Agreement
and the Pricing Agreement, the Company has agreed to sell to each of the
Underwriters named below, and each of the Underwriters has severally agreed to
purchase the principal amount of the Notes set forth opposite its name below:
Principal
Amount
Underwriter of Notes
----------- ------------
Goldman, Sachs & Co. ........................................ $
BancAmerica Robertson Stephens .............................. $
Morgan Stanley & Co. Incorporated ........................... $
------------
Total.................................................... $150,000,000
============
S-16
<PAGE>
Under the terms and conditions of the Underwriting Agreement and the
Pricing Agreement, the Underwriters are committed to take and pay for all of the
Notes, if any are taken.
The Underwriters propose to offer the Notes in part directly to the public
at the initial public offering price set forth on the cover page of this
Prospectus Supplement and in part to certain securities dealers at such price
less a concession of ____% of the principal amount of the Notes. The
Underwriters may allow, and such dealers may reallow, a concession not to exceed
____% of the principal amount of the Notes to certain brokers and dealers. After
the Notes are released for sale to the public, the offering price and other
selling terms may from time to time be varied by the Underwriters.
The Notes are a new issue of securities with no established trading market.
The Company has been advised by the Underwriters that they intend to make a
market in the Notes but are not obligated to do so and may discontinue market
making at any time without notice. No assurance can be given as to the liquidity
of the trading market for the Notes.
In connection with the offering, the Underwriters may purchase and sell the
Notes in the open market. These transactions may include over-allotment and
stabilizing transactions and purchases to cover short positions created by the
Underwriters in connection with the offering. Stabilizing transactions consist
of certain bids or purchases for the purpose of preventing or retarding a
decline in the market price of the Notes; and short positions created by the
Underwriters involve the sale by the Underwriters of a greater number of Notes
than they are required to purchase from the Company in the offering. The
Underwriters also may impose a penalty bid, whereby selling concessions allowed
to broker-dealers in respect of the securities sold in the offering may be
reclaimed by the Underwriters if such Notes are repurchased by the Underwriters
in stabilizing or covering transactions. These activities may stabilize,
maintain or otherwise affect the market price of the Notes, which may be higher
than the price that might otherwise prevail in the open market; and these
activities, if commenced, may be discontinued at any time. These transactions
may be effected in the over-the-counter market or otherwise.
The Company has agreed to indemnify the several Underwriters against
certain liabilities, including liabilities under the Securities Act of 1933, as
amended.
VALIDITY OF THE NOTES
Certain legal matters in connection with the Notes offered hereby will be
passed upon for the Company by Stoel Rives LLP, Portland, Oregon. The validity
of the Notes offered hereby will be passed upon for the Underwriters by Sullivan
& Cromwell, Los Angeles, California.
S-17
<PAGE>
- --------------------------------------------------------------------------------
Information contained herein is subject to completion or amendment. A
registration statement relating to these securities has been filed with the
Securities and Exchange Commission. These securities may not be sold nor may
offers to buy be accepted prior to the time the registration statement becomes
effective. This prospectus shall not constitute an offer to sell or the
solicitation of an offer to buy nor shall there by any sale of these securities
in any State in which such offer, solicitation or sale would be unlawful prior
to registration or qualification under the securities laws of any such State.
- --------------------------------------------------------------------------------
SUBJECT TO COMPLETION, DATED NOVEMBER 28, 1997
Prospectus
$300,000,000
PRECISION CASTPARTS CORP.
Debt Securities
Precision Castparts Corp. (the "Company") may offer from time to time up to
$300,000,000 of its debt securities consisting of notes, debentures or other
evidences of indebtedness (the "Debt Securities"). The Debt Securities may be
offered as separate series in amounts, at prices and on terms to be determined
in light of market conditions at the time of sale and set forth in a Prospectus
Supplement or Prospectus Supplements.
The terms of each series of Debt Securities, including, where applicable,
the specific designation, aggregate principal amount, authorized denominations,
maturity, rate or rates and time or times of payment of any interest, any terms
for optional or mandatory redemption or payment of additional amounts or any
sinking fund provisions, any initial public offering price, the proceeds to the
Company and any other specific terms in connection with the offering and sale of
such series (the "Offered Debt Securities") will be set forth in a Prospectus
Supplement or Prospectus Supplements.
The Debt Securities may be sold directly by the Company, through agents
designated from time to time or to or through underwriters or dealers. See "Plan
of Distribution." If any agents of the Company or any underwriters are involved
in the sale of any Debt Securities in respect of which this Prospectus is being
delivered, the names of such agents or underwriters and any applicable
commissions or discounts will be set forth in a Prospectus Supplement. The net
proceeds to the Company from such sale also will be set forth in a Prospectus
Supplement. See "Plan of Distribution" for possible indemnification arrangements
for underwriters, dealers and agents.
------------------------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES
COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF THIS
PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY
IS A CRIMINAL OFFENSE.
------------------------
This Prospectus may not be used to consummate sales of Debt Securities
unless accompanied by a Prospectus Supplement.
The date of this Prospectus is ____________, 1997.
<PAGE>
AVAILABLE INFORMATION
The Company is subject to the informational requirements of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), and in accordance
therewith files reports, proxy and information statements and other information
with the Securities and Exchange Commission (the "Commission"). Such reports,
proxy and information statements and other information can be inspected and
copied at the public reference facilities maintained by the Commission at 450
Fifth Street, N.W., Washington, D.C. 20549, and at the following regional
offices of the Commission: New York Regional Office, 7 World Trade Center, New
York, New York 10048; and Chicago Regional Office, 1400 Citicorp Center, 500
West Madison Street, Chicago, Illinois 60661. Copies of such material can be
obtained from the Public Reference Section of the Commission, 450 Fifth Street,
N.W., Washington, D.C. 20549 at prescribed rates. In addition, the
aforementioned material can also be inspected at the offices of the New York
Stock Exchange, Inc., 20 Broad Street, New York, New York 10005. Such material
may also be accessed through an Internet Web site maintained by the Commission
at http://www.sec.gov.
The Company has filed with the Commission a Registration Statement on Form
S-3 (together with all amendments and exhibits thereto, the "Registration
Statement") under the Securities Act of 1933, as amended (the "Securities Act").
This Prospectus does not contain all of the information set forth in the
Registration Statement, certain parts of which are omitted in accordance with
the rules and regulations of the Commission. For further information, reference
is made to the Registration Statement, copies of which are available from the
Public Reference Section of the Commission at prescribed rates as described
above. Statements contained herein concerning the provisions of documents filed
with, or incorporated by reference in, the Registration Statement as exhibits
are necessarily summaries of such provisions and documents, and each such
statement is qualified in its entirety by reference to the copy of the
applicable document filed with the Commission.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents filed by the Company with the Commission pursuant
to the Exchange Act are incorporated into this Prospectus by reference:
(i) the Company's Annual Report on Form 10-K for the fiscal year ended
March 30, 1997, as amended by Form 10-K/A filed July 9, 1997; and
(ii) the Company's Quarterly Reports on Form 10-Q for the quarters ended
June 29, 1997 and September 28, 1997.
All documents filed by the Company pursuant to Sections 13(a), 13(c), 14 or
15(d) of the Exchange Act after the date of this Prospectus and prior to the
termination of the offering made hereby shall be deemed to be incorporated by
reference in this Prospectus and to be a part hereof from the date of the filing
of such documents. Any statement contained in a document incorporated or deemed
to be incorporated by reference herein shall be deemed to be modified or
2
<PAGE>
superseded for purposes of this Prospectus to the extent that a statement
contained herein or in any other subsequently filed document which also is or is
deemed to be incorporated by reference herein modifies or supersedes such
statement. Any such statement so modified or superseded shall not be deemed,
except as so modified or superseded, to constitute a part of this Prospectus.
The Company undertakes to provide without charge to each person, including
any beneficial owner, to whom a copy of this Prospectus has been delivered, on
written or oral request, a copy of any and all of the documents incorporated in
this Prospectus by reference, other than exhibits to such documents not
specifically incorporated by reference therein. Requests for such copies should
be directed to Precision Castparts Corp., at its principal executive offices
located at 4650 S.W. Macadam Avenue, Suite 440, Portland, Oregon 97201,
Attention: Director of Corporate Communications (telephone: (503) 417-4800).
THE COMPANY
The Company is a worldwide manufacturer of complex metal components and
products. The Company is the market leader in manufacturing large, complex
structural investment castings and is the leading manufacturer of airfoil
castings used in jet aircraft engines. In addition, the Company has expanded
into the industrial gas turbine, fluid management, industrial metalworking tools
and machines, powdered metal and other metal products markets.
USE OF PROCEEDS
Unless otherwise indicated in a Prospectus Supplement, the net proceeds to
the Company from the issuance and sale of the Debt Securities will be used for
general corporate purposes, including the repayment of indebtedness that may be
incurred from time to time, working capital, future acquisitions and further
investments in subsidiaries.
RATIO OF EARNINGS TO FIXED CHARGES
The ratios of earnings to fixed charges of the Company for each of the five
fiscal years ended March 30, 1997 and for the six-month period ended September
28, 1997 were as follows:
<TABLE>
<CAPTION>
Six Months Ended
Fiscal Years ----------------
---------------------------------------------------- Sept. 28,
1993 1994 1995 1996 1997 1997
---- ---- ---- ---- ---- ----------------
<S> <C> <C> <C> <C> <C> <C>
Ratio of Earnings to
Fixed Charges 1.0 18.8 53.0 58.9 6.3 7.3
</TABLE>
For the purpose of computing such ratios, "earnings" represents the
aggregate of (a) income before income taxes and (b) fixed charges. "Fixed
charges" represents
3
<PAGE>
(a) consolidated interest charges, (b) the amortization of debt discount and
expense and premium on indebtedness and (c) the portion of rental expense
representative of an interest factor.
DESCRIPTION OF DEBT SECURITIES
The Debt Securities are to be issued under an Indenture (as amended or
supplemented from time to time, the "Indenture") between the Company and The
First National Bank of Chicago, as Trustee (the "Trustee"), a copy of which is
filed as an exhibit to the Registration Statement. The statements herein
relating to the Debt Securities and the following summaries of certain
provisions of the Indenture do not purport to be complete and are subject to,
and are qualified in their entirety by reference to, all the provisions of the
Indenture, including the definitions therein of certain terms, and the Trust
Indenture Act of 1939, as amended (the "Trust Indenture Act"). Wherever
particular sections or defined terms of the Indenture are referred to in this
Prospectus or in a Prospectus Supplement, such sections or defined terms are
incorporated herein or therein by reference.
The following sets forth certain general terms and provisions of the Debt
Securities offered hereby. The particular terms of the Debt Securities offered
by any Prospectus Supplement and the extent, if any, to which such general terms
and provisions may not apply to the Offered Debt Securities will be described in
the Prospectus Supplement relating to such Offered Debt Securities (the
"Applicable Prospectus Supplement").
General
The Indenture does not limit the amount of Debt Securities that may be
issued thereunder and Debt Securities may be issued thereunder from time to time
in one or more series. The Debt Securities will be unsecured and unsubordinated
obligations of the Company and will rank equally and ratably, on a pari passu
basis, with other unsecured and unsubordinated obligations of the Company,
including, without limitation, its obligations under the committed revolving
credit facility with Bank of America, as agent (the "Credit Agreement"). Certain
subsidiaries of the Company are permitted to borrow under the Credit Agreement,
subject to limitations contained in the Credit Agreement and the limitations
contained in the Indenture (see "Certain Covenants of the Company--Limitation on
Debt of Restricted Subsidiaries," below). The lenders under the Credit Agreement
would have a prior claim as to the assets of such subsidiaries for the repayment
of such subsidiary loans.
Unless otherwise indicated in the Applicable Prospectus Supplement,
principal of, premium, if any, and interest on the Debt Securities will be
payable, and the transfer of Debt Securities will be registrable, at the office
or agency to be maintained by the Company in The City of New York and at any
other office or agency maintained by the Company for such purpose. (Sections
301, 305 and 1002) Unless otherwise indicated in the Applicable Prospectus
Supplement, the Debt Securities will be issued only in fully registered form
without coupons and in denominations of $1,000 or integral multiples thereof.
(Section 302) No service charge will
4
<PAGE>
be made for any registration of transfer or exchange of the Debt Securities, but
the Company may require payment of a sum sufficient to cover any tax or other
governmental charge imposed in connection therewith. (Section 305)
The Applicable Prospectus Supplement will describe the terms of the Offered
Debt Securities, including: (1) the title of the Offered Debt Securities; (2)
any limit on the aggregate principal amount of the Offered Debt Securities; (3)
the person or entity to whom any interest on the Offered Debt Securities shall
be payable, if other than the person in whose name that Security (or one or more
Predecessor Securities) is registered at the close of business on the Regular
Record Date for such interest; (4) the date or dates on which the principal of
and premium, if any, on the Offered Debt Securities is payable or the method of
determination thereof; (5) the rate or rates at which the Offered Debt
Securities shall bear interest, if any, or the method of calculating such rate
or rates of interest, the date or dates from which any such interest shall
accrue or the method by which such date or dates shall be determined, the
Interest Payment Dates on which any such interest shall be payable and the
Regular Record Date for interest payable on any Interest Payment Date; (6) the
place or places where the principal of, premium, if any, and interest on the
Offered Debt Securities shall be payable; (7) the period or periods within
which, the price or prices at which, the currency or currencies (including
currency units) in which and the other terms and conditions upon which the
Offered Debt Securities may be redeemed, in whole or in part, at the option of
the Company; (8) the obligation, if any, of the Company to redeem or purchase
the Offered Debt Securities pursuant to any sinking fund or analogous provisions
or at the option of a holder thereof and the period or periods within which, the
price or prices at which and the other terms and conditions upon which the
Offered Debt Securities shall be redeemed or purchased, in whole or in part,
pursuant to such obligation; (9) if other than denominations of $1,000 and any
integral multiple thereof, the denominations in which the Offered Debt
Securities shall be issuable; (10) the currency, currencies or currency units in
which payment of the principal of and any premium and interest on any Offered
Debt Securities shall be payable if other than the currency of the United States
of America and the manner of determining the equivalent thereof in the currency
of the United States of America; (11) if the amount of payments of principal of
or any premium or interest on any Offered Debt Securities may be determined with
reference to an index, formula or other method, the index, formula or other
method by which such amounts shall be determined; (12) if the principal of or
any premium or interest on any Offered Debt Securities is to be payable, at the
election of the Company or a holder thereof, in one or more currencies or
currency units other than that or those in which the Debt Securities are stated
to be payable, the currency, currencies or currency units in which payment of
the principal of and any premium and interest on the Offered Debt Securities as
to which such election is made shall be payable, and the periods within which
and the other terms and conditions upon which such election is to be made; (13)
if other than the principal amount thereof, the portion of the principal amount
of the Offered Debt Securities which shall be payable upon declaration of
acceleration of the maturity thereof or the method by which such portion may be
determined; (14) the applicability of the provisions described under
"--Defeasance of Offered Debt Securities or Certain Covenants in Certain
Circumstances"; (15) if the Offered Debt Securities will be issuable only in the
form of a Book Entry Security as described under "--Book Entry Debt Securities",
the Depositary or its nominee with respect to the Offered Debt Securities and
the circumstances under which the Book Entry Security may be
5
<PAGE>
registered for transfer or exchange or authenticated and delivered in the name
of a person or entity other than the Depositary or its nominee; and (16) any
additional, modified or different covenants applicable to one or more particular
series of Debt Securities; and (17) other terms of the Offered Debt Securities.
(Section 301)
Debt Securities may be issued under the Indenture as Original Issue
Discount Debt Securities to be offered and sold at a substantial discount below
their stated principal amount. Special Federal income tax, accounting and other
considerations applicable thereto will be described in the Prospectus Supplement
relating thereto. "Original Issue Discount Debt Security" means any Debt
Security which provides for an amount less than the principal amount thereof to
be due and payable upon a declaration of acceleration of the maturity thereof
upon the occurrence and continuance of an Event of Default. (Section 101)
If the purchase price of any of the Debt Securities is payable in one or
more foreign currencies or currency units, if any Debt Securities are
denominated in one or more foreign currencies or currency units or if the
principal of, premium, if any, or interest, if any, on any Debt Securities is
payable in one or more foreign currencies or currency units, the restrictions,
elections, material U.S. federal income tax considerations and other information
with respect to such issue of Debt Securities and such foreign currency or
currency units will be set forth in the Applicable Prospectus Supplement.
If any index is used to determine the amount of payments of principal of,
premium, if any, or interest, if any, on any series of Debt Securities, material
U.S. federal income tax, accounting and other considerations applicable thereto
will be described in the Applicable Prospectus Supplement.
Book Entry Debt Securities
The following description of Book Entry Securities will apply to any series
of Debt Securities except as otherwise provided in the Prospectus Supplement
relating thereto.
The Debt Securities of a series may be issued in the form of one or more
Book Entry Securities that will be deposited with or on behalf of a Depositary,
which will be a clearing agent registered under the Exchange Act. Book Entry
Securities will be registered in the name of the Depositary or a nominee of the
Depositary, will be deposited with such Depositary or nominee or a custodian
therefor and will bear a legend regarding the restrictions on exchanges and
registration of transfer thereof and any such other matters as may be provided
for pursuant to the Indenture. Unless and until it is exchanged in whole or in
part for Debt Securities in definitive certificated form, a Book Entry Security
may not be transferred or exchanged except as a whole by the Depositary for such
Book Entry Security to a nominee of such Depositary or by a nominee of such
Depositary to such Depositary or another nominee of such Depositary or by such
Depositary or any such nominee to a successor Depositary for such series or a
nominee of such successor Depositary, or except in the circumstances described
in the Applicable Prospectus Supplement. (Section 305)
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Upon the issuance of any Book Entry Security, and the deposit of such Book
Entry Security with or on behalf of the Depositary for such Book Entry Security,
the Depositary will credit on its book-entry registration and transfer system
the respective principal amounts of the Debt Securities represented by such Book
Entry Security to the accounts of institutions ("participants") that have
accounts with the Depositary. The accounts to be credited will be designated by
the underwriters or agents engaging in the distribution of such Debt Securities
or by the Company, if such Debt Securities are offered and sold directly by the
Company. Ownership of beneficial interests in a Book Entry Security will be
limited to participants or persons that may hold interests through participants.
Ownership of beneficial interests in a Book Entry Security will be shown on, and
the transfer of that ownership will be effected only through, records maintained
by the Depositary for such Book Entry Security or by its nominee. Ownership of
beneficial interests in such Book Entry Security by persons who hold through
participants will be shown on, and the transfer of such beneficial interests
within such participants will be effected only through, records maintained by
such participants. The laws of some jurisdictions require that certain
purchasers of securities take physical delivery of such securities in definitive
form. Such laws may impair the ability to transfer beneficial interests in such
a Book Entry Security.
So long as the Depositary for a Book Entry Security, or its nominee, is the
owner of such Book Entry Security, such Depositary or such nominee, as the case
may be, will be considered the sole owner or holder of the Debt Security
represented by such Book Entry Security for all purposes under the Indenture.
Accordingly, each person owning a beneficial interest in such Book Entry
Security must rely on the procedures of the Depositary and, if such person is
not a participant, on the procedures of the participant through which such
person owns its interest, to exercise any rights of a holder under such
Indenture. The Company understands that under existing industry practices, if it
requests any action of holders or if an owner of a beneficial interest in a Book
Entry Security desires to give or take any instruction or action which a holder
is entitled to give or take under the Indenture, the Depositary would authorize
the participants holding the relevant beneficial interests to give or take such
instruction or action, and such participants would authorize beneficial owners
owning through such participants to give or take such instruction or action or
would otherwise act upon the instructions of beneficial owners holding through
them.
Unless otherwise specified in the Applicable Prospectus Supplement,
payments with respect to principal, premium, if any, and interest, if any, on
the Debt Securities represented by a Book Entry Security registered in the name
of the Depositary or its nominee will be made to such Depositary or its nominee,
as the case may be, as the registered owner of such Book Entry Security. The
Company expects that the Depositary for any Debt Securities represented by a
Book Entry Security, upon receipt of any payment of principal or interest in
respect of such Book Entry Security, will credit immediately participants'
accounts with payments in amounts proportionate to their respective beneficial
interests in the Book Entry Security as shown on the records of the Depositary.
The Company also expects that payments by participants to owners of beneficial
interests in such Book Entry Security held through such participants will be
governed by standing instructions and customary practices, as is now the case
with securities in bearer form held for the accounts of customers or registered
in "street name", and will be the
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responsibility of such participants. None of the Company, the Trustee or any
agent of the Company or the Trustee shall have any responsibility or liability
for any aspect of the records relating to, or payments made on account of,
beneficial interests in any Book Entry Security, or for maintaining, supervising
or reviewing any records relating to such beneficial interests.
A Book Entry Security shall be exchangeable for Debt Securities in
certificated registered form, of like tenor and of an equal aggregate principal
amount, only if (a) the Depositary notifies the Company that it is unwilling or
unable to continue as Depositary for such Book Entry Security or if at any time
the Depositary ceases to be a clearing agency registered under the Exchange Act,
(b) the Company in its sole discretion determines that such Book Entry Security
shall be exchangeable for Debt Securities in certificated registered form or (c)
there shall have occurred and be continuing an Event of Default with respect to
the Debt Securities. Any Book Entry Security that is exchangeable pursuant to
the preceding sentence shall be exchangeable for Debt Securities registered in
the name or names of such person or persons as the Depositary shall instruct the
Trustee. It is expected that such instructions may be based upon directions
received by the Depositary from its participants with respect to ownership of
beneficial interests in such Book Entry Security.
Certain Covenants of the Company
Limitation on Liens
Unless otherwise indicated in the Applicable Prospectus Supplement, the
Indenture shall provide the holders of the Offered Debt Securities the benefit
of the "Limitation on Liens" covenant described below. The "Limitation on Liens"
covenant provides that the Company will not, and will not permit any Restricted
Subsidiary (as defined below) to, create, incur, issue, assume or guarantee any
indebtedness for money borrowed ("Debt") secured by a Mortgage (as defined
below) upon any Operating Property (as defined below), or upon shares of capital
stock or Debt issued by any Restricted Subsidiary and owned by the Company or
any Restricted Subsidiary, whether owned at the date of the Indenture or
thereafter acquired, without effectively providing concurrently that the Debt
Securities of each series then outstanding are secured equally and ratably with
or, at the option of the Company, prior to such Debt so long as such Debt shall
be so secured.
The foregoing restriction shall not apply to, and there shall be excluded
from Debt in any computation under such restriction, Debt secured by (i)
Mortgages on any property existing at the time of the acquisition thereof; (ii)
Mortgages on property of a corporation existing at the time such corporation is
merged into or consolidated with the Company or a Restricted Subsidiary or at
the time of a sale, lease or other disposition of the properties of such
corporation (or a division thereof) as an entirety or substantially as an
entirety to the Company or a Restricted Subsidiary, provided that any such
Mortgage does not extend to any property owned by the Company or any Restricted
Subsidiary immediately prior to such merger, consolidation, sale, lease or
disposition; (iii) Mortgages on property of a corporation existing at the time
such corporation becomes a Restricted Subsidiary; (iv) Mortgages in favor of the
Company or a Restricted Subsidiary; (v) Mortgages to secure all or part of the
cost of acquisition, construction, development or
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improvement of the underlying property, or to secure Debt incurred to provide
funds for any such purpose, provided that the commitment of the creditor to
extend the credit secured by any such Mortgage shall have been obtained not
later than 270 days after the later of (a) the completion of the acquisition,
construction, development or improvement of such property or (b) the placing in
operation of such property; (vi) Mortgages in favor of the United States of
America or any State thereof, or any department, agency or instrumentality or
political subdivision thereof, to secure partial, progress, advance or other
payments; and (vii) Mortgages existing on the date of the Indenture or any
extension, renewal, replacement or refunding of any Debt secured by a Mortgage
existing on the date of the Indenture or referred to in clauses (i) to (iii) or
(v), provided that the principal amount of Debt secured thereby and not
otherwise authorized by clauses (i) to (iii) or (v) shall not exceed the
principal amount of Debt, plus any premium or fee payable in connection with any
such extension, renewal, replacement or refunding, so secured at the time of
such extension, renewal, replacement or refunding. (Section 1008)
Notwithstanding the restrictions described above, the Company and its
Restricted Subsidiaries may create, incur, issue, assume or guarantee Debt
secured by Mortgages without equally and ratably securing the Debt Securities of
each series then outstanding if, at the time of such creation, incurrence,
issuance, assumption or guarantee, after giving effect thereto and to the
retirement of any Debt which is concurrently being retired, the aggregate amount
of all outstanding Debt secured by Mortgages which would otherwise be subject to
such restrictions (other than any Debt secured by Mortgages permitted as
described in clauses (i) through (vii) of the immediately preceding paragraph)
plus all Attributable Debt in respect of Sale and Leaseback Transactions (as
defined below) with respect to Operating Properties (with the exception of such
transactions which are permitted under clauses (i) through (iv) of the first
sentence of the first paragraph under "--Limitation on Sale and Leaseback
Transactions" below) does not exceed 10% of Consolidated Net Tangible Assets (as
defined below).
Limitation on Sale and Leaseback Transactions
Unless otherwise indicated in the Applicable Prospectus Supplement, the
Indenture shall provide the holders of the Offered Debt Securities the benefit
of the "Limitation on Sale and Leaseback" covenant discussed below. The
"Limitation on Sale and Leaseback" covenant provides that the Company will not,
and will not permit any Restricted Subsidiary to, enter into any Sale and
Leaseback Transaction with respect to any Operating Property unless: (i) the
Sale and Leaseback Transaction is solely with the Company or another Restricted
Subsidiary; (ii) the lease is for a period not in excess of twenty four months,
including renewals; (iii) the Company or such Restricted Subsidiary would (at
the time of entering into such arrangement) be entitled as described in clauses
(i) through (vii) of the second preceding paragraph, without equally and ratably
securing the Debt Securities of each series then outstanding, to create, incur,
issue, assume or guarantee Debt secured by a Mortgage on such Operating Property
in the amount of the Attributable Debt arising from such Sale and Leaseback
Transaction; (iv) the Company or such Restricted Subsidiary, within 270 days
after the sale of such Operating Property in connection with such Sale and
Leaseback Transaction is completed, applies an amount equal to the greater of
(A) the net proceeds of the sale of such Operating Property or (B) the fair
market value of such Operating Property to (1) the retirement of Debt
Securities, other Funded Debt (as
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defined below) of the Company ranking on a parity with the Debt Securities or
Funded Debt of a Restricted Subsidiary or (2) the purchase of Operating
Property; or (v) the Attributable Debt of the Company and its Restricted
Subsidiaries in respect of such Sale and Leaseback Transaction and all other
Sale and Leaseback Transactions entered into after the date of the Indenture
(other than any such Sale and Leaseback Transactions as would be permitted as
described in clauses (i) through (iv) of this sentence), plus the aggregate
principal amount of Debt secured by Mortgages on Operating Properties then
outstanding (not including any such Debt secured by Mortgages described in
clauses (i) through (vi) of the second preceding paragraph) which do not equally
and ratably secure such outstanding Debt Securities (or secure such outstanding
Debt Securities on a basis that is prior to other Debt secured thereby), would
not exceed 10% of Consolidated Net Tangible Assets. (Section 1009)
Limitation on Debt of Restricted Subsidiaries
Unless otherwise indicated in the Applicable Prospectus Supplement, the
Indenture will provide that the Company will not permit any Restricted
Subsidiary to create, incur, issue, assume or guaranty any Debt, except: (i)
Debt outstanding on the date of the Indenture; (ii) Debt issued to and held by
the Company or a wholly owned Restricted Subsidiary; (iii) Debt created,
incurred, issued, assumed or guaranteed by a Person prior to the time the Person
became, merges into, or consolidates with such Person and thereby such Person
becomes a Restricted Subsidiary (which Debt was not incurred in anticipation of
such transaction and was outstanding prior to such transaction); (iv) Debt
incurred to provide funds for all or part of the cost of acquisition,
construction, development or improvement of property, provided that the
commitment of the creditor to extend the credit evidenced by such Debt shall
have been obtained not later than 270 days after the later of (a) the completion
of the acquisition, construction, development or improvement of such property or
(b) the placing in operation of such property; (v) Debt which is exchanged for,
or the proceeds of which are used to replace or refund, any Debt permitted to be
outstanding pursuant to clauses (i) through (iv) above (or any extension or
renewal thereof), in an aggregate principal amount not to exceed the principal
amount of the Debt so exchanged, replaced or refunded; and (vi) Debt not
otherwise permitted pursuant to clauses (i) through (v) above that, together
with any other outstanding Debt created, incurred, issued, assumed or guaranteed
pursuant to this clause (vi), has an aggregate principal amount at any time
outstanding that does not exceed 15% of Consolidated Net Tangible Assets.
(Section 1010)
Certain Definitions
"Attributable Debt," in respect of any Sale and Leaseback Transaction,
means, as of the time of determination, the total obligation (discounted to
present value at the rate per annum equal to the discount rate which would be
applicable to a capital lease obligation with like term in accordance with
generally accepted accounting principles) of the lessee for rental payments
(other than amounts required to be paid on account of property taxes,
maintenance, repairs, insurance, water rates and other items which do not
constitute payments for property rights) during the remaining portion of the
initial term of the lease included in such Sale and Leaseback Transaction.
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"Consolidated Net Tangible Assets" means the aggregate amount of assets
(less applicable reserves and other properly deductible items) after deducting
therefrom (i) all current liabilities (excluding any indebtedness for money
borrowed having a maturity of less than 12 months from the date of the most
recent consolidated balance sheet of the Company but which by its terms is
renewable or extendable beyond 12 months from such date at the option of the
borrower), (ii) all Investments in Unrestricted Subsidiaries and (iii) all
goodwill, trade names, patents, unamortized debt discount and expense and any
other like intangibles, all as set forth on the most recent consolidated balance
sheet of the Company and computed in accordance with generally accepted
accounting principles.
"Funded Debt" means all Debt having a maturity of more than 12 months from
the date as of which the determination is made or having a maturity of 12 months
or less but by its terms being renewable or extendable beyond 12 months from
such date at the option of the borrower, but excluding any such Debt owed to the
Company or a Restricted Subsidiary.
"Mortgage" means, with respect to any property or assets, any mortgage or
deed of trust, pledge, hypothecation, assignment, security interest, lien,
encumbrance, or other security arrangement of any kind or nature whatsoever on
or with respect to such property or assets (including any conditional sale or
other title retention agreement having substantially the same economic effect as
any of the foregoing).
"Operating Property" means any real property or equipment located within
the United States and owned by, or leased to, the Company or any of its
Restricted Subsidiaries that has a market value in excess of 0.5% of
Consolidated Net Tangible Assets.
"Restricted Subsidiary" means any Subsidiary of the Company that owns
Operating Property that has a market value in excess of 1.0% of Consolidated Net
Tangible Assets.
"Sale and Leaseback Transaction" means any arrangement with any person
providing for the leasing to the Company or any Subsidiary of any Operating
Property, which Operating Property has been or is to be sold or transferred by
the Company or such Subsidiary to such person.
"Subsidiary" means any corporation of which at least a majority of the
outstanding stock having by the terms thereof ordinary voting power for the
election 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 by the Company, or by one or more other
Subsidiaries, or by the Company and one or more other Subsidiaries.
"Unrestricted Subsidiary" means any Subsidiary other than a Restricted
Subsidiary.
Unless otherwise indicated in the Applicable Prospectus Supplement, the
Indenture does not limit the amount of Debt that may be incurred by the Company
or its Subsidiaries or contain covenants specifically designed to protect
holders of Debt Securities in the event of a highly
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leveraged transaction, restructuring, change in control, merger or similar
transaction involving the Company that may adversely affect holders of Debt
Securities.
Events of Default
Any one of the following events will constitute an Event of Default under
the Indenture with respect to Debt Securities of any series: (a) failure to pay
any interest on any Debt Security of that series when due, continued for 30
days; (b) failure to pay principal of or any premium on any Debt Security of
that series when due; (c) failure to deposit any sinking fund payment, when due,
in respect of any Debt Security of that series; (d) failure to perform, or
breach of, any covenant or warranty of the Company in the Indenture with respect
to Debt Securities of that series continued for 60 days after written notice as
provided in the Indenture; (e) a default under any indebtedness for money
borrowed by the Company or any Subsidiary if (A) such default either (1) results
from the failure to pay the principal of any such indebtedness at its stated
maturity or (2) relates to an obligation other than the obligation to pay the
principal of such indebtedness at its stated maturity and results in such
indebtedness becoming or being declared due and payable prior to the date on
which it would otherwise become due and payable, (B) the principal amount of
such indebtedness, together with the principal amount of any other such
indebtedness in default for failure to pay principal at stated maturity or the
maturity of which has been so accelerated, aggregates $10.0 million or more at
any one time outstanding and (C) such indebtedness is not discharged, or such
acceleration is not rescinded or annulled, within 10 business days after written
notice as provided in the Indenture; (f) certain events of bankruptcy,
insolvency or reorganization of the Company; or (g) any other Event of Default
provided with respect to Debt Securities of that series. (Section 501)
If an Event of Default (other than an Event of Default described in clause
(f) of the preceding paragraph) with respect to the Debt Securities of any
series at the time Outstanding shall occur and be continuing, either the Trustee
or the Holders of at least 25% in aggregate principal amount of the Outstanding
Debt Securities of that series may accelerate the maturity of all Debt
Securities of that series; provided, however, that after such acceleration, but
before a judgment or decree based on acceleration, the Holders of a majority in
aggregate principal amount of the Outstanding Debt Securities of that series
may, under certain circumstances, rescind and annul such acceleration if all
Events of Default, other than the non-payment of accelerated principal, have
been cured or waived as provided in the Indenture. If an Event of Default
described in clause (f) of the immediately preceding paragraph occurs, the
Outstanding Debt Securities will ipso facto become immediately due and payable
without any declaration or other act on the part of the Trustee or any Holder.
(Section 502)
Reference is made to the Applicable Prospectus Supplement relating to any
series of Offered Debt Securities that are Original Issue Discount Debt
Securities for the particular provisions relating to acceleration of the Stated
Maturity of a portion of the principal amount of such series of Original Issue
Discount Debt Securities upon the occurrence of an Event of Default and the
continuation thereof.
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The Indenture provides that, subject to the duty of the Trustee during
default to act with the required standard of care, the Trustee will be under no
obligation to exercise any of its rights or powers under the Indenture at the
request or direction of any of the holders of Debt Securities, unless such
holders shall have offered to the Trustee reasonable indemnity. (Section 603)
Subject to such provisions for the indemnification of the Trustee and to certain
other conditions, the holders of a majority in aggregate principal amount of the
Outstanding Debt Securities of any series will 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, with
respect to the Debt Securities of that series. (Section 512)
No holder of Debt Securities of any series will have any right to institute
any proceeding with respect to the Indenture or for any remedy thereunder,
unless such holder shall have previously given to the Trustee written notice of
a continuing Event of Default and unless the holders of at least 25% in
principal amount of the Outstanding Debt Securities of that series shall have
made written request, and offered reasonable indemnity, to the Trustee to
institute such proceeding as trustee, and the Trustee shall not have received
from the holders of a majority in aggregate principal amount of the Outstanding
Debt Securities of that series a direction inconsistent with such request and
shall have failed to institute such proceeding within 60 days. (Section 507)
However, such limitations do not apply to a suit instituted by a holder of Debt
Securities for enforcement of payment of the principal of and premium, if any,
or interest on such Debt Securities on or after the respective due dates
expressed in such Debt Securities. (Section 508)
The Company is required to furnish to the Trustee annually a statement as
to the performance by the Company of certain of its obligations under the
Indenture and as to any default in such performance. (Section 1004)
Modification and Waiver
Modifications and amendments of the Indenture may be made by the Company
and the Trustee without the consent of the holders of any of the Debt Securities
in order (i) to evidence the succession of another entity to the Company and the
assumption of the covenants and obligations of the Company under the Debt
Securities and the Indenture by such successor to the Company; (ii) to add to
the covenants of the Company for the benefit of the holders of all or any series
of Debt Securities or to surrender any right or power conferred on the Company
by the Indenture; (iii) to add additional Events of Default with respect to any
series of Debt Securities; (iv) to add to or change any provisions to such
extent as may be necessary to permit or facilitate the issuance of Debt
Securities in bearer form or to facilitate the issuance of Book Entry
Securities; (v) to add to, change or eliminate any provision affecting only Debt
Securities not yet issued; (vi) to secure the Debt Securities; (vii) to
establish the form or terms of Debt Securities of any series; (viii) to evidence
and provide for successor Trustees or to add or change any provisions to such
extent as may be necessary to provide for or facilitate the appointment of a
separate Trustee or Trustees for specific series of Debt Securities; (ix) to
permit payment in respect of Debt Securities in bearer form in the United States
to the extent allowed by law; (x) to cure any ambiguity, to correct or
supplement any mistaken or inconsistent provisions or to
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make any other provisions with respect to matters or questions arising under the
Indenture, provided that any such action (other than in respect of a mistaken
provision) does not adversely affect in any material respect the interests of
any holder of Debt Securities of any series then outstanding. (Section 901)
Modifications and amendments of the Indenture also may be made by the
Company and the Trustee with the consent of the holders of not less than a
majority in aggregate principal amount of the Outstanding Debt Securities of
each series issued under the Indenture and affected by the modification or
amendments; provided, however, that no such modification or amendment may,
without the consent of the holders of all Debt Securities affected thereby, (i)
change the Stated Maturity of the principal amount of, or any installment of
principal of or interest on, any Debt Security; (ii) reduce the principal amount
of, or the premium, if any, or (except as otherwise provided in the Applicable
Prospectus Supplement) interest on any Debt Security (including in the case of
an Original Issue Discount Debt Security the amount payable upon acceleration of
the maturity thereof ); (iii) change the place or currency of payment of
principal of, premium, if any, or interest on any Debt Security; (iv) impair the
right to institute suit for the enforcement of any payment on any Debt Security
on or after the Stated Maturity thereof (or in the case of redemption, on or
after the Redemption Date); or (v) reduce the percentage in principal amount of
Outstanding Debt Securities of any series, the consent of whose holders is
required for modification or amendment of the Indenture or for waiver of
compliance with certain provisions of the Indenture or for waiver of certain
defaults. (Section 902)
The holders of at least a majority in aggregate principal amount of the
Outstanding Debt Securities of any series may, on behalf of all holders of Debt
Securities of that series, waive compliance by the Company with certain
restrictive provisions of the Indenture. (Section 1010) The holders of not less
than a majority in aggregate principal amount of the Outstanding Debt Securities
of any series may, on behalf of all holders of Debt Securities of that series,
waive any past default under the Indenture, except a default in the payment of
principal, premium or interest or in respect of a covenant or provision of the
Indenture that cannot be modified or amended without the consent of the holder
of each Outstanding Debt Security of such series affected thereby. (Section 513)
Consolidation, Merger and Sale of Assets
The Company may not consolidate with or merge with or into any other entity
or transfer or lease its assets substantially as an entirety to any entity,
unless (i) either the Company is the continuing corporation, or any successor or
purchaser is a corporation, partnership or trust organized under the laws of the
United States of America, any State thereof or the District of Columbia, and any
such successor or purchaser expressly assumes the Company's obligations on the
Debt Securities under a supplemental indenture, (ii) immediately after giving
effect to the transaction, no Event of Default, and no event which, after notice
or lapse of time or both, would become an Event of Default, shall have occurred
and be continuing, (iii) if properties or assets of the Company become subject
to a Mortgage not permitted by the Indenture, the Company or such successor
entity, as the case may be, takes such steps as shall be necessary effectively
to secure the Debt Securities equally and ratably with (or prior to) all Debt
secured thereby, and (iv)
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if a supplemental indenture is to be executed in connection with such
consolidation, merger, transfer or lease, the Company has delivered to the
Trustee an officers' certificate and an opinion of counsel stating compliance
with these provisions. (Section 801)
Defeasance of Offered Debt Securities or Certain Covenants in Certain
Circumstances
Defeasance and Discharge
The Indenture provides that the terms of any series of Debt Securities may
provide that the Company, at the Company's option, will be discharged from any
and all obligations in respect of the Debt Securities of such series (except for
certain obligations to register the transfer or exchange of Debt Securities of
such series, to replace stolen, lost or mutilated Debt Securities of such
series, to maintain paying agencies and to hold moneys for payment in trust)
upon the deposit with the Trustee, in trust, of money and/or U.S. Government
Obligations which, through the payment of interest and principal thereof in
accordance with their terms, will provide money in an amount sufficient to pay
any installment of principal (and premium, if any) and interest on, and any
mandatory sinking fund payments in respect of, the Debt Securities of such
series on the Stated Maturity of such payments in accordance with the terms of
the Indenture and such Debt Securities. Such discharge may only occur if, among
other things, the Company has delivered to the Trustee an opinion of counsel to
the effect that the Company has received from, or there has been published by,
the United States Internal Revenue Service a ruling, or there has been a change
in tax law, in either case to the effect that such discharge will not be deemed,
or result in, a taxable event with respect to holders of the Debt Securities of
such series. (Sections 1302 and 1304)
Defeasance of Certain Covenants
The Indenture provides that the terms of any series of Debt Securities may
provide the Company with the option to be released from certain restrictive
covenants described in this Prospectus under "--Certain Covenants of the
Company--Limitations on Liens", "--Certain Covenants of the Company--Limitation
on Sale and Leaseback Transactions", "--Consolidation, Merger and Sale of
Assets" and any other covenants made applicable to any series of Debt Securities
as described in the Applicable Prospectus Supplement. The Company, in order to
exercise such option, will be required to deposit with the Trustee money and/or
U.S. Government Obligations which, through the payment of interest and principal
thereof in accordance with their terms, will provide money in an amount
sufficient to pay principal (and premium, if any) and interest on, and any
mandatory sinking fund payments in respect of, the Debt Securities of such
series on the Stated Maturity of such payments in accordance with the terms of
the Indenture and such Debt Securities. The Company will also be required to
deliver to the Trustee an opinion of counsel to the effect that the deposit and
related covenant defeasance will not cause the holders of the Debt Securities of
such series to recognize income, gain or loss for federal income tax purposes.
(Sections 1303 and 1304)
In the event the Company exercises this option and the Debt Securities of
such series are declared due and payable because of the occurrence of any Event
of Default, the amount of
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money and U.S. Government Obligations on deposit with the Trustee will be
sufficient to pay amounts due on the Debt Securities of such series at the time
of their Stated Maturity but may not be sufficient to pay amounts due on the
Debt Securities of such series at the time of the acceleration resulting from
such Event of Default. However, the Company shall remain liable for such
payments.
The Applicable Prospectus Supplement will state if any defeasance
provisions will apply to the Offered Debt Securities.
Concerning the Trustee
The First National Bank of Chicago is the Trustee under the Indenture. The
Trustee may resign at any time or may be removed by the holders of at least a
majority in aggregate principal amount of the Outstanding Debt Securities. If
the Trustee resigns, is removed or becomes incapable of acting as Trustee or if
a vacancy occurs in the office of the Trustee for any cause, a successor Trustee
shall be appointed in accordance with the provisions of the Indenture.
PLAN OF DISTRIBUTION
The Company may sell the Debt Securities to one or more underwriters for
public offering and sale by them or may sell the Offered Debt Securities to
investors directly or through agents, which agents may be affiliated with the
Company. Any such underwriter or agent involved in the offer and sale of the
Offered Debt Securities will be named in the applicable Prospectus Supplement.
Sales of Offered Debt Securities offered pursuant to any applicable
Prospectus Supplement may be effected from time to time in one or more
transactions at a fixed price or prices which may be changed, at prices related
to the prevailing market prices at the time of sale or at negotiated prices. The
Company also may, from time to time, authorize underwriters acting as the
Company's agents to offer and sell the Offered Debt Securities upon the terms
and conditions set forth in the Applicable Prospectus Supplement. In connection
with the sale of Offered Debt Securities, underwriters may be deemed to have
received compensation from the Company in the form of underwriting discounts or
commissions and may also receive commissions from purchasers of Offered Debt
Securities for whom they may act as agent. Underwriters may sell Offered Debt
Securities to or through dealers, and such dealers may receive compensation in
the form of discounts, concessions or commissions from the underwriters and/or
commissions from purchasers of Offered Debt Securities for whom they may act as
agent.
Any underwriting compensation paid by the Company to underwriters or agents
in connection with the offering of Offered Debt Securities, and any discounts,
concessions or commissions allowed by underwriters to participating dealers,
will be set forth in the applicable Prospectus Supplement. Underwriters, dealers
and agents participating in the distribution of the Offered Debt Securities may
be deemed to be underwriters, and any discounts, concessions or commissions
received by them and any profit realized by them on resale of the Offered Debt
16
<PAGE>
Securities may be deemed to be underwriting discounts and commissions under the
Securities Act. Underwriters, dealers and agents may be entitled, under
agreements entered into with the Company, to indemnification against and
contribution toward certain civil liabilities, including liabilities under the
Securities Act. Any such indemnification arrangements will be described in the
Applicable Prospectus Supplement.
Unless otherwise specified in the Applicable Prospectus Supplement, each
series of Offered Debt Securities will be a new issue with no established
trading market. The Company may elect to list any series of Offered Debt
Securities on any exchange, but is not obligated to do so. It is possible that
one or more underwriters may make a market in a series of Offered Debt
Securities, but will not be obligated to do so and may discontinue any market
making at any time without notice. No assurance can be given as to the liquidity
of the trading market for the Offered Debt Securities.
Certain of the underwriters, agents and their affiliates may be customers
of, engage in transactions with and perform services for the Company in the
ordinary course of business.
VALIDITY OF THE DEBT SECURITIES
Certain legal matters in connection with the Offered Debt Securities will
be passed upon for the Company by Stoel Rives LLP, Portland, Oregon. The
validity of the Offered Debt Securities will be passed upon for the underwriters
or agents by Sullivan & Cromwell, Los Angeles, California.
EXPERTS
The consolidated financial statements of the Company incorporated in this
prospectus by reference to the Annual Report on Form 10-K of Precision Castparts
Corp. for the year ended March 30, 1997 have been so incorporated in reliance on
the report of Price Waterhouse LLP, independent accountants, given on the
authority of said firm as experts in auditing and accounting.
17
<PAGE>
[THREE PHOTOS:
IGT ENGINE,
LARGE STRUCTURAL CASTING
AND JOHNSTON VERTICAL PUMP]
<PAGE>
No person has been authorized to give any information or to make any
representations other than those contained in this Prospectus Supplement or the
Prospectus, and, if given or made, such information or representations must not
be relied upon as having been authorized. This Prospectus Supplement and the
Prospectus do not constitute an offer to sell or the solicitation of an offer to
buy any securities other than the securities described in this Prospectus
Supplement or an offer to sell or the solicitation of an offer to buy such
securities in any circumstances in which such offer or solicitation is unlawful.
Neither the delivery of this Prospectus Supplement or the Prospectus nor any
sale made hereunder or thereunder shall, under any circumstances, create any
implication that there has been no change in the affairs of the Company since
the date hereof or that the information contained herein or therein is correct
as of any time subsequent to its date.
------------------------
TABLE OF CONTENTS
Page
Prospectus Supplement
The Company................................................................. S-3
Selected Financial Data..................................................... S-7
Use of Proceeds............................................................. S-9
Capitalization.............................................................. S-9
Management's Discussion and Analysis of Financial Condition
and Results of Operations.................................................S-10
Description of Notes........................................................S-14
Underwriting................................................................S-16
Validity of the Notes.......................................................S-17
Prospectus
Available Information......................................................... 2
Incorporation of Certain Documents by Reference .............................. 2
The Company................................................................... 3
Use of Proceeds............................................................... 3
Ratio of Earnings to Fixed Charges ........................................... 3
Description of Debt Securities................................................ 4
Plan of Distribution..........................................................16
Validity of the Debt Securities ..............................................17
Experts.......................................................................17
<PAGE>
$150,000,000
Precision Castparts Corp.
___% Notes due ________, 2007
____________________
PROSPECTUS SUPPLEMENT
____________________
Goldman, Sachs & Co.
BancAmerica Robertson Stephens
Morgan Stanley Dean Witter
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution
The following table sets forth the costs and expenses, other than
underwriting discounts and commissions, payable by registrant in connection with
the sale of the Debt Securities being registered. All amounts are estimates
except the registration fee.
Registration fee (a).....................................$ 88,500
Legal fees and expenses (b).............................. 200,000
Rating Agencies - Shelf Registration (c)................. 145,000
Rating Agencies - Takedown (d)........................... 48,750
Accounting fees and expenses............................. 25,000
Trustee.................................................. 8,000
Printing and engraving .................................. 50,000
Miscellaneous............................................ 25,000
--------
Total.............................................$590,250
========
- --------------
(a) SEC registration fee is calculated at 3.03 basis points of principal
amount.
(b) Issuer's Counsel only.
(c) Moody's Registration Fee includes a non-refundable $35,000 fee and $20,000
first-time issuer's fee. Standard & Poor's Registration Fee is calculated
as 3.25 basis points of the principal amount registered. Standard & Poor's
Shelf Registration fee (for amounts up to $500mm) is subject to a minimum
of $25,000 and a maximum of $90,000.
(d) Moody's fee is calculated as 3.25 basis points of the principal amount
issued, subject to a minimum of $25,000 and maximum of $90,000. Standard &
Poor's grants credit towards the amount issued based upon the amount paid
for the shelf registration (for up to two years after the date of
registration). Standard & Poor's fee is subject to a minimum of $25,000 and
a maximum fee of $125,000.
Item 15. Indemnification of Directors and Officers
Article VI of the Company's Restated Articles of Incorporation (the
"Articles"), authorizes indemnification of current or former directors or
officers of the Registrant to the fullest extent permitted by law. In addition,
the Company has entered into indemnity agreements with certain of its officers
and directors. The Bylaws of the Company require indemnification of officers and
directors to the fullest extent permitted by the Oregon Business Corporation Act
(the "Act"). The effects of the Articles, the Bylaws, the Act, and the indemnity
agreements (the "Indemnification Provisions") are summarized as follows:
(a) The Indemnification Provisions grant a right of indemnification in
respect of any action, suit or proceeding (other than an action by or in
the right of the Company) against expenses (including attorney fees),
judgments, fines and amounts paid in settlement actually and reasonably
incurred, if the person concerned acted in good faith and in a manner the
person reasonably believed to be in or not opposed to the best interests of
the Company, was not adjudged liable on the basis of receipt of an improper
personal benefit and, with respect to any criminal action or proceeding,
had no reasonable cause to believe the conduct was unlawful. The
termination of an action, suit or proceeding by judgment, order,
settlement, conviction or plea of nolo contendere does not, of itself,
create a presumption that the person did not meet the required standards of
conduct.
(b) The Indemnification Provisions grant a right of indemnification in
respect of any action or suit by or in the right of the Company against the
expenses (including attorney fees) actually and reasonably incurred if the
person concerned acted in good faith and in a manner the person reasonably
believed to be in or not opposed to the best interests of the Company,
except that no right of indemnification will be granted if the person is
adjudged to be liable to the Company.
(c) Every person who has been wholly successful on the merits of a
controversy described in (a) or (b) above is entitled to indemnification as
a matter of right.
II-1
<PAGE>
(d) Because the limits of permissible indemnification under Oregon law
are not clearly defined, the Indemnification Provisions may provide
indemnification broader than that described in (a) and (b).
(e) The Company may advance to a director or officer the expenses
incurred in defending any action, suit or proceeding in advance of its
final disposition if the director or officer affirms in good faith that he
or she has met the standard of conduct to be entitled to indemnification as
described in (a) or (b) above and undertakes to repay any amount advanced
if it is determined that the person did not meet the required standard of
conduct.
The Registrant may obtain insurance for the protection of its directors and
officers against any liability asserted against them in their official
capacities.
Insofar as indemnification for liabilities arising under the Securities Act
of 1933 may be permitted to directors, officers or persons controlling the
Company pursuant to the foregoing provisions, the Company has been informed that
in the opinion of the Securities and Exchange Commission such indemnification is
against public policy as expressed in the Securities Act of 1933 and is
therefore unenforceable.
Item 16. Exhibits
1 Form of Underwriting Agreement
4 Form of Indenture
5 Opinion by Stoel Rives LLP Regarding Legality of Debt Securities
12 Statement Regarding Computation of Ratios
23.1 Consent of Price Waterhouse LLP
23.2 Consent of Stoel Rives LLP (See Exhibit 5.)
24 Power of Attorney of the directors and certain officers of the
Company
25 Statement of Eligibility of Trustee
Item 17. Undertakings
The undersigned Registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being made, a
post-effective amendment to this registration statement:
(i) To include any prospectus required by section 10(a)(3) of the
Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events arising after
the effective date of the registration statement (or the most recent
post-effective amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the information set forth
in the registration statement. Notwithstanding the foregoing, any
increase or decrease in the volume of securities offered (if the total
dollar value of securities offered would not exceed that which was
registered) and any deviation from the high or low end of the
estimated maximum offering range may be reflected in the form of
prospectus filed with the Commission pursuant to Rule 424(b) if, in
the aggregate, the changes in volume and price represent no more than
20% change in the maximum aggregate offering price set forth in the
"Calculation of Registration Fee" table in the effective registration
statement.
(iii) To include any material information with respect to the plan of
distribution not previously disclosed in the registration statement or
any material change to such information in the registration statement.
Provided, however, That paragraphs (a)(1)(i) and (a)(1)(ii) of this section do
not apply if the registration statement is on Form S-3, Form S-8 or Form F-3,
and the information required to be included in a post-effective amendment by
those paragraphs is contained in periodic reports filed with or furnished to the
Commission by the registrant pursuant to section 13 or section 15(d) of the
Securities Exchange Act of 1934 that are incorporated by reference in the
registration statement.
II-2
<PAGE>
(2) That, for purposes of determining any liability under the Securities
Act of 1933, each such post-effective amendment shall be deemed to be a new
registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
(3) To remove from registration by means of a post-effective amendment any
of the securities being registered which remain unsold at the termination of the
offering.
The undersigned registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of the
registrant's annual report pursuant to section 13(a) or section 15(d) of the
Securities Exchange Act of 1934 (and, where applicable, each filing of an
employee benefit plan's annual report pursuant to section 15(d) of the
Securities Exchange Act of 1934) that is incorporated by reference in the
registration statement shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.
The undersigned registrant hereby undertakes that:
(1) For purposes of determining any liability under the Securities Act of
1933, the information omitted from the form of prospectus filed as part of this
registration statement in reliance upon Rule 430A and contained in a form of
prospectus filed by the registrant pursuant to Rule 424(b)(1) or (4) or 497(h)
under the Securities Act shall be deemed to be part of this registration
statement as of the time it was declared effective.
(2) For the purpose of determining any liability under the Securities Act
of 1933, each post-effective amendment that contains a form of prospectus shall
be deemed to be a new registration statement relating to the securities offered
therein, and the offering of such securities at that time shall be deemed to be
the initial bona fide offering thereof.
The undersigned registrant hereby undertakes to file an application for the
purpose of determining the eligibility of the trustee to act under subsection
(a) of section 310 of the Trust Indenture Act ("Act") in accordance with the
rules and regulations prescribed by the Commission under section 305(b)(2) of
the Act.
Insofar as indemnification for liabilities arising under the Securities Act
of 1933 may be permitted to directors, officers and controlling persons of the
registrant pursuant to the provisions described under Item 15 above, or
otherwise, the registrant has been advised that in the opinion of the Securities
and Exchange Commission such indemnification is against public policy as
expressed in the Act and is, therefore, unenforceable. In the event that a claim
for indemnification against such liabilities (other than the payment by the
registrant of expenses incurred or paid by a director, officer or controlling
person of the registrant in the successful defense of any action, suit or
proceeding) is asserted against the registrant by such director, officer or
controlling person in connection with the securities being registered, the
registrant will, unless in the opinion of its counsel the matter has been
settled by controlling precedent, submit to a court of appropriate jurisdiction
the question whether such indemnification by it is against public policy as
expressed in the Act and will be governed by the final adjudication of such
issue.
II-3
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-3 and has duly caused this registration
statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Portland, State of Oregon, on November 28, 1997.
PRECISION CASTPARTS CORP.
By: /s/ WILLIAM C. MCCORMICK
------------------------------------------
William C. McCormick
Chairman of the Board, Director and Chief
Executive Officer
Pursuant to the requirements of the Securities Act of 1933, the
registration statement has been signed by the following persons in the following
capacities effective on November 28, 1997.
Signature Title
--------- -----
/s/ WILLIAM C. MCCORMICK Chairman of the Board,
- ---------------------------------- Director and Chief
William C. McCormick Executive Officer
(Principal Executive Officer)
/s/ WILLIAM D. LARSSON Vice President and
- ---------------------------------- Chief Financial Officer
William D. Larsson (Principal Financial and
Accounting Officer)
*/s/ STEVEN C. RIEDEL Director
- ----------------------------------
Steven C. Riedel
*/s/ PETER R. BRIDENBAUGH Director
- ----------------------------------
Peter R. Bridenbaugh
*/s/ DEAN T. DUCRAY Director
- ----------------------------------
Dean T. DuCray
*/s/ DON R. GRABER Director
- ----------------------------------
Don R. Graber
II-4
<PAGE>
Signature Title
--------- -----
*/s/ ROY M. MARVIN Director
- ----------------------------------
Roy M. Marvin
*/s/ VERNON E. OECHSLE Director
- ----------------------------------
Vernon E. Oechsle
*/s/ STEVEN G. ROTHMEIER Director
- ----------------------------------
Steven G. Rothmeier
*By: /s/ WILLIAM C. MCCORMICK
----------------------------------
William C. McCormick
Attorney-in-fact
II-5
<PAGE>
INDEX TO EXHIBITS
Sequentially
Numbered
Exhibit No. Exhibit Page Number
- ----------- ------- -----------
1 Form of Underwriting Agreement
4 Form of Indenture
5 Opinion by Stoel Rives LLP Regarding Legality of
Debt Securities
12 Statement Regarding Computation of Ratios
23.1 Consent of Price Waterhouse LLP
23.2 Consent of Stoel Rives LLP (See Exhibit 5.)
24 Powers of Attorney of the directors and certain
officers of the Company
25 Statement of Eligibility of Trustee
II-6
EXHIBIT 1
S&C Draft of November 25, 1997
Precision Castparts Corp.
Debt Securities
-----------------------------
Underwriting Agreement
, 1997
Goldman, Sachs & Co.,
Morgan Stanley & Co. Incorporated,
BancAmerica Robertson Stephens,
c/o Goldman, Sachs & Co.,
85 Broad Street,
New York, New York 10004.
Ladies and Gentlemen:
From time to time Precision Castparts Corp., an Oregon corporation (the
"Company"), proposes to enter into one or more Pricing Agreements (each a
"Pricing Agreement") in the form of Annex I hereto, with such additions and
deletions as the parties thereto may determine, and, subject to the terms and
conditions stated herein and therein, to issue and sell to the firms named in
Schedule I to the applicable Pricing Agreement (such firms constituting the
"Underwriters" with respect to such Pricing Agreement and the securities
specified therein) certain of its debt securities (the "Securities") specified
in Schedule II to such Pricing Agreement (with respect to such Pricing
Agreement, the "Designated Securities").
The terms and rights of any particular issuance of Designated Securities
shall be as specified in the Pricing Agreement relating thereto and in or
pursuant to the indenture (the "Indenture") identified in such Pricing
Agreement.
1. Particular sales of Designated Securities may be made from time to time
to the Underwriters of such Securities, for whom the firms designated as
representatives of the Underwriters of such Securities in the Pricing Agreement
relating thereto will act as representatives (the "Representatives"). The term
"Representatives" also refers to a single firm acting as sole representative of
the Underwriters and to an Underwriter or Underwriters who act without any firm
being designated as its or their representatives. This Underwriting Agreement
shall not be construed as an obligation of the Company to sell any of the
Securities or as an obligation of any of the Underwriters to purchase the
Securities. The obligation of the Company to issue and sell any of the
Securities and the obligation of any of the Underwriters to purchase any of the
Securities shall be evidenced by the Pricing Agreement with respect to the
Designated Securities specified therein. Each Pricing Agreement shall specify
the aggregate principal amount of such Designated Securities, the initial public
offering price of such Designated Securities, the purchase price to the
Underwriters
<PAGE>
of such Designated Securities, the names of the Underwriters of such Designated
Securities, the names of the Representatives of such Underwriters and the
principal amount of such Designated Securities to be purchased by each
Underwriter and shall set forth the date, time and manner of delivery of such
Designated Securities and payment therefor. The Pricing Agreement shall also
specify (to the extent not set forth in the Indenture and the registration
statement and prospectus with respect thereto) the terms of such Designated
Securities. A Pricing Agreement shall be in the form of an executed writing
(which may be in counterparts), and may be evidenced by an exchange of
telegraphic communications or any other rapid transmission device designed to
produce a written record of communications transmitted. The obligations of the
Underwriters under this Agreement and each Pricing Agreement shall be several
and not joint.
2. The Company represents and warrants to, and agrees with, each of the
Underwriters that:
(a) A registration statement on Form S-3 (File No. 333-....) (the
"Initial Registration Statement") in respect of the Securities has been
filed with the Securities and Exchange Commission (the "Commission"); the
Initial Registration Statement and any post-effective amendment thereto,
each in the form heretofore delivered or to be delivered to the
Representatives and, excluding exhibits to such registration statement, but
including all documents incorporated by reference in the prospectus
contained therein, to the Representatives for each of the other
Underwriters, have been declared effective by the Commission in such form;
other than a registration statement, if any, increasing the size of the
offering (a "Rule 462(b) Registration Statement"), filed pursuant to Rule
462(b) under the Securities Act of 1933, as amended (the "Act"), which
became effective upon filing, no other document with respect to the Initial
Registration Statement or document incorporated by reference therein has
heretofore been filed or transmitted for filing with the Commission (other
than prospectuses filed pursuant to Rule 424(b) of the rules and
regulations of the Commission under the Act, each in the form heretofore
delivered to the Representatives); and no stop order suspending the
effectiveness of the Initial Registration Statement, any post-effective
amendment thereto or the Rule 462(b) Registration Statement, if any, has
been issued and no proceeding for that purpose has been initiated or
threatened by the Commission (any preliminary prospectus included in the
Initial Registration Statement or filed with the Commission pursuant to
Rule 424(a) under the Act, is hereinafter called a "Preliminary
Prospectus"; the various parts of the Initial Registration Statement and
the Rule 462(b) Registration Statement, if any, including all exhibits
thereto and the documents incorporated by reference in the prospectus
contained in the Initial Registration Statement at the time such part of
the registration statement became effective but excluding Form T-1, each as
amended at the time such part of the Initial Registration Statement became
effective or such part of the Rule 462(b) Registration Statement, if any,
became or hereinafter becomes effective, are hereinafter collectively
called the "Registration Statement"; the prospectus relating to the
Securities, in the form in which it has most recently been filed, or
transmitted for filing, with the Commission on or prior to the date of this
Agreement, being hereinafter called the "Prospectus"; any reference herein
to any Preliminary Prospectus or the Prospectus shall be deemed to refer to
and include the documents incorporated by reference therein pursuant to the
applicable form under the Act, as of the date of such Preliminary
Prospectus or Prospectus, as the case may be; any reference to any
amendment or supplement to any Preliminary Prospectus or the Prospectus
shall be deemed to refer to and include any documents filed after the date
of such Preliminary
2
<PAGE>
Prospectus or Prospectus, as the case may be, under the Securities Exchange
Act of 1934, as amended (the "Exchange Act"), and incorporated by reference
in such Preliminary Prospectus or Prospectus, as the case may be; any
reference to any amendment to the Registration Statement shall be deemed to
refer to and include any annual report of the Company filed pursuant to
Sections 13(a) or 15(d) of the Exchange Act after the effective date of the
Initial Registration Statement that is incorporated by reference in the
Registration Statement; and any reference to the Prospectus as amended or
supplemented shall be deemed to refer to the Prospectus as amended or
supplemented in relation to the applicable Designated Securities in the
form in which it is filed with the Commission pursuant to Rule 424(b) under
the Act in accordance with Section 5(a) hereof, including any documents
incorporated by reference therein as of the date of such filing);
(b) The documents incorporated by reference in the Prospectus, when
they became effective or were filed with the Commission, as the case may
be, conformed in all material respects to the requirements of the Act or
the Exchange Act, as applicable, and the rules and regulations of the
Commission thereunder, and none of such documents contained an untrue
statement of a material fact or omitted to state a material fact required
to be stated therein or necessary to make the statements therein not
misleading; and any further documents so filed and incorporated by
reference in the Prospectus or any further amendment or supplement thereto,
when such documents become effective or are filed with the Commission, as
the case may be, will conform in all material respects to the requirements
of the Act or the Exchange Act, as applicable, and the rules and
regulations of the Commission thereunder and will not contain an untrue
statement of a material fact or omit to state a material fact required to
be stated therein or necessary to make the statements therein not
misleading; provided, however, that this representation and warranty shall
not apply to any statements or omissions made in reliance upon and in
conformity with information furnished in writing to the Company by an
Underwriter of Designated Securities through the Representatives expressly
for use in the Prospectus as amended or supplemented relating to such
Securities;
(c) The Registration Statement and the Prospectus conform, and any
further amendments or supplements to the Registration Statement or the
Prospectus will conform, in all material respects to the requirements of
the Act and the Trust Indenture Act of 1939, as amended (the "Trust
Indenture Act") and the rules and regulations of the Commission thereunder
and do not and will not, as of the applicable effective date as to the
Registration Statement and any amendment thereto and as of the applicable
filing date as to the Prospectus and any amendment or supplement thereto,
contain an untrue statement of a material fact or omit to state a material
fact required to be stated therein or necessary to make the statements
therein not misleading; provided, however, that this representation and
warranty shall not apply to any statements or omissions made in reliance
upon and in conformity with information furnished in writing to the Company
by an Underwriter of Designated Securities through the Representatives
expressly for use in the Prospectus as amended or supplemented relating to
such Securities;
(d) Neither the Company nor any of its subsidiaries has sustained
since the date of the latest audited financial statements included or
incorporated by reference in the Prospectus any material loss or
interference with its business from fire, explosion, flood or other
calamity, whether or not covered by insurance, or from any labor dispute or
court or
3
<PAGE>
governmental action, order or decree, otherwise than as set forth or
contemplated in the Prospectus; and, since the respective dates as of which
information is given in the Registration Statement and the Prospectus,
there has not been any change in the capital stock or long-term debt of the
Company or any of its subsidiaries or any material adverse change, or any
development involving a prospective material adverse change, in or
affecting the general affairs, management, financial position,
shareholders' equity or results of operations of the Company and its
subsidiaries, otherwise than as set forth or contemplated in the
Prospectus;
(e) The Company has been duly incorporated and is validly existing as
a corporation in good standing under the laws of the jurisdiction of its
incorporation, with power and authority (corporate and other) to own its
properties and conduct its business as described in the Prospectus;
(f) The Company has an authorized capitalization as set forth in the
Prospectus, and all of the issued shares of capital stock of the Company
have been duly and validly authorized and issued and are fully paid and
non-assessable;
(g) The Securities have been duly authorized, and, when Designated
Securities are issued and delivered pursuant to this Agreement and the
Pricing Agreement with respect to such Designated Securities, such
Designated Securities will have been duly executed, authenticated, issued
and delivered and will constitute valid and legally binding obligations of
the Company entitled to the benefits provided by the Indenture, which will
be substantially in the form filed as an exhibit to the Registration
Statement; the Indenture has been duly authorized and duly qualified under
the Trust Indenture Act and, at the Time of Delivery for such Designated
Securities (as defined in Section 4 hereof), the Indenture will constitute
a valid and legally binding instrument, enforceable in accordance with its
terms, subject, as to enforcement, to bankruptcy, insolvency,
reorganization and other laws of general applicability relating to or
affecting creditors' rights and to general equity principles; and the
Indenture conforms, and the Designated Securities will conform, to the
descriptions thereof contained in the Prospectus as amended or supplemented
with respect to such Designated Securities;
(h) The issue and sale of the Securities and the compliance by the
Company with all of the provisions of the Securities, the Indenture, this
Agreement and any Pricing Agreement, and the consummation of the
transactions herein and therein contemplated will not conflict with or
result in a breach or violation of any of the terms or provisions of, or
constitute a default under, any indenture, mortgage, deed of trust, loan
agreement or other agreement or instrument to which the Company is a party
or by which the Company is bound or to which any of the property or assets
of the Company is subject that is material to the Company and its
subsidiaries, taken as a whole, nor will such action result in any
violation of the provisions of the Certificate of Incorporation or By-laws
of the Company or any statute or any order, rule or regulation of any court
or governmental agency or body having jurisdiction over the Company or any
of its properties; and no consent, approval, authorization, order,
registration or qualification of or with any such court or governmental
agency or body is required for the issue and sale of the Securities or the
consummation by the Company of the transactions contemplated by this
Agreement or any Pricing Agreement or the Indenture, except such as have
been, or will have been prior to the Time of Delivery, obtained under the
Act and the Trust Indenture Act and such consents, approvals,
4
<PAGE>
authorizations, registrations or qualifications as may be required under
state securities or Blue Sky laws in connection with the purchase and
distribution of the Securities by the Underwriters;
(i) The statements set forth in the Prospectus under the captions
"Description of Debt Securities" and "Description of the Notes," insofar as
they purport to constitute a summary of the terms of the Securities are
accurate, complete and fair;
(j) Neither the Company nor any of its subsidiaries is in violation of
its Certificate of Incorporation or By-laws or in default in the
performance or observance of any material obligation, agreement, covenant
or condition contained in any indenture, mortgage, deed of trust, loan
agreement, lease or other agreement or instrument to which it is a party or
by which it or any of its properties may be bound;
(k) Other than as set forth in the Prospectus, there are no legal or
governmental proceedings pending to which the Company or any of its
subsidiaries is a party or of which any property of the Company or any of
its subsidiaries is the subject which, if determined adversely to the
Company or any of its subsidiaries, would individually or in the aggregate
have a material adverse effect on the current or future consolidated
financial position, shareholders' equity or results of operations of the
Company and its subsidiaries; and, to the best of the Company's knowledge,
no such proceedings are threatened or contemplated by governmental
authorities or threatened by others;
(l) The Company is not and, after giving effect to the offering and
sale of the Securities, will not be an "investment company" or an entity
"controlled" by an "investment company", as such terms are defined in the
Investment Company Act of 1940, as amended (the "Investment Company Act");
and
(m) Price Waterhouse LLP, who have certified certain financial
statements of the Company and its subsidiaries are independent public
accountants as required by the Act and the rules and regulations of the
Commission thereunder.
3. Upon the execution of the Pricing Agreement applicable to any Designated
Securities and authorization by the Representatives of the release of such
Designated Securities, the several Underwriters propose to offer such Designated
Securities for sale upon the terms and conditions set forth in the Prospectus as
amended or supplemented.
4. Designated Securities to be purchased by each Underwriter pursuant to
the Pricing Agreement relating thereto, in the form specified in such Pricing
Agreement, and in such authorized denominations and registered in such names as
the Representatives may request upon at least forty-eight hours' prior notice to
the Company, shall be delivered by or on behalf of the Company to the
Representatives for the account of such Underwriter, against payment by such
Underwriter or on its behalf of the purchase price therefor by wire transfer or
certified or official bank check or checks, payable to the order of the Company
in the funds specified in such Pricing Agreement, all in the manner and at the
place and time and date specified in such Pricing Agreement or at such other
place and time and date as the Representatives and the Company may agree upon in
writing, such time and date being herein called the "Time of Delivery" for such
Securities.
5. The Company agrees with each of the Underwriters of any Designated
Securities:
(a) To prepare the Prospectus as amended or supplemented in relation
to the
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applicable Designated Securities in a form approved by the Representatives
and to file such Prospectus pursuant to Rule 424(b) under the Act not later
than the Commission's close of business on the second business day
following the execution and delivery of the Pricing Agreement relating to
the applicable Designated Securities or, if applicable, such earlier time
as may be required by Rule 424(b); to make no further amendment or any
supplement to the Registration Statement or Prospectus as amended or
supplemented after the date of the Pricing Agreement relating to such
Securities and prior to the Time of Delivery for such Securities which
shall be disapproved by the Representatives for such Securities promptly
after reasonable notice thereof; to advise the Representatives promptly of
any such amendment or supplement after such Time of Delivery and furnish
the Representatives with copies thereof; to file promptly all reports and
any definitive proxy or information statements required to be filed by the
Company with the Commission pursuant to Section 13(a), 13(c), 14 or 15(d)
of the Exchange Act for so long as the delivery of a prospectus is required
in connection with the offering or sale of such Securities, and during such
same period to advise the Representatives, promptly after it receives
notice thereof, of the time when any amendment to the Registration
Statement has been filed or becomes effective or any supplement to the
Prospectus or any amended Prospectus has been filed with the Commission, of
the issuance by the Commission of any stop order or of any order preventing
or suspending the use of any prospectus relating to the Securities, of the
suspension of the qualification of such Securities for offering or sale in
any jurisdiction, of the initiation or threatening of any proceeding for
any such purpose, or of any request by the Commission for the amending or
supplementing of the Registration Statement or Prospectus or for additional
information; and, in the event of the issuance of any such stop order or of
any such order preventing or suspending the use of any prospectus relating
to the Securities or suspending any such qualification, to promptly use its
best efforts to obtain the withdrawal of such order;
(b) Promptly from time to time to take such action as the
Representatives may reasonably request to qualify such Securities for
offering and sale under the securities laws of such jurisdictions as the
Representatives may request and to comply with such laws so as to permit
the continuance of sales and dealings therein in such jurisdictions for as
long as may be necessary to complete the distribution of such Securities,
provided that in connection therewith the Company shall not be required to
qualify as a foreign corporation or to file a general consent to service of
process in any jurisdiction;
(c) Prior to 10:00 a.m., New York City time, on the day next
succeeding the date of the Pricing Agreement for such Designated Securities
that is a Monday, Tuesday, Wednesday, Thursday or Friday on which banking
institutions in New York are generally authorized or obligated by law or
executive order to close (each such day, a "New York Business Day"), to
furnish the Underwriters with copies of the Prospectus in New York City as
amended or supplemented in such quantities as the Representatives may
reasonably request, and, if the delivery of a prospectus is required at any
time in connection with the offering or sale of the Securities and if at
such time any event shall have occurred as a result of which the Prospectus
as then amended or supplemented would include an untrue statement of a
material fact or omit to state any material fact necessary in order to make
the statements therein, in the light of the circumstances under which they
were made when such Prospectus is delivered, not misleading, or, if for any
other reason it shall be necessary during such same period to amend or
supplement the Prospectus or to file under the
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Exchange Act any document incorporated by reference in the Prospectus in
order to comply with the Act, the Exchange Act or the Trust Indenture Act,
to notify the Representatives and upon their request to file such document
and to prepare and furnish without charge to each Underwriter and to any
dealer in securities as many copies as the Representatives may from time to
time reasonably request of an amended Prospectus or a supplement to the
Prospectus which will correct such statement or omission or effect such
compliance;
(d) To make generally available to its security holders as soon as
practicable, but in any event not later than eighteen months after the
effective date of the Registration Statement (as defined in Rule 158(c)
under the Act), an earnings statement of the Company and its subsidiaries
(which need not be audited) complying with Section 11(a) of the Act and the
rules and regulations of the Commission thereunder (including, at the
option of the Company, Rule 158);
(e) During the period beginning from the date of the Pricing Agreement
for such Designated Securities and continuing to and including the later of
(i) the termination of trading restrictions for such Designated Securities,
as notified to the Company by the Representatives and (ii) the Time of
Delivery for such Designated Securities or (iii) such later date as may be
specified in such Pricing Agreement, not to offer, sell, contract to sell
or otherwise dispose of any debt securities of the Company which mature
more than one year after such Time of Delivery and which are substantially
similar to such Designated Securities, without the prior written consent of
the Representatives; and
(f) If the Company elects to rely upon Rule 462(b) in respect of the
offering and sale of any Designated Securities, to file a Rule 462(b)
Registration Statement with the Commission in compliance with Rule 462(b)
by 10:00 p.m., Washington, D.C. time, on the date of the Pricing Agreement
for such Designated Securities, and, at the time of filing, to either pay
to the Commission the filing fee for the Rule 462(b) Registration Statement
or give irrevocable instructions for the payment of such fee pursuant to
Rule 111(b) under the Act.
6. The Company covenants and agrees with the several Underwriters that the
Company will pay or cause to be paid the following: (i) the fees, disbursements
and expenses of the Company's counsel and accountants in connection with the
registration of the Securities under the Act and all other expenses in
connection with the preparation, printing and filing of the Registration
Statement, any Preliminary Prospectus and the Prospectus and amendments and
supplements thereto and the mailing and delivering of copies thereof to the
Underwriters and dealers; (ii) the cost of printing or producing any Agreement
among Underwriters, this Agreement, any Pricing Agreement, any Indenture, any
Blue Sky and Legal Investment Memoranda, closing documents (including any
compilations thereof) and any other documents in connection with the offering,
purchase, sale and delivery of the Securities; (iii) all expenses in connection
with the qualification of the Securities for offering and sale under state
securities laws as provided in Section 5(b) hereof, including the reasonable
fees and disbursements of counsel for the Underwriters in connection with such
qualification and in connection with the Blue Sky and Legal Investment Surveys;
(iv) any fees charged by securities rating services for rating the Securities;
(v) any filing fees incident to, and the fees and disbursements of counsel for
the Underwriters in connection with, any required review by the National
Association of Securities Dealers, Inc. of the terms of the sale of the
Securities; (vi) the cost of preparing the Securities; (vii) the fees and
expenses of any Trustee and any agent of any Trustee and the fees and
disbursements of counsel for any Trustee in connection with any Indenture and
the Securities; and (viii) all other costs and expenses incident to the
performance of its
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<PAGE>
obligations hereunder which are not otherwise specifically provided for in this
Section. It is understood, however, that, except as provided in this Section,
and Sections 8 and 11 hereof, the Underwriters will pay all of their own costs
and expenses, including the fees of their counsel, transfer taxes on resale of
any of the Securities by them, and any advertising expenses connected with any
offers they may make.
7. The obligations of the Underwriters of any Designated Securities under
the Pricing Agreement relating to such Designated Securities shall be subject,
in the discretion of the Representatives, to the condition that all
representations and warranties and other statements of the Company in or
incorporated by reference in the Pricing Agreement relating to such Designated
Securities are, at and as of the Time of Delivery for such Designated
Securities, true and correct, the condition that the Company shall have
performed all of its obligations hereunder theretofore to be performed, and the
following additional conditions:
(a) The Prospectus as amended or supplemented in relation to the
applicable Designated Securities shall have been filed with the Commission
pursuant to Rule 424(b) within the applicable time period prescribed for
such filing by the rules and regulations under the Act and in accordance
with Section 5(a) hereof; if the Company has elected to rely upon Rule
462(b) in respect of the offering and sale of any Designated Securities,
the applicable Rule 462(b) Registration Statement shall have become
effective by 10:00 p.m., Washington, D.C. time, on the date of the Pricing
Agreement for such Designated Securities; no stop order suspending the
effectiveness of the Registration Statement or any part thereof shall have
been issued and no proceeding for that purpose shall have been initiated or
threatened by the Commission; and all requests for additional information
on the part of the Commission shall have been complied with to the
Representatives' reasonable satisfaction;
(b) Sullivan & Cromwell, counsel for the Underwriters shall have
furnished to the Representatives such opinion or opinions (a draft of such
opinion is attached as Annex II(a) hereto), dated the Time of Delivery for
such Designated Securities, with respect to the incorporation of the
Company, the Indenture, the Designated Securities and the Prospectus, as
amended or supplemented, as well as such other related matters as the
Representatives may reasonably request, and such counsel shall have
received such papers and information as they may reasonably request to
enable them to pass upon such matters;
(c) Stoel Rives LLP, counsel for the Company, shall have furnished to
the Representatives their written opinion (a draft of such opinion is
attached as Annex II(b) hereto), dated the Time of Delivery for such
Designated Securities, in form and substance satisfactory to the
Representatives, to the effect that:
(i) The Company has been duly incorporated, is validly existing
as a corporation under the laws of the jurisdiction of its
incorporation, has the corporate power and authority to own its
property and to conduct its business as described in the Prospectus
and is duly qualified to transact business and is in good standing in
each jurisdiction in which the conduct of its business or its
ownership or leasing of property requires such qualification, except
to the extent that the failure to be so qualified or be in good
standing would not have a material adverse effect on the Company and
its subsidiaries, taken as a whole;
(ii) Each subsidiary of the Company which is a "significant
subsidiary" (as such term is defined in Regulation S-X promulgated by
the Commission) has been duly
8
<PAGE>
incorporated, is validly existing as a corporation in good standing
under the laws of the jurisdiction of its incorporation, has the
corporate power and authority to own its property and to conduct its
business as described in the Prospectus and is duly qualified to
transact business and is in good standing in each jurisdiction in
which the conduct of its business or its ownership or leasing of
property requires such qualification, except to the extent that the
failure to be so qualified or be in good standing would not have a
material adverse effect on the Company and its subsidiaries, taken as
a whole;
(iii) The Company has an authorized capitalization as set forth
in the Prospectus as amended or supplemented and all of the issued
shares of capital stock of the Company have been duly and validly
authorized and issued and are fully paid and non-assessable;
(iv) After due inquiry, counsel for the Company does not know of
any legal or governmental proceedings pending or threatened to which
the Company or any of its subsidiaries is a party or of which any
property of the Company or any of its subsidiaries is the subject that
are required to be described in the Registration Statement or the
Prospectus and are not so described or of any statutes, regulations,
contracts or other documents that are required to be described in the
Registration Statement that are not described or filed as required;
(v) This Agreement and the Pricing Agreement with respect to the
Designated Securities have been duly authorized, executed and
delivered by the Company;
(vi) The Designated Securities have been duly authorized and when
executed, authenticated, issued and delivered in accordance herewith
will constitute valid and legally binding obligations of the Company
entitled to the benefits provided by the Indenture; and the Designated
Securities and the Indenture conform to the descriptions thereof in
the Prospectus as amended or supplemented;
(vii) The Indenture has been duly authorized, executed and
delivered by the parties thereto and constitutes a valid and legally
binding instrument, enforceable against the Company in accordance with
its terms, subject, as to enforcement, to bankruptcy, insolvency,
reorganization and other laws of general applicability relating to or
affecting creditors' rights and to general equity principles; and the
Indenture has been duly qualified under the Trust Indenture Act;
(viii) The execution and delivery by the Company of, and the
performance by the Company of its obligations under, the Indenture,
this Agreement and the Pricing Agreement with respect to the
Designated Securities will not contravene any provision of applicable
law or the Certificate of Incorporation or By-laws of the Company, or,
to the best of such counsel's knowledge, any agreement or other
instrument binding upon the Company or any of its subsidiaries that is
material to the Company and its subsidiaries, taken as a whole, or, to
the best of such counsel's knowledge, any judgment, order or decree of
any governmental body, agency or court having jurisdiction over the
Company or any subsidiary, and no consent, approval, authorization or
order of, or qualification with, any governmental body or agency is
required for the performance by the Company of its obligations under
the Indenture, this Agreement and the Pricing Agreement with respect
to the Designated Securities,
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<PAGE>
except such as may be required by the securities or Blue Sky laws of
the various states in connection with the offer and sale of the
Designated Securities by the Underwriters;
(ix) The statements set forth in the Prospectus under the
captions "Description of Debt Securities," and "Description of the
Notes", insofar as such statements constitute summaries of the legal
matters, documents or proceedings referred to therein, fairly present
the information called for with respect to such legal matters,
documents and proceedings and fairly summarize the matters referred to
therein;
(x) The Company is not and, after giving effect to the offering
and sale of the Designated Securities and the application of the
proceeds thereof as described in the Prospectus, will not be an
"investment company" as such term is defined in the Investment Company
Act;
(xi) The documents incorporated by reference in the Prospectus as
amended or supplemented (other than the financial statements,
schedules and other financial data contained therein, as to which such
counsel need express no opinion), when they became effective or were
filed with the Commission, as the case may be, complied as to form in
all material respects with the requirements of the Act or the Exchange
Act, as applicable, and the rules and regulations of the Commission
thereunder; and
(xii) The Registration Statement and the Prospectus as amended or
supplemented and any further amendments and supplements thereto made
by the Company prior to the Time of Delivery for the Designated
Securities (other than the financial statements, schedules and other
financial data contained therein, as to which such counsel need
express no opinion) comply as to form in all material respects with
the requirements of the Act and the Trust Indenture Act and the rules
and regulations thereunder; although they do not assume any
responsibility for the accuracy, completeness or fairness of the
statements contained in the Registration Statement or the Prospectus,
except for those referred to in the opinion in subsection (x) of this
Section 7(c), which has caused them to believe that, as of its
effective date, the Registration Statement or any further amendment
thereto made by the Company prior to the Time of Delivery (other than
the financial statements, schedules and other financial data contained
therein, as to which such counsel need express no opinion) contained
an untrue statement of a material fact or omitted to state a material
fact required to be stated therein or necessary to make the statements
therein not misleading or that, as of its date, the Prospectus as
amended or supplemented or any further amendment or supplement thereto
made by the Company prior to the Time of Delivery (other than the
financial statements,schedules and other financial data contained
therein, as to which such counsel need express no opinion) contained
an untrue statement of a material fact or omitted to state a material
fact necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading or that, as
of the Time of Delivery, either the Registration Statement or the
Prospectus as amended or supplemented or any further amendment or
supplement thereto made by the Company prior to the Time of Delivery
(other than
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<PAGE>
the financial statements, schedules and other financial data contained
therein, as to which such counsel need express no opinion) contains an
untrue statement of a material fact or omits to state a material fact
necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading; and to their
knowledge, there is no amendment to the Registration Statement
required to be filed or any contracts or other documents of a
character required to be filed as an exhibit to the Registration
Statement or required to be incorporated by reference into the
Prospectus as amended or supplemented or required to be described in
the Registration Statement or the Prospectus as amended or
supplemented which are not filed or incorporated by reference or
described as required;
(d) On the date of the Pricing Agreement for such Designated
Securities at a time prior to the execution of the Pricing Agreement with
respect to such Designated Securities and at the Time of Delivery for such
Designated Securities, the independent accountants of the Company who have
certified the financial statements of the Company and its subsidiaries
included or incorporated by reference in the Registration Statement shall
have furnished to the Representatives a letter, dated the effective date of
the Registration Statement or the date of the most recent report filed with
the Commission containing financial statements and incorporated by
reference in the Registration Statement, if the date of such report is
later than such effective date, and a letter dated such Time of Delivery,
respectively, to the effect set forth in Annex II hereto, and with respect
to such letter dated such Time of Delivery, as to such other matters as the
Representatives may reasonably request and in form and substance
satisfactory to the Representatives;
(e) (i) Neither the Company nor any of its subsidiaries shall have
sustained since the date of the latest audited financial statements
included or incorporated by reference in the Prospectus as amended prior to
the date of the Pricing Agreement relating to the Designated Securities any
loss or interference with its business from fire, explosion, flood or other
calamity, whether or not covered by insurance, or from any labor dispute or
court or governmental action, order or decree, otherwise than as set forth
or contemplated in the Prospectus as amended prior to the date of the
Pricing Agreement relating to the Designated Securities, and (ii) since the
respective dates as of which information is given in the Prospectus as
amended prior to the date of the Pricing Agreement relating to the
Designated Securities there shall not have been any change in the capital
stock or long-term debt of the Company or any of its subsidiaries or any
change, or any development involving a prospective change, in or affecting
the general affairs, management, financial position, shareholders' equity
or results of operations of the Company and its subsidiaries, otherwise
than as set forth or contemplated in the Prospectus as amended prior to the
date of the Pricing Agreement relating to the Designated Securities, the
effect of which, in any such case described in Clause (i) or (ii), is in
the judgment of the Representatives so material and adverse as to make it
impracticable or inadvisable to proceed with the public offering or the
delivery of the Designated Securities on the terms and in the manner
contemplated in the Prospectus as first amended or supplemented relating to
the Designated Securities;
(f) On or after the date of the Pricing Agreement relating to the
Designated Securities (i) no downgrading shall have occurred in the rating
accorded the Company's debt securities or preferred stock by any
"nationally recognized statistical rating organization", as that term is
defined by the Commission for purposes of Rule 436(g)(2) under the Act, and
(ii) no such
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organization shall have publicly announced that it has under surveillance
or review, with possible negative implications, its rating of any of the
Company's debt securities or preferred stock;
(g) On or after the date of the Pricing Agreement relating to the
Designated Securities there shall not have occurred any of the following:
(i) a suspension or material limitation in trading in securities generally
on the New York Stock Exchange; (ii) a suspension or material limitation in
trading in the Company's securities on the New York Stock Exchange; (iii) a
general moratorium on commercial banking activities declared by either
Federal or New York or Oregon State authorities; or (iv) the outbreak or
escalation of hostilities involving the United States or the declaration by
the United States of a national emergency or war, if the effect of any such
event specified in this Clause (iv) in the judgment of the Representatives
makes it impracticable or inadvisable to proceed with the public offering
or the delivery of the Designated Securities on the terms and in the manner
contemplated in the Prospectus as first amended or supplemented relating to
the Designated Securities;
(h) The Company shall have complied with the provisions of Section
5(c) hereof with respect to the furnishing of prospectuses on the New York
Business Day next succeeding the date of the applicable Pricing Agreement;
and
(i) The Company shall have furnished or caused to be furnished to the
Representatives at the Time of Delivery for the Designated Securities a
certificate or certificates of officers of the Company satisfactory to the
Representatives as to the accuracy of the representations and warranties of
the Company herein at and as of such Time of Delivery, as to the
performance by the Company of all of its obligations hereunder to be
performed at or prior to such Time of Delivery, as to the matters set forth
in subsections (a) and (e) of this Section and as to such other matters as
the Representatives may reasonably request.
8. (a) The Company will indemnify and hold harmless each Underwriter
against any losses, claims, damages or liabilities, joint or several, to which
such Underwriter may become subject, under the Act or otherwise, insofar as such
losses, claims, damages or liabilities (or actions in respect thereof) arise out
of or are based upon an untrue statement or alleged untrue statement of a
material fact contained in any Preliminary Prospectus, any preliminary
prospectus supplement, the Registration Statement, the Prospectus as amended or
supplemented and any other prospectus relating to the Securities, or any
amendment or supplement thereto, or arise out of or are based upon the omission
or alleged omission to state therein a material fact required to be stated
therein or necessary to make the statements therein not misleading, and will
reimburse each Underwriter for any legal or other expenses reasonably incurred
by such Underwriter in connection with investigating or defending any such
action or claim as such expenses are incurred; provided, however, that the
Company shall not be liable in any such case to the extent that any such loss,
claim, damage or liability arises out of or is based upon an untrue statement or
alleged untrue statement or omission or alleged omission made in any Preliminary
Prospectus, any preliminary prospectus supplement, the Registration Statement,
the Prospectus as amended or supplemented and any other prospectus relating to
the Securities, or any such amendment or supplement in reliance upon and in
conformity with written information furnished to the Company by any Underwriter
of Designated Securities through the Representatives expressly for use in the
Prospectus as amended or supplemented relating to such Securities.
(b) Each Underwriter will indemnify and hold harmless the Company against
any losses, claims,
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damages or liabilities to which the Company may become subject, under the Act or
otherwise, insofar as such losses, claims, damages or liabilities (or actions in
respect thereof) arise out of or are based upon an untrue statement or alleged
untrue statement of a material fact contained in any Preliminary Prospectus, any
preliminary prospectus supplement, the Registration Statement, the Prospectus as
amended or supplemented and any other prospectus relating to the Securities, or
any amendment or supplement thereto, or arise out of or are based upon the
omission or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein not misleading, in
each case to the extent, but only to the extent, that such untrue statement or
alleged untrue statement or omission or alleged omission was made in any
Preliminary Prospectus, any preliminary prospectus supplement, the Registration
Statement, the Prospectus as amended or supplemented and any other prospectus
relating to the Securities, or any such amendment or supplement in reliance upon
and in conformity with written information furnished to the Company by such
Underwriter through the Representatives expressly for use therein; and will
reimburse the Company for any legal or other expenses reasonably incurred by the
Company in connection with investigating or defending any such action or claim
as such expenses are incurred.
(c) Promptly after receipt by an indemnified party under subsection (a) or
(b) above of notice of the commencement of any action, such indemnified party
shall, if a claim in respect thereof is to be made against the indemnifying
party under such subsection, notify the indemnifying party in writing of the
commencement thereof; but the omission so to notify the indemnifying party shall
not relieve it from any liability which it may have to any indemnified party
otherwise than under such subsection. In case any such action shall be brought
against any indemnified party and it shall notify the indemnifying party of the
commencement thereof, the indemnifying party shall be entitled to participate
therein and, to the extent that it shall wish, jointly with any other
indemnifying party similarly notified, to assume the defense thereof, with
counsel satisfactory to such indemnified party (who shall not, except with the
consent of the indemnified party, be counsel to the indemnifying party), and,
after notice from the indemnifying party to such indemnified party of its
election so to assume the defense thereof, the indemnifying party shall not be
liable to such indemnified party under such subsection for any legal expenses of
other counsel or any other expenses, in each case subsequently incurred by such
indemnified party, in connection with the defense thereof other than reasonable
costs of investigation. No indemnifying party shall, without the written consent
of the indemnified party, effect the settlement or compromise of, or consent to
the entry of any judgment with respect to, any pending or threatened action or
claim in respect of which indemnification or contribution may be sought
hereunder (whether or not the indemnified party is an actual or potential party
to such action or claim) unless such settlement, compromise or judgment (i)
includes an unconditional release of the indemnified party from all liability
arising out of such action or claim and (ii) does not include a statement as to
or an admission of fault, culpability or a failure to act, by or on behalf of
any indemnified party.
(d) If the indemnification provided for in this Section 8 is unavailable to
or insufficient to hold harmless an indemnified party under subsection (a) or
(b) above in respect of any losses, claims, damages or liabilities (or actions
in respect thereof) referred to therein, then each indemnifying party shall
contribute to the amount paid or payable by such indemnified party as a result
of such losses, claims, damages or liabilities (or actions in respect thereof)
in such proportion as is appropriate to reflect the relative benefits received
by the Company on the one hand and the Underwriters of the Designated Securities
on the other from the offering of the Designated Securities to which such loss,
claim, damage or liability (or action in respect thereof) relates. If, however,
the allocation provided
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by the immediately preceding sentence is not permitted by applicable law or if
the indemnified party failed to give the notice required under subsection (c)
above, then each indemnifying party shall contribute to such amount paid or
payable by such indemnified party in such proportion as is appropriate to
reflect not only such relative benefits but also the relative fault of the
Company on the one hand and the Underwriters of the Designated Securities on the
other in connection with the statements or omissions which resulted in such
losses, claims, damages or liabilities (or actions in respect thereof), as well
as any other relevant equitable considerations. The relative benefits received
by the Company on the one hand and such Underwriters on the other shall be
deemed to be in the same proportion as the total net proceeds from such offering
(before deducting expenses) received by the Company bear to the total
underwriting discounts and commissions received by such Underwriters. The
relative fault shall be determined by reference to, among other things, whether
the untrue or alleged untrue statement of a material fact or the omission or
alleged omission to state a material fact relates to information supplied by the
Company on the one hand or such Underwriters on the other and the parties'
relative intent, knowledge, access to information and opportunity to correct or
prevent such statement or omission. The Company and the Underwriters agree that
it would not be just and equitable if contribution pursuant to this subsection
(d) were determined by pro rata allocation (even if the Underwriters were
treated as one entity for such purpose) or by any other method of allocation
which does not take account of the equitable considerations referred to above in
this subsection (d). The amount paid or payable by an indemnified party as a
result of the losses, claims, damages or liabilities (or actions in respect
thereof) referred to above in this subsection (d) shall be deemed to include any
legal or other expenses reasonably incurred by such indemnified party in
connection with investigating or defending any such action or claim.
Notwithstanding the provisions of this subsection (d), no Underwriter shall be
required to contribute any amount in excess of the amount by which the total
price at which the applicable Designated Securities underwritten by it and
distributed to the public were offered to the public exceeds the amount of any
damages which such Underwriter has otherwise been required to pay by reason of
such untrue or alleged untrue statement or omission or alleged omission. No
person guilty of fraudulent misrepresentation (within the meaning of Section
11(f) of the Act) shall be entitled to contribution from any person who was not
guilty of such fraudulent misrepresentation. The obligations of the Underwriters
of Designated Securities in this subsection (d) to contribute are several in
proportion to their respective underwriting obligations with respect to such
Securities and not joint.
(e) The obligations of the Company under this Section 8 shall be in
addition to any liability which the Company may otherwise have and shall extend,
upon the same terms and conditions, to each person, if any, who controls any
Underwriter within the meaning of the Act; and the obligations of the
Underwriters under this Section 8 shall be in addition to any liability which
the respective Underwriters may otherwise have and shall extend, upon the same
terms and conditions, to each officer and director of the Company and to each
person, if any, who controls the Company within the meaning of the Act.
9. (a) If any Underwriter shall default in its obligation to purchase the
Designated Securities which it has agreed to purchase under the Pricing
Agreement relating to such Designated Securities, the Representatives may in
their discretion arrange for themselves or another party or other parties to
purchase such Designated Securities on the terms contained herein. If within
thirty-six hours after such default by any Underwriter the Representatives do
not arrange for the purchase of such Designated Securities, then the Company
shall be entitled to a further period of thirty-six hours within which to
procure another party or other parties satisfactory to the
14
<PAGE>
Representatives to purchase such Designated Securities on such terms. In the
event that, within the respective prescribed period, the Representatives notify
the Company that they have so arranged for the purchase of such Designated
Securities, or the Company notifies the Representatives that it has so arranged
for the purchase of such Designated Securities, the Representatives or the
Company shall have the right to postpone the Time of Delivery for such
Designated Securities for a period of not more than seven days, in order to
effect whatever changes may thereby be made necessary in the Registration
Statement or the Prospectus as amended or supplemented, or in any other
documents or arrangements, and the Company agrees to file promptly any
amendments or supplements to the Registration Statement or the Prospectus which
in the opinion of the Representatives may thereby be made necessary. The term
"Underwriter" as used in this Agreement shall include any person substituted
under this Section with like effect as if such person had originally been a
party to the Pricing Agreement with respect to such Designated Securities.
(b) If, after giving effect to any arrangements for the purchase of the
Designated Securities of a defaulting Underwriter or Underwriters by the
Representatives and the Company as provided in subsection (a) above, the
aggregate principal amount of such Designated Securities which remains
unpurchased does not exceed one-eleventh of the aggregate principal amount of
the Designated Securities, then the Company shall have the right to require each
non-defaulting Underwriter to purchase the principal amount of Designated
Securities which such Underwriter agreed to purchase under the Pricing Agreement
relating to such Designated Securities and, in addition, to require each
non-defaulting Underwriter to purchase its pro rata share (based on the
principal amount of Designated Securities which such Underwriter agreed to
purchase under such Pricing Agreement) of the Designated Securities of such
defaulting Underwriter or Underwriters for which such arrangements have not been
made; but nothing herein shall relieve a defaulting Underwriter from liability
for its default.
(c) If, after giving effect to any arrangements for the purchase of the
Designated Securities of a defaulting Underwriter or Underwriters by the
Representatives and the Company as provided in subsection (a) above, the
aggregate principal amount of Designated Securities which remains unpurchased
exceeds one-eleventh of the aggregate principal amount of the Designated
Securities, as referred to in subsection (b) above, or if the Company shall not
exercise the right described in subsection (b) above to require non-defaulting
Underwriters to purchase Designated Securities of a defaulting Underwriter or
Underwriters, then the Pricing Agreement relating to such Designated Securities
shall thereupon terminate, without liability on the part of any non-defaulting
Underwriter or the Company, except for the expenses to be borne by the Company
and the Underwriters as provided in Section 6 hereof and the indemnity and
contribution agreements in Section 8 hereof; but nothing herein shall relieve a
defaulting Underwriter from liability for its default.
10. The respective indemnities, agreements, representations, warranties and
other statements of the Company and the several Underwriters, as set forth in
this Agreement or made by or on behalf of them, respectively, pursuant to this
Agreement, shall remain in full force and effect, regardless of any
investigation (or any statement as to the results thereof) made by or on behalf
of any Underwriter or any controlling person of any Underwriter, or the Company,
or any officer or director or controlling person of the Company, and shall
survive delivery of and payment for the Securities.
11. If any Pricing Agreement shall be terminated pursuant to Section 9
hereof, the Company shall not then be under any liability to any Underwriter
with respect to the Designated Securities
15
<PAGE>
covered by such Pricing Agreement except as provided in Sections 6 and 8 hereof;
but, if for any other reason Designated Securities are not delivered by or on
behalf of the Company as provided herein, the Company will reimburse the
Underwriters through the Representatives for all out-of-pocket expenses approved
in writing by the Representatives, including reasonable fees and disbursements
of counsel, reasonably incurred by the Underwriters in making preparations for
the purchase, sale and delivery of such Designated Securities, but the Company
shall then be under no further liability to any Underwriter with respect to such
Designated Securities except as provided in Sections 6 and 8 hereof.
12. In all dealings hereunder, the Representatives of the Underwriters of
Designated Securities shall act on behalf of each of such Underwriters, and the
parties hereto shall be entitled to act and rely upon any statement, request,
notice or agreement on behalf of any Underwriter made or given by such
Representatives jointly or by such of the Representatives, if any, as may be
designated for such purpose in the Pricing Agreement.
All statements, requests, notices and agreements hereunder shall be in
writing, and if to the Underwriters shall be delivered or sent by mail, telex or
facsimile transmission to the address of the Representatives as set forth in the
Pricing Agreement; and if to the Company shall be delivered or sent by mail,
telex or facsimile transmission to the address of the Company set forth in the
Registration Statement: Attention: Secretary; provided, however, that any notice
to an Underwriter pursuant to Section 8(c) hereof shall be delivered or sent by
mail, telex or facsimile transmission to such Underwriter at its address set
forth in its Underwriters' Questionnaire, or telex constituting such
Questionnaire, which address will be supplied to the Company by the
Representatives upon request. Any such statements, requests, notices or
agreements shall take effect upon receipt thereof.
13. This Agreement and each Pricing Agreement shall be binding upon, and
inure solely to the benefit of, the Underwriters, the Company and, to the extent
provided in Sections 8 and 10 hereof, the officers and directors of the Company
and each person who controls the Company or any Underwriter, and their
respective heirs, executors, administrators, successors and assigns, and no
other person shall acquire or have any right under or by virtue of this
Agreement or any such Pricing Agreement. No purchaser of any of the Securities
from any Underwriter shall be deemed a successor or assign by reason merely of
such purchase.
14. Time shall be of the essence of each Pricing Agreement. As used herein,
"business day" shall mean any day when the Commission's office in Washington,
D.C. is open for business.
15. This Agreement and each Pricing Agreement shall be governed by and
construed in accordance with the laws of the State of New York.
16. This Agreement and each Pricing Agreement may be executed by any one or
more of the parties hereto and thereto in any number of counterparts, each of
which shall be deemed to be an original, but all such respective counterparts
shall together constitute one and the same instrument.
16
<PAGE>
If the foregoing is in accordance with your understanding, please sign and
return to us six counterparts hereof.
Very truly yours,
PRECISION CASTPARTS CORP.
By:
-------------------------------------
Name:
Title:
Accepted as of the date hereof:
GOLDMAN, SACHS & CO.
MORGAN STANLEY & CO. INCORPORATED
BANCAMERICA ROBERTSON STEPHENS
By:
-----------------------------------
(Goldman, Sachs & Co.)
17
<PAGE>
ANNEX I
Pricing Agreement
Goldman, Sachs & Co.,
[Name(s) of Co-Representative(s)]
[As Representatives of the several
Underwriters named in Schedule I hereto,]
[c/o Goldman, Sachs & Co.,]
85 Broad Street,
New York, New York 10004.
, 1997
Ladies and Gentlemen:
Precision Castparts Corp., an Oregon corporation (the "Company"), proposes,
subject to the terms and conditions stated herein and in the Underwriting
Agreement, dated . . . . . . . . . . . ., 1997 (the "Underwriting Agreement"),
between the Company on the one hand and Goldman, Sachs & Co., Morgan Stanley &
Co. Incorporated and BancAmerica Robertson Stephens on the other hand, to issue
and sell to the Underwriters named in Schedule I hereto (the "Underwriters") the
Securities specified in Schedule II hereto (the "Designated Securities"). Each
of the provisions of the Underwriting Agreement is incorporated herein by
reference in its entirety, and shall be deemed to be a part of this Agreement to
the same extent as if such provisions had been set forth in full herein; and
each of the representations and warranties set forth therein shall be deemed to
have been made at and as of the date of this Pricing Agreement, except that each
representation and warranty which refers to the Prospectus in Section 2 of the
Underwriting Agreement shall be deemed to be a representation or warranty as of
the date of the Underwriting Agreement in relation to the Prospectus (as therein
defined), and also a representation and warranty as of the date of this Pricing
Agreement in relation to the Prospectus as amended or supplemented relating to
the Designated Securities which are the subject of this Pricing Agreement. Each
reference to the Representatives herein and in the provisions of the
Underwriting Agreement so incorporated by reference shall be deemed to refer to
you. Unless otherwise defined herein, terms defined in the Underwriting
Agreement are used herein as therein defined. The Representatives designated to
act on behalf of the Representatives and on behalf of each of the Underwriters
of the Designated Securities pursuant to Section 12 of the Underwriting
Agreement and the address of the Representatives referred to in such Section 12
are set forth at the end of Schedule II hereto.
An amendment to the Registration Statement, or a supplement to the
Prospectus, as the case may be, relating to the Designated Securities, in the
form heretofore delivered to you is now proposed to be filed with the
Commission.
Subject to the terms and conditions set forth herein and in the
Underwriting Agreement incorporated herein by reference, the Company agrees to
issue and sell to each of the Underwriters, and each of the Underwriters agrees,
severally and not jointly, to purchase from the Company, at the time and place
and at the purchase price to the Underwriters set forth in Schedule II hereto,
the
<PAGE>
principal amount of Designated Securities set forth opposite the name of such
Underwriter in Schedule I hereto.
If the foregoing is in accordance with your understanding, please sign and
return to us counterparts hereof, and upon acceptance hereof by you, on behalf
of each of the Underwriters, this letter and such acceptance hereof, including
the provisions of the Underwriting Agreement incorporated herein by reference,
shall constitute a binding agreement between each of the Underwriters and the
Company. It is understood that your acceptance of this letter on behalf of each
of the Underwriters is or will be pursuant to the authority set forth in a form
of Agreement among Underwriters, the form of which shall be submitted to the
Company for examination upon request, but without warranty on the part of the
Representatives as to the authority of the signers thereof.
Very truly yours,
PRECISION CASTPARTS CORP.
By:
-------------------------------------
Name:
Title:
[Accepted as of the date hereof:
[Goldman, Sachs & Co.
[Name(s) of Co-Representative(s)]]
[By:]..................................
(Goldman, Sachs & Co.)
[[Name(s) of Co-Representative Corporation(s)]
By:....................................
Name:
Title:
....................................
[(Name(s) of Co-Representative
Partnership(s))]]]
On behalf of each of the Underwriters
2
<PAGE>
SCHEDULE I
Principal
Amount of
Designated
Securities
to be
Underwriter Purchased
----------- ---------
Goldman, Sachs & Co.................................................. $
[Name(s) of Co-Representative(s)]....................................
[Names of other Underwriters]........................................
---------
Total ............................................................ $
=========
3
<PAGE>
SCHEDULE II
Title of Designated Securities:
[ %] [Floating Rate] [Zero Coupon] [Notes]
[Debentures] due ,
Aggregate principal amount:
[$]
Price to Public:
% of the principal amount of the Designated Securities, plus accrued
interest[, if any,] from to [and accrued
amortization[, if any,] from to ]
Purchase Price by Underwriters:
% of the principal amount of the Designated Securities, plus accrued
interest[, if any,] from to [and accrued
amortization[, if any,] from to ]
Form of Designated Securities:
[Definitive form to be made available for checking and packaging at least
twenty-four hours prior to the Time of Delivery at the office of [The
Depository Trust Company or its designated custodian] [the
Representatives]]
[Book-entry only form represented by one or more global securities
deposited with The Depository Trust Company ("DTC") or its designated
custodian, to be made available for checking by the Representatives at
least twenty-four hours prior to the Time of Delivery at the office of
DTC.]
Specified funds for payment of purchase price:
[Wire transfer of Federal (same-day) funds.]
[Other.]
Time of Delivery:
a.m. (New York City time), , 19
Indenture:
Indenture dated , 19 , between the Company
and , as Trustee
Maturity:
Interest Rate:
[ %] [Zero Coupon] [See Floating Rate Provisions]
Interest Payment Dates:
[months and dates, commencing ....................., 19..]
Redemption Provisions:
4
<PAGE>
[No provisions for redemption]
[The Designated Securities may be redeemed, otherwise than through the
sinking fund, in whole or in part at the option of the Company, in the
amount of [$ ] or an integral multiple thereof,
[on or after , at the following redemption prices (expressed in
percentages of principal amount). If [redeemed on or before , %,
and if] redeemed during the 12-month period beginning ,
Redemption
Year Price
---- -----
and thereafter at 100% of their principal amount, together in each case
with accrued interest to the redemption date.]
[on any interest payment date falling on or after , , at the election of
the Company, at a redemption price equal to the principal amount thereof,
plus accrued interest to the date of redemption.]]
[Other possible redemption provisions, such as mandatory redemption upon
occurrence of certain events or redemption for changes in tax law]
[Restriction on refunding]
Sinking Fund Provisions:
[No sinking fund provisions]
[The Designated Securities are entitled to the benefit of a sinking fund to
retire [$ ] principal amount of Designated Securities on
in each of the years through at 100% of their principal amount
plus accrued interest[, together with [cumulative] [noncumulative]
redemptions at the option of the Company to retire an additional [$ ]
principal amount of Designated Securities in the years through at 100%
of their principal amount plus accrued interest.]
[If Designated Securities are extendable debt securities, insert--
Extendable provisions:
Designated Securities are repayable on , [insert date
and years], at the option of the holder, at their principal amount with
accrued interest. The initial annual interest rate will be %, and
thereafter the annual interest rate will be adjusted on ,
and to a rate not less than % of the effective annual interest rate on U.S.
Treasury obligations with -year maturities as of the [insert date 15 days
prior to maturity date] prior to such [insert maturity date].]
[If Designated Securities are floating rate debt securities, insert--
Floating rate provisions:
5
<PAGE>
Initial annual interest rate will be % through [and
thereafter will be adjusted [monthly] [on each , ,
and ] [to an annual rate of % above the average rate for
-year [month][securities][certificates of deposit] issued by and
[insert names of banks].] [and the annual interest rate
[thereafter] [from through ] will be the interest yield
equivalent of the weekly average per annum market discount rate for
-month Treasury bills plus % of Interest Differential (the excess, if any,
of (i) the then current weekly average per annum secondary market yield for
-month certificates of deposit over (ii) the then current interest yield
equivalent of the weekly average per annum market discount rate for -month
Treasury bills); [from and thereafter the rate will be the then current
interest yield equivalent plus % of Interest Differential].]
Defeasance provisions:
Lock-up provisions:
Closing location for delivery of Designated Securities:
Names and addresses of Representatives:
Designated Representatives:
Address for Notices, etc.:
Other Terms:
6
<PAGE>
ANNEX II
Pursuant to Section 7(d) of the Underwriting Agreement, the accountants
shall furnish letters to the Underwriters to the effect that:
(i) They are independent certified public accountants with respect to
the Company and its subsidiaries within the meaning of the Act and the
applicable published rules and regulations thereunder;
(ii) In their opinion, the financial statements and any supplementary
financial information and schedules audited (and, if applicable, financial
forecasts and/or pro forma financial information) examined by them and
included or incorporated by reference in the Registration Statement or the
Prospectus comply as to form in all material respects with the applicable
accounting requirements of the Act or the Exchange Act, as applicable, and
the related published rules and regulations thereunder; and, if applicable,
they have made a review in accordance with standards established by the
American Institute of Certified Public Accountants of the consolidated
interim financial statements, selected financial data, pro forma financial
information, financial forecasts and/or condensed financial statements
derived from audited financial statements of the Company for the periods
specified in such letter, as indicated in their reports thereon, copies of
which have been separately furnished to the representative or
representatives of the Underwriters (the "Representatives") such term to
include an Underwriter or Underwriters who act without any firm being
designated as its or their representatives;
(iii) They have made a review in accordance with standards established
by the American Institute of Certified Public Accountants of the unaudited
condensed consolidated statements of income, consolidated balance sheets
and consolidated statements of cash flows included in the Prospectus and/or
included in the Company's quarterly report on Form 10-Q incorporated by
reference into the Prospectus as indicated in their reports thereon copies
of which have been separately furnished to the Representatives; and on the
basis of specified procedures including inquiries of officials of the
Company who have responsibility for financial and accounting matters
regarding whether the unaudited condensed consolidated financial statements
referred to in paragraph (vi)(A)(i) below comply as to form in all material
respects with the applicable accounting requirements of the Act and the
Exchange Act and the related published rules and regulations, nothing came
to their attention that caused them to believe that the unaudited condensed
consolidated financial statements do not comply as to form in all material
respects with the applicable accounting requirements of the Act and the
Exchange Act and the related published rules and regulations;
(iv) The unaudited selected financial information with respect to the
consolidated results of operations and financial position of the Company
for the five most recent fiscal years included in the Prospectus and
included or incorporated by reference in Item 6 of the Company's Annual
Report on Form 10-K for the most recent fiscal year agrees with the
corresponding amounts (after restatement where applicable) in the audited
consolidated financial statements for five such fiscal years which were
included or incorporated by reference in the Company's Annual Reports on
Form 10-K for such fiscal years;
(v) They have compared the information in the Prospectus under
selected captions
<PAGE>
with the disclosure requirements of Regulation S-K and on the basis of
limited procedures specified in such letter nothing came to their attention
as a result of the foregoing procedures that caused them to believe that
this information does not conform in all material respects with the
disclosure requirements of Items 301, 302, 402 and 503(d), respectively, of
Regulation S-K;
(vi) On the basis of limited procedures, not constituting an
examination in accordance with generally accepted auditing standards,
consisting of a reading of the unaudited financial statements and other
information referred to below, a reading of the latest available interim
financial statements of the Company and its subsidiaries, inspection of the
minute books of the Company and its subsidiaries since the date of the
latest audited financial statements included or incorporated by reference
in the Prospectus, inquiries of officials of the Company and its
subsidiaries responsible for financial and accounting matters and such
other inquiries and procedures as may be specified in such letter, nothing
came to their attention that caused them to believe that:
(A) (i) the unaudited condensed consolidated statements of
income, consolidated balance sheets and consolidated statements of
cash flows included in the Prospectus and/or included or incorporated
by reference in the Company's Quarterly Reports on Form 10-Q
incorporated by reference in the Prospectus do not comply as to form
in all material respects with the applicable accounting requirements
of the Exchange Act and the related published rules and regulations,
or (ii) any material modifications should be made to the unaudited
condensed consolidated statements of income, consolidated balance
sheets and consolidated statements of cash flows included in the
Prospectus or included in the Company's Quarterly Reports on Form 10-Q
incorporated by reference in the Prospectus for them to be in
conformity with generally accepted accounting principles;
(B) any other unaudited income statement data and balance sheet
items included in the Prospectus do not agree with the corresponding
items in the unaudited consolidated financial statements from which
such data and items were derived, and any such unaudited data and
items were not determined on a basis substantially consistent with the
basis for the corresponding amounts in the audited consolidated
financial statements included or incorporated by reference in the
Company's Annual Report on Form 10-K for the most recent fiscal year;
(C) the unaudited financial statements which were not included in
the Prospectus but from which were derived the unaudited condensed
financial statements referred to in clause (A) and any unaudited
income statement data and balance sheet items included in the
Prospectus and referred to in Clause (B) were not determined on a
basis substantially consistent with the basis for the audited
financial statements included or incorporated by reference in the
Company's Annual Report on Form 10-K for the most recent fiscal year;
(D) any unaudited pro forma consolidated condensed financial
statements included or incorporated by reference in the Prospectus do
not comply as to form in all material respects with the applicable
accounting requirements of the Act and the published rules and
regulations thereunder or the pro forma adjustments have not been
properly applied to the historical amounts in the compilation of those
statements;
2
<PAGE>
(E) as of a specified date not more than five days prior to the
date of such letter, there have been any changes in the consolidated
capital stock (other than issuances of capital stock upon exercise of
options and stock appreciation rights, upon earn-outs of performance
shares and upon conversions of convertible securities, in each case
which were outstanding on the date of the latest balance sheet
included or incorporated by reference in the Prospectus) or any
increase in the consolidated long-term debt of the Company and its
subsidiaries, or any decreases in consolidated net current assets or
stockholders' equity or other items specified by the Representatives,
or any increases in any items specified by the Representatives, in
each case as compared with amounts shown in the latest balance sheet
included or incorporated by reference in the Prospectus, except in
each case for changes, increases or decreases which the Prospectus
discloses have occurred or may occur or which are described in such
letter; and
(F) for the period from the date of the latest financial
statements included or incorporated by reference in the Prospectus to
the specified date referred to in Clause (E) there were any decreases
in consolidated net revenues or operating profit or the total or per
share amounts of consolidated net income or other items specified by
the Representatives, or any increases in any items specified by the
Representatives, in each case as compared with the comparable period
of the preceding year and with any other period of corresponding
length specified by the Representatives, except in each case for
increases or decreases which the Prospectus discloses have occurred or
may occur or which are described in such letter; and
(vii) In addition to the audit referred to in their report(s) included
or incorporated by reference in the Prospectus and the limited procedures,
inspection of minute books, inquiries and other procedures referred to in
paragraphs (iii) and (vi) above, they have carried out certain specified
procedures, not constituting an audit in accordance with generally accepted
auditing standards, with respect to certain amounts, percentages and
financial information specified by the Representatives which are derived
from the general accounting records of the Company and its subsidiaries,
which appear in the Prospectus (excluding documents incorporated by
reference), or in Part II of, or in exhibits and schedules to, the
Registration Statement specified by the Representatives or in documents
incorporated by reference in the Prospectus specified by the
Representatives, and have compared certain of such amounts, percentages and
financial information with the accounting records of the Company and its
subsidiaries and have found them to be in agreement.
All references in this Annex II to the Prospectus shall be deemed to refer
to the Prospectus (including the documents incorporated by reference therein) as
defined in the Underwriting Agreement as of the date of the letter delivered on
the date of the Pricing Agreement for purposes of such letter and to the
Prospectus as amended or supplemented (including the documents incorporated by
reference therein) in relation to the applicable Designated Securities for
purposes of the letter delivered at the Time of Delivery for such Designated
Securities.
3
EXHIBIT 4
S&C Draft of 11/25/97
================================================================================
PRECISION CASTPARTS CORP.
TO
THE FIRST NATIONAL BANK OF CHICAGO
as Trustee
----------
INDENTURE
Dated as of _________, 1997
Providing for Issuance of
Debt Securities in Series
================================================================================
<PAGE>
PRECISION CASTPARTS CORP.
Certain Sections of this Indenture relating to
Sections 310 through 318, inclusive, of the
Trust Indenture Act of 1939:
Trust Indenture
Act Section Indenture Section
ss. 310(a)(1) . . . . . . . . . . . . . . . . . . . . . . 609
(a)(2) . . . . . . . . . . . . . . . . . . . . . . 609
(a)(3) . . . . . . . . . . . . . . . . . . . . . . Not Applicable
(a)(4) . . . . . . . . . . . . . . . . . . . . . . Not Applicable
(b) . . . . . . . . . . . . . . . . . . . . . . 608
610
ss. 311(a) . . . . . . . . . . . . . . . . . . . . . . 613
(b) . . . . . . . . . . . . . . . . . . . . . . 613
ss. 312(a) . . . . . . . . . . . . . . . . . . . . . . 701
702(a)
(b) . . . . . . . . . . . . . . . . . . . . . . 702(b)
(c) . . . . . . . . . . . . . . . . . . . . . . 702(c)
ss. 313(a) . . . . . . . . . . . . . . . . . . . . . . 703(a)
(b) . . . . . . . . . . . . . . . . . . . . . . 703(a)
(c) . . . . . . . . . . . . . . . . . . . . . . 703(a)
(d) . . . . . . . . . . . . . . . . . . . . . . 703(b)
ss. 314(a) . . . . . . . . . . . . . . . . . . . . . . 704
(a)(4) . . . . . . . . . . . . . . . . . . . . . . 101
1004
(b) . . . . . . . . . . . . . . . . . . . . . . Not Applicable
(c)(1) . . . . . . . . . . . . . . . . . . . . . . 102
(c)(2) . . . . . . . . . . . . . . . . . . . . . . 102
(c)(3) . . . . . . . . . . . . . . . . . . . . . . Not Applicable
(d) . . . . . . . . . . . . . . . . . . . . . . Not Applicable
(e) . . . . . . . . . . . . . . . . . . . . . . 102
ss. 315(a) . . . . . . . . . . . . . . . . . . . . . . 601
(b) . . . . . . . . . . . . . . . . . . . . . . 602
(c) . . . . . . . . . . . . . . . . . . . . . . 601
(d) . . . . . . . . . . . . . . . . . . . . . . 601
(e) . . . . . . . . . . . . . . . . . . . . . . 514
ss. 316(a) . . . . . . . . . . . . . . . . . . . . . . 101
(a)(1)(A). . . . . . . . . . . . . . . . . . . . . . 502
512
(a)(1)(B). . . . . . . . . . . . . . . . . . . . . . 513
(a)(2) . . . . . . . . . . . . . . . . . . . . . . Not Applicable
(b) . . . . . . . . . . . . . . . . . . . . . . 508
(c) . . . . . . . . . . . . . . . . . . . . . . 104(c)
ss. 317(a)(1) . . . . . . . . . . . . . . . . . . . . . . 503
(a)(2) . . . . . . . . . . . . . . . . . . . . . . 504
(b) . . . . . . . . . . . . . . . . . . . . . . 1003
ss. 318(a) . . . . . . . . . . . . . . . . . . . . . . 107
- -------------------
NOTE: This reconciliation and tie shall not, for any purpose, be deemed to be a
part of the Indenture.
i
<PAGE>
TABLE OF CONTENTS
Page
ARTICLE ONE
Definitions and Other Provisions
of General Application
Section 101. Definitions......................................................1
Section 102. Compliance Certificates and Opinions............................10
Section 103. Form of Documents Delivered to Trustee..........................11
Section 104. Acts of Holders; Record Dates...................................12
Section 105. Notices, Etc., to Trustee and Company...........................13
Section 106. Notice to Holders; Waiver.......................................13
Section 107. Conflict with Trust Indenture Act...............................14
Section 108. Effect of Headings and Table of Contents........................14
Section 109. Successors and Assigns..........................................14
Section 110. Separability Clause.............................................15
Section 111. Benefits of Indenture...........................................15
Section 112. Governing Law...................................................15
Section 113. Legal Holidays..................................................15
ARTICLE TWO
Security Forms
Section 201. Forms Generally.................................................16
Section 202. Form of Face of Security........................................16
Section 203. Form of Reverse of Security.....................................19
Section 204. Additional Provisions Required in
Book-Entry Security...........................................23
Section 205. Form of Trustee's Certificate of
Authentication................................................24
ARTICLE THREE
The Securities
Section 301. Amount Unlimited; Issuable in Series............................24
Section 302. Denominations...................................................27
Section 303. Execution, Authentication, Delivery and
Dating........................................................27
Section 304. Temporary Securities............................................30
Section 305. Registration, Registration of
Transfer and Exchange.........................................31
Section 306. Mutilated, Destroyed, Lost and Stolen
Securities....................................................33
Section 307. Payment of Interest; Interest Rights
Preserved.....................................................34
Section 308. Persons Deemed Owners...........................................35
Section 309. Cancellation....................................................36
Section 310. Computation of Interest.........................................36
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Section 311. CUSIP Numbers...................................................36
ARTICLE FOUR
Satisfaction and Discharge
Section 401. Satisfaction and Discharge of
Indenture.....................................................37
Section 402. Application of Trust Money......................................38
ARTICLE FIVE
Remedies
Section 501. Events of Default...............................................38
Section 502. Acceleration of Maturity; Rescission
and Annulment.................................................41
Section 503. Collection of Indebtedness and Suits
for Enforcement by Trustee....................................42
Section 504. Trustee May File Proofs of Claim................................43
Section 505. Trustee May Enforce Claims Without
Possession of Securities......................................44
Section 506. Application of Money Collected..................................44
Section 507. Limitation on Suits.............................................44
Section 508. Unconditional Right of Holders to
Receive Principal, Premium and Interest.......................45
Section 509. Restoration of Rights and Remedies..............................45
Section 510. Rights and Remedies Cumulative..................................46
Section 511. Delay or Omission Not Waiver....................................46
Section 512. Control by Holders..............................................46
Section 513. Waiver of Past Defaults.........................................47
Section 514. Undertaking for Costs...........................................47
Section 515. Waiver of Usury, Stay or Extension Laws.........................47
ARTICLE SIX
The Trustee
Section 601. Certain Duties and Responsibilities.............................48
Section 602. Notice of Defaults..............................................48
Section 603. Certain Rights of Trustee.......................................49
Section 604. Not Responsible for Recitals or
Issuance of Securities........................................50
Section 605. May Hold Securities.............................................50
Section 606. Money Held in Trust.............................................51
Section 607. Compensation and Reimbursement..................................51
Section 608. Disqualification; Conflicting Interests.........................52
Section 609. Corporate Trustee Required;
Eligibility...................................................52
Section 610. Resignation and Removal;
Appointment of Successor......................................52
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Section 611. Acceptance of Appointment by
Successor.....................................................55
Section 612. Merger, Conversion, Consolidation
or Succession to Business.....................................56
Section 613. Preferential Collection of Claims
Against Company...............................................57
Section 614. Appointment of Authenticating Agent.............................57
ARTICLE SEVEN
Holders' Lists and Reports by Trustee and Company
Section 701. Company to Furnish Trustee
Names and Addresses of Holders................................59
Section 702. Preservation of Information;
Communications to Holders.....................................59
Section 703. Reports by Trustee..............................................60
Section 704. Reports by Company..............................................60
ARTICLE EIGHT
Consolidation, Merger, Conveyance, Transfer or Lease
Section 801. Company May Consolidate, Etc., Only on Certain
Terms.........................................................61
Section 802. Successor Substituted...........................................62
Section 803. Officers' Certificate and
Opinion of Counsel............................................62
ARTICLE NINE
Supplemental Indentures
Section 901. Supplemental Indentures Without
Consent of Holders............................................62
Section 902. Supplemental Indentures with Consent
of Holders....................................................64
Section 903. Execution of Supplemental Indentures............................65
Section 904. Effect of Supplemental Indentures...............................66
Section 905. Conformity with Trust Indenture Act.............................66
Section 906. Reference in Securities to
Supplemental Indentures.......................................66
ARTICLE TEN
Covenants
Section 1001. Payment of Principal, Premium and
Interest......................................................66
Section 1002. Maintenance of Office or Agency.................................66
Section 1003. Money for Securities Payments to
Be Held in Trust..............................................67
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Section 1004. Statement by Officers as to Default.............................69
Section 1005. Existence.......................................................69
Section 1006. INTENTIONALLY LEFT BLANK........................................69
Section 1007. Payment of Taxes and Other Claims...............................69
Section 1008. Limitation on Liens.............................................70
Section 1009. Limitation on Sales and Leasebacks..............................71
Section 1010. Limitation on Debt of Restricted
Subsidiaries..................................................72
Section 1011. Waiver of Certain Covenants.....................................73
Section 1012. Calculation of Original Issue Discount..........................73
ARTICLE ELEVEN
Redemption of Securities
Section 1101. Applicability of Article........................................74
Section 1102. Election to Redeem: Notice to Trustee...........................74
Section 1103. Selection by Trustee of Securities to Be
Redeemed......................................................74
Section 1104. Notice of Redemption............................................75
Section 1105. Deposit of Redemption Price.....................................76
Section 1106. Securities Payable on Redemption Date...........................76
Section 1107. Securities Redeemed in Part.....................................77
ARTICLE TWELVE
Sinking Funds
Section 1201. Applicability of Article........................................77
Section 1202. Satisfaction of Sinking Fund Payments
with Securities...............................................78
Section 1203. Redemption of Securities for Sinking
Fund..........................................................78
ARTICLE THIRTEEN
Defeasance and Covenant Defeasance
Section 1301. Applicability of Article; Company's
Option to Effect Defeasance or
Covenant Defeasance...........................................79
Section 1302. Defeasance and Discharge........................................79
Section 1303. Covenant Defeasance.............................................80
Section 1304. Conditions to Defeasance or
Covenant Defeasance...........................................80
Section 1305. Deposited Money and U.S. Government
Obligations to be Held in Trust; Other
Miscellaneous Provisions......................................83
Section 1306. Reinstatement...................................................84
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NOTE: This table of contents shall not, for any purpose, be deemed to be a part
of the Indenture.
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INDENTURE, dated as of ____________, 1997, between Precision Castparts
Corp., a corporation duly organized and existing under the laws of the State of
Oregon (herein called the "Company"), having its principal office at 4650 S.W.
Macadam Avenue, Suite 440, Portland, Oregon, and The First National Bank of
Chicago, a national banking association, as Trustee (herein called the
"Trustee").
RECITALS OF THE COMPANY
The Company has duly authorized the execution and delivery of this
Indenture to provide for the issuance from time to time of its unsecured
debentures, notes or other evidences of indebtedness (herein called the
"Securities"), to be issued in one or more series as in this Indenture provided.
All things necessary to make this Indenture a valid agreement of the
Company, in accordance with its terms, have been done.
NOW, THEREFORE, THIS INDENTURE WITNESSETH:
For and in consideration of the premises and the purchase of the
Securities by the Holders thereof, it is mutually agreed, for the equal and
proportionate benefit of all Holders of the Securities or of series thereof, as
follows:
ARTICLE ONE
Definitions and Other Provisions
of General Application
Section 101. Definitions.
For all purposes of this Indenture, except as otherwise expressly
provided or unless the context otherwise requires:
(1) the terms defined in this Article have the meanings assigned to
them in this Article and include the plural as well as the singular;
<PAGE>
(2) all other terms used herein which are defined in the Trust
Indenture Act, either directly or by reference therein, have the meanings
assigned to them therein;
(3) all accounting terms not otherwise defined herein have the
meanings assigned to them in accordance with generally accepted accounting
principles, and, except as otherwise herein expressly provided, the term
"generally accepted accounting principles" with respect to any computation
required or permitted hereunder shall mean such accounting principles as
are generally accepted at the date of such computation; and
(4) unless the context otherwise requires, any reference to an
"Article" or a "Section" refers to an Article or a Section, as the case may
be, of this Indenture; and
(5) the words "herein", "hereof" and "hereunder" and other words of
similar import refer to this Indenture as a whole and not to any particular
Article, Section or other subdivision.
"Act", when used with respect to any Holder, has the meaning specified
in Section 104.
"Affiliate" of any specified Person means any other Person directly or
indirectly controlling or controlled by or under direct or indirect common
control with such specified Person. For the purposes of this definition,
"control" when used with respect to any specified Person means the power to
direct the management and policies of such Person, directly or indirectly,
whether through the ownership of voting securities, by contract or otherwise;
and the terms "controlling" and "controlled" have meanings correlative to the
foregoing.
"Attributable Debt," in respect of any Sale and Leaseback Transaction,
means, as of the time of determination, the total obligation (discounted to
present value at the rate per annum equal to the discount rate which would be
applicable to a capital lease obligation with like term in accordance with
generally accepted accounting principles) of the lessee for rental payments
(other than amounts required to be paid on account of property taxes,
maintenance, repairs, insurance, water rates and other items which do not
constitute payments for property rights) during the remaining portion of the
initial term of the lease included in such Sale and Leaseback Transaction.
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"Authenticating Agent" means any Person authorized by the Trustee
pursuant to Section 614 to act on behalf of the Trustee to authenticate
Securities of one or more series.
"Board of Directors" means either the board of directors of the
Company or any duly authorized committee of that board.
"Board Resolution" means a copy of a resolution certified by the
Secretary or an Assistant Secretary of the Company to have been duly adopted by
the Board of Directors and to be in full force and effect on the date of such
certification, and delivered to the Trustee.
"Book-Entry Security" means a Security in the form prescribed in
Section 204 evidencing all or part of a series of Securities, issued to the
Depositary for such series or its nominee, and registered in the name of such
Depositary or such nominee.
"Business Day", when used with respect to any Place of Payment, means
each Monday, Tuesday, Wednesday, Thursday and Friday which is not a day on which
banking institutions in that Place of Payment are authorized or obligated by law
or executive order to close.
"Commission" means the Securities and Exchange Commission, as from
time to time constituted, created under the Securities Exchange Act of 1934, or,
if at any time after the execution of this instrument such Commission is not
existing and performing the duties now assigned to it under the Trust Indenture
Act, then the body performing such duties at such time.
"Company" means the Person named as the "Company" in the first
paragraph of this instrument until a successor Person shall have become such
pursuant to the applicable provisions of this Indenture, and thereafter
"Company" shall mean such successor Person.
"Company Request" or "Company Order" means a written request or order
signed in the name of the Company by its Chairman of the Board, its Vice
Chairman of the Board, its President or a Vice President, and by its Treasurer,
an Assistant Treasurer, its Controller, an Assistant Controller, its Secretary
or an Assistant Secretary, and delivered to the Trustee.
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"Consolidated Net Tangible Assets" means the aggregate amount of
assets (less applicable reserves and other properly deductible items) after
deducting therefrom (i) all current liabilities (excluding any indebtedness for
money borrowed having a maturity of less than 12 months from the date of the
most recent consolidated balance sheet of the Company but which by its terms is
renewable or extendable beyond 12 months from such date at the option of the
borrower), (ii) all Investments in Unrestricted Subsidiaries and (iii) all
goodwill, trade names, patents, unamortized debt discount and expense and any
other like intangibles, all as set forth on the most recent consolidated balance
sheet of the Company and computed in accordance with generally accepted
accounting principles.
"Corporate Trust Office" means the principal office of the Trustee at
which at any particular time its corporate trust business shall be administered,
which office at the date of original execution of this Indenture is located at
One First National Plaza, Suite 0126, Chicago, Illinois 60670, Attention:
Corporate Trust Administration, except that, with respect to presentation of the
Securities for payment or registration of transfers or exchanges and the
location of the register, such term means the office or agency of the Trustee at
which at any particular time its corporate agency business shall be conducted,
which at the date of original execution of this Indenture is located at c/o
First Chicago Trust Company of New York, 14 Wall Street, 8th Floor-Window 2, New
York, New York 10005.
"Corporation" means a corporation, association, company, joint-stock
company or business trust.
"Debt" has the meaning specified in Section 1008.
"Defaulted Interest" has the meaning specified in Section 307.
"Depositary" means, with respect to the Securities of any series
issuable or issued in whole or in part in the form of one or more Book-Entry
Securities, the Person designated as Depositary for such series by the Company
pursuant to Section 301, which Person shall be a clearing agency registered
under the Securities Exchange Act of 1934; and if at any time there is more than
one such Person 'Depositary' as used with respect to the Securities of any
series shall mean the Depositary with respect to the Securities of such series.
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"Event of Default" has the meaning specified in Section 501.
"Funded Debt" means all Debt having a maturity of more than 12 months
from the date as of which the determination is made or having a maturity of 12
months or less but by its terms being renewable or extendable beyond 12 months
from such date at the option of the borrower, but excluding any such Debt owed
to the Company or a Restricted Subsidiary.
"Holder" means a Person in whose name a Security is registered in the
Security Register.
"Indenture" means this instrument as originally executed or as it may
from time to time be supplemented or amended by one or more indentures
supplemental hereto entered into pursuant to the applicable provisions hereof,
including, for all purposes of this instrument, and any such supplemental
indenture, the provisions of the Trust Indenture Act that are deemed to be a
part of and govern this instrument and any such supplemental indenture,
respectively. The term "Indenture" shall also include the forms and terms of
particular series of Securities established as contemplated by Section 301.
"Indexed Security" means any Security which provides that the
principal amount thereof payable at Stated Maturity may be more or less than the
principal face amount thereof at original issuance.
"Interest", when used with respect to an Original Issue Discount
Security which by its terms bears interest only after Maturity, means interest
payable after Maturity.
"Interest Payment Date", when used with respect to any Security, means
the Stated Maturity of an installment of interest on such Security.
"Investment," with respect to any Person, means any obligations or
other securities of, capital contribution to, or investment in such Person, in
each case in the amount that would be reflected from time to time on a balance
sheet of the Company prepared in accordance with generally accepted accounting
principles.
"Maturity", when used with respect to any Security, means the date on
which the principal of such Security or an installment of principal becomes due
and payable as therein or herein provided, whether at the Stated
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Maturity or by declaration of acceleration, call for redemption or otherwise.
"Mortgage" means, with respect to any property or assets, any mortgage
or deed of trust, pledge, hypothecation, assignment, security interest, lien,
encumbrance, or other security arrangement of any kind or nature whatsoever on
or with respect to such property or assets (including any conditional sale or
other title retention agreement having substantially the same economic effect as
any of the foregoing).
"Officers' Certificate" means a certificate signed by the Chairman of
the Board, a Vice Chairman of the Board, the President or a Vice President, and
by the Treasurer, an Assistant Treasurer, the Controller, an Assistant
Controller, the Secretary or an Assistant Secretary, of the Company, and
delivered to the Trustee. One of the officers signing an Officers' Certificate
given pursuant to Section 1004 shall be the principal executive, financial or
accounting officer of the Company. Each such certificate shall include the
statements provided for in Section 102.
"Operating Property" means any real property or equipment located
within the United States and owned by, or leased to, the Company or any of its
Restricted Subsidiaries that has a market value in excess of 0.5% of
Consolidated Net Tangible Assets.
"Opinion of Counsel" means a written opinion of counsel, who may be
counsel for the Company, and who shall be acceptable to the Trustee. Each such
opinion shall include the statements provided for in Section 102.
"Original Issue Discount Security" means any Security which provides
for an amount less than the principal amount thereof to be due and payable upon
a declaration of acceleration of the Maturity thereof pursuant to Section 502.
"Outstanding", when used with respect to Securities, means, as of the
date of determination, all Securities theretofore authenticated and delivered
under this Indenture, except:
(i) Securities theretofore cancelled by the Trustee or delivered to
the Trustee for cancellation;
(ii) Securities for whose payment or redemption money in the necessary
amount has been theretofore
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deposited with the Trustee or any Paying Agent (other than the Company) in
trust or set aside and segregated in trust by the Company (if the Company
shall act as its own Paying Agent) for the Holders of such Securities;
provided that, if such Securities are to be redeemed, notice of such
redemption has been duly given pursuant to Section 1104 of this Indenture
or provision therefor satisfactory to the Trustee has been made;
(iii) Securities, except to the extent provided in Sections 1302 and
1303, with respect to which the Company has effected defeasance or covenant
defeasance as provided in Article Thirteen; and
(iv) Securities which have been paid pursuant to Section 306 or in
exchange for or in lieu of which other Securities have been authenticated
and delivered pursuant to this Indenture, other than any such Securities in
respect of which there shall have been presented to the Trustee proof
satisfactory to it that such Securities are held by a bona fide purchaser
in whose hands such Securities are valid obligations of the Company;
provided, however, that in determining whether the Holders of the requisite
principal amount of the Outstanding Securities have given, made or taken any
request, demand, authorization, direction, notice, consent, waiver or other
action hereunder, or whether sufficient funds are available for redemption or
for any other purpose, and for the purpose of making the calculations required
by section 313 of the Trust Indenture Act, (i) the principal amount of an
Original Issue Discount Security that shall be deemed to be Outstanding shall be
the amount of the principal thereof that would be due and payable as of the date
of such determination upon acceleration of the Maturity thereof pursuant to
Section 502, (ii) the principal amount of a Security denominated in one or more
foreign currencies or currency units shall be the U.S. dollar equivalent,
determined in the manner provided as contemplated by Section 301 on the date of
original issuance of such Security, of the principal amount (or, in the case of
an Original Issue Discount Security, the U.S. dollar equivalent on the date of
original issuance of such Security of the amount determined as provided in (i)
above) of such Security, (iii) the principal amount of any Indexed Security that
may be counted in making such determination or calculation and that shall be
deemed to be Outstanding for such purpose shall be equal to the principal face
amount of such Indexed Security at original issuance, unless otherwise provided
with respect to
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<PAGE>
such Security pursuant to Section 301, and (iv) Securities owned by the Company
or any other obligor upon the Securities or any Affiliate of the Company or of
such other obligor shall be disregarded and deemed not to be Outstanding, except
that, in determining whether the Trustee shall be protected in relying upon any
such request, demand, authorization, direction, notice, consent, waiver or other
action, only Securities which a Responsible Officer of the Trustee actually
knows to be so owned shall be so disregarded. Securities so owned which have
been pledged in good faith may be regarded as Outstanding if the pledgee
establishes to the satisfaction of the Trustee the pledgee's right so to act
with respect to such Securities and that the pledgee is not the Company or any
other obligor upon the Securities or any Affiliate of the Company or of such
other obligor.
"Paying Agent" means any Person authorized by the Company to pay the
principal of or any premium or interest on any Securities on behalf of the
Company.
"Person" means any individual, corporation, partnership, joint
venture, trust, unincorporated organization or government or any agency or
political subdivision thereof.
"Place of Payment", when used with respect to the Securities of any
series, means the place or places where the principal of and any premium and
interest on the Securities of that series are payable as specified as
contemplated by Sections 301 and 1002.
"Predecessor Security" of any particular Security means every previous
Security evidencing all or a portion of the same debt as that evidenced by such
particular Security; and, for the purposes of this definition, any Security
authenticated and delivered under Section 306 in exchange for or in lieu of a
mutilated, destroyed, lost or stolen Security shall be deemed to evidence the
same debt as the mutilated, destroyed, lost or stolen Security.
"Redemption Date", when used with respect to any Security to be
redeemed, means the date fixed for such redemption by or pursuant to this
Indenture.
"Redemption Price", when used with respect to any Security to be
redeemed, means the price at which it is to be redeemed pursuant to this
Indenture.
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<PAGE>
"Regular Record Date" for the interest payable on any Interest Payment
Date on the Securities of any series means the date specified for that purpose
as contemplated by Section 301.
"Responsible Officer", when used with respect to the Trustee, means
any vice president, any assistant secretary, any assistant treasurer, any trust
officer or assistant trust officer, or any other officer of the Trustee
customarily performing functions similar to those performed by any of the above
designated officers and also means, with respect to a particular corporate trust
matter, any other officer to whom such matter is referred because of his
knowledge of and familiarity with the particular subject.
"Restricted Subsidiary" means any Subsidiary of the Company that owns
Operating Property that has a market value in excess of 1% of Consolidated Net
Tangible Assets.
"Sale and Leaseback Transaction" means any arrangement with any Person
providing for the leasing to the Company or any Subsidiary of any Operating
Property, which Operating Property has been or is to be sold or transferred by
the Company or such Subsidiary to such Person.
"Securities" has the meaning stated in the first recital of this
Indenture and more particularly means any Securities authenticated and delivered
under this Indenture.
"Security Register" and "Security Registrar" have the respective
meanings specified in Section 305.
"Special Record Date" for the payment of any Defaulted Interest means
a date fixed by the Trustee pursuant to Section 307.
"Stated Maturity", when used with respect to any Security or any
installment of principal thereof or interest thereon, means the date specified
in such Security as the fixed date on which the principal of such Security or
such installment of principal or interest is due and payable.
"Subsidiary" means any corporation of which at least a majority of the
outstanding stock having by the terms thereof ordinary voting power for the
election 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 by the Company, or by one or more other
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<PAGE>
Subsidiaries, or by the Company and one or more other Subsidiaries.
"Trustee" means the Person named as the "Trustee" in the first
paragraph of this instrument until a successor Trustee shall have become such
pursuant to the applicable provisions of this Indenture, and thereafter
"Trustee" shall mean or include each Person who is then a Trustee hereunder, and
if at any time there is more than one such Person, "Trustee" as used with
respect to the Securities of any series shall mean the Trustee with respect to
Securities of that series.
"Trust Indenture Act" means the Trust Indenture Act of 1939 as in
force at the date as of which this instrument was executed; provided, however,
that in the event the Trust Indenture Act of 1939 is amended after such date,
"Trust Indenture Act" means, to the extent required by any such amendment, the
Trust Indenture Act of 1939 as so amended.
"Unrestricted Subsidiary" means any Subsidiary other than a Restricted
Subsidiary.
"U.S. Government Obligations" has the meaning specified in Section
1304.
"Vice President", when used with respect to the Company or the
Trustee, means any vice president, whether or not designated by a number or a
word or words added before or after the title "vice president".
Section 102. Compliance Certificates and Opinions.
Upon any application or request by the Company to the Trustee to take
any action under any provision of this Indenture, the Company shall furnish to
the Trustee such certificates and opinions as may be required under the Trust
Indenture Act. Each such certificate or opinion shall be given in the form of an
Officers' Certificate, if to be given by an officer of the Company, or an
Opinion of Counsel, if to be given by counsel, and shall comply with the
requirements of the Trust Indenture Act and any other requirements set forth in
this Indenture.
Every certificate or opinion with respect to compliance with a
condition or covenant provided for in this Indenture shall include
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(1) a statement that each individual signing such certificate or
opinion has read such covenant or condition and the definitions herein
relating thereto;
(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 each such individual, he has
made such examination or investigation as is necessary to enable him to
express an informed opinion as to whether or not such covenant or condition
has been complied with; and
(4) a statement as to whether, in the opinion of each such individual,
such condition or covenant has been complied with.
Section 103. Form of Documents Delivered to Trustee.
In any case where several matters are required to be certified by, or
covered by an opinion of, any specified Person, it is not necessary that all
such matters be certified by, or covered by the opinion of, only one such
Person, or that they be so certified or covered by only one document, but one
such Person may certify or give an opinion with respect to some matters and one
or more other such Persons as to other matters, and any such Person may certify
or give an opinion as to such matters in one or several documents.
Any certificate 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 knows, or in the exercise of
reasonable care should know, that the certificate or opinion or representations
with respect to the matters upon which his certificate or opinion is based are
erroneous. Any such certificate or opinion of counsel may be based, insofar as
it relates to factual matters, upon a certificate or opinion of, or
representations by, an officer or officers of the Company stating that the
information with respect to such factual matters is in the possession of the
Company, unless such counsel knows, or in the exercise of reasonable care should
know, that the certificate or opinion or representations with respect to such
matters are erroneous.
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Where any Person is required to make, give or execute two or more
applications, requests, consents, certificates, statements, opinions or other
instruments under this Indenture, they may, but need not, be consolidated and
form one instrument.
Section 104. Acts of Holders; Record Dates.
(a) Any request, demand, authorization, direction, notice, consent,
waiver or other action provided or permitted by this Indenture to be given, made
or taken by Holders may be embodied in and evidenced by one or more instruments
of substantially similar tenor signed by such Holders in person or by agent duly
appointed in writing; and, except as herein otherwise expressly provided, such
action shall become effective when such instrument or instruments are delivered
to the Trustee and, where it is hereby expressly required, to the Company. Such
instrument or instruments (and the action embodied therein and evidenced
thereby) are herein sometimes referred to as the "Act" of the Holders signing
such instrument or instruments. Proof of execution of any such instrument or of
a writing appointing any such agent shall be sufficient for any purpose of this
Indenture and (subject to Section 601) conclusive in favor of the Trustee and
the Company, if made in the manner provided in this Section.
(b) The fact and date of the execution by any Person of any such
instrument or writing may be proved by the affidavit of a witness of such
execution or by a certificate of a notary public or other officer authorized by
law to take acknowledgments of deeds, certifying that the individual signing
such instrument or writing acknowledged to him the execution thereof. Where such
execution is by a signer acting in a capacity other than his individual
capacity, such certificate or affidavit shall also constitute sufficient proof
of his authority. The fact and date of the execution of any such instrument or
writing, or the authority of the Person executing the same, may also be proved
in any other manner which the Trustee deems sufficient.
(c) The Company may, in the circumstances permitted by the Trust
Indenture Act, fix any day as the record date for the purpose of determining the
Holders of Securities of any series entitled to give or take any request,
demand, authorization, direction, notice, consent, waiver or other action, or to
vote on any action, authorized or permitted to be given or taken by Holders of
Securities of such series. If not set by the Company prior to the
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first solicitation of a Holder of Securities of such series made by any Person
in respect of any such action, or, in the case of any such vote, prior to such
vote, the record date for any such action or vote shall be the 30th day (or, if
later, the date of the most recent list of Holders required to be provided
pursuant to Section 701) prior to such first solicitation or vote, as the case
may be. With regard to any record date for action to be taken by the Holders of
one or more series of Securities, only the Holders of Securities of such series
on such date (or their duly designated proxies) shall be entitled to give or
take, or vote on, the relevant action.
(d) The ownership of Securities shall be proved by the Security
Register.
(e) Any request, demand, authorization, direction, notice, consent,
waiver or other Act of the Holder of any Security shall bind every future Holder
of the same Security and the Holder of every Security issued upon the
registration of transfer thereof or in exchange therefor or in lieu thereof in
respect of anything done, omitted or suffered to be done by the Trustee or the
Company in reliance thereon, whether or not notation of such action is made upon
such Security.
Section 105. Notices, Etc., to Trustee and Company.
Any request, demand, authorization, direction, notice, consent, waiver
or Act of Holders or other document provided or permitted by this Indenture to
be made upon, given or furnished to, or filed with,
(1) the Trustee by any Holder or by the Company shall be sufficient
for every purpose hereunder if made, given, furnished or filed in writing
to or with the Trustee at its Corporate Trust Office, Attention: Corporate
Trust Administration, or
(2) the Company by the Trustee or by any Holder shall be sufficient
for every purpose hereunder (unless otherwise herein expressly provided) if
in writing and mailed, first-class postage prepaid, to the Company
addressed to it at the address of its principal office specified in the
first paragraph of this instrument or at any other address previously
furnished in writing to the Trustee by the Company.
Section 106. Notice to Holders; Waiver.
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Where this Indenture provides for notice to Holders of any event, such
notice shall be sufficiently given (unless otherwise herein expressly provided)
if in writing and mailed, first-class postage prepaid, to each Holder affected
by such event, at his address as it appears in the Security Register, not later
than the latest date (if any), and not earlier than the earliest date (if any),
prescribed for the giving of such notice. In any case where notice to Holders is
given by mail, neither the failure to mail such notice, nor any defect in any
notice so mailed, to any particular Holder shall affect the sufficiency of such
notice with respect to other Holders. Any notice mailed to a Holder in the
manner herein prescribed shall be conclusively deemed to have been received by
such Holder, whether or not such Holder actually receives such notice. Where
this Indenture provides for notice in any manner, such notice may be waived in
writing by the Person entitled to receive such notice, either before or after
the event, and such waiver shall be the equivalent of such notice. Waivers of
notice by Holders shall be filed with the Trustee, but such filing shall not be
a condition precedent to the validity of any action taken in reliance upon such
waiver.
In case by reason of the suspension of regular mail service or by
reason of any other cause it shall be impracticable to give such notice by mail,
then such notification as shall be made with the approval of the Trustee shall
constitute a sufficient notification for every purpose hereunder.
Section 107. Conflict with Trust Indenture Act.
If any provision hereof limits, qualifies or conflicts with a
provision of the Trust Indenture Act that is required under such Act to be a
part of and govern this Indenture, the latter provision shall control. If any
provision of this Indenture modifies or excludes any provision of the Trust
Indenture Act that may be so modified or excluded, the latter provision shall be
deemed to apply to this Indenture as so modified or to be excluded, as the case
may be.
Section 108. Effect of Headings and Table of Contents.
The Article and Section headings herein and the Table of Contents are
for convenience only and shall not affect the construction hereof.
Section 109. Successors and Assigns.
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All covenants and agreements in this Indenture by the Company shall
bind its successors and assigns, whether so expressed or not.
Section 110. Separability Clause.
In case any provision in this Indenture or in the Securities shall be
invalid, illegal or unenforceable, the validity, legality and enforceability of
the remaining provisions shall not in any way be affected or impaired thereby.
Section 111. Benefits of Indenture.
Nothing in this Indenture or in the Securities, express or implied,
shall give to any Person, other than the parties hereto and their successors
hereunder and the Holders, any benefit or any legal or equitable right, remedy
or claim under this Indenture.
Section 112. Governing Law.
THIS INDENTURE AND THE SECURITIES SHALL BE GOVERNED BY AND CONSTRUED
IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.
Section 113. Legal Holidays.
In any case where any Interest Payment Date, Redemption Date, Stated
Maturity or Maturity of any Security shall not be a Business Day at any Place of
Payment, then (notwithstanding any other provision of this Indenture or of the
Securities (other than a provision of the Securities of any series which
specifically states that such provision shall apply in lieu of this Section))
payment of interest or principal (and premium, if any) need not be made at such
Place of Payment on such date, but may be made on the next succeeding Business
Day at such Place of Payment with the same force and effect as if made on the
Interest Payment Date, the Redemption Date, or at the Stated Maturity or
Maturity.
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ARTICLE TWO
Security Forms
Section 201. Forms Generally.
The Securities of each series shall be in substantially the form set
forth in this Article, or in such other form as shall be established by or
pursuant to a Board Resolution or in one or more indentures supplemental hereto,
in each case with such appropriate insertions, omissions, substitutions and
other variations as are required or permitted by this Indenture, and may have
such letters, numbers or other marks of identification and such legends or
endorsements placed thereon as may be required to comply with the rules of any
securities exchange or Depositary therefor or as may, consistently herewith, be
determined by the officers executing such Securities, as evidenced by their
execution of the Securities. If the form of Securities of any series is
established by, or by action taken pursuant to, a Board Resolution, a copy of an
appropriate record of such action shall be certified by the Secretary or an
Assistant Secretary of the Company and delivered to the Trustee at or prior to
the delivery of the Company Order contemplated by Section 303 for the
authentication and delivery of such Securities.
The definitive Securities shall be printed, lithographed or engraved
on steel engraved borders or may be produced in any other manner, all as
determined by the officers executing such Securities, as evidenced by their
execution of such Securities.
Section 202. Form of Face of Security.
[insert any legend required by the Internal Revenue Code and the
regulations thereunder.]
PRECISION CASTPARTS CORP.
............................................
No. ......................... $...............
CUSIP No.______________
Precision Castparts Corp., a corporation duly organized and existing
under the laws of Oregon (herein called the "Company", which term includes any
successor
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Person under the Indenture hereinafter referred to), for value received, hereby
promises to pay to ................................., or registered assigns, the
principal sum of ........................... Dollars on .....................
...... [if the Security is to bear interest prior to Maturity, insert --, and to
pay interest thereon from ........... or from the most recent Interest Payment
Date to which interest has been paid or duly provided for, semi-annually on
............. and ............ in each year, commencing ........., at the rate
of .......... % per annum, until the principal hereof is paid or made available
for payment [if applicable, insert -- and (to the extent that the payment of
such interest shall be legally enforceable) at the rate of .... % per annum on
any overdue principal and premium and on any overdue installment of interest].
The interest so payable, and punctually paid or duly provided for, on any
Interest Payment Date will, as provided in such Indenture, be paid to the Person
in whose name this Security (or one or more Predecessor Securities) is
registered at the close of business on the Regular Record Date for such
interest, which shall be the .......... or ........ (whether or not a Business
Day), as the case may be, next preceding such Interest Payment Date. Any such
interest not so punctually paid or duly provided for will forthwith cease to be
payable to the Holder on such Regular Record Date and may either be paid to the
Person in whose name this Security (or one or more Predecessor Securities) is
registered at the close of business on a Special Record Date for the payment of
such Defaulted Interest to be fixed by the Trustee, notice whereof shall be
given to Holders of Securities of this series not less than 10 days prior to
such Special Record Date, or be paid at any time in any other lawful manner not
inconsistent with the requirements of any securities exchange on which the
Securities of this series may be listed, and upon such notice as may be required
by such exchange, all as more fully provided in said Indenture].
[If the Security is not to bear interest prior to Maturity, insert -- The
principal of this Security shall not bear interest except in the case of a
default in payment of principal upon acceleration, upon redemption or at Stated
Maturity and in such case the overdue principal of this Security shall bear
interest at the rate of ....% per annum (to the extent that the payment of such
interest shall be legally enforceable), which shall accrue from the date of such
default in payment to the date payment of such principal has been made or duly
provided for. Interest on any overdue principal shall be payable on demand. Any
such interest on any overdue principal that is not so paid on
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demand shall bear interest at the rate of ......% per annum (to the extent that
the payment of such interest shall be legally enforceable), which shall accrue
from the date of such demand for payment to the date payment of such interest
has been made or duly provided for, and such interest shall also be payable on
demand.]
Payment of the principal of (and premium, if any) and [if applicable,
insert -- any such] interest on this Security will be made at the office or
agency of the Company maintained for that purpose in ............., in such coin
or currency of the United States of America as at the time of payment is legal
tender for payment of public and private debts [if applicable, insert -- ;
provided, however, that at the option of the Company payment of interest may be
made by check mailed to the address of the Person entitled thereto as such
address shall appear in the Security Register or by wire transfer to an account
maintained by the Person entitled thereto as specified in the Security Register,
provided that such Person shall have given the Trustee written wire
instructions.]
[If the Security is payable in a foreign currency, insert -- the
appropriate provision.]
Reference is hereby made to the further provisions of this Security
set forth on the reverse hereof, which further provisions shall for all purposes
have the same effect as if set forth at this place.
Unless the certificate of authentication hereon has been executed by
the Trustee referred to on the reverse hereof by manual signature, this Security
shall not be entitled to any benefit under the Indenture or be valid or
obligatory for any purpose.
IN WITNESS WHEREOF, the Company has caused this instrument to be duly
executed under its corporate seal.
Precision Castparts Corp.
By.......................................
By.......................................
Attest:
.......................................
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<PAGE>
Section 203. Form of Reverse of Security.
This Security is one of a duly authorized issue of securities of the
Company (herein called the "Securities"), issued and to be issued in one or more
series under an Indenture, dated as of ____________, 1997 (herein called the
"Indenture"), between the Company and The First National Bank of Chicago, as
Trustee (herein called the "Trustee", which term includes any successor trustee
under the Indenture), to which Indenture and all indentures supplemental thereto
reference is hereby made for a statement of the respective rights, limitations
of rights, duties and immunities thereunder of the Company, the Trustee and the
Holders of the Securities and of the terms upon which the Securities are, and
are to be, authenticated and delivered. This Security is one of the series
designated on the face hereof[, limited in aggregate principal amount to
$..........].
[If applicable, insert -- The Securities of this series are subject to
redemption upon not less than 30 nor more than 60 days' notice by mail, [if
applicable, insert-- in whole or in part, at the option of the Company at any
time at a redemption price equal to the greater of (i) 100% of the principal
amount of such Notes or (ii) the sum of the present values of the remaining
scheduled payments of principal and interest thereon (not including the portion
of any such payments of interest accrued as of the redemption date) discounted
to the redemption date on a semiannual basis (assuming a 360-day year consisting
of twelve 30-day months) at the [define applicable discount rate] (determined on
the _____ Business Day preceding such redemption date), plus, in each case,
accrued and unpaid interest thereon to the redemption date.] [if applicable,
insert -- (1) on ........... in any year commencing with the year...... and
ending with the year .......... through operation of the sinking fund for this
series at a Redemption Price equal to 100% of the principal amount, and (2)] at
any time [on or after .......... 19..], as a whole or in part, at the election
of the Company, at the following Redemption Prices (expressed as percentages of
the principal amount): If redeemed [on or before ................, _%, and if
redeemed] during the 12-month period beginning ........ of the years indicated,
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<PAGE>
Redemption Redemption
Year Price Year Price
- ---- ---------- ---- ----------
and thereafter at a Redemption Price equal to ..........% of the principal
amount, together in the case of any such redemption [if applicable, insert --
(whether through operation of the sinking fund or otherwise)] with accrued
interest to the Redemption Date, but interest installments whose Stated Maturity
is on or prior to such Redemption Date will be payable to the Holders of such
Securities, or one or more Predecessor Securities, of record at the close of
business on the relevant Regular Record Dates or Special Record Dates referred
to on the face hereof, all as provided in the Indenture.]
[If applicable insert -- The Securities of this series are subject to
redemption upon not less than 30 nor more than 60 days' notice by mail, (1) on
.......... in any year commencing with the year .... and ending with the year
.... through operation of the sinking fund for this series at the Redemption
Prices for redemption through operation of the sinking fund (expressed as
percentages of the principal amount) set forth in the table below, and (2) at
any time [on or after ........], as a whole or in part, at the election of the
Company, at the Redemption Prices for redemption otherwise than through
operation of the sinking fund (expressed as percentages of the principal amount)
set forth in the table below: If redeemed during the 12-month period beginning
.......... of the years indicated,
Redemption Price Redemption Price for
For Redemption Redemption Otherwise
Through Operation Than Through Operation
Year of the Sinking Fund of the Sinking Fund
- ---- ------------------- -------------------
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and thereafter at a Redemption Price equal to ........% of the principal amount,
together in the case of any such redemption (whether through operation of the
sinking fund or otherwise) with accrued interest to the Redemption Date, but
interest installments whose Stated Maturity is on or prior to such Redemption
Date will be payable to the Holders of such Securities, or one or more
Predecessor Securities, of record at the close of business on the relevant
Regular Record Dates or Special Record Dates referred to on the face hereof, all
as provided in the Indenture.]
Notwithstanding the foregoing, the Company may not, prior to
.........., redeem any Securities of this series as contemplated by [Clause (2)
of] the preceding paragraph as a part of, or in anticipation of, any refunding
operation by the application, directly or indirectly, of moneys borrowed having
an interest cost to the Company (calculated in accordance with generally
accepted financial practice) of less than .......% per annum.]
[The sinking fund for this series provides for the redemption on
........ in each year beginning with the year ......... and ending with the year
of .......... [not less than $............ ("mandatory sinking fund") and not
more than] $......... aggregate principal amount of Securities of this series.
Securities of this series acquired or redeemed by the Company otherwise than
through [mandatory] sinking fund payments may be credited against subsequent
[mandatory] sinking fund payments otherwise required to be made [in the inverse
order in which they become due].]
[If the Security is subject to redemption, insert -- In the event of
redemption of this Security in part only, a new Security or Securities of this
series and of like tenor for the unredeemed portion hereof will be issued in the
name of the Holder hereof upon the cancellation hereof.]
[If applicable, insert -- The Indenture contains provisions for
defeasance at any time of [the entire indebtedness of this Security] [or]
[certain restrictive covenants and Events of Default with respect to this
Security] [, in each case] upon compliance with certain conditions set forth in
the Indenture.]
[If the Security is not an Original Issue Discount Security, insert --
If an Event of Default with respect to Securities of this series shall occur and
be continuing, the
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principal of the Securities of this series may be declared due and payable in
the manner and with the effect provided in the Indenture.]
[If the Security is an Original Issue Discount Security, insert -- If
an Event of Default with respect to Securities of this series shall occur and be
continuing, an amount of principal of the Securities of this series may be
declared due and payable in the manner and with the effect provided in the
Indenture. Such amount shall be equal to -- insert formula for determining the
amount. Upon payment (i) of the amount of principal so declared due and payable
and (ii) of interest on any overdue principal and overdue interest (in each case
to the extent that the payment of such interest shall be legally enforceable),
all of the Company's obligations in respect of the payment of the principal of
and interest, if any, on the Securities of this series shall terminate.]
[If the Security is an Indexed Security, insert -- the appropriate
provision.]
The Indenture permits, with certain exceptions as therein provided,
the amendment thereof and the modification of the rights and obligations of the
Company and the rights of the Holders of the Securities of each series to be
affected under the Indenture at any time by the Company and the Trustee with the
consent of the Holders of a majority in principal amount of the Securities at
the time Outstanding of each series to be affected. The Indenture also contains
provisions permitting the Holders of specified percentages in principal amount
of the Securities of each series at the time Outstanding, on behalf of the
Holders of all Securities of such series, to waive compliance by the Company
with certain provisions of the Indenture and certain past defaults under the
Indenture and their consequences. Any such consent or waiver by the Holder of
this Security shall be conclusive and binding upon such Holder and upon all
future Holders of this Security and of any Security issued upon the registration
of transfer hereof or in exchange herefor or in lieu hereof, whether or not
notation of such consent or waiver is made upon this Security.
No reference herein to the Indenture and no provision of this
Security or of the Indenture shall alter or impair the obligation of the
Company, which is absolute and unconditional, to pay the principal of and any
premium and interest on this Security at the times, place and rate, and in the
coin or currency, herein prescribed.
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As provided in the Indenture and subject to certain limitations
therein set forth, the transfer of this Security is registrable in the Security
Register, upon surrender of this Security for registration of transfer at the
office or agency of the Company in any place where the principal of and any
premium and interest on this Security are payable, duly endorsed by, or
accompanied by a written instrument of transfer in form satisfactory to the
Company and the Security Registrar duly executed by, the Holder hereof or his
attorney duly authorized in writing, and thereupon one or more new Securities of
this series and of like tenor, of authorized denominations and for the same
aggregate principal amount, will be issued to the designated transferee or
transferees.
The Securities of this series are issuable only in registered form
without coupons in denominations of $....... and any integral multiple thereof.
As provided in the Indenture and subject to certain limitations therein set
forth, Securities of this series are exchangeable for a like aggregate principal
amount of Securities of this series and of like tenor of a different authorized
denomination, as requested by the Holder surrendering the same.
No service charge shall be made for any such registration of transfer
or exchange, but the Company may require payment of a sum sufficient to cover
any tax or other governmental charge payable in connection therewith.
Prior to due presentment of this Security for registration of
transfer, the Company, the Trustee and any agent of the Company or the Trustee
may treat the Person in whose name this Security is registered as the owner
hereof for all purposes, whether or not this Security be overdue, and neither
the Company, the Trustee nor any such agent shall be affected by notice to the
contrary.
All terms used in this Security which are defined in the Indenture
shall have the meanings assigned to them in the Indenture.
Section 204. Additional Provisions Required in
Book-Entry Security.
Any Book-Entry Security issued hereunder shall, in addition to the
provisions contained in Sections 202 and 203, bear a legend in substantially the
following form:
"This Security is a Book-Entry Security within the meaning of the
Indenture hereinafter referred to and is
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registered in the name of a Depositary or a nominee of a Depositary. This
Security is exchangeable for Securities registered in the name of a person other
than the Depositary or its nominee only in the limited circumstances described
in the Indenture and may not be transferred except as a whole by the Depositary
to a nominee of the Depositary or by a nominee of the Depositary to the
Depositary or another nominee of the Depositary."
Section 205. Form of Trustee's Certificate of
Authentication.
The Trustee's certificate of authentication shall be in substantially
the following form:
Dated: ______________
This is one of the Securities of the series designated therein
referred to in the within-mentioned Indenture.
The First National Bank of Chicago
As Trustee
By.......................................
Authorized Signatory
ARTICLE THREE
The Securities
Section 301. Amount Unlimited; Issuable in Series.
The aggregate principal amount of Securities which may be
authenticated and delivered under this Indenture is unlimited.
The Securities may be issued from time to time in one or more series.
There shall be established in or pursuant to a Board Resolution and, subject to
Section 303, set forth, or determined in the manner provided, in an Officers'
Certificate, or established in one or more indentures supplemental hereto, prior
to the issuance of Securities of any series,
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(1) the title of the Securities of the series (which shall distinguish
the Securities of the series from Securities of any other series);
(2) any limit upon the aggregate principal amount of the Securities of
the series which may be authenticated and delivered under this Indenture
(except for Securities authenticated and delivered upon registration of
transfer of, or in exchange for, or in lieu of, other Securities of the
series pursuant to Section 304, 305, 306, 906 or 1107 and except for any
Securities which, pursuant to Section 303, are deemed never to have been
authenticated and delivered hereunder);
(3) the Person to whom any interest on a Security of the series shall
be payable, if other than the Person in whose name that Security (or one or
more Predecessor Securities) is registered at the close of business on the
Regular Record Date for such interest;
(4) the date or dates on which the principal of and premium, if any,
on the Securities of the series is payable or the method of determination
thereof;
(5) the rate or rates at which the Securities of the series shall bear
interest, if any, or the method of calculating such rate or rates of
interest, the date or dates from which such interest shall accrue or the
method by which such date or dates shall be determined, the Interest
Payment Dates on which any such interest shall be payable and the Regular
Record Date for any interest payable on any Interest Payment Date;
(6) the place or places where the principal of and any premium and
interest on Securities of the series shall be payable;
(7) the period or periods within which, the price or prices at which,
the currency or currencies (including currency units) in which and the
other terms and conditions upon which Securities of the series may be
redeemed, in whole or in part, at the option of the Company;
(8) the obligation, if any, of the Company to redeem or purchase
Securities of the series pursuant to any sinking fund or analogous
provisions or at the option of a Holder thereof and the period or periods
within which, the price or prices at which and the
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other terms and conditions upon which Securities of the series shall be
redeemed or purchased, in whole or in part, pursuant to such obligation;
(9) if other than denominations of $1,000 and any integral multiple
thereof, the denominations in which Securities of the series shall be
issuable;
(10) the currency, currencies or currency units in which payment of
the principal of and any premium and interest on any Securities of the
series shall be payable if other than the currency of the United States of
America and the manner of determining the equivalent thereof in the
currency of the United States of America for purposes of the definition of
"Outstanding" in Section 101;
(11) if the amount of payments of principal of or any premium or
interest on any Securities of the series may be determined with reference
to an index, formula or other method, the index, formula or other method by
which such amounts shall be determined;
(12) if the principal of or any premium or interest on any Securities
of the series is to be payable, at the election of the Company or a Holder
thereof, in one or more currencies or currency units other than that or
those in which the Securities are stated to be payable, the currency,
currencies or currency units in which payment of the principal of and any
premium and interest on Securities of such series as to which such election
is made shall be payable, and the periods within which and the other terms
and conditions upon which such election is to be made;
(13) if other than the principal amount thereof, the portion of the
principal amount of Securities of the series which shall be payable upon
declaration of acceleration of the Maturity thereof pursuant to Section 502
or the method by which such portion shall be determined;
(14) the application, if any, of Section 1302 or 1303 to the
Securities of any series;
(15) whether the Securities of the series shall be issued in whole or
in part in the form of one or more Book-Entry Securities and, in such case,
the Depositary with respect to such Book-Entry Security or Securities and
the circumstances under which any Book-Entry
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<PAGE>
Security may be registered for transfer or exchange, or authenticated and
delivered, in the name of a Person other than such Depositary or its
nominee, if other than as set forth in Section 305;
(16) any additional, modified or different covenants applicable to one
or more particular series of Securities; and
(17) any other terms of the series (which terms shall not be
inconsistent with the provisions of this Indenture, except as permitted by
Section 901(5)).
All Securities of any one series shall be substantially identical
except as to denomination and except as may otherwise be provided in or pursuant
to the Board Resolution referred to above and (subject to Section 303) set
forth, or determined in the manner provided, in the Officers' Certificate
referred to above or in any such indenture supplemental hereto. All Securities
of any one series need not be issued at the same time and, unless otherwise
provided, a series may be reopened, without the consent of the Holders, for
issuances of additional Securities of such series.
If any of the terms of the series are established by action taken
pursuant to a Board Resolution, a copy of an appropriate record of such action
shall be certified by the Secretary or an Assistant Secretary of the Company and
delivered to the Trustee at or prior to the delivery of the Officers'
Certificate setting forth, or providing the manner for determining, the terms of
the series.
Section 302. Denominations.
The Securities of each series shall be issuable in registered form
without coupons in such denominations as shall be specified as contemplated by
Section 301. In the absence of any such specified denomination with respect to
the Securities of any series, the Securities of such series shall be issuable in
denominations of $1,000 and any integral multiple thereof.
Section 303. Execution, Authentication, Delivery and
Dating.
The Securities shall be executed on behalf of the Company by its
Chairman of the Board, its Vice Chairman of the Board, its President or one of
its Vice Presidents, under its corporate seal reproduced thereon attested by its
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Secretary or one of its Assistant Secretaries. The signature of any of these
officers on the Securities may be manual or facsimile.
Securities bearing the manual or facsimile signatures of individuals
who were at any time the proper officers of the Company shall bind the Company,
notwithstanding that such individuals or any of them have ceased to hold such
offices prior to the authentication and delivery of such Securities or did not
hold such offices at the date of such Securities.
At any time and from time to time after the execution and delivery of
this Indenture, the Company may deliver Securities of any series executed by the
Company to the Trustee for authentication, together with a Company Order for the
authentication and delivery of such Securities, and the Trustee in accordance
with the Company Order shall authenticate and deliver or make available for
delivery such Securities; provided, however, that, in the case of Securities of
a series that are not to be originally issued at one time, the Trustee shall
authenticate and deliver or make available for delivery such Securities from
time to time in accordance with such other procedures (including, without
limitation, the receipt by the Trustee of oral or electronic instructions from
the Company or its duly authorized agents, promptly confirmed in writing)
acceptable to the Trustee as may be specified by or pursuant to a Company Order
delivered to the Trustee prior to the time of the first authentication of
Securities of such series. If the form or terms of the Securities of the series
have been established in or pursuant to one or more Board Resolutions as
permitted by Sections 201 and 301, in authenticating such Securities, and
accepting the additional responsibilities under this Indenture in relation to
such Securities, the Trustee shall be entitled to receive, and (subject to
Section 601) shall be fully protected in relying upon, an Opinion of Counsel
stating,
(a) if the form of such Securities has been established by or pursuant
to Board Resolution as permitted by Section 201, that such form has been
established in conformity with the provisions of this Indenture;
(b) if the terms of such Securities have been established by or
pursuant to Board Resolution as permitted by Section 301, that such terms
have been established in conformity with the provisions of this Indenture;
and
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(c) that such Securities, when authenticated and delivered by the
Trustee and issued by the Company in the manner and subject to any
conditions specified in such Opinion of Counsel, will constitute valid and
legally binding obligations of the Company enforceable in accordance with
their terms, subject to bankruptcy, insolvency, fraudulent transfer,
reorganization, moratorium and similar laws of general applicability
relating to or affecting creditors' rights and to general equity
principles.
If such form or terms have been so established, the Trustee shall not be
required to authenticate such Securities if the issue of such Securities
pursuant to this Indenture will affect the Trustee's own rights, duties or
immunities under the Securities and this Indenture or otherwise in a manner
which is not reasonably acceptable to the Trustee.
Notwithstanding the provisions of Section 301 and of the preceding
paragraph, if all Securities of a series are not to be originally issued at one
time, it shall not be necessary to deliver the Officers' Certificate otherwise
required pursuant to Section 301 or the Company Order and Opinion of Counsel
otherwise required pursuant to such preceding paragraph at or prior to the time
of authentication of each Security of such series if such documents, with
appropriate modifications to cover such future issuances, are delivered at or
prior to the authentication upon original issuance of the first Security of such
series to be issued.
If the Company shall establish pursuant to Section 301 that the
Securities of a series are to be issued in whole or in part in the form of one
or more Book-Entry Securities, then the Company shall execute and the Trustee
shall, in accordance with this Section and the Company Order with respect to
such series, authenticate and deliver or make available for delivery one or more
Securities in such form that (i) shall represent and shall be denominated in an
amount equal to the aggregate principal amount of the Outstanding Securities of
such series to be represented by such Book-Entry Security or Securities, (ii)
shall be registered in the name of the Depositary for such Book-Entry Security
or Securities or the nominee of such Depositary, (iii) shall be delivered by the
Trustee to such Depositary or pursuant to such Depositary's instruction and (iv)
shall bear the legend set forth in Section 204.
Unless otherwise established pursuant to Section 301, each Depositary
designated pursuant to Section 301 for
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a Book-Entry Security must, at the time of its designation and at all times
while it serves as Depositary, be a clearing agency registered under the
Securities Exchange Act of 1934 and any other applicable statute or regulation.
The Trustee shall have no responsibility to determine if the Depositary is so
registered. Each Depositary shall enter into an agreement with the Trustee
governing the respective duties and rights of such Depositary and the Trustee
with regard to Book-Entry Securities.
Each Security shall be dated the date of its authentication.
No Security shall be entitled to any benefit under this Indenture or
be valid or obligatory for any purpose unless there appears on such Security a
certificate of authentication substantially in the form provided for herein
executed by the Trustee by manual signature, and such certificate upon any
Security shall be conclusive evidence, and the only evidence, that such Security
has been duly authenticated and delivered hereunder. Notwithstanding the
foregoing, if any Security shall have been authenticated and delivered hereunder
but never issued and sold by the Company, and the Company shall deliver such
Security to the Trustee for cancellation as provided in Section 309, for all
purposes of this Indenture such Security shall be deemed never to have been
authenticated and delivered hereunder and shall never be entitled to the
benefits of this Indenture.
Section 304. Temporary Securities.
Pending the preparation of definitive Securities of any series, the
Company may execute, and upon Company Order the Trustee shall authenticate and
deliver or make available for delivery, temporary Securities which are printed,
lithographed, typewritten, mimeographed or otherwise produced, in any authorized
denomination, substantially of the tenor of the definitive Securities in lieu of
which they are issued and with such appropriate insertions, omissions,
substitutions and other variations as the officers executing such Securities may
determine, as evidenced by their execution of such Securities.
If temporary Securities of any series are issued, the Company will
cause definitive Securities of that series to be prepared without unreasonable
delay. After the preparation of definitive Securities of such series, the
temporary Securities of such series shall be exchangeable for definitive
Securities of such series upon surrender of the temporary Securities of such
series at the office or
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agency of the Company in a Place of Payment for that series, without charge to
the Holder. Upon surrender for cancellation of any one or more temporary
Securities of any series the Company shall execute and the Trustee shall
authenticate and deliver or make available for delivery in exchange therefor one
or more definitive Securities of the same series, of any authorized
denominations and of a like aggregate principal amount and tenor. Until so
exchanged the temporary Securities of any series shall in all respects be
entitled to the same benefits under this Indenture as definitive Securities of
such series and tenor.
Section 305. Registration, Registration of
Transfer and Exchange.
The Company shall cause to be kept at the Corporate Trust Office of
the Trustee a register (the register maintained in such office and in any other
office or agency of the Company in a Place of Payment being herein sometimes
collectively referred to as the "Security Register") in which, subject to such
reasonable regulations as it may prescribe, the Company shall provide for the
registration of Securities and of transfers of Securities. The Trustee is hereby
appointed "Security Registrar" for the purpose of registering Securities and
transfers of Securities as herein provided.
Upon surrender for registration of transfer of any Security of any
series at the office or agency in a Place of Payment for that series, the
Company shall execute, and the Trustee shall authenticate and deliver or make
available for delivery, in the name of the designated transferee or transferees,
one or more new Securities of the same series, of any authorized denominations
and of a like aggregate principal amount and tenor.
At the option of the Holder, Securities of any series may be exchanged
for other Securities of the same series, of any authorized denominations and of
a like aggregate principal amount and tenor, upon surrender of the Securities to
be exchanged at such office or agency. Whenever any Securities are so
surrendered for exchange, the Company shall execute, and the Trustee shall
authenticate and deliver or make available for delivery, the Securities which
the Holder making the exchange is entitled to receive.
All Securities issued upon any registration of transfer or exchange of
Securities shall be the valid obligations of the Company, evidencing the same
debt, and entitled to the same benefits under this Indenture, as the
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Securities surrendered upon such registration of transfer or exchange.
Every Security presented or surrendered for registration of transfer
or for exchange shall (if so required by the Company, the Security Registrar or
the Trustee) be duly endorsed, or be accompanied by a written instrument of
transfer in form satisfactory to the Company, the Security Registrar and the
Trustee duly executed, by the Holder thereof or his attorney duly authorized in
writing.
No service charge shall be made for any registration of transfer or
exchange of Securities, but the Company may require payment of a sum sufficient
to cover any tax or other governmental charge that may be imposed in connection
with any registration of transfer or exchange of Securities, other than
exchanges pursuant to Section 304, 906 or 1107 not involving any transfer.
The Company shall not be required (i) to issue, register the transfer
of or exchange Securities of any series during a period beginning at the opening
of business 15 days before the day of the mailing of a notice of redemption of
Securities of that series selected for redemption under Section 1103 and ending
at the close of business on the day of such mailing, or (ii) to register the
transfer of or exchange any Security so selected for redemption in whole or in
part, except the unredeemed portion of any Security being redeemed in part.
Notwithstanding the foregoing, any Book-Entry Security shall be
exchangeable pursuant to this Section 305 for Securities registered in the names
of Persons other than the Depositary for such Security or its nominee only if
(i) such Depositary notifies the Company that it is unwilling or unable to
continue as Depositary for such Book-Entry Security or if at any time such
Depositary ceases to be a clearing agency registered under the Securities
Exchange Act of 1934, as amended, (ii) the Company executes and delivers to the
Trustee a Company Order that such Book-Entry Security shall be so exchangeable
or (iii) there shall have occurred and be continuing an Event of Default with
respect to the Securities. Any Book-Entry Security that is exchangeable pursuant
to the preceding sentence shall be exchangeable for Securities registered in
such names as such Depositary shall direct.
Notwithstanding any other provision in this Indenture, unless and
until it is exchanged in whole or in part for Securities that are not in the
form of a Book-Entry
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Security, a Book-Entry Security may not be transferred or exchanged except as a
whole by the Depositary with respect to such Book-Entry Security to a nominee of
such Depositary or by a nominee of such Depositary to such Depositary or another
nominee of such Depositary.
Section 306. Mutilated, Destroyed, Lost and Stolen
Securities.
If any mutilated Security is surrendered to the Trustee, the Company
shall execute and the Trustee shall authenticate and deliver or make available
for delivery in exchange therefor a new Security of the same series and of like
tenor and principal amount and bearing a number not contemporaneously
outstanding.
If there shall be delivered to the Company and the Trustee (i)
evidence to their satisfaction of the destruction, loss or theft of any
Security and (ii) such security or indemnity as may be required by them to save
each of them and any agent of either of them harmless, then, in the absence of
notice to the Company or the Trustee that such Security has been acquired by a
bona fide purchaser, the Company shall execute and the Trustee shall
authenticate and deliver, in lieu of any such destroyed, lost or stolen
Security, a new Security of the same series and of like tenor and principal
amount and bearing a number not contemporaneously outstanding.
In case any such mutilated, destroyed, lost or stolen Security has
become or is about to become due and payable, the Company in its discretion may,
instead of issuing a new Security, pay such Security.
Upon the issuance of any new Security under this Section, the Company
may require the payment of a sum sufficient to cover any tax or other
governmental charge that may be imposed in relation thereto and any other
expenses (including the fees and expenses of the Trustee) connected therewith.
Every new Security of any series issued pursuant to this Section in
lieu of any destroyed, lost or stolen Security shall constitute an original
additional contractual obligation of the Company, whether or not the destroyed,
lost or stolen Security shall be at any time enforceable by anyone, and shall be
entitled to all the benefits of this Indenture equally and proportionately with
any and all other Securities of that series duly issued hereunder.
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The provisions of this Section are exclusive and shall preclude (to
the extent lawful) all other rights and remedies with respect to the replacement
or payment of mutilated, destroyed, lost or stolen Securities.
Section 307. Payment of Interest; Interest Rights
Preserved.
Except as otherwise provided as contemplated by Section 301 with
respect to any series of Securities, interest on any Security which is payable,
and is punctually paid or duly provided for, on any Interest Payment Date shall
be paid to the Person in whose name that Security (or one or more Predecessor
Securities) is registered at the close of business on the Regular Record Date
for such interest at the office or agency maintained for such purpose pursuant
to Section 1002; provided, however, that at the option of the Company, interest
on Securities of any series that bear interest may be paid (i) by check mailed
to the address of the Person entitled thereto as it shall appear on the Security
Register or (ii) by wire transfer to an account maintained by the Person
entitled thereto as specified in the Security Register.
Any interest on any Security of any series which is payable, but is
not punctually paid or duly provided for, on any Interest Payment Date (herein
called "Defaulted Interest") shall forthwith cease to be payable to the Holder
on the relevant Regular Record Date by virtue of having been such Holder, and
such Defaulted Interest may be paid by the Company, at its election in each
case, as provided in Clause (1) or (2) below:
(1) The Company may elect to make payment of any Defaulted Interest to
the Persons in whose names the Securities of such series (or their
respective Predecessor Securities) are registered at the close of business
on a Special Record Date for the payment of such Defaulted Interest, which
shall be fixed in the following manner. The Company shall notify the
Trustee in writing of the amount of Defaulted Interest proposed to be paid
on each Security of such series and the date of the proposed payment, and
at the same time the Company shall deposit with the Trustee an amount of
money equal to the aggregate amount proposed to be paid in respect of such
Defaulted Interest or shall make arrangements satisfactory to the Trustee
for such deposit prior to the date of the proposed payment, such money when
deposited to be held in trust for the benefit of the Persons entitled to
such Defaulted
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Interest as in this Clause provided. Thereupon the Trustee shall fix a
Special Record Date for the payment of such Defaulted Interest which shall
be not more than 15 days and not less than 10 days prior to the date of the
proposed payment and not less than 10 days after the receipt by the Trustee
of the notice of the proposed payment. The Trustee shall promptly notify
the Company of such Special Record Date and, in the name and at the expense
of the Company, shall cause notice of the proposed payment of such
Defaulted Interest and the Special Record Date therefor to be mailed,
first-class postage prepaid, to each Holder of Securities of such series at
his address as it appears in the Security Register, not less than 10 days
prior to such Special Record Date. Notice of the proposed payment of such
Defaulted Interest and the Special Record Date therefor having been so
mailed, such Defaulted Interest shall be paid to the Persons in whose names
the Securities of such series (or their respective Predecessor Securities)
are registered at the close of business on such Special Record Date and
shall no longer be payable pursuant to the following Clause (2).
(2) The Company may make payment of any Defaulted Interest on the
Securities of any series in any other lawful manner not inconsistent with
the requirements of any securities exchange on which such Securities may be
listed, and upon such notice as may be required by such exchange, if, after
notice given by the Company to the Trustee of the proposed payment pursuant
to this Clause, such manner of payment shall be deemed practicable by the
Trustee.
Subject to the foregoing provisions of this Section, each Security
delivered under this Indenture upon registration of transfer of or in exchange
for or in lieu of any other Security shall carry the rights to interest accrued
and unpaid, and to accrue, which were carried by such other Security.
Section 308. Persons Deemed Owners.
Prior to due presentment of a Security for registration of transfer,
the Company, the Trustee and any agent of the Company or the Trustee may treat
the Person in whose name such Security is registered as the owner of such
Security for the purpose of receiving payment of principal of and any premium
and (subject to Section 307) any interest on such Security and for all other
purposes whatsoever,
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whether or not such Security be overdue, and neither the Company, the Trustee
nor any agent of the Company or the Trustee shall be affected by notice to the
contrary.
Section 309. Cancellation.
All Securities surrendered for payment, redemption, registration of
transfer or exchange or for credit against any sinking fund payment shall, if
surrendered to any Person other than the Trustee, be delivered to the Trustee.
All Securities so delivered and any Securities surrendered directly to the
Trustee for any such purpose shall be promptly cancelled by the Trustee and such
cancellation shall be noted conspicuously on each such Security. The Company may
at any time deliver to the Trustee for cancellation any Securities previously
authenticated and delivered hereunder which the Company may have acquired in any
manner whatsoever, and may deliver to the Trustee (or to any other Person for
delivery to the Trustee) for cancellation any Securities previously
authenticated hereunder which the Company has not issued and sold, and all
Securities so delivered shall be promptly cancelled by the Trustee. No
Securities shall be authenticated in lieu of or in exchange for any Securities
cancelled an provided in this Section, except as expressly permitted by this
Indenture. Unless the Company directs otherwise by a Company Order, all
cancelled Securities held by the Trustee may be destroyed, but the Trustee shall
not be obligated to so destroy such Securities, and, if any such cancelled
Security is destroyed, the Trustee shall furnish to the Company a certificate
with respect to such destruction.
Section 310. Computation of Interest.
Except as otherwise specified as contemplated by Section 301 for
Securities of any series, interest on the Securities of each series shall be
computed on the basis of a 360-day year of twelve 30-day months.
Section 311. CUSIP Numbers.
The Company in issuing the Securities may use "CUSIP" numbers (if then
generally in use), and, if so, the Trustee shall use "CUSIP" numbers in notices
of redemption as a convenience to Holders; provided that any such notice may
state that no representation is made as to the correctness of such numbers
either as printed on the Securities or as contained in any notice of a
redemption and that reliance may be placed only on the other identification
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numbers printed on the Securities, and any such redemption shall not be affected
by any defect in or omission of such CUSIP numbers. The Company will promptly
notify the Trustee of any change in the CUSIP numbers.
ARTICLE FOUR
Satisfaction and Discharge
Section 401. Satisfaction and Discharge of
Indenture.
This Indenture shall upon Company Request cease to be of further
effect with respect to Securities of any series (except as to any surviving
rights of registration of transfer, exchange or replacement of such Securities
herein expressly provided for), and the Trustee, at the expense of the Company,
shall execute proper instruments acknowledging satisfaction and discharge of
this Indenture with respect to such Securities, when
(1) either
(A) all such Securities theretofore authenticated and delivered (other
than (i) such Securities which have been destroyed, lost or stolen and
which have been replaced or paid as provided in Section 306 and (ii) such
Securities for whose payment 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 1003) have
been delivered to the Trustee for cancellation; or
(B) all such Securities not theretofore delivered to the Trustee for
cancellation
(i) have become due and payable, or
(ii) will become due and payable at their Stated Maturity within
one year, or
(iii) are to be called for redemption within one year under
arrangements satisfactory to the Trustee for the giving of notice of
redemption by the Trustee in the name, and at the expense, of the
Company
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and the Company, in the case of (i), (ii) or (iii) above, has deposited or
caused to be deposited with the Trustee as trust funds in trust for the purpose
an amount in the currency or currencies or currency unit or units in which such
Securities are payable sufficient to pay and discharge the entire indebtedness
on such Securities not theretofore delivered to the Trustee for cancellation,
for principal and any premium and interest to the date of such deposit (in the
case of Securities which have become due and payable) or to the Stated Maturity
or Redemption Date, as the case may be;
(2) the Company has paid or caused to be paid all other sums payable
hereunder by the Company; and
(3) the Company has delivered to the Trustee an Officers' Certificate
and an Opinion of Counsel, each stating that all conditions precedent
herein provided for relating to the satisfaction and discharge of this
Indenture with respect to such Securities have been complied with.
Notwithstanding the satisfaction and discharge of this Indenture, the
obligations of the Company to the Trustee under Section 607, the obligations of
the Trustee to any Authenticating Agent under Section 614 and, if money shall
have been deposited with the Trustee pursuant to subclause (B) of Clause (1) of
this Section, the obligations of the Trustee under Section 402, Article Six and
the last paragraph of Section 1003 shall survive.
Section 402. Application of Trust Money.
Subject to provisions of the last paragraph of Section 1003, all money
deposited with the Trustee pursuant to Section 401 shall be held in trust and
applied by it, in accordance with the provisions of the Securities and this
Indenture, to the payment, either directly or through any Paying Agent
(including the Company acting as its own Paying Agent) as the Trustee may
determine, to the Persons entitled thereto, of the principal and any premium and
interest for whose payment such money has been deposited with the Trustee.
ARTICLE FIVE
Remedies
Section 501. Events of Default.
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"Event of Default", wherever used herein with respect to Securities of
any series, means any one of the following events (whatever the reason for such
Event of Default and whether it shall be voluntary or involuntary or be effected
by operation of law or pursuant to any judgment, decree or order of any court or
any order, rule or regulation of any administrative or governmental body):
(1) default in the payment of any interest upon any Security of that
series when it becomes due and payable, and continuance of such default for
a period of 30 days; or
(2) default in the payment of the principal of (or premium, if any,
on) any Security of that series at its Maturity; or
(3) default in the deposit of any sinking fund payment, when and as
due by the terms of a Security of that series; or
(4) default in the performance, or breach, of any covenant or warranty
of the Company in this Indenture with respect to Securities of that series
(other than a covenant or warranty a default in whose performance or whose
breach is elsewhere in this Section specifically dealt with), and
continuance of such default or breach for a period of 60 days after there
has been given, by registered or certified mail, to the Company by the
Trustee or to the Company and the Trustee by the Holders of at least 25% in
principal amount of the Outstanding Securities of that series a written
notice specifying such default or breach and requiring it to be remedied
and stating that such notice is a "Notice of Default" hereunder; or
(5) if an event of default as defined in 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 of the Company or
any Subsidiary, whether such indebtedness now exists or shall hereafter be
created, if (A) such default either (1) results from the failure to pay the
principal of any such indebtedness at its stated maturity or (2) relates to
an obligation other than the obligation to pay the principal of such
indebtedness at its stated maturity and results in such indebtedness
becoming or being declared due and payable prior to the date on which it
would otherwise become due and payable, (B) the principal amount of such
indebtedness,
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together with the principal amount of any other such indebtedness in
default for failure to pay principal at stated maturity or the maturity of
which has been so accelerated, aggregates $10.0 million or more at any one
time outstanding and (C) such indebtedness is not discharged, or such
acceleration is not rescinded or annulled within a period of 10 Business
Days after there has been given, by registered or certified mail, to the
Company by the Trustee or to the Company and the Trustee by the Holders of
at least 25% in principal amount of Outstanding Securities a written notice
specifying such event of default and requiring the Company to cause such
acceleration to be rescinded or annulled or to cause such indebtedness to
be discharged and stating that such notice is a "Notice of Default"
hereunder; or
(6) the entry by a court having jurisdiction in the premises of (A) a
decree or order for relief in respect of the Company in an involuntary case
or proceeding under any applicable Federal or state bankruptcy, insolvency,
reorganization or other similar law or (B) a decree or order adjudging the
Company a bankrupt or insolvent, or approving as properly filed a petition
seeking reorganization, arrangement, adjustment or composition of or in
respect of the Company under any applicable Federal or state law, or
appointing a custodian, receiver, liquidator, assignee, trustee,
sequestrator or other similar official of the Company or of any substantial
part of its property, or ordering the winding up or liquidation of its
affairs, and the continuance of any such decree or order for relief or any
such other decree or order unstayed and in effect for a period of 60
consecutive days; or
(7) the commencement by the Company of a voluntary case or proceeding
under any applicable Federal or state bankruptcy, insolvency,
reorganization or other similar law or of any other case or proceeding to
be adjudicated a bankrupt or insolvent, or the consent by it to the entry
of a decree or order for relief in respect of the Company in an involuntary
case or proceeding under any applicable Federal or state bankruptcy,
insolvency, reorganization or other similar law or to the commencement of
any bankruptcy or insolvency case or proceeding against it, or the filing
by it of a petition or answer or consent seeking reorganization or relief
under any applicable Federal or State law, or the consent by it to the
filing of such petition or to the appointment of or taking pos-
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session by a custodian, receiver, liquidator, assignee, trustee,
sequestrator or other similar official of the Company or of any substantial
part of its property, or the making by it of an assignment for the benefit
of creditors, or the admission by it in writing of its inability to pay its
debts generally as they become due, or the taking of corporate action by
the Company in furtherance of any such action; or
(8) any other Event of Default provided with respect to Securities of
that series.
Section 502. Acceleration of Maturity; Rescission
and Annulment.
If an Event of Default (other than an Event of Default described in
clause 6 or 7 of Section 501) with respect to Securities of any series at the
time Outstanding occurs and is continuing, then in every such case the Trustee
or the Holders of not less than 25% in principal amount of the Outstanding
Securities of that series may declare the principal amount (or, if any of the
Securities of that series are Original Issue Discount Securities or Indexed
Securities, such portion of the principal amount of such Securities as may be
specified in the terms thereof) of all of the Securities of that series to be
due and payable immediately, by a notice in writing to the Company (and to the
Trustee if given by Holders), and upon any such declaration such principal
amount (or, in the case of Original Issue Discount Securities or Indexed
Securities, such specified amount) shall become immediately due and payable.
At any time after such a declaration of acceleration with respect to
Securities of any series has been made and before a judgment or decree for
payment of the money due has been obtained by the Trustee as hereinafter in this
Article provided, the Holders of a majority in principal amount of the
Outstanding Securities of that series, by written notice to the Company and the
Trustee, may rescind and annul such declaration and its consequences if
(1) the Company has paid or deposited with the Trustee a sum
sufficient to pay
(A) all overdue interest on all Securities of that series,
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(B) the principal of (and premium, if any, on) any Securities of
that series which have become due otherwise than by such declaration
of acceleration and any interest thereon at the rate or rates
prescribed therefor in such Securities,
(C) to the extent that payment of such interest is lawful,
interest upon overdue interest at the rate or rates prescribed
therefor in such Securities, and
(D) all sums paid or advanced by the Trustee hereunder and the
reasonable compensation, expenses, disbursements and advances of the
Trustee, its agents and counsel;
and
(2) all Events of Default with respect to Securities of that series,
other than the non-payment of the principal of Securities of that series
which have become due solely by such declaration of acceleration, have been
cured or waived as provided in Section 513.
No such rescission shall affect any subsequent default or impair any right
consequent thereon.
If an Event of Default described in clause 6 or 7 of Section 501
occurs, the Outstanding Securities shall ipso facto become immediately due and
payable without need of any declaration or other act on the part of the Trustee
or any Holder.
Section 503. Collection of Indebtedness and Suits
for Enforcement by Trustee.
The Company covenants that if
(1) default is made in the payment of any interest on any Security
when such interest becomes due and payable and such default continues for a
period of 30 days, or
(2) default is made in the payment of the principal of (or premium, if
any, on) any Security at the Maturity thereof,
the Company will, upon demand of the Trustee, pay to it, for the benefit of the
Holders of such Securities, the whole
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amount then due and payable on such Securities for principal and any premium and
interest and, to the extent that payment of such interest shall be legally
enforceable, interest on any overdue principal and premium and on any overdue
interest, at the rate or rates prescribed therefor in such Securities, and, in
addition thereto, such further amount as shall be sufficient to cover the costs
and expenses of collection, including the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel.
If an Event of Default with respect to Securities of any series occurs
and is continuing, the Trustee may in its discretion proceed to protect and
enforce its rights and the rights of the Holders of Securities of such series by
such appropriate judicial proceedings as the Trustee shall deem most effectual
to protect and enforce any such rights, whether for the specific enforcement of
any covenant or agreement in this Indenture or in aid of the exercise of any
power granted herein, or to enforce any other proper remedy.
Section 504. Trustee May File Proofs of Claim.
In case of any judicial proceeding relative to the Company (or any
other obligor upon the Securities), its property or its creditors, the Trustee
shall be entitled and empowered, by intervention in such proceeding or
otherwise, to take any and all actions authorized under the Trust Indenture Act
in order to have claims of the Holders and the Trustee allowed in any such
proceeding. In particular, the Trustee shall be authorized to collect and
receive any moneys or other property payable or deliverable on any such claims
and to distribute the same; and any custodian, receiver, assignee, trustee,
liquidator, sequestrator or other similar official in any such judicial
proceeding is hereby authorized by each Holder to make such payments to the
Trustee and, in the event that the Trustee shall consent to the making of such
payments directly to the Holders, to pay to the Trustee any amount due it for
the reasonable compensation, expenses, disbursements and advances of the
Trustee, its agents and counsel, and any other amounts due the Trustee under
Section 607.
No provision of this Indenture shall be deemed to authorize the
Trustee to authorize or consent to or accept or adopt on behalf of any Holder
any plan of reorganization, arrangement, adjustment or composition affecting the
Securities or the rights of any Holder thereof or to authorize the Trustee to
vote in respect of the claim of any Holder in any such proceeding.
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Section 505. Trustee May Enforce Claims Without
Possession of Securities.
All rights of action and claims under this Indenture or the
Securities may be prosecuted and enforced by the Trustee without the possession
of any of the Securities or the production thereof in any proceeding relating
thereto, and any such proceeding instituted by the Trustee shall be brought in
its own name as trustee of an express trust, and any recovery of judgment shall,
after provision for the payment of the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel, be for the
ratable benefit of the Holders of the Securities in respect of which such
judgment has been recovered.
Section 506. Application of Money Collected.
Any money collected by the Trustee pursuant to this Article shall be
applied in the following order, at the date or dates fixed by the Trustee and,
in case of the distribution of such money on account of principal or any premium
or interest, upon presentation of the Securities and the notation thereon of the
payment if only partially paid and upon surrender thereof if fully paid:
FIRST: To the payment of all amounts due the Trustee under Section
607;
SECOND: To the payment of the amounts then due and unpaid for
principal of and any premium and interest on the Securities in respect of
which or for the benefit of which such money has been collected, ratably,
without preference or priority of any kind, according to the amounts due
and payable on such Securities for principal and any premium and interest,
respectively; and
THIRD: The balance, if any, to the Company or to such other Person or
Persons entitled thereto.
Section 507. Limitation on Suits.
No Holder of any Security of any series shall have any right to
institute any proceeding, judicial or otherwise, with respect to this Indenture,
or for the appointment of a receiver or trustee, or for any other remedy
hereunder, unless
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(1) such Holder has previously given written notice to the Trustee of
a continuing Event of Default with respect to the Securities of that
series;
(2) the Holders of not less than 25% in principal amount of the
Outstanding Securities of that series shall have made written request to
the Trustee to institute proceedings in respect of such Event of Default in
its own name as Trustee hereunder;
(3) such Holder or Holders have offered to the Trustee reasonable
indemnity against the costs, expenses and liabilities to be incurred in
compliance with such request;
(4) the Trustee for 60 days after its receipt of such notice, request
and offer of indemnity has failed to institute any such proceeding; and
(5) no direction inconsistent with such written request has been given
to the Trustee before or during such 60-day period by the Holders of a
majority in principal amount of the Outstanding Securities of that series;
it being understood and intended that no one or more of such Holders shall have
any right in any manner whatever by virtue of, or by availing of, any provision
of this Indenture to affect, disturb or prejudice the rights of any other
Holders, or to obtain or to seek to obtain priority or preference over any other
Holders or to enforce any right under this Indenture, except in the manner
herein provided and for the equal and ratable benefit of all Holders.
Section 508. Unconditional Right of Holders to
Receive Principal, Premium and Interest.
Notwithstanding any other provision in this Indenture, the Holder of
any Security shall have the right, which is absolute and unconditional, to
receive payment of the principal of and any premium and (subject to Section 307)
any interest on such Security on the Stated Maturity or Maturities expressed in
such Security (or, in the case of redemption, on the Redemption Date) and to
institute suit for the enforcement of any such payment, and such rights shall
not be impaired without the consent of such Holder.
Section 509. Restoration of Rights and Remedies.
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If the Trustee or any Holder has instituted any proceeding to enforce
any right or remedy under this Indenture and such proceeding has been
discontinued or abandoned for any reason, or has been determined adversely to
the Trustee or to such Holder, then and in every such case, subject to any
determination in such proceeding, the Company, the Trustee and the Holders shall
be restored severally and respectively to their former positions hereunder and
thereafter all rights and remedies of the Trustee and the Holders shall continue
as though no such proceeding had been instituted.
Section 510. Rights and Remedies Cumulative.
Except as otherwise provided with respect to the replacement or
payment of mutilated, destroyed, lost or stolen Securities in the last paragraph
of Section 306 and as otherwise provided in Section 507, no right or remedy
herein conferred upon or reserved to the Trustee or to the Holders is intended
to be exclusive of any other right or remedy, and every right and remedy shall,
to the extent permitted by law, be cumulative and in addition to every other
right and remedy given hereunder or now or hereafter existing at law or in
equity or otherwise. The assertion or employment of any right or remedy
hereunder, or otherwise, shall not prevent the concurrent assertion or
employment of any other appropriate right or remedy.
Section 511. Delay or Omission Not Waiver.
No delay or omission of the Trustee or of any Holder of any Securities
to exercise any right or remedy accruing upon any Event of Default shall impair
any such right or remedy or constitute a waiver of any such Event of Default or
an acquiescence therein. Every right and remedy given by this Article or by law
to the Trustee or to the Holders may be exercised from time to time, and as
often as may be deemed expedient, by the Trustee or by the Holders, as the case
may be.
Section 512. Control by Holders.
The Holders of a majority in principal amount of the Outstanding
Securities of any series 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, with respect to the
Securities of such series, provided that
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(1) such direction shall not be in conflict with any rule of law or
with this Indenture, and
(2) the Trustee may take any other action deemed proper by the Trustee
which is not inconsistent with such direction.
Section 513. Waiver of Past Defaults.
The Holders of not less than a majority in principal amount of the
Outstanding Securities of any series may on behalf of the Holders of all the
Securities of such series waive any past default hereunder with respect to such
series and its consequences, except a default
(1) in the payment of the principal of or any premium or interest on
any Security of such series, or
(2) in respect of a covenant or provision hereof which under Article
Nine cannot be modified or amended without the consent of the Holder of
each Outstanding Security of such series affected.
Upon any such waiver, such default shall cease to exist, and any Event
of Default arising therefrom shall be deemed to have been cured, for every
purpose of this Indenture; but no such waiver shall extend to any subsequent or
other default or impair any right consequent thereon.
Section 514. Undertaking for Costs.
In any suit for the enforcement of any right or remedy under this
Indenture, or in any suit against the Trustee for any action taken, suffered or
omitted by it as Trustee, a court may require any party litigant in such suit to
file an undertaking to pay the costs of such suit, and may assess costs,
including reasonable counsel fees and expenses, against any such party litigant,
in the manner and to the extent provided in the Trust Indenture Act; provided
that neither this Section nor the Trust Indenture Act shall be deemed to
authorize any court to require such an undertaking or to make such an assessment
in any suit instituted by the Company, the Trustee or the Holders of 10%
aggregate principal amount of the Outstanding Securities of any series.
Section 515. Waiver of Usury, 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
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plead, or in any manner whatsoever claim or take the benefit or advantage of,
any usury, 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 benefit or advantage of any such law and covenants that it will not
hinder, delay or impede the execution of any power herein granted to the
Trustee, but will suffer and permit the execution of every such power as though
no such law had been enacted.
ARTICLE SIX
The Trustee
Section 601. Certain Duties and Responsibilities.
The duties and responsibilities of the Trustee shall be as provided by
the Trust Indenture Act. Notwithstanding the foregoing, no provision of this
Indenture shall require the Trustee to expend or risk its own funds or otherwise
incur any financial liability in the performance of any of its duties hereunder,
or in the exercise of any of its rights or powers, if it shall have reasonable
grounds for believing that repayment of such funds or adequate indemnity against
such risk or liability is not reasonably assured to it. Whether or not therein
expressly so provided, every provision of this Indenture relating to the conduct
or affecting the liability of or affording protection to the Trustee shall be
subject to the provisions of this Section.
Section 602. Notice of Defaults.
If a default occurs hereunder with respect to Securities of any
series, the Trustee shall give the Holders of Securities of such series notice
of such default as and to the extent provided by the Trust Indenture Act;
provided, however, that in the case of any default of the character specified in
Section 501(4) with respect to Securities of such series, no such notice to
Holders shall be given until at least 30 days after the occurrence thereof. For
the purpose of this Section, the term "default" means any event which is, or
after notice or lapse of time or both would become, an Event of Default with
respect to Securities of such series.
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Section 603. Certain Rights of Trustee.
Subject to the provisions of Section 601:
(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, direction, consent, order,
bond, debenture, note, other evidence of indebtedness or other paper or
document believed by it to be genuine and to have been signed or presented
by the proper party or parties;
(b) any request or direction of the Company mentioned herein shall be
sufficiently evidenced by a Company Request or Company Order and any
resolution of the Board of Directors may be sufficiently evidenced by a
Board Resolution;
(c) whenever in the administration of this Indenture the Trustee shall
deem it desirable that a matter be proved or established prior to taking,
suffering or omitting any action hereunder, the Trustee (unless other
evidence be herein specifically prescribed) may, in the absence of bad
faith on its part, rely upon an Officers' Certificate;
(d) the Trustee may consult with counsel of its selection and the
advice of such counsel or any Opinion of Counsel shall be full and complete
authorization and protection in respect of any action taken, suffered or
omitted by it hereunder in good faith and in reliance thereon;
(e) the Trustee shall be under no obligation to exercise any of the
rights or powers vested in it by this Indenture at the request or direction
of any of the Holders pursuant to this Indenture, unless such Holders shall
have offered to the Trustee reasonable security or indemnity against the
costs, expenses and liabilities which might be incurred by it in compliance
with such request or direction;
(f) the Trustee shall not be bound to make any investigation into the
facts or matters stated in any resolution, certificate, statement,
instrument, opinion, report, notice, request, direction, consent, order,
bond, debenture, note, other evidence of indebtedness or other paper or
document, but the Trustee, in its discretion, may make such further
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inquiry or investigation into such facts or matters as it may see fit, and,
if the Trustee shall determine to make such further inquiry or
investigation, it shall be entitled to examine the books, records and
premises of the Company, personally or by agent or attorney;
(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 and the Trustee shall not be responsible for any misconduct or
negligence on the part of any agent or attorney appointed with due care by
it hereunder;
(h) the Trustee shall not be liable for any action taken, suffered, or
omitted to be taken by it in good faith and reasonably believed by it to be
authorized or within the discretion or rights or powers conferred upon it
by this Indenture; and
(i) The Trustee shall not be deemed to have notice of any Default or
Event of Default unless a Responsible Officer of the Trustee has actual
knowledge thereof or unless written notice of any event which is in fact
such a default is received by the Trustee at the Corporate Trust Office of
the Trustee, and such notice references the Securities and this Indenture.
Section 604. Not Responsible for Recitals or
Issuance of Securities.
The recitals contained herein and in the Securities, except the
Trustee's certificates of authentication, shall be taken as the statements of
the Company, and neither the Trustee nor any Authenticating Agent assumes any
responsibility for their correctness. The Trustee makes no representations as to
the validity or sufficiency of this Indenture or of the Securities. Neither the
Trustee nor any Authenticating Agent shall be accountable for the use or
application by the Company of Securities or the proceeds thereof.
Section 605. May Hold Securities.
The Trustee, any Authenticating Agent, any Paying Agent, any Security
Registrar or any other agent of the Company, in its individual or any other
capacity, may become the owner or pledgee of Securities and, subject to Sections
608 and 613, may otherwise deal with the Company with the same rights it would
have if it were not Trustee,
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Authenticating Agent, Paying Agent, Security Registrar or such other agent.
Subject to the provisions of Section 608, the Trustee may become and
act as trustee under other indentures under which other securities, or
certificates of interest or participation in other securities, of the Company
are outstanding in the same manner as if it were not Trustee.
Section 606. Money Held in Trust.
Money held by the Trustee in trust hereunder need not be segregated
from other funds except to the extent required by law. The Trustee shall be
under no liability for interest on any money received by it hereunder except as
otherwise agreed in writing with the Company.
Section 607. Compensation and Reimbursement.
The Company agrees
(1) to pay to the Trustee from time to time such compensation as shall
be agreed in writing between the Company and the Trustee for all services
rendered by it hereunder (which compensation shall not be limited by any
provision of law in regard to the compensation of a trustee of an express
trust);
(2) except as otherwise expressly provided herein, to reimburse the
Trustee upon its request for all reasonable expenses, disbursements and
advances incurred or made by the Trustee in accordance with any provision
of this Indenture (including the reasonable compensation and the expenses
and disbursements of its agents and counsel), except any such expense,
disbursement or advance as may be attributable to its negligence or bad
faith; and
(3) to indemnify each of the Trustee, or any predecessor Trustee, for,
and to hold it harmless against, any and all loss, liability, damage, claim
or expense incurred without negligence or bad faith on its part, arising
out of or in connection with the acceptance or administration of the trust
or trusts hereunder, including the costs and expenses of defending itself
against any claim or liability in connection with the exercise or
performance of any of its powers or duties hereunder.
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The Trustee shall have a lien prior to the Securities as to all
property and funds held by it hereunder for any amount owing it or any
predecessor Trustee pursuant to this Section 607, except with respect to funds
held in trust for the benefit of the Holders of particular Securities.
When the Trustee incurs expenses or renders services in connection
with an Event of Default specified in Section 501(6) or Section 501(7), the
expenses (including the reasonable charges and expenses of its counsel) and the
compensation for the services are intended to constitute expenses of
administration under any applicable Federal or state bankruptcy, insolvency or
other similar law.
The provisions of this Section shall survive the termination of this
Indenture.
Section 608. Disqualification; Conflicting
Interests.
If the Trustee has or shall acquire a conflicting interest within the
meaning of the Trust Indenture Act, the Trustee shall either eliminate such
interest or resign, to the extent and in the manner provided by, and subject to
the provisions of, the Trust Indenture Act and this Indenture.
Section 609. Corporate Trustee Required;
Eligibility.
There shall at all times be a Trustee hereunder which shall be a
Person that is eligible pursuant to the Trust Indenture Act to act as such and
has a combined capital and surplus of at least $50,000,000 and an office in the
Borough of Manhattan, The City of New York at which at any particular time its
corporate trust business may be administered. If such Person publishes reports
of condition at least annually, pursuant to law or to the requirements of any
Federal or state supervising or examining authority, then for the purposes of
this Section, the combined capital and surplus of such Person shall be deemed to
be its combined capital and surplus as set forth in its most recent report of
condition so published. If at any time the Trustee shall cease to be eligible in
accordance with the provisions of this Section, it shall resign immediately in
the manner and with the effect hereinafter specified in this Article.
Section 610. Resignation and Removal;
Appointment of Successor.
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(a) No resignation or removal of the Trustee and appointment of a
successor Trustee pursuant to this Article shall become effective until the
acceptance of appointment by the successor Trustee in accordance with the
applicable requirements of Section 611.
(b) The Trustee may resign at any time with respect to the Securities
of one or more series by giving written notice thereof to the Company. If the
instrument of acceptance by a successor Trustee required by Section 611 shall
not have been delivered to the Trustee within 30 days after the giving of such
notice of resignation, the resigning Trustee may petition, at the expense of the
Company, any court of competent jurisdiction for the appointment of a successor
Trustee with respect to the Securities of such series.
(c) The Trustee may be removed at any time with respect to the
Securities of any series by Act of the Holders of a majority in principal amount
of the Outstanding Securities of such series, delivered to the Trustee and to
the Company. If the instrument of acceptance by a successor Trustee required by
Section 611 shall not have been delivered to the Trustee within 30 days after
the giving of such notice of removal, the Trustee being removed may petition, at
the expense of the Company, any court of competent jurisdiction for the
appointment of a successor Trustee with respect to the Securities of such
series.
(d) If at any time:
(1) the Trustee shall fail to comply with Section 608 after written
request therefor by the Company or by any Holder who has been a bona fide
Holder of a Security for at least six months, or
(2) the Trustee shall cease to be eligible under Section 609 and
shall fail to resign after written request therefor by the Company or by
any such Holder, or
(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,
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then, in any such case, (i) the Company by or pursuant to a Board Resolution may
remove the Trustee and appoint a successor Trustee with respect to all
Securities, or (ii) subject to Section 514, any Holder who has been a bona fide
Holder of a Security 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 with respect to all Securities and the appointment of a
successor Trustee or Trustees.
(e) If the Trustee shall resign, be removed or become incapable of
acting, or if a vacancy shall occur in the office of Trustee for any cause, with
respect to the Securities of one or more series, the Company, by or pursuant to
a Board Resolution, shall promptly appoint a successor Trustee or Trustees with
respect to the Securities of that or those series (it being understood that any
such successor Trustee may be appointed with respect to the Securities of one or
more or all of such series and that at any time there shall be only one Trustee
with respect to the Securities of any particular series) and shall comply with
the applicable requirements of Section 611. If, within one year after such
resignation, removal or incapability, or the occurrence of such vacancy, a
successor Trustee with respect to the Securities of any series shall be
appointed by Act of the Holders of a majority in principal amount of the
Outstanding Securities of such series delivered to the Company and the retiring
Trustee, the successor Trustee so appointed shall, forthwith upon its acceptance
of such appointment in accordance with the applicable requirements of Section
611, become the successor Trustee with respect to the Securities of such series
and to that extent supersede the successor Trustee appointed by the Company. If
no successor Trustee with respect to the Securities of any series shall have
been so appointed by the Company or the Holders and accepted appointment in the
manner required by Section 611, any Holder who has been a bona fide Holder of a
Security of such series for at least six months may, on behalf of himself and
all others similarly situated, petition any court of competent jurisdiction for
the appointment of a successor Trustee with respect to the Securities of such
series.
(f) The Company shall give notice of each resignation and each
removal of the Trustee with respect to the Securities of any series and each
appointment of a successor Trustee with respect to the Securities of any series
to all Holders of Securities of such series in the manner provided in Section
106. Each notice shall include the name of the
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successor Trustee with respect to the Securities of such series and the address
of its Corporate Trust Office.
Section 611. Acceptance of Appointment by
Successor.
(a) In case of the appointment hereunder of a successor Trustee with
respect to all Securities, every such successor Trustee so appointed shall
execute, acknowledge and deliver to the Company and to the retiring Trustee an
instrument accepting such appointment, and thereupon the resignation or removal
of the retiring Trustee shall become effective and such successor Trustee,
without any further act, deed or conveyance, shall become vested with all the
rights, powers, trusts and duties of the retiring Trustee; but, on the request
of the Company or the successor Trustee, such retiring Trustee shall, upon
payment of its charges, execute and deliver an instrument transferring to such
successor Trustee all the rights, powers and trusts of the retiring Trustee and
shall duly assign, transfer and deliver to such successor Trustee all property
and money held by such retiring Trustee hereunder.
(b) In case of the appointment hereunder of a successor Trustee with
respect to the Securities of one or more (but not all) series, the Company, the
retiring Trustee and each successor Trustee with respect to the Securities of
one or more series shall execute and deliver an indenture supplemental hereto
wherein each successor Trustee shall accept such appointment and which (1) shall
contain such provisions as shall be necessary or desirable to transfer and
confirm to, and to vest in, each successor Trustee all the rights, powers,
trusts and duties of the retiring Trustee with respect to the Securities of that
or those series to which the appointment of such successor Trustee relates, (2)
if the retiring Trustee is not retiring with respect to all Securities, shall
contain such provisions as shall be deemed necessary or desirable to confirm
that all the rights, powers, trusts and duties of the retiring Trustee with
respect to the Securities of that or those series as to which the retiring
Trustee is not retiring shall continue to be vested in the retiring Trustee, and
(3) shall add to or change any of the provisions of this Indenture as shall be
necessary to provide for or facilitate the administration of the trusts
hereunder by more than one Trustee, it being understood that nothing herein or
in such supplemental indenture shall constitute such Trustees co-trustees of the
same trust and that each such Trustee shall be trustee of a trust or trusts
hereunder separate and apart from any trust or trusts hereunder administered by
any
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other such Trustee; and upon the execution and delivery of such supplemental
indenture the resignation or removal of the retiring Trustee shall become
effective to the extent provided therein and each such successor Trustee,
without any further act, deed or conveyance, shall become vested with all the
rights, powers, trusts and duties of the retiring Trustee with respect to the
Securities of that or those series to which the appointment of such successor
Trustee relates; but, on request of the Company or any successor Trustee, such
retiring Trustee shall duly assign, transfer and deliver to such successor
Trustee all property and money held by such retiring Trustee hereunder with
respect to the Securities of that or those series to which the appointment of
such successor Trustee relates; provided, however, that to the extent that such
property and money is not held by the Trustee in trust for the benefit of the
Holders of particular Securities, such retiring Trustee shall transfer and
deliver to such successor Trustee such property and money upon payment of its
charges hereunder.
(c) Upon request of any such successor Trustee, the Company shall
execute any and all instruments for more fully and certainly vesting in and
confirming to such successor Trustee all such rights, powers and trusts
referred to in paragraph (a) and (b) of this Section, as the case may be.
(d) No successor Trustee shall accept its appointment unless at the
time of such acceptance such successor Trustee shall be qualified and eligible
under this Article.
Section 612. Merger, Conversion, Consolidation
or Succession to Business.
Any corporation into which the Trustee may be merged or converted or
with which it may be consolidated, or any corporation resulting from any merger,
conversion or consolidation to which the Trustee shall be a party, or any
corporation succeeding to all or substantially all the corporate trust business
of the Trustee, shall be the successor of the Trustee hereunder, provided such
corporation shall be otherwise qualified and eligible under this Article,
without the execution or filing of any paper or any further act on the part of
any of the parties hereto. In case any Securities shall have been authenticated,
but not delivered, by the Trustee then in office, any successor by merger,
conversion or consolidation to such authenticating Trustee may adopt such
authentication and deliver the Securities so authenticated with the same effect
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as if such successor Trustee had itself authenticated such Securities.
Section 613. Preferential Collection of Claims
Against Company.
If and when the Trustee shall be or become a creditor of the Company
(or any other obligor upon the Securities), the Trustee shall be subject to the
provisions of the Trust Indenture Act regarding the collection of claims against
the Company (or any such other obligor).
Section 614. Appointment of Authenticating Agent.
The Trustee may appoint an Authenticating Agent or Agents with respect
to one or more series of Securities which shall be authorized to act on behalf
of the Trustee to authenticate Securities of such series issued upon original
issue and upon exchange, registration of transfer or partial redemption thereof
or pursuant to Section 306, and Securities so authenticated shall be entitled
to the benefits of this Indenture and shall be valid and obligatory for all
purposes as if authenticated by the Trustee hereunder. Wherever reference is
made in this Indenture to the authentication and delivery of Securities by the
Trustee or the Trustee's certificate of authentication, such reference shall be
deemed to include authentication and delivery on behalf of the Trustee by an
Authenticating Agent and a certificate of authentication executed on behalf of
the Trustee by an Authenticating Agent. Each Authenticating Agent shall be
acceptable to the Company and shall at all times be a corporation organized and
doing business under the laws of the United States of America, any State thereof
or the District of Columbia, authorized under such laws to act as Authenticating
Agent, having a combined capital and surplus of not less than $50,000,000 and
subject to supervision or examination by Federal or state authority. If such
Authenticating Agent publishes reports of condition at least annually, pursuant
to law or to the requirements of said supervising or examining authority, then
for the purposes of this Section, the combined capital and surplus of such
Authenticating Agent shall be deemed to be its combined capital and surplus as
set forth in its most recent report of condition so published. If at any time an
Authenticating Agent shall cease to be eligible in accordance with the
provisions of this Section, such Authenticating Agent shall resign immediately
in the manner and with the effect specified in this Section.
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Any corporation into which an Authenticating Agent may be merged or
converted or with which it may be consolidated, or any corporation resulting
from any merger, conversion or consolidation to which such Authenticating Agent
shall be a party, or any corporation succeeding to all or substantially all the
corporate agency or corporate trust business of an Authenticating Agent, shall
continue to be an Authenticating Agent, provided such corporation shall be
otherwise eligible under this Section, without the execution or filing of any
paper or any further act on the part of the Trustee or the Authenticating Agent.
An Authenticating Agent may resign at any time by giving written
notice thereof to the Trustee and to the Company. The Trustee may at any time
terminate the agency of an Authenticating Agent by giving written notice thereof
to such Authenticating Agent and to the Company. Upon receiving such a notice of
resignation or upon such a termination, or in case at any time such
Authenticating Agent shall cease to be eligible in accordance with the
provisions of this Section, the Trustee may appoint a successor Authenticating
Agent which shall be acceptable to the Company and shall mail written notice of
such appointment by first-class mail, postage prepaid, to all Holders of
Securities of the series with respect to which such Authenticating Agent will
serve, as their names and addresses appear in the Security Register. Any
successor Authenticating Agent upon acceptance of its appointment hereunder
shall become vested with all the rights, powers and duties of its predecessor
hereunder, with like effect as if originally named as an Authenticating Agent.
No successor Authenticating Agent shall be appointed unless eligible under the
provisions of this section.
The Company agrees to pay to each Authenticating Agent from time to
time reasonable compensation for its services under this Section.
If an appointment with respect to one or more series is made pursuant
to this Section, the Securities of such series may have endorsed thereon, in
addition to or in lieu of the Trustee's certificate of authentication, an
alternative certificate of authentication in the following form:
Dated: _______________
This is one of the Securities of the series designated therein
referred to in the within-mentioned Indenture.
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[------------------],
As Trustee
By.......................................
As Authenticating Agent
By.......................................
Authorized Officer
ARTICLE SEVEN
Holders' Lists and Reports by Trustee and Company
Section 701. Company to Furnish Trustee
Names and Addresses of Holders.
The Company will furnish or cause to be furnished to the Trustee
(a) semi-annually, not later than January 15 and July 15 in each year,
a list, in such form as the Trustee may reasonably require, of the names
and addresses of the Holders as of the preceding January 1 or July 1, as
the case may be, and
(b) at such other times as the Trustee may request in writing, within
30 days after the receipt by the Company of any such request, a list in
similar form and content as of a date not more than 15 days prior to the
time such list is furnished;
excluding from any such list names and addresses received by the Trustee in its
capacity as Security Registrar.
Section 702. Preservation of Information;
Communications to Holders.
(a) The Trustee shall preserve, in as current a form as is reasonably
practicable, the names and addresses of Holders contained in the most recent
list furnished to the Trustee as provided in Section 701 and the names and
addresses of Holders received by the Trustee in its capacity as Security
Registrar. The Trustee may destroy any list furnished to it as provided in
Section 701 upon receipt of a new list so furnished.
(b) The rights of the Holders to communicate with
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other Holders with respect to their rights under this Indenture or under the
Securities, and the corresponding rights and privileges of the Trustee, shall be
as provided by the Trust Indenture Act.
(c) Every Holder of Securities, by receiving and holding the same,
agrees with the Company and the Trustee that neither the Company nor the Trustee
nor any agent of either of then shall be held accountable by reason of any
disclosure of information as to names and addresses of Holders made pursuant to
the Trust Indenture Act.
Section 703. Reports by Trustee.
(a) The Trustee shall transmit to Holders such reports concerning the
Trustee and its actions under this Indenture as may be required pursuant to the
Trust Indenture Act at the times and in the manner provided pursuant thereto.
If required by Section 313(a) of the Trust Indenture Act, the Trustee shall,
within sixty days after each May 1 following the date of the first issuance
deliver to Holders a brief report, dated as of such May 1, which complies with
the provisions of such Section 313(a).
(b) A copy of each such report shall, at the time of such transmission
to Holders, be filed by the Trustee with each stock exchange upon which any
Securities are listed, with the Commission and with the Company. The Company
promptly will notify the Trustee when any Securities are listed on any stock
exchange.
Section 704. Reports by Company.
The Company shall file with the Trustee and the Commission, and
transmit to Holders, such information, documents and other reports, and such
summaries thereof, as may be required pursuant to the Trust Indenture Act at the
times and in the manner provided pursuant to such Act; provided that any such
information, documents or reports required to be filed with the Commission
pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 shall be
filed with the Trustee within 15 days after the same is so required to be filed
with the Commission.
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ARTICLE EIGHT
Consolidation, Merger, Conveyance, Transfer or Lease
Section 801. Company May Consolidate, Etc., Only
on Certain Terms.
The Company shall not consolidate with or merge with or into any other
Person or convey, transfer or lease its properties and assets substantially as
an entirety to any Person, unless:
(1) either the Company shall be the continuing corporation, or any
successor Person or purchaser shall be a corporation, partnership or trust
organized and validly existing under the laws of the United States of
America, any State thereof or the District of Columbia and shall expressly
assume, by an indenture supplemental hereto, executed and delivered to the
Trustee, in form satisfactory to the Trustee, the due and punctual payment
of the principal of and any premium and interest on all the Securities and
the performance or observance of every covenant of this Indenture on the
part of the Company to be performed or observed;
(2) immediately after giving effect to such transaction, no Event of
Default, and no event which, after notice or lapse of time or both, would
become an Event of Default, shall have occurred and be continuing; and
(3) if, as a result of any such consolidation or merger or such
conveyance, transfer or lease, the Person formed by or resulting or
surviving therefrom or which shall have received the properties and assets
of the Company substantially as an entirety would have outstanding any Debt
secured by any Mortgage on any Operating Property, or on any shares of
stock or Debt of any Restricted Subsidiary, which Debt could not at such
time be incurred by such Person under Section 1008 without equally and
ratably securing the Securities, the Company, or such Person, prior to such
consolidation, merger, conveyance, transfer or lease, will secure the
Outstanding Securities, equally and ratably with (or prior to) the Debt
secured by such Mortgage; and
(4) if a supplemental indenture is to be executed in connection with
such consolidation, merger, transfer
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or lease, the Company shall have delivered to the Trustee (A) an Officers'
certificate and (B) an Opinion of Counsel attesting to compliance with
these provisions.
Section 802. Successor Substituted.
Upon any consolidation of the Company with, or merger of the Company
with or into, any other Person or any conveyance, transfer or lease of the
properties and assets of the Company substantially as an entirety in accordance
with Section 801, the successor Person formed by such consolidation or into
which the Company is merged or to which such conveyance, transfer or lease is
made shall succeed to, and be substituted for, and may exercise every right and
power of, the Company under this Indenture with the same effect as if such
successor Person had been named as the Company herein, and thereafter, except in
the case of a lease, the predecessor Person shall be relieved of all obligations
and covenants under this Indenture and the Securities.
Section 803. Officers' Certificate and
Opinion of Counsel.
The Trustee, subject to the provisions of Sections 601 and 603, shall
receive an Officers' Certificate and an Opinion of Counsel as conclusive
evidence that any such consolidation, merger, conveyance, transfer or lease, and
any such assumption, complies with the provisions of this Article before the
Trustee shall execute any supplemental indenture required pursuant to this
Article.
ARTICLE NINE
Supplemental Indentures
Section 901. Supplemental Indentures Without
Consent of Holders.
Without the consent of any Holders, the Company, when authorized by a
Board Resolution, and the Trustee, at any time and from time to time, may enter
into one or more indentures supplemental hereto, in form satisfactory to the
Trustee, for any of the following purposes:
(1) to evidence the succession of another Person to the Company and
the assumption by any such successor
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of the covenants of the Company herein and in the Securities; or
(2) to add to the covenants of the Company for the benefit of the
Holders of all or any series of Securities (and if such covenants are to be
for the benefit of less than all series of Securities, stating that such
covenants are expressly being included solely for the benefit of such
series) or to surrender any right or power herein conferred upon the
Company; or
(3) to add any additional Events of Default with respect to all or any
series of Securities; or
(4) to add to or change any of the provisions of this Indenture to
such extent as shall be necessary to permit or facilitate the issuance of
Securities in bearer form, registrable or not registrable as to principal,
and with or without interest coupons, or to permit or facilitate the
issuance of Securities in uncertificated form or in the form of Book-Entry
Securities; or
(5) to add to, change or eliminate any of the provisions of this
Indenture in respect of one or more series of Securities, provided that any
such addition, change or elimination (i) shall neither (A) apply to any
Security of any series created prior to the execution of such supplemental
indenture and entitled to the benefit of such provision nor (B) modify the
rights of the Holder of any such Security with respect to such provision or
(ii) shall become effective only when there is no such Security
Outstanding; or
(6) to secure the Securities; or
(7) to establish the form or terms of Securities of any series as
permitted by Sections 201 and 301; or
(8) to evidence and provide for the acceptance of appointment
hereunder by a successor Trustee with respect to the Securities of one or
more series and to add to or change any of the provisions of this Indenture
as shall be necessary to provide for or facilitate the administration of
the trusts hereunder by more than one Trustee, pursuant to the requirements
of Section 611(b); or
(9) if allowed, without penalty under applicable laws and regulations,
to permit payment in the United
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States (including any of the States thereof and the District of Columbia),
its territories, its possessions and other areas subject to its
jurisdiction of principal, premium, if any, or interest, if any, on
securities in bearer form or coupons, if any; or
(10) to cure any ambiguity, to correct or supplement any provision
herein which is mistaken or may be inconsistent with any other provision
herein or to make any other provisions with respect to matters or questions
arising under this Indenture, provided that such action pursuant to this
clause (10), other than with respect to a mistaken provision, shall not
adversely affect the interests of the Holders of Securities of any series
in any material respect.
Section 902. Supplemental Indentures with Consent
of Holders.
With the consent of the Holders of not less than a majority in
principal amount of the Outstanding Securities of each series affected by such
supplemental indenture, by Act of said Holders delivered to the Company and the
Trustee, the Company, when authorized by a Board Resolution, and the Trustee may
enter into an indenture or indentures supplemental hereto for the purpose of
adding any provisions to or changing in any manner or eliminating any of the
provisions of this Indenture or of modifying in any manner the rights of the
Holders of Securities of such series under this Indenture; provided, however,
that no such supplemental indenture shall, without the consent of the Holder of
each Outstanding Security affected thereby,
(1) change the Stated Maturity of the principal of, or any installment
of principal of or interest on, any Security, or reduce the principal
amount thereof or the rate of interest thereon or any premium payable upon
the redemption thereof, or reduce the amount of the principal of an
Original Issue Discount Security or any other Security that would be due
and payable upon a declaration of acceleration of the Maturity thereof
pursuant to Section 502, or change any Place of Payment where, or the coin
or currency in which, any Security or any premium or interest thereon is
payable, or impair the right to institute suit for the enforcement of any
such payment on or after the Stated Maturity thereof (or, in the case of
redemption, on or after the Redemption Date), or
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(2) reduce the percentage in principal amount of the Outstanding
Securities of any series, the consent of whose Holders is required for any
such supplemental indenture, or the consent of whose Holders is required
for any waiver (of compliance with certain provisions of this Indenture or
certain defaults hereunder and their consequences) provided for in this
Indenture, or
(3) modify any of the provisions of this Section, Section 513 or
Section 1011, except to increase any percentage set forth in such Sections
or to provide that certain other provisions of this Indenture cannot be
modified or waived without the consent of the Holder of each Outstanding
Security affected thereby; provided, however, that this clause shall not be
deemed to require the consent of any Holder with respect to changes in the
references to "the Trustee" and concomitant changes in this Section and
Section 1011, or the deletion of this proviso, in accordance with the
requirements of Sections 611(b) and 901(8).
A supplemental indenture which changes or eliminates any covenant or other
provision of this Indenture which has expressly been included solely for the
benefit of one or more particular series of Securities, or which modifies the
rights of the Holders of Securities of such series with respect to such covenant
or other provision, shall be deemed not to affect the rights under this
Indenture of the Holders of Securities of any other series.
It shall not be necessary for any Act of Holders under this Section to
approve the particular form of any proposed supplemental indenture, but it shall
be sufficient if such Act shall approve the substance thereof.
Section 903. Execution of Supplemental Indentures.
In executing, or accepting the additional trusts created by, any
supplemental indenture permitted by this Article or the modifications thereby of
the trusts created by this Indenture, the Trustee shall be entitled to receive,
and (subject to Section 601) shall be fully protected in relying upon, an
Opinion of Counsel stating that the execution of such supplemental indenture is
authorized or permitted by this Indenture. The Trustee may, but shall not be
obligated to, enter into any such supplemental indenture which affects the
Trustee's own rights, duties or immunities under this Indenture or otherwise.
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Section 904. Effect of Supplemental Indentures.
Upon the execution of any supplemental indenture under this Article,
this Indenture shall be modified in accordance therewith and such supplemental
indenture shall form a part of this Indenture for all purposes; and every Holder
of Securities theretofore or thereafter authenticated and delivered hereunder
shall be bound thereby.
Section 905. Conformity with Trust Indenture Act.
Every supplemental indenture executed pursuant to this Article shall
conform to the requirements of the Trust Indenture Act.
Section 906. Reference in Securities to
Supplemental Indentures.
Securities of any series authenticated and delivered after the
execution of any supplemental indenture pursuant to this Article may, and shall
if required by the Trustee, bear a notation in form approved by the Trustee as
to any matter provided for in such supplemental indenture. If the Company shall
so determine, new Securities of any series so modified as to conform, in the
opinion of the Trustee and the Company, to any such supplemental indenture may
be prepared and executed by the Company and authenticated and delivered by the
Trustee in exchange for Outstanding Securities of such series.
ARTICLE TEN
Covenants
Section 1001. Payment of Principal, Premium and Interest.
The Company covenants and agrees for the benefit of each series of
Securities that it will duly and punctually pay the principal of and any
premium and interest on the Securities of that series in accordance with the
terms of such Securities and this Indenture.
Section 1002. Maintenance of Office or Agency.
The Company will maintain in each Place of Payment for any series of
Securities an office or agency where Securities of that series may be presented
or surrendered for payment, where Securities of that series may be surrendered
for registration of transfer or exchange and where notices
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and demands to or upon the Company in respect of the Securities of that series
and this Indenture may be served. The Company will give prompt written notice to
the Trustee of the location, and any change in the location, of such office or
agency. If at any time the Company shall fail to maintain any such required
office or agency or shall fail to furnish the Trustee with the address thereof,
such presentations, surrenders, notices and demands may be made or served at the
Corporate Trust Office of the Trustee, and the Company hereby appoints the
Trustee as its agent to receive all such presentations, surrenders, notices and
demands.
The Company may also from time to time designate one or more other
offices or agencies where the Securities of one or more series 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 each Place of Payment for Securities of any series for such
purposes. The Company will give prompt written notice to the Trustee of any such
designation or rescission and of any change in the location of any such other
office or agency.
Section 1003. Money for Securities Payments to
Be Held in Trust.
If the Company shall at any time act as its own Paying Agent with
respect to any series of Securities, it will, on or before each due date of the
principal of or any premium or interest on any of the Securities of that series,
segregate and hold in trust for the benefit of the Persons entitled thereto a
sum sufficient to pay the principal and any premium and interest so becoming due
until such sums shall be paid to such Persons or otherwise disposed of as herein
provided and will promptly notify the Trustee of its action or failure so to
act.
Whenever the Company shall have one or more Paying Agents for any
series of Securities, it will, prior to each due date of the principal of or any
premium or interest on any Securities of that series, deposit with a Paying
Agent a sum sufficient to pay such amount, such sum to be held as provided by
the Trust Indenture Act, and (unless such Paying Agent is the Trustee) the
Company will promptly notify the Trustee of its action or failure so to act.
The Company will cause each Paying Agent for any series of Securities
other than the Trustee to execute and
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deliver to the Trustee an instrument in which such Paying Agent shall agree with
the Trustee, subject to the provisions of this Section, that such Paying Agent
will (i) comply with the provisions of the Trust Indenture Act applicable to it
as a Paying Agent and (ii) during the continuance of any default by the Company
(or any other obligor upon the Securities of that series) in the making of any
payment in respect of the Securities of that series, and upon the written
request of the Trustee, forthwith pay to the Trustee all sums held in trust by
such Paying Agent for payment in respect of the Securities of that series.
The Company may at any time, for the purpose of obtaining the
satisfaction and discharge of this Indenture or for any other purpose, pay, or
by Company Order direct any Paying Agent to pay, to the Trustee all sums held in
trust by the Company or such Paying Agent, such sums to be held by the Trustee
upon the same trusts as those upon which such sums were held by the Company or
such Paying Agent; and, upon such payment by any Paying Agent to the Trustee,
such Paying Agent shall be released from all further liability with respect to
such money.
Any money deposited with the Trustee or any Paying Agent, or then held
by the Company, in trust for the payment of the principal of or any premium or
interest on any Security of any series and remaining unclaimed for two years
after such principal, premium or interest has become due and payable shall be
paid to the Company on Company Request, or (if then held by the Company) shall
be discharged from such trust; and the Holder of such Security shall thereafter,
as an unsecured general creditor, look only to the Company for payment thereof,
and all liability of the Trustee or such Paying Agent with respect to such trust
money, and all liability of the Company as trustee thereof, shall thereupon
cease; provided, however, that the Trustee or such Paying Agent, before being
required to make any such repayment, may at the expense of the Company 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 City of New
York, notice that such money remains unclaimed and that, after a date specified
therein, which shall not be less than 30 days from the date of such publication,
any unclaimed balance of such money then remaining will be repaid to the
Company.
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Section 1004. Statement by Officers as to Default.
The Company will deliver to the Trustee, within 120 days after the end
of each fiscal year of the Company ending after the date hereof, an Officers'
Certificate, one of the signers of which shall be the principal executive
officer, principal financial officer or principal accounting officer of the
Company, stating whether or not to the best knowledge of the signers thereof the
Company is in default in the performance and observance of any of the terms,
provisions and conditions of this Indenture (without regard to any period of
grace or requirement of notice provided hereunder) and, if the Company shall be
in default, specifying all such defaults and the nature and status thereof of
which they may have knowledge.
Section 1005. Existence.
Subject to Article Eight, the Company will do or cause to be done all
things necessary to preserve and keep in full force and effect its existence,
rights (charter and statutory) and franchises; provided, however, that the
Company shall not be required to preserve any such right or franchise if the
Board of Directors shall determine that the preservation thereof is no longer
desirable in the conduct of the business of the Company and that the loss
thereof is not disadvantageous in any material respect to the Holders.
Section 1006. INTENTIONALLY LEFT BLANK
Section 1007. Payment of Taxes and Other Claims.
The Company will pay or discharge or cause to be paid or discharged,
before the same shall become delinquent, (1) all taxes, assessments and
governmental charges levied or imposed upon the Company or any Subsidiary or
upon the income, profits or property of the Company or any Subsidiary, and (2)
all lawful claims for labor, materials and supplies which, if unpaid, might by
law become a lien upon the property of the Company or any Subsidiary; provided,
however, that the Company shall not be required to pay or discharge or cause to
be paid or discharged any such tax, assessment, charge or claim whose amount,
applicability or validity is being contested in good faith by appropriate
proceedings.
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Section 1008. Limitation on Liens.
Unless otherwise indicated with respect to any series of Securities,
the Company agrees as to each series of Securities, that it will not, and will
not permit any Restricted Subsidiary to, create, incur, issue, assume or
guarantee any notes, bonds, debentures or other similar evidences of
indebtedness for money borrowed ("Debt"), secured by a Mortgage upon any
Operating Property, or upon shares of capital stock or Debt issued by any
Restricted Subsidiary and owned by the Company or any Restricted Subsidiary,
whether owned at the date of this Indenture or hereafter acquired, without
effectively providing concurrently that the Outstanding Securities (together
with, if the Company shall so determine, any other Debt of the Company or such
Restricted Subsidiary then existing or thereafter created which is not
subordinate to the Securities) shall be secured equally and ratably with or, at
the option of the Company, prior to such Debt so long as such Debt shall be so
secured, unless, at the time of such creation, incurrence, issuance, assumption
or guarantee, after giving effect thereto and to the retirement of any Debt
which is concurrently being retired, the aggregate amount of all such Debt
secured by Mortgages which would otherwise be subject to such restrictions
(other than any Debt secured by Mortgages permitted in Clauses (1) through (7)
of this Section 1008) plus all Attributable Debt of the Company and its
Restricted Subsidiaries in respect of Sale and Leaseback Transactions with
respect to Operating Properties (with the exception of such Sale and Leaseback
Transactions permitted under Clauses (1) through (4) of Section 1009) would not
exceed 10% of Consolidated Net Tangible Assets; provided, however, that this
Section shall not apply to, and there shall be excluded from Debt in any
computation under this Section, Debt secured by:
(1) Mortgages on property existing at the time of the acquisition
thereof;
(2) Mortgages on property of a corporation existing at the time such
corporation is merged into or consolidated with the Company or a Restricted
Subsidiary or at the time of a sale, lease or other disposition of the
properties of such corporation (or a division thereof) as an entirety or
substantially as an entirety to the Company or a Restricted Subsidiary,
provided that any such Mortgage does not extend to any property owned by
the Company or any Restricted Subsidiary immediately prior to such merger,
consolidation, sale, lease or disposition;
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(3) Mortgages on property of a corporation existing at the time such
corporation becomes a Restricted Subsidiary;
(4) Mortgages in favor of the Company or a Restricted Subsidiary;
(5) Mortgages to secure all or part of the cost of acquisition,
construction, development or improvement of the underlying property, or to
secure Debt incurred to provide funds for any such purpose, provided that
the commitment of the creditor to extend the credit secured by any such
Mortgage shall have been obtained not later than 270 days after the later
of (A) the completion of the acquisition, construction, development or
improvement of such property or (B) the placing in operation of such
property;
(6) Mortgages in favor of the United States of America or any State
thereof, or any department, agency or instrumentality or political
subdivision thereof, to secure partial, progress, advance or other
payments; and
(7) Mortgages existing on the date of this Indenture or any extension,
renewal, replacement or refunding of any Debt secured by a Mortgage
existing on the date of this Indenture or referred to in clauses (1) to (3)
or (5) of this Section 1008, provided that the principal amount of Debt
secured thereby and not otherwise authorized by clauses (1) to (3) or (5)
shall not exceed the principal amount of Debt, plus any premium or fee
payable in connection with any such extension, renewal, replacement or
refunding, so secured at the time of such extension, renewal, replacement
or refunding.
Section 1009. Limitation on Sales and Leasebacks.
Unless otherwise indicated with respect to any series of Securities,
the Company agrees as to each series of Securities, that it will not, and it
will not permit any Restricted Subsidiary to, enter into any Sale and Leaseback
Transaction with respect to any Operating Property unless:
(1) the Sale and Leaseback Transaction is solely with the Company or
another Restricted Subsidiary;
(2) the lease is for a period not in excess of twenty-four months,
including renewals;
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(3) the Company or such Restricted Subsidiary would (at the time of
entering into such arrangement) be entitled as described in clauses (1)
through (7) of Section 1008, without equally and ratably securing the
Securities of each series then outstanding, to create, incur, issue, assume
or guarantee Debt secured by a Mortgage on such Operating Property in the
amount of the Attributable Debt arising from such Sale and Leaseback
Transaction;
(4) the Company or such Restricted Subsidiary within 270 days after
the sale of such Operating Property in connection with such Sale and
Leaseback Transaction is completed, applies an amount equal to the greater
of (i) the net proceeds of the sale of such Operating Property or (ii) the
fair market value of such Operating Property to (A) the retirement of
Securities, other Funded Debt of the Company ranking on a parity with the
Securities or Funded Debt of a Restricted Subsidiary or (B) the purchase of
Operating Property; or
(5) the Attributable Debt of the Company and its Restricted
Subsidiaries in respect of such Sale and Leaseback Transaction and all
other Sale and Leaseback Transactions entered into after the date of this
Indenture (other than any such Sale and Leaseback Transactions as would be
permitted as described in clauses (1) through (4) of this Section 1009),
plus the aggregate principal amount of Debt secured by Mortgages on
Operating Properties then outstanding (not including any such Debt secured
by Mortgages described in clauses (1) through (6) of Section 1008) which do
not equally and ratably secure such Outstanding Securities (or secure such
Outstanding Securities on a basis that is prior to other Debt secured
thereby), would not exceed 10% of Consolidated Net Tangible Assets.
Section 1010. Limitation on Debt of Restricted Subsidiaries.
Unless otherwise indicated, with respect to any series of Securities,
the Company agrees as to each series of Securities, that it will not permit any
Restricted Subsidiary to create, incur, issue, assume or guaranty any Debt,
except: (i) Debt outstanding on the date of the Indenture; (ii) Debt issued to
and held by the Company or a wholly-owned Restricted Subsidiary; (iii) Debt
created, incurred, issued, assumed or guaranteed by a Person prior to the time
the Person became, merges into, or consolidates with such Person and thereby
such Person becomes a Restricted Subsidiary
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(which Debt was not incurred in anticipation of such transaction and was
outstanding prior to such transaction); (iv) Debt incurred to provide funds for
all or part of the cost of acquisition, construction, development or improvement
of property, provided that the commitment of the creditor to extend the credit
evidenced by such Debt shall have been obtained not later than 270 days after
the later of (a) the completion of the acquisition, construction, development or
improvement of such property or (b) the placing in operation of such property;
(v) Debt which is exchanged for, or the proceeds of which are used to replace or
refund, any Debt permitted to be outstanding pursuant to clauses (i) through
(iv) above (or any extension or renewal thereof), in an aggregate principal
amount not to exceed the principal amount of the Debt so exchanged, replaced or
refunded; and (vi) Debt not otherwise permitted pursuant to clauses (i) through
(v) above that, together with any other outstanding Debt created, incurred,
issued, assumed or guaranteed pursuant to this clause (vi), has an aggregate
principal amount at any time outstanding that does not exceed 15% of
Consolidated Net Tangible Assets.
Section 1011. Waiver of Certain Covenants.
The Company may omit in any particular instance to comply with any
term, provision or condition set forth in Sections 1005 to 1010, inclusive, with
respect to the Securities of any series if before or after the time for such
compliance the Holders of at least a majority in principal amount of the
Outstanding Securities of such series shall, by Act of such Holders, either
waive such compliance in such instance or generally waive compliance with such
term, provision or condition, but no such waiver shall extend to or affect such
term, provision or condition except to the extent so expressly waived, and,
until such waiver shall become effective, the obligations of the Company and the
duties of the Trustee in respect of any such term, provision or condition shall
remain in full force and effect.
Section 1012. Calculation of Original Issue Discount.
If the Trustee is requested or required to send Form 1099 (or any
successor form) to Holders of Original Issue Discount Securities, the Company
shall file with the Trustee promptly at the end of each calendar year (i) a
written notice specifying the amount of original issue discount (including daily
rates and accrual periods) accrued on Outstanding Securities as of the end of
such year and (ii) such other specific information relating to such
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original issue discount as may then be relevant under the Internal Revenue Code
of 1986, as amended from time to time.
ARTICLE ELEVEN
Redemption of Securities
Section 1101. Applicability of Article.
Securities of any series which are redeemable in whole or in part
before their Stated Maturity shall be redeemable in accordance with their terms
and (except as otherwise specified as contemplated by Section 301 for Securities
of any series) in accordance with this Article.
Section 1102. Election to Redeem: Notice to Trustee.
The election of the Company to redeem any Securities shall be
evidenced by or pursuant to a Board Resolution. In case of any redemption at the
election of the Company of the Securities of any series, the Company shall, at
least 60 days prior to the Redemption Date fixed by the Company (unless a
shorter notice shall be satisfactory to the Trustee), notify the Trustee of such
Redemption Date, of the principal amount of Securities of such series to be
redeemed and, if applicable, of the tenor of the Securities to be redeemed. In
the case of any redemption of Securities prior to the expiration of any
restriction on such redemption provided in the terms of such Securities or
elsewhere in this Indenture, the Company shall furnish the Trustee with an
Officers' Certificate evidencing compliance with such restriction.
Section 1103. Selection by Trustee of Securities
to Be Redeemed.
If less than all the Securities of any series are to be redeemed
(unless all of the Securities of such series and of a specified tenor are to be
redeemed), the particular Securities to be redeemed shall be selected not more
than 60 days prior to the Redemption Date by the Trustee, from the Outstanding
Securities of such series not previously called for redemption, by such method
as the Trustee shall deem fair and appropriate and which may provide for the
selection for redemption a portion of the principal amount of any Security of
such series, provided that the unredeemed portion of the principal amount of any
Security shall be in an authorized denomination (which shall not be less than
the minimum authorized denomination) for such Security. If less
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than all of the Securities of such series and of a specified tenor are to be
redeemed, the particular Securities to be redeemed shall be selected not more
than 60 days prior to the Redemption Date by the Trustee, from the Outstanding
Securities of such series and specified tenor not previously called for
redemption in accordance with the preceding sentence.
The Trustee shall promptly notify the Company in writing of the
Securities selected for redemption and, in the case of any Securities selected
for partial redemption, the principal amount thereof to be redeemed.
The provisions of the two preceding paragraphs shall not apply with
respect to any redemption affecting only a single Security, whether such
Security is to be redeemed in whole or in part. In the case of any such
redemption in part, the unredeemed portion of the principal amount of the
Security shall be in an authorized denomination (which shall not be less than
the minimum authorized denomination) for such Security.
For all purposes of this Indenture, unless the context otherwise
requires, all provisions relating to the redemption of Securities shall relate,
in the case of any Securities redeemed or to be redeemed only in part, to the
portion of the principal amount of such Securities which has been or is to be
redeemed.
Section 1104. Notice of Redemption.
Notice of redemption shall be given by first-class mail, postage
prepaid, mailed not less than 30 nor more than 60 days prior to the Redemption
Date, to each Holder of Securities to be redeemed, at his address appearing in
the Security Register.
All notices of redemption shall identify the Securities to be redeemed
(including CUSIP numbers) and shall state:
(1) the Redemption Date,
(2) the Redemption Price,
(3) if less than all the Outstanding Securities of any series are to
be redeemed, the identification (and, in the case of partial redemption of
any Securities, the principal amounts) of the particular Securities to be
redeemed,
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(4) that on the Redemption Date the Redemption Price will become due
and payable upon each such Security, or portion thereof, to be redeemed
and, if applicable, that interest thereon will cease to accrue on and after
said date,
(5) the place or places where such Securities are to be surrendered
for payment of the Redemption Price, and
(6) that the redemption is for a sinking fund, if such is the case.
Notice of redemption of Securities to be redeemed at the election of
the Company shall be given by the Company or, at the Company's request, by the
Trustee in the name and at the expense of the Company and shall be irrevocable.
Section 1105. Deposit of Redemption Price.
Prior to 12:00 noon New York City time on any Redemption Date, the
Company shall deposit with the Trustee or with a Paying Agent (or, if the
Company is acting as its own Paying Agent, segregate and hold in trust as
provided in Section 1003) an amount of money in the currency or currencies in
which the Securities of such series are payable (except as otherwise specified
pursuant to Section 301 for the Securities of such series) sufficient to pay the
Redemption Price of, and (except if the Redemption Date shall be an Interest
Payment Date) accrued interest on, all the Securities or portions thereof which
are to be redeemed on that date.
Section 1106. Securities Payable on Redemption Date.
Notice of redemption having been given as aforesaid, the Securities
so to be red eemed shall, on the Redemption Date, become due and payable at the
Redemption Price therein specified, and from and after such date (unless the
Company shall default in the payment of the Redemption Price and accrued
interest) such Securities shall cease to bear interest. Upon surrender of any
such Security for redemption in accordance with said notice, such Security shall
be paid by the Company at the Redemption Price, together with accrued interest
to the Redemption Date; provided, however, that, unless otherwise specified as
contemplated by Section 301, installments of interest whose Stated Maturity is
on or prior to the Redemption Date shall be payable to the Holders of such
Securities, or one or more Predecessor Securities, registered as such at the
close of
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business on the relevant Record Dates according to their terms and the
provisions of Section 307.
If any Security called for redemption shall not be so paid upon
surrender thereof for redemption, the principal and any premium shall, until
paid, bear interest from the Redemption Date at the rate prescribed therefor in
the Security.
Section 1107. Securities Redeemed in Part.
Any Security which is to be redeemed only in part shall be surrendered
at a Place of Payment therefor (with, if the Company or the Trustee so requires,
due endorsement by, or a written instrument of transfer in form satisfactory to
the Company and the Trustee duly executed by, the Holder thereof or his attorney
duly authorized in writing), and the Company shall execute, and the Trustee
shall authenticate and deliver or make available for delivery to the Holder of
such Security without service charge, a new Security or Securities of the same
series and of like tenor, of any authorized denomination as requested by such
Holder, in aggregate principal amount equal to and in exchange for the
unredeemed portion of the principal of the Security so surrendered.
ARTICLE TWELVE
Sinking Funds
Section 1201. Applicability of Article.
The provisions of this Article shall be applicable to any sinking fund
for the retirement of Securities of a series except as otherwise specified as
contemplated by Section 301 for Securities of such series.
The minimum amount of any sinking fund payment provided for by the
terms of Securities of any series is herein referred to as a "mandatory sinking
fund payment", and any payment in excess of such minimum amount provided for by
the terms of Securities of any series is herein referred to as an "optional
sinking fund payment". If provided for by the terms of Securities of any series,
the cash amount of any sinking fund payment may be subject to reduction as
provided in Section 1202. Each sinking fund payment shall be applied to the
redemption of Securities of any series as provided for by the terms of
Securities of such series.
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<PAGE>
Section 1202. Satisfaction of Sinking Fund Payments
with Securities.
The Company (1) may deliver Outstanding Securities of a series (other
than any previously called for redemption) and (2) may apply as a credit
Securities of a series which have been redeemed either at the election of the
Company pursuant to the terms of such Securities or through the application of
permitted optional sinking fund payments pursuant to the terms of such
Securities, in each case in satisfaction of all or any part of any sinking fund
payment with respect to the Securities of such series required to be made
pursuant to the terms of such Securities as provided for by the terms of such
series; provided that such Securities have not been previously so credited. Such
Securities shall be received and credited for such purpose by the Trustee at the
Redemption Price specified in such Securities for redemption through operation
of the sinking fund and the amount of such sinking fund payment shall be reduced
accordingly.
Section 1203. Redemption of Securities for Sinking Fund.
Not less than 45 days prior to each sinking fund payment date for any
series of Securities, the Company will deliver to the Trustee an Officers'
Certificate specifying the amount of the next ensuing sinking fund payment for
that series pursuant to the terms of that series, the portion thereof, if any,
which is to be satisfied by payment of cash and the portion thereof, if any,
which is to be satisfied by delivering and crediting Securities of that series
pursuant to Section 1202 and will also deliver to the Trustee any Securities to
be so delivered. Not less than 30 days before each such sinking fund payment
date the Trustee shall select the Securities to be redeemed upon such sinking
fund payment date in the manner specified in Section 1103 and cause notice of
the redemption thereof to be given in the name of and at the expense of the
Company in the manner provided in Section 1104. Such notice having been duly
given, the redemption of such Securities shall be made upon the terms and in the
manner stated in Sections 1106 and 1107.
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<PAGE>
ARTICLE THIRTEEN
Defeasance and Covenant Defeasance
Section 1301. Applicability of Article; Company's
Option to Effect Defeasance or
Covenant Defeasance.
If pursuant to Section 301 provision is made for either or both of (a)
defeasance of the Securities of a series under Section 1302 or (b) covenant
defeasance of the Securities of a series under Section 1303, then the provisions
of such Section or Sections, as the case may be, together with the other
provisions of this Article Thirteen, with such modifications thereto as may be
specified pursuant to Section 301 with respect to any Securities, shall be
applicable to the Securities of such series, and the Company may at its option
by Board Resolution, at any time, with respect to the Securities of such series,
elect to have either Section 1302 (if applicable) or Section 1303 (if
applicable) applied to the Outstanding Securities of such series upon compliance
with the conditions set forth below in this Article Thirteen.
Section 1302. Defeasance and Discharge.
Upon the Company's exercise of its option to have this Section applied
to any series of Securities the Company shall be deemed to have been discharged
from its obligations with respect to the Outstanding Securities of such series
on and after the date the conditions precedent set forth below are satisfied
(hereinafter, "defeasance"). For this purpose, such defeasance means that the
Company shall be deemed to have paid and discharged the entire indebtedness
represented by the Outstanding Securities of such series which shall thereafter
be deemed to be "Outstanding" only for the purposes of the Sections of this
Indenture referred to in clauses (A) and (B) of this Section, and to have
satisfied all its other obligations under such Securities and this Indenture
insofar as such Securities are concerned (and the Trustee, at the expense of the
Company, shall execute proper instruments acknowledging the same), except for
the following which shall survive until otherwise terminated or discharged
hereunder: (A) the rights of Holders of Outstanding Securities of such series to
receive, solely from the trust fund described in Section 1304 as more fully set
forth in such Section, payments of the principal of (and premium, if any) and
interest on such Securities when such payments are due, (B) the Company's
obligations with respect to such Securities under Sections 305, 306,
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<PAGE>
1002 and 1003 and such obligations as shall be ancillary thereto, (C) the
rights, powers, trusts, duties, immunities and other provisions in respect of
the Trustee hereunder and (D) this Article Thirteen. Subject to compliance with
this Article Thirteen, the Company may exercise its option under this Section
1302 notwithstanding the prior exercise of its option under Section 1303 with
respect to the Securities of such series. Following a defeasance, payment of
such Securities may not be accelerated because of an Event of Default.
Section 1303. Covenant Defeasance.
Upon the Company's exercise of its option (if any) to have this
Section applied to any series of Securities (1) the Company shall be released
from its obligations under Sections 801, 1008, 1009 and 1010 (and any covenant
made applicable to such Securities pursuant to Section 301 to be subject to this
provision) and the occurrence of an event specified in Section 501(4) (with
respect to any of Sections 801, 1008, 1009 or 1010) (and any other Event of
Default applicable to such Securities that are determined pursuant to Section
301 to be subject to this provision) shall not be deemed to be an Event of
Default with respect to the Outstanding Securities of such series on and after
the date the conditions set forth below are satisfied (hereinafter, "covenant
defeasance"), and such Securities shall thereafter be deemed not to be
"Outstanding" for the purposes of any direction, waiver, consent or declaration
or Act of Holders (and the consequences of any thereof) in connection with
Sections 801, 1008, 1009 and 1010 (and any other covenant made applicable to
such Security pursuant to Section 301), but shall continue to be deemed
"Outstanding" for all other purposes hereunder. For this purpose, such covenant
defeasance means that, with respect to the Outstanding Securities of such
series, the Company may omit to comply with and shall have no liability in
respect of any term, condition or limitation set forth in any such Section or
such other covenant whether directly or indirectly by reason of any reference
elsewhere herein to any such Section or such other covenant or by reason of any
reference in any such Section or such other covenant to any other provision
herein or in any other document, but the remainder of this Indenture and such
Securities shall be unaffected thereby.
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<PAGE>
Section 1304. Conditions to Defeasance or
Covenant Defeasance.
The following shall be the conditions precedent to application of
either Section 1302 or Section 1303 to the Outstanding Securities of or within
such series:
(1) The Company shall irrevocably have deposited or caused to be
deposited with the Trustee (or another trustee satisfying the requirements
of Section 609 who shall agree to comply with the provisions of this
Article Thirteen applicable to it) as trust funds in trust for the purpose
of making the following payments, specifically pledged as security for, and
dedicated solely to, the benefit of the Holders of such Securities, (A)
money in an amount (in such currency, currencies or currency units in which
such Securities are then specified as payable at Maturity), or (B) U.S.
Government Obligations which through the scheduled payment of principal and
interest in respect thereof in accordance with their terms will provide,
not later than one day before the due date of any payment, money in an
amount, or (C) a combination thereof in an amount, sufficient, without
reinvestment, in the opinion of a nationally recognized firm of independent
public accountants expressed in a written certification thereof delivered
to the Trustee, to pay and discharge, and which shall be applied by the
Trustee (or other qualifying trustee) to pay and discharge, (i) the
principal of (and premium, if any) and interest on the Outstanding
Securities of such series on the Maturity of such principal, premium, if
any, or interest and (ii) any mandatory sinking fund payments applicable to
such Securities on the day on which such payments are due and payable in
accordance with the terms of this Indenture and such Securities. Before
such a deposit the Company may make arrangements satisfactory to the
Trustee for the redemption of Securities at a future date or dates in
accordance with Article Eleven, which shall be given effect in applying the
foregoing. For this purpose, "U.S. Government Obligations" means securities
that are (x) direct obligations of the United States of America for the
payment of which its full faith and credit is pledged or (y) obligations of
a Person controlled or supervised by and acting as an agency or
instrumentality of the United States of America the payment of which is
unconditionally guaranteed as a full faith and credit obligation by the
United States of America, which, in either case, are not callable or
redeemable at the option of the issuer
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<PAGE>
thereof, and shall also include a depositary receipt issued by a bank (as
defined in Section 3(a)(2) of the Securities Act of 1933, as amended) as
custodian with respect to any such U.S. Government Obligation or a specific
payment of principal of or interest on any such U.S. Government Obligation
held by such custodian for the account of the holder of such depositary
receipt, provided that (except as required by law) such custodian is not
authorized to make any deduction from the amount payable to the holder of
such depositary receipt from any amount received by the custodian in
respect of the U.S. Government Obligation or the specific payment of
principal of or interest on the U.S. Government Obligation evidenced by
such depositary receipt.
(2) No Event of Default or event which with notice or lapse of time or
both would become an Event of Default with respect to the Securities of
such series shall have occurred and be continuing (A) on the date of such
deposit or (B) insofar as subsections 501(6) and (7) are concerned, at any
time during the period ending on the 91st day after the date of such
deposit or, if longer, ending on the day following the expiration of the
longest preference period applicable to the Company in respect of such
deposit (it being understood that this condition shall not be deemed
satisfied until the expiration of such period).
(3) Such defeasance or covenant defeasance shall not (A) cause the
Trustee for the Securities of such series to have a conflicting interest as
defined in Section 608 or for purposes of the Trust Indenture Act with
respect to any securities of the Company or (B) result in the trust arising
from such deposit to constitute, unless it is qualified as, a regulated
investment company under the Investment Company Act of 1940, as amended.
(4) Such defeasance or covenant defeasance shall not result in a
breach or violation of, or constitute a default under, this Indenture or
any other material agreement or instrument to which the Company is a party
or by which it is bound.
(5) In the case of an election under Section 1302, the Company shall
have delivered to the Trustee an Opinion of Counsel stating that (x) the
Company has received from, or there has been published by, the Internal
Revenue Service a ruling, or (y) since the
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<PAGE>
date of this Indenture there has been a change in the applicable Federal
income tax law, in either case to the effect that, and based thereon such
opinion shall confirm that, the Holders of the Outstanding Securities of
such series will not recognize income, gain or loss for Federal income tax
purposes as a result of such defeasance and will be subject to Federal
income tax on the same amounts, in the same manner and at the same times as
would have been the case if such defeasance had not occurred.
(6) In the case of an election under Section 1303, the Company shall
have delivered to the Trustee an Opinion of Counsel to the effect that the
Holders of the Outstanding Securities of such series will not recognize
income, gain or loss for Federal income tax purposes as a result of such
covenant defeasance and will be subject to Federal income tax on the same
amounts, in the same manner and at the same times as would have been the
case if such covenant defeasance had not occurred.
(7) Such defeasance or covenant defeasance shall be effected in
compliance with any additional terms, conditions or limitations which may
be imposed on the Company in connection therewith pursuant to Section 301.
(8) The Company shall have delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel, each stating that all conditions
precedent provided for relating to either the defeasance under Section 1302
or the covenant defeasance under Section 1303 (as the case may be) have
been complied with.
Section 1305. Deposited Money and U.S. Government
Obligations to be Held in Trust; Other
Miscellaneous Provisions.
Subject to the provisions of the last paragraph of Section 1003, all
money and U.S. Government Obligations (including the proceeds thereof) deposited
with the Trustee or other qualifying trustee (collectively, for purposes of this
Section 1305, the "Trustee") pursuant to Section 1304 in respect of the
Outstanding Securities of such series shall be held in trust and applied by the
Trustee, in accordance with the provisions of such Securities and this
Indenture, to the payment, either directly or through any Paying Agent (but not
including the Company acting as its own Paying Agent) as the Trustee may
determine, to the
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<PAGE>
Holders of such Securities, of all sums due and to become due thereon in respect
of principal (and premium, if any) and interest, but such money need not be
segregated from other funds except to the extent required by law.
The Company shall pay and indemnify the Trustee against any tax, fee
or other charge imposed on or assessed against the money or U.S. Government
Obligations deposited pursuant to Section 1304 or the principal and interest
received in respect thereof.
Anything herein to the contrary notwithstanding, the Trustee shall
deliver or pay to the Company from time to time upon Company Request any money
or U.S. Government Obligations held by it as provided in Section 1304 which in
the opinion of a nationally recognized firm of independent public accountants
expressed in a written certification thereof delivered to the Trustee, are in
excess of the amount thereof which would then be required to be deposited to
effect an equivalent defeasance or covenant defeasance.
Section 1306. Reinstatement.
If the Trustee or the Paying Agent is unable to apply any money in
accordance with Section 1305 by reason of any order or judgment or any court or
governmental authority enjoining, restraining or otherwise prohibiting such
application, then the Company's obligations under the Securities of such series
shall be revived and reinstated as though no deposit had occurred pursuant to
this Article Thirteen until such time as the Trustee or Paying Agent is
permitted to apply all such money in accordance with Section 1305; provided,
however, that if the Company makes any payment of principal of (and premium, if
any) or interest on any such Security following the reinstatement of its
obligations, the Company shall be subrogated to the rights of the Holders of
such Securities to receive such payment from the money held by the Trustee or
the Paying Agent.
This instrument may be executed in any number of counterparts, each of
which so executed shall be deemed to be an original, but all such counterparts
shall together constitute but one and the same instrument.
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<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this Indenture to
be duly executed as of the day and year first above written.
PRECISION CASTPARTS CORP.
By ......................................
Name:
Title:
By ......................................
Name:
Title:
THE FIRST NATIONAL BANK OF CHICAGO
By ......................................
Name:
Title:
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<PAGE>
STATE OF OREGON )
) ss.:
COUNTY OF [_______] )
On the _______day of [_________], 1997, before me personally came
________________________ and ______________________, to me known, who, being by
me duly sworn, did depose and say that they are _________________________, and
________________________, respectively, of Precision Castparts Corp., one of the
corporations described in and which executed the foregoing instrument; and that
they signed their names thereto by like authority of the Board of Directors of
said corporation.
.........................................
Notary Public
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<PAGE>
STATE OF ILLINOIS )
) ss.:
COUNTY OF COOK )
On the _________ day of [_________], 1997, before me personally came
________________________, to me known, who, being by me duly sworn, did depose
and say that he is _______________________ of The First National Bank of
Chicago, one of the corporations described in and which executed the foregoing
instrument; that it was so affixed by authority of the Board of Directors of
said corporation, and that she/he signed her/his name thereto by like authority
of the Board of Directors of said corporation.
.........................................
Notary Public
-87-
EXHIBIT 5
November 26, 1997
Board of Directors
Precision Castparts Corp.
4650 SW Macadam Avenue, Suite 440
Portland, Oregon 97201
We have acted as counsel for Precision Castparts Corp., an Oregon
corporation, (the "Company") in connection with the preparation and filing of a
Registration Statement on Form S-3 (the "Registration Statement") under the
Securities Act of 1933, as amended, covering $300,000,000 of Debt Securities of
the Company (the "Debt Securities"). We have reviewed the corporate action of
the Company in connection with this matter and have examined the documents,
corporate records and other instruments we deemed necessary for the purpose of
this opinion.
Based on the foregoing, we are of the opinion that the Company is a
corporation duly organized and validly existing under the laws of the State of
Oregon.
We are further of the opinion that all action necessary to make valid the
proposed issuance of the Debt Securities by the Company will have been taken
when:
(1) the Registration Statement, as it may be amended, shall have become
effective;
(2) certain officers of the Company shall have taken appropriate action
approving certain of the terms of such Debt Securities;
(3) the Indenture shall have been duly executed and delivered; and
(4) the Debt Securities shall have been appropriately issued and delivered
for the consideration contemplated by, and otherwise in conformity
with, the acts, proceedings and documents referred to above.
We are further of the opinion that when the steps set forth in the
immediately preceding paragraph shall have been taken, the Debt Securities will
be duly authorized and binding obligations of the Company.
We consent to the use of our name in the Registration Statement and in the
Prospectus filed as a part thereof and to the filing of this opinion as an
exhibit to the Registration Statement.
Very truly yours,
STOEL RIVES LLP
EXHIBIT 12
PRECISION CASTPARTS CORP.
COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES
<TABLE>
<CAPTION>
Six Months Ended
Fiscal Year ------------------------
----------------------------------------------------------------- Sept. 29, Sept. 28,
1993 1994 1995 1996 1997 1996 1997
--------- ---------- ---------- ---------- ---------- ---------- ----------
(In thousands)
<S> <C> <C> <C> <C> <C> <C> <C>
Income before tax $ (100) $ 37,400 $ 46,800 $ 63,700 $ 95,700 $ 41,800 $ 67,400
Add fixed charges 2,100 2,100 900 1,100 18,100 5,900 10,700
--------- ---------- ---------- ---------- ---------- ---------- ----------
Earnings for computation
purposes 2,000 39,500 47,700 64,800 113,800 47,700 78,100
Fixed charges
Interest on debt, expensed
or capitalized 2,100 2,100 900 1,100 18,100 5,900 10,700
--------- ---------- ---------- ---------- ---------- ---------- ----------
2,100 2,100 900 1,100 18,100 5,900 10,700
Ratio of earnings to fixed
charges 1.0 18.8 53.0 58.9 6.3 8.1 7.3
========= ========== ========== ========== ========== ========== ==========
</TABLE>
EXHIBIT 23.1
CONSENT OF INDEPENDENT ACCOUNTANTS
We hereby consent to the incorporation by reference in the Prospectus
constituting part of this Registration Statement on Form S-3 of our report dated
April 25, 1997, which appears on page 31 of the 1997 Annual Report to
Shareholders of Precision Castparts Corp., which is incorporated by reference in
the Precision Castparts Corp.'s Annual Report on Form 10-K/A for the year ended
March 30, 1997. We also consent to the incorporation by reference of our report
on the Financial Statement Schedule, which appears on page 31 of such Annual
Report on Form 10-K/A. We also consent to the references to us under the
headings "Experts" and "Selected Financial Data" in such Prospectus. However, it
should be noted that Price Waterhouse LLP has not prepared or certified such
"Selected Financial Data."
PRICE WATERHOUSE LLP
Portland, Oregon
November 26, 1997
EXHIBIT 24
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS that the undersigned constitutes and
appoints William C. McCormick, Steven C. Riedel and William D. Larsson, and each
of them, his true and lawful attorneys and agents, with full power of
substitution and resubstitution for him and in his name, place and stead, in any
and all capacities, to sign one or more Form S-3 Registration Statements under
the Securities Act of 1933, prepared in connection with the issuance and/or sale
of shares of Debt Securities of Precision Castparts Corp., and any and all
amendments (including post-effective amendments) thereto, and to file the same,
with all exhibits thereto, and other documents in connection therewith, with the
Securities and Exchange Commission; granting unto said attorneys and agents, and
each of them, full power and authority to do any and all acts and things
necessary or advisable to be done, as fully and to all intents and purposes as
he might or could do in person, hereby ratifying and confirming all that said
attorneys and agents or any of them or their substitute or substitutes, may
lawfully do or cause to be done by virtue hereof.
Dated: November 5, 1997.
/s/ STEVEN C. RIEDEL
-----------------------------------------
Steven C. Riedel, Director
<PAGE>
EXHIBIT 24
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS that the undersigned constitutes and
appoints William C. McCormick, Steven C. Riedel and William D. Larsson, and each
of them, his true and lawful attorneys and agents, with full power of
substitution and resubstitution for him and in his name, place and stead, in any
and all capacities, to sign one or more Form S-3 Registration Statements under
the Securities Act of 1933, prepared in connection with the issuance and/or sale
of shares of Debt Securities of Precision Castparts Corp., and any and all
amendments (including post-effective amendments) thereto, and to file the same,
with all exhibits thereto, and other documents in connection therewith, with the
Securities and Exchange Commission; granting unto said attorneys and agents, and
each of them, full power and authority to do any and all acts and things
necessary or advisable to be done, as fully and to all intents and purposes as
he might or could do in person, hereby ratifying and confirming all that said
attorneys and agents or any of them or their substitute or substitutes, may
lawfully do or cause to be done by virtue hereof.
Dated: November 5, 1997.
/s/ PETER R. BRIDENBAUGH
-----------------------------------------
Peter R. Bridenbaugh, Director
<PAGE>
EXHIBIT 24
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS that the undersigned constitutes and
appoints William C. McCormick, Steven C. Riedel and William D. Larsson, and each
of them, his true and lawful attorneys and agents, with full power of
substitution and resubstitution for him and in his name, place and stead, in any
and all capacities, to sign one or more Form S-3 Registration Statements under
the Securities Act of 1933, prepared in connection with the issuance and/or sale
of shares of Debt Securities of Precision Castparts Corp., and any and all
amendments (including post-effective amendments) thereto, and to file the same,
with all exhibits thereto, and other documents in connection therewith, with the
Securities and Exchange Commission; granting unto said attorneys and agents, and
each of them, full power and authority to do any and all acts and things
necessary or advisable to be done, as fully and to all intents and purposes as
he might or could do in person, hereby ratifying and confirming all that said
attorneys and agents or any of them or their substitute or substitutes, may
lawfully do or cause to be done by virtue hereof.
Dated: November 5, 1997.
/s/ DEAN T. DUCRAY
-----------------------------------------
Dean T. DuCray, Director
<PAGE>
EXHIBIT 24
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS that the undersigned constitutes and
appoints William C. McCormick, Steven C. Riedel and William D. Larsson, and each
of them, his true and lawful attorneys and agents, with full power of
substitution and resubstitution for him and in his name, place and stead, in any
and all capacities, to sign one or more Form S-3 Registration Statements under
the Securities Act of 1933, prepared in connection with the issuance and/or sale
of shares of Debt Securities of Precision Castparts Corp., and any and all
amendments (including post-effective amendments) thereto, and to file the same,
with all exhibits thereto, and other documents in connection therewith, with the
Securities and Exchange Commission; granting unto said attorneys and agents, and
each of them, full power and authority to do any and all acts and things
necessary or advisable to be done, as fully and to all intents and purposes as
he might or could do in person, hereby ratifying and confirming all that said
attorneys and agents or any of them or their substitute or substitutes, may
lawfully do or cause to be done by virtue hereof.
Dated: November 5, 1997.
/s/ DON R. GRABER
-----------------------------------------
Don R. Graber, Director
<PAGE>
EXHIBIT 24
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS that the undersigned constitutes and
appoints William C. McCormick, Steven C. Riedel and William D. Larsson, and each
of them, his true and lawful attorneys and agents, with full power of
substitution and resubstitution for him and in his name, place and stead, in any
and all capacities, to sign one or more Form S-3 Registration Statements under
the Securities Act of 1933, prepared in connection with the issuance and/or sale
of shares of Debt Securities of Precision Castparts Corp., and any and all
amendments (including post-effective amendments) thereto, and to file the same,
with all exhibits thereto, and other documents in connection therewith, with the
Securities and Exchange Commission; granting unto said attorneys and agents, and
each of them, full power and authority to do any and all acts and things
necessary or advisable to be done, as fully and to all intents and purposes as
he might or could do in person, hereby ratifying and confirming all that said
attorneys and agents or any of them or their substitute or substitutes, may
lawfully do or cause to be done by virtue hereof.
Dated: November 5, 1997.
/s/ ROY M. MARVIN
-----------------------------------------
Roy M. Marvin, Director
<PAGE>
EXHIBIT 24
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS that the undersigned constitutes and
appoints William C. McCormick, Steven C. Riedel and William D. Larsson, and each
of them, his true and lawful attorneys and agents, with full power of
substitution and resubstitution for him and in his name, place and stead, in any
and all capacities, to sign one or more Form S-3 Registration Statements under
the Securities Act of 1933, prepared in connection with the issuance and/or sale
of shares of Debt Securities of Precision Castparts Corp., and any and all
amendments (including post-effective amendments) thereto, and to file the same,
with all exhibits thereto, and other documents in connection therewith, with the
Securities and Exchange Commission; granting unto said attorneys and agents, and
each of them, full power and authority to do any and all acts and things
necessary or advisable to be done, as fully and to all intents and purposes as
he might or could do in person, hereby ratifying and confirming all that said
attorneys and agents or any of them or their substitute or substitutes, may
lawfully do or cause to be done by virtue hereof.
Dated: November 5, 1997.
/s/ STEVEN G. ROTHMEIER
-----------------------------------------
Steven G. Rothmeier, Director
<PAGE>
EXHIBIT 24
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS that the undersigned constitutes and
appoints William C. McCormick, Steven C. Riedel and William D. Larsson, and each
of them, his true and lawful attorneys and agents, with full power of
substitution and resubstitution for him and in his name, place and stead, in any
and all capacities, to sign one or more Form S-3 Registration Statements under
the Securities Act of 1933, prepared in connection with the issuance and/or sale
of shares of Debt Securities of Precision Castparts Corp., and any and all
amendments (including post-effective amendments) thereto, and to file the same,
with all exhibits thereto, and other documents in connection therewith, with the
Securities and Exchange Commission; granting unto said attorneys and agents, and
each of them, full power and authority to do any and all acts and things
necessary or advisable to be done, as fully and to all intents and purposes as
he might or could do in person, hereby ratifying and confirming all that said
attorneys and agents or any of them or their substitute or substitutes, may
lawfully do or cause to be done by virtue hereof.
Dated: November 5, 1997.
/s/ VERNON E. OECHSLE
-----------------------------------------
Vernon E. Oechsle, Director
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM T-1
STATEMENT OF ELIGIBILITY
UNDER THE TRUST INDENTURE ACT OF 1939
OF A CORPORATION DESIGNATED TO ACT AS TRUSTEE
CHECK IF AN APPLICATION TO DETERMINE ELIGIBILITY
OF A TRUSTEE PURSUANT TO SECTION 305(b)(2)
THE FIRST NATIONAL BANK OF CHICAGO
(Exact name of trustee as specified in its charter)
A National Banking Association 36-0899825
(I.R.S. employer
identification number)
One First National Plaza, Chicago, Illinois 60670-0126
(Address of principal executive offices) (Zip Code)
The First National Bank of Chicago
One First National Plaza, Suite 0286
Chicago, Illinois 60670-0286
Attn: Lynn A. Goldstein, Law Department (312) 732-6919
(Name, address and telephone number of agent for service)
PRECISION CASTPARTS CORP.
(Exact name of obligor as specified in its charter)
Oregon 93-0460598
(State or other jurisdiction of (I.R.S. employer
incorporation or organization) identification number)
4650 S.W. Macadam Avenue, Suite 440
Portland, Oregon 97201
(Address of principal executive offices) (Zip Code)
Debt Securities
(Title of Indenture Securities)
<PAGE>
Item 1. General Information. Furnish the following information as to the
trustee:
(a) Name and address of each examining or supervising authority to
which it is subject.
Comptroller of Currency, Washington, D.C.,
Federal Deposit Insurance Corporation,
Washington, D.C., The Board of Governors of
the Federal Reserve System, Washington D.C.
(b) Whether it is authorized to exercise corporate trust powers.
The trustee is authorized to exercise corporate trust powers.
Item 2. Affiliations With the Obligor. If the obligor is an affiliate of
the trustee, describe each such affiliation.
No such affiliation exists with the trustee.
Item 16. List of exhibits. List below all exhibits filed as a part of this
Statement of Eligibility.
1. A copy of the articles of association of the trustee now in
effect.*
2. A copy of the certificates of authority of the trustee to
commence business.*
3. A copy of the authorization of the trustee to exercise corporate
trust powers.*
4. A copy of the existing by-laws of the trustee.*
5. Not Applicable.
6. The consent of the trustee required by Section 321(b) of the Act.
2
<PAGE>
7. A copy of the latest report of condition of the trustee published
pursuant to law or the requirements of its supervising or
examining authority.
8. Not Applicable.
9. Not Applicable.
Pursuant to the requirements of the Trust Indenture Act of 1939, as
amended, the trustee, The First National Bank of Chicago, a national
banking association organized and existing under the laws of the United
States of America, has duly caused this Statement of Eligibility to be
signed on its behalf by the undersigned, thereunto duly authorized, all in
the City of Chicago and State of Illinois, on the 6th day of November,
1997.
The First National Bank of Chicago,
Trustee
By /s/ RICHARD D. MANELLA
Richard D. Manella
Vice President and Senior Counsel
* Exhibits 1, 2, 3 and 4 are herein incorporated by reference to Exhibits
bearing identical numbers in Item 16 of the Form T-1 of The First National Bank
of Chicago, filed as Exhibit 25.1 to the Registration Statement on Form S-3 of
SunAmerica Inc. filed with the Securities and Exchange Commission on October 25,
1996 (Registration No. 333-14201).
3
<PAGE>
EXHIBIT 6
THE CONSENT OF THE TRUSTEE REQUIRED
BY SECTION 321(b) OF THE ACT
November 6, 1997
Securities and Exchange Commission
Washington, D.C. 20549
Gentlemen:
In connection with the qualification of an indenture between Precision Castparts
Corp. and The First National Bank of Chicago, the undersigned, in accordance
with Section 321(b) of the Trust Indenture Act of 1939, as amended, hereby
consents that the reports of examinations of the undersigned, made by Federal or
State authorities authorized to make such examinations, may be furnished by such
authorities to the Securities and Exchange Commission upon its request therefor.
Very truly yours,
The First National Bank of Chicago
By: /s/ RICHARD D. MANELLA
Richard D. Manella
Vice President and Senior Counsel
4
<PAGE>
EXHIBIT 7
Legal Title of Bank: The First National Bank of Chic Call Date: 06/30/97
ST-BK: 17-1630 FFIEC 031
Address: One First National Plaza, Ste 0303 Page RC-1
City, State Zip: Chicago, IL 60670
FDIC Certificate No.: 0/3/6/1/8
Consolidated Report of Condition for Insured Commercial
and State-Chartered Savings Banks for June 30, 1997
All schedules are to be reported in thousands of dollars. Unless otherwise
indicated, report the amount outstanding as of the last business day of the
quarter.
Schedule RC--Balance Sheet
<TABLE>
<CAPTION>
C400
Dollar Amounts in ------------
Thousands RCFD BIL MIL THOU
----------------- ---- ------------
<S> <C> <C> <C> <C>
ASSETS
1. Cash and balances due from depository institutions (from
Schedule RC-A):
a. Noninterest-bearing balances and currency and coin(1)......... 0081 4,415,563 1.a.
b. Interest-bearing balances(2).................................. 0071 7,049,275 1.b.
2. Securities
a. Held-to-maturity securities(from Schedule RC-B, column A)..... 1754 0 2.a.
b. Available-for-sale securities (from Schedule RC-B, column D).. 1773 4,455,173 2.b.
3. Federal funds sold and securities purchased under agreements to
resell........................................................... 1350 4,604,233 3.
4. Loans and lease financing receivables:
a. Loans and leases, net of unearned income (from Schedule
RC-C)............................................................ RCFD 2122 24,185,099 4.a.
b. LESS: Allowance for loan and lease losses..................... RCFD 3123 423,419 4.b.
c. LESS: Allocated transfer risk reserve......................... RCFD 3128 0 4.c.
d. Loans and leases, net of unearned income, allowance, and
reserve (item 4.a minus 4.b and 4.c).......................... 2125 23,761,680 4.d.
5. Trading assets (from Schedule RD-D).............................. 3545 6,930,216 5.
6. Premises and fixed assets (including capitalized leases)......... 2145 705,704 6.
7. Other real estate owned (from Schedule RC-M)..................... 2150 7,960 7.
8. Investments in unconsolidated subsidiaries and associated
companies (from Schedule RC-M)................................... 2130 64,504 8.
9. Customers' liability to this bank on acceptances outstanding 2155 562,251 9.
10. Intangible assets (from Schedule RC-M)........................... 2143 283,716 10.
11. Other assets (from Schedule RC-F)................................ 2160 1,997,778 11.
12. Total assets (sum of items 1 through 11)......................... 2170 54,837,423 12.
- --------------
(1) Includes cash items in process of collection and unposted debits.
(2) Includes time certificates of deposit not held for trading.
</TABLE>
5
<PAGE>
Legal Title of Bank: The First National Bank of Chicago Call Date: 06/30/97
ST-BK: 17-1630 FFIEC 031
Address: One First National Plaza, Ste 0303 Page RC-2
City, State Zip: Chicago, IL 60670
FDIC Certificate No.: 0/3/6/1/8
Schedule RC-Continued
<TABLE>
<CAPTION>
C400
Dollar Amounts in ------------
Thousands BIL MIL THOU
----------------- ------------
<S> <C> <C> <C>
LIABILITIES
13. Deposits:
a. In domestic offices (sum of totals of columns A and C
from Schedule RC-E, part 1).................................. RCON 2200 21,852,164 13.a
(1) Noninterest-bearing(1)................................... RCON 6631 9,474,510 13.a.1
(2) Interest-bearing......................................... RCON 6636 12,377,654 13.a.2
b. In foreign offices, Edge and Agreement subsidiaries, and
IBFs (from Schedule RC-E, part II)........................... RCFN 2200 13,756,280 13.b.
(1) Noninterest bearing...................................... RCFN 6631 330,030 13.b.1
(2) Interest-bearing......................................... RCFN 6636 13,426,250 13.b.2
14. Federal funds purchased and securities sold under agreements
to repurchase: RCFD 2800 3,827,159 14
15. a. Demand notes issued to the U.S. Treasury..................... RCON 2840 40,307 15.a
b. Trading Liabilities(from Schedule RC-D)...................... RCFD 3548 4,985,577 15.b
16. Other borrowed money:
a. With original maturity of one year or less.... RCFD 2332 2,337,018 16.a
b. With original maturity of more than one year through
three years.................................................. A547 265,393 16.b
c. With a remaining maturity of more than three years .......... A548 322,175 16.c
17. Not applicable
18. Bank's liability on acceptance executed and outstanding......... RCFD 2920 562,251 18
19. Subordinated notes and debentures (2)........................... RCFD 3200 1,700,000 19
20. Other liabilities (from Schedule RC-G).......................... RCFD 2930 929,875 20
21. Total liabilities (sum of items 13 through 20).................. RCFD 2948 50,618,199 21
22. Not applicable
EQUITY CAPITAL
23. Perpetual preferred stock and related surplus................... RCFD 3838 0 23
24. Common stock.................................................... RCFD 3230 200,858 24
25. Surplus (exclude all surplus related to preferred stock)........ RCFD 3839 2,948,616 25
26. a. Undivided profits and capital reserves....................... RCFD 3632 1,059,214 26.a.
b. Net unrealized holding gains (losses) on available-for-sale
securities................................................... RCFD 8434 12,788 26.b.
27. Cumulative foreign currency translation adjustments............. RCFD 3284 (2,252) 27
28. Total equity capital (sum of items 23 through 27)............... RCFD 3210 4,219,224 28
29. Total liabilities and equity capital (sum of items 21 and 28)... RCFD 3300 54,837,423 29
Memorandum
To be reported only with the March Report of Condition.
1. Indicate in the box at the right the number of the statement below that best describes
the most comprehensive level of auditing work performed for the bank by independent
Number
external auditors as of any date during 1996.................... RCFD 6724...............N/A M.1.
1 = Independent audit of the bank conducted in accordance 4. = Directors' examination of the bank performed by other
with generally accepted auditing standards by a certified external auditors (may be required by state chartering
public accounting firm which submits a report on the authority)
bank
2 = Independent audit of the bank's parent holding company 5 = Review of the bank's financial statements by external
conducted in accordance with generally accepted auditing auditors
standards by a certified public accounting firm which 6 = Compilation of the bank's financial statements by
submits a report on the consolidated holding company external auditors
(but not on the bank separately) 7 = Other audit procedures (excluding tax preparation work)
3 = Directors' examination of the bank conducted in 8 = No external audit
work accordance with generally accepted auditing
standards by a certified public accounting firm
(may be required by state chartering authority)
- --------------
(1) Includes total demand deposits and noninterest-bearing time and savings
deposits.
(2) Includes limited-life preferred stock and related surplus.
</TABLE>
6
