Under the programme, notes issued by Cosipa benefit from an unconditional and irrevocable guarantee by Usiminas granted under a deed of guarantee. Notes issued by Usiminas count as unsecured obligations.
The companies can issue Euro Medium Term Notes denominated in US dollars, Japanese yen or euros. They will have maturities of between seven days and three years from the date of issue, and bear interest on a fixed or floating rate basis, or be issued on a fully discounted basis and bear no interest. Although the programme permits notes to be issued on an unlisted basis, application was made to list the notes issued under the programme on the Luxembourg Stock Exchange.

Nicácio Busaferro Nunes, in-house counsel to Usiminas, told LATIN LAWYER that “considering the legal aspects, the programme, as an umbrella contract, represents a very manageable instrument. It permits the company to react immediately to market opportunities, without facing the usual formalities of a completely new transaction.

With regards to the initial issuance, which was used for general corporate purposes, he added that “we worked very hard to take advantage of a favourable market window. That imposed a very rigid timetable, which was just achieved with the full co-operation of the law firms involved.”

BES Investimento do Brasil SA - Banco de Investimento acted as local arranger and dealer, whilst Banco Espírito Santo de Investimento SA (BESI) acted as international arranger and dealer.

Machado, Meyer, Sendacz e Opice Advogados acted as Brazilian counsel to BESI, through partner Nei Schilling Zelmanovits and associate Daniel de Miranda Facó.

It took English counsel from Clifford Chance S/C Consultores em Direito Estrangeiro, through associates Isabel Carvalho Forsman, Charles Johnson and Cyntia Menezes.

The companies were also advised by Usiminas in-house counsel Nicácio Busaferro Nunes.

Sources:   Latin Lawyer Online August./2003
Date of insertion:   15/08/2003 - 16:32:13