EXHIBIT 4.1
EXECUTION COPY
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H&E Equipment Services L.L.C.
and
H&E Finance Corp.
and each of the Guarantors named herein
11 1/8% Senior Secured Notes due 2012
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INDENTURE
Dated as of June 17, 2002
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The Bank of New York
Trustee
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CROSS-REFERENCE TABLE*
TRUST INDENTURE
ACT SECTION INDENTURE SECTION
310(a)(1)................................................................. 7.10
(a)(2)................................................................. 7.10
(a)(3)................................................................. N.A.
(a)(4)................................................................. N.A.
(a)(5)................................................................. 7.10
(b).................................................................... 7.10
(c).................................................................... N.A.
311(a).................................................................... 7.11
(b).................................................................... 7.11
(c).................................................................... N.A.
312(a).................................................................... 2.05
(b).................................................................... 12.03
(c).................................................................... 12.03
313(a).................................................................... 7.06
(b)(1)................................................................. 11.05
(b)(2)................................................................. 7.06; 7.07
(c).................................................................... 7.06; 12.02
(d).................................................................... 7.06
314(a).................................................................... 4.03;12.02; 12.05
(b).................................................................... 11.05
(c)(1)................................................................. 12.04
(c)(2)................................................................. 12.04
(c)(3)................................................................. N.A.
(d).................................................................... 11.05
(e).................................................................... 12.05
(f).................................................................... N.A.
315(a).................................................................... 7.01
(b).................................................................... 7.05,12.02
(c).................................................................... 7.01
(d).................................................................... 7.01
(e).................................................................... 6.11
316(a) (last sentence).................................................... 2.09
(a)(1)(A).............................................................. 6.05
(a)(1)(B).............................................................. 6.04
(a)(2)................................................................. N.A.
(b).................................................................... 6.07
(c).................................................................... 2.12
317(a)(1)................................................................. 6.08
(a)(2)................................................................. 6.09
(b).................................................................... 2.04
318(a).................................................................... 12.01
(b).................................................................... N.A.
(c).................................................................... 12.01
N.A. means not applicable.
* This Cross Reference Table is not part of the
Indenture.
TABLE OF CONTENTS
PAGE
ARTICLE 1.
DEFINITIONS AND INCORPORATION
BY REFERENCE
Section 1.01 Definitions.................................................................1
Section 1.02 Other Definitions..........................................................26
Section 1.03 Incorporation by Reference of Trust Indenture Act..........................26
Section 1.04 Rules of Construction......................................................27
ARTICLE 2.
THE NOTES
Section 2.01 Form and Dating............................................................27
Section 2.02 Execution and Authentication...............................................28
Section 2.03 Registrar and Paying Agent.................................................29
Section 2.04 Paying Agent to Hold Money in Trust........................................29
Section 2.05 Holder Lists...............................................................29
Section 2.06 Transfer and Exchange......................................................29
Section 2.07 Replacement Notes..........................................................41
Section 2.08 Outstanding Notes..........................................................41
Section 2.09 Treasury Notes.............................................................42
Section 2.10 Temporary Notes............................................................42
Section 2.11 Cancellation...............................................................42
Section 2.12 Defaulted Interest.........................................................42
Section 2.13 CUSIP Numbers..............................................................43
ARTICLE 3.
REDEMPTION AND PREPAYMENT
Section 3.01 Notices to Trustee.........................................................43
Section 3.02 Selection of Notes to Be Redeemed or Purchased.............................43
Section 3.03 Notice of Redemption.......................................................44
Section 3.04 Effect of Notice of Redemption.............................................44
Section 3.05 Deposit of Redemption or Purchase Price....................................45
Section 3.06 Notes Redeemed or Purchased in Part........................................45
Section 3.07 Optional Redemption........................................................45
Section 3.08 Mandatory Redemption.......................................................46
Section 3.09 Offer to Purchase by Application of Excess Proceeds........................46
ARTICLE 4.
COVENANTS
Section 4.01 Payment of Notes...........................................................47
Section 4.02 Maintenance of Office or Agency............................................48
Section 4.03 Reports....................................................................48
Section 4.04 Compliance Certificate.....................................................49
Section 4.05 Taxes......................................................................50
Section 4.06 Stay, Extension and Usury Laws.............................................50
Section 4.07 Restricted Payments........................................................50
Section 4.08 Dividend and Other Payment Restrictions Affecting Restricted Subsidiaries..53
Section 4.09 Incurrence of Indebtedness and Issuance of Preferred Stock.................54
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Section 4.10 Asset Sales................................................................56
Section 4.11 Transactions with Affiliates...............................................58
Section 4.12 Liens......................................................................59
Section 4.13 Business Activities........................................................60
Section 4.14 Corporate Existence........................................................60
Section 4.15 Offer to Repurchase Upon Change of Control.................................60
Section 4.16 Sale and Leaseback Transactions............................................62
Section 4.17 Designation of Restricted and Unrestricted Subsidiaries....................62
Section 4.18 Payments for Consent.......................................................62
Section 4.19 Additional Subsidiary Guarantees and Liens.................................63
ARTICLE 5.
SUCCESSORS
Section 5.01 Merger, Consolidation, or Sale of Assets...................................63
Section 5.02 Successor Corporation Substituted..........................................64
ARTICLE 6.
DEFAULTS AND REMEDIES
Section 6.01 Events of Default..........................................................65
Section 6.02 Acceleration...............................................................66
Section 6.03 Other Remedies.............................................................67
Section 6.04 Waiver of Past Defaults....................................................67
Section 6.05 Control by Majority........................................................67
Section 6.06 Limitation on Suits........................................................67
Section 6.07 Rights of Holders of Notes to Receive Payment..............................68
Section 6.08 Collection Suit by Trustee.................................................68
Section 6.09 Trustee May File Proofs of Claim...........................................68
Section 6.10 Priorities.................................................................69
Section 6.11 Undertaking for Costs......................................................69
ARTICLE 7.
TRUSTEE
Section 7.01 Duties of Trustee..........................................................69
Section 7.02 Rights of Trustee..........................................................70
Section 7.03 Individual Rights of Trustee...............................................71
Section 7.04 Trustee's Disclaimer.......................................................71
Section 7.05 Notice of Defaults.........................................................71
Section 7.06 Reports by Trustee to Holders of the Notes.................................72
Section 7.07 Compensation and Indemnity.................................................72
Section 7.08 Replacement of Trustee.....................................................73
Section 7.09 Successor Trustee by Merger, etc...........................................74
Section 7.10 Eligibility; Disqualification..............................................74
Section 7.11 Preferential Collection of Claims Against Company..........................74
ARTICLE 8.
LEGAL DEFEASANCE AND COVENANT DEFEASANCE
Section 8.01 Option to Effect Legal Defeasance or Covenant Defeasance...................74
Section 8.02 Legal Defeasance and Discharge.............................................74
Section 8.03 Covenant Defeasance........................................................75
Section 8.04 Conditions to Legal or Covenant Defeasance.................................75
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Section 8.05 Deposited Money and Government Securities to be Held in Trust; Other
Miscellaneous Provisions.................................................76
Section 8.06 Repayment to Company.......................................................77
Section 8.07 Reinstatement..............................................................77
ARTICLE 9.
AMENDMENT, SUPPLEMENT AND WAIVER
Section 9.01 Without Consent of Holders of Notes........................................77
Section 9.02 With Consent of Holders of Notes...........................................78
Section 9.03 Compliance with Trust
Indenture Act........................................80
Section 9.04 Revocation and Effect of Consents..........................................80
Section 9.05 Notation on or Exchange of Notes...........................................80
Section 9.06 Trustee to Sign Amendments, etc............................................80
ARTICLE 10.
RANKING OF NOTE LIENS
Section 10.01 Agreement for the Benefit of Holders of Priority and Parity Liens..........81
Section 10.02 Ranking....................................................................81
Section 10.03 Lien Sharing with Parity Liens.............................................82
Section 10.04 Restriction on Enforcement of Note Liens and Parity Liens..................83
Section 10.05 Insolvency or Liquidation Proceedings......................................86
Section 10.06 Release of Collateral or Subsidiary Guarantees upon Sale or Other
Disposition..............................................................89
Section 10.07 Amendment of Second-Lien Security Documents................................91
Section 10.08 Waiver of Certain Subrogation, Marshalling, Appraisal and Valuation
Rights...................................................................91
Section 10.09 Limitation on Certain Relief and Defenses..................................93
Section 10.10 Reinstatement..............................................................94
Section 10.11 Amendment; Waiver..........................................................95
Section 10.12 Enforcement................................................................96
Section 10.13 Notes, Subsidiary Guarantees and Other Note Obligations Not Subordinated...96
Section 10.14 Relative Rights............................................................97
ARTICLE 11.
COLLATERAL AND SECURITY
Section 11.01 Second-Lien Security Documents.............................................97
Section 11.02 Collateral Agent...........................................................98
Section 11.03 Authorization of Actions to Be Taken.......................................98
Section 11.04 Release of Note Liens......................................................99
Section 11.05 Filing, Recording and Opinions............................................100
ARTICLE 12.
SUBSIDIARY GUARANTEES
Section 12.01 Guarantee.................................................................101
Section 12.02 Limitation on Guarantor Liability.........................................102
Section 12.03 Execution and Delivery of Subsidiary Guarantee............................103
Section 12.04 Guarantors May Consolidate, etc., on Certain Terms........................103
Section 12.05 Releases..................................................................104
ARTICLE 13.
SATISFACTION AND DISCHARGE
Section 13.01 Satisfaction and Discharge................................................104
Section 13.02 Application of Trust Money................................................105
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ARTICLE 14.
MISCELLANEOUS
Section 14.01 Trust
Indenture Act Controls..............................................106
Section 14.02 Notices...................................................................106
Section 14.03 Communication by Holders of Notes with Other Holders of Notes.............107
Section 14.04 Certificate and Opinion as to Conditions Precedent........................107
Section 14.05 Statements Required in Certificate or Opinion.............................107
Section 14.06 Rules by Trustee and Agents...............................................108
Section 14.07 No Personal Liability of Directors, Officers, Employees and Stockholders..108
Section 14.08 Governing Law.............................................................108
Section 14.09 No Adverse Interpretation of Other Agreements.............................108
Section 14.10 Successors................................................................108
Section 14.11 Severability..............................................................108
Section 14.12 Counterpart Originals.....................................................108
Section 14.13 Table of Contents, Headings, etc..........................................109
EXHIBITS
Exhibit A1 FORM OF NOTE
Exhibit A2 FORM OF REGULATION S TEMPORARY GLOBAL NOTE
Exhibit B FORM OF CERTIFICATE OF TRANSFER
Exhibit C FORM OF CERTIFICATE OF EXCHANGE
Exhibit D FORM OF CERTIFICATE OF ACQUIRING INSTITUTIONAL ACCREDITED INVESTOR
Exhibit E FORM OF NOTE GUARANTEE
Exhibit F FORM OF SUPPLEMENTAL
INDENTURE
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INDENTURE dated as of June 17, 2002 between H&E Equipment Services
L.L.C., a Louisiana limited liability company ("H&E LLC"), H&E Finance Corp., a
Delaware corporation ("H&E FINANCE" and together with H&E LLC, the "COMPANY"),
the Guarantors (as defined) and The Bank of
New York, a
New York banking
corporation as trustee (the "TRUSTEE").
The Company, the Guarantors and the Trustee agree as follows for the
benefit of each other and for the equal and ratable benefit of the Holders (as
defined) of the 11 1/8% Senior Secured Notes due 2012 (the "NOTES"):
ARTICLE 1.
DEFINITIONS AND INCORPORATION
BY REFERENCE
Section 1.01 DEFINITIONS.
"144A GLOBAL NOTE" means a Global Note substantially in the form of
Exhibit A1 hereto bearing the Global Note Legend and the Private Placement
Legend and deposited with or on behalf of, and registered in the name of, the
Depositary or its nominee that will be issued in a denomination equal to the
outstanding principal amount of the Notes sold in reliance on Rule 144A.
"ACQUIRED DEBT" means, with respect to any specified Person:
(1) Indebtedness of any other Person existing at the time such
other Person is merged with or into or became a Subsidiary of such
specified Person, whether or not such Indebtedness is incurred in
connection with, or in contemplation of, such other Person merging
with or into, or becoming a Subsidiary of, such specified Person; and
(2) Indebtedness secured by a Lien encumbering any asset acquired
by such specified Person.
"ADDITIONAL NOTES" means an unlimited amount of Notes (other than the
Initial Notes) issued under this
Indenture in accordance with Sections 2.02 and
4.09 hereof, as part of the same class as the Initial Notes.
"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 purposes of this definition, "control,"
as used with respect to any Person, means the possession, directly or
indirectly, of the power to direct or cause the direction of the management or
policies of such Person, whether through the ownership of voting securities, by
agreement or otherwise; PROVIDED that beneficial ownership of 10% or more of the
Voting Stock of a Person will be deemed to be control. For purposes of this
definition, the terms "controlling," "controlled by" and "under common control
with" have correlative meanings.
"AFFILIATE AGREEMENTS" means the Contribution Agreement, the
Securityholders Agreement, the Registration Rights Agreement and the Operating
Agreement, each as described in "Certain Relationships and Related Transactions"
in the Offering Circular.
"AGENT" means any Registrar, co-registrar, Paying Agent or additional
paying agent.
"APPLICABLE PROCEDURES" means, with respect to any transfer or
exchange of or for beneficial interests in any Global Note, the rules and
procedures of the Depositary, Euroclear and Clearstream that apply to such
transfer or exchange.
1
"ASSET SALE" means:
(1) the sale, lease, conveyance or other disposition of any
assets or rights, other than sales of inventory and equipment in the
ordinary course of business; PROVIDED that the sale, conveyance or
other disposition of all or substantially all of the assets of the
Company and its Subsidiaries taken as a whole will be governed by the
provisions of this Indenture described above under the Section 4.15
and/or the provisions described above under Section 5.01 and not by
the provisions of Section 4.10; and
(2) the issuance of Equity Interests in any of the Company's
Restricted Subsidiaries or the sale by the Company or any of its
Restricted Subsidiaries of Equity Interests in any of its
Subsidiaries.
Notwithstanding the preceding, none of the following items will be
deemed to be an Asset Sale:
(1) any single transaction or series of related transactions that
involves assets having a fair market value of less than $1.0 million;
(2) a transfer of assets between or among the Company and its
Restricted Subsidiaries,
(3) an issuance of Equity Interests by a Subsidiary to the
Company or to another Restricted Subsidiary;
(4) the sale or lease of equipment, inventory, or accounts
receivable in the ordinary course of business;
(5) the sale or other disposition of cash or Cash Equivalents;
(6) a Restricted Payment or Permitted Investment that is
permitted by Section 4.07;
(7) any exchange of property pursuant to Section 1031 on the
Internal Revenue Code of 1986, as amended, for use in a Permitted
Business; and
(8) the licensing of intellectual property.
"ATTRIBUTABLE DEBT" in respect of a sale and leaseback transaction
means, at the time of determination, the present value of the obligation of the
lessee for net rental payments during the remaining term of the lease included
in such sale and leaseback transaction including any period for which such lease
has been extended or may, at the option of the lessor, be extended. Such present
value shall be calculated using a discount rate equal to the rate of interest
implicit in such transaction, determined in accordance with GAAP.
"BANKRUPTCY LAW" means Title 11, U.S. Code or any similar federal or
state law for the relief of debtors.
"BENEFICIAL OWNER" has the meaning assigned to such term in Rule 13d-3
and Rule 13d-5 under the Exchange Act. The terms "Beneficially Owns" and
"Beneficially Owned" have a corresponding meaning.
"BOARD OF DIRECTORS" means:
(1) with respect to a corporation, the board of directors of the
corporation;
2
(2) with respect to a partnership, the Board of Directors of the
general partner of the partnership; and
(3) with respect to any other Person, the board or committee of
such Person serving a similar function.
"BORROWING BASE" means, as of any date, an amount equal to:
(1) 75% of the face amount of all accounts receivable owned by
the Company and its Restricted Subsidiaries as of such date; PLUS
(2) 50% of the book value of all inventory owned by the Company
and its Restricted Subsidiaries as of such date; PLUS
(3) 80% of the book value of the rental equipment owned by the
Company and its Restricted Subsidiaries as of such date; MINUS
(4) 100% of the book value of all inventory and rental equipment
owned by the Company and its Restricted Subsidiaries as of such date,
that were subject to a Lien immediately prior to the use of proceeds
referred to below, securing Indebtedness, other than a Priority Lien,
Note Lien or Parity Lien; MINUS
(5) $125 million.
all calculated on a consolidated basis and in accordance with GAAP and after
giving effect to any incurrence of Indebtedness on such date and the use of
proceeds therefrom.
In the event that information with respect to any element of the
Borrowing Base is not available as of any date then the most recently available
information will be utilized.
"BROKER-DEALER" has the meaning set forth in the Registration Rights
Agreement.
"BRS" means Bruckmann, ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ & Co., Inc.
"BUSINESS DAY" means any day other than a Legal Holiday.
"CAPITAL LEASE OBLIGATION" means, at the time any determination is to
be made, the amount of the liability in respect of a capital lease that would at
that time be required to be capitalized on a balance sheet in accordance with
GAAP.
"CAPITAL STOCK" means:
(1) in the case of a corporation, corporate stock;
(2) in the case of an association or business entity, any and all
shares, interests, participations, rights or other equivalents
(however designated) of corporate stock;
(3) in the case of a partnership or limited liability company,
partnership or membership interests (whether general or limited or
common or preferred); and
(4) any other interest or participation that confers on a Person
the right to receive a share of the profits and losses of, or
distributions of assets of, the issuing Person.
3
"CASH EQUIVALENTS" means:
(1) United States dollars;
(2) securities issued or directly and fully guaranteed or insured
by the United States government or any agency or instrumentality of
the United States government (PROVIDED that the full faith and credit
of the United States is pledged in support of those securities) having
maturities of not more than one year from the date of acquisition;
(3) certificates of deposit and eurodollar time deposits with
maturities of one year or less from the date of acquisition, bankers'
acceptances with maturities not exceeding one year and overnight bank
deposits, in each case, with any lender party to the Credit Agreement
or with any domestic commercial bank having capital and surplus in
excess of $500.0 million and a Thomson Bank Watch Rating of "B" or
better;
(4) repurchase obligations with a term of not more than seven
days for underlying securities of the types described in clauses (2)
and (3) above entered into with any financial institution meeting the
qualifications specified in clause (3) above;
(5) commercial paper having a rating of "P-2" (or higher) from
▇▇▇▇▇'▇ Investors Service, Inc. or "A-3" (or higher) from Standard &
Poor's Rating Services and in each case maturing within one year after
the date of acquisition; and
(6) money market funds at least 95% of the assets of which
constitute Cash Equivalents of the kinds described in clauses (1)
through (5) of this definition.
"CLEARSTREAM" means Clearstream Banking, S.A.
"CHANGE OF CONTROL" means the occurrence of any of the following:
(1) the transfer, conveyance or other disposition (other than by
way of merger or consolidation), in one or a series of related
transactions, of all or substantially all of the properties or assets
of the Company and its Restricted Subsidiaries taken as a whole to any
"person" (as that term is used in Section 13(d)(3) of the Exchange
Act) other than a Principal or a Related Party of a Principal;
(2) the adoption of a plan relating to the liquidation or
dissolution of the Company;
(3) the consummation of any transaction (including, without
limitation, any merger or consolidation) the result of which is that
any "person" (as defined above), other than the Principals and their
Related Parties or a Permitted Group, becomes the Beneficial Owner,
directly or indirectly, of more than 50% of the Voting Stock of the
Company, measured by voting power rather than number of shares; or
(4) the first day on which a majority of the members of the Board
of Directors of the Company are not Continuing Directors.
"COLLATERAL" means property in which the Company or any other Obligor
now or hereafter has rights or the power to transfer a security interest that is
subject to a Note Lien.
4
"COLLATERAL AGENT" means the Trustee in its capacity as the holder of
Liens granted to it pursuant to the Second-Lien Security Documents and any
successor in such capacity and, after transfer of the Note Liens to the Joint
Collateral Agent pursuant to Section 10.03, the Joint Collateral Agent.
"COMPANY" means the issuers, and any and all successors thereto.
"CONSOLIDATED CASH FLOW" means, with respect to any specified Person
for any period, the Consolidated Net Income of such Person for such period PLUS:
(1) an amount equal to any extraordinary loss plus any net loss
realized by such Person or any of its Restricted Subsidiaries in
connection with an Asset Sale, to the extent such losses were deducted
in computing such Consolidated Net Income; PLUS
(2) provision for taxes based on income or profits of such Person
and its Restricted Subsidiaries for such period, to the extent that
such provision for taxes was deducted in computing such Consolidated
Net Income; PLUS
(3) consolidated interest expense of such Person and its
Restricted Subsidiaries for such period, whether paid or accrued and
whether or not capitalized (including, without limitation,
amortization of debt issuance costs and original issue discount,
non-cash interest payments, the interest component of any deferred
payment obligations, the interest component of all payments associated
with Capital Lease Obligations, imputed interest with respect to
Attributable Debt, commissions, discounts and other fees and charges
incurred in respect of letter of credit or bankers' acceptance
financings, and net of the effect of all payments made or received
pursuant to Hedging Obligations), to the extent that any such expense
was deducted in computing such Consolidated Net Income; PLUS
(4) depreciation, amortization (including amortization of
goodwill and other intangibles but excluding amortization of prepaid
cash expenses that were paid in a prior period) and other non-cash
expenses (including impairment charges but excluding any such non-cash
expense to the extent that it represents an accrual of or reserve for
cash expenses in any future period or amortization of a prepaid cash
expense that was paid in a prior period) of such Person and its
Restricted Subsidiaries for such period to the extent that such
depreciation, amortization and other non-cash expenses were deducted
in computing such Consolidated Net Income; PLUS
(5) any management fee payable to BRS or an Affiliate pursuant to
the Management Agreement as is in effect on the date of this Indenture
or as the same may be amended, modified or replaced from time to time
so long as any such amendment, modification or replacement is no less
favorable to the Holders than the contract or agreement as in effect
on the date of this Indenture; PLUS
(6) any non-recurring expenses and charges of the Company or any
of its Restricted Subsidiaries; MINUS
(7) non-cash items increasing such Consolidated Net Income for
such period, other than the accrual of revenue in the ordinary course
of business,
in each case, on a consolidated basis and determined in accordance
with GAAP.
5
"CONSOLIDATED NET INCOME" means, with respect to any specified Person
for any period, the aggregate of the Net Income of such Person and its
Restricted Subsidiaries for such period, on a consolidated basis, determined in
accordance with GAAP; PROVIDED that:
(1) the Net Income (but not loss) of any Person that is not a
Restricted Subsidiary or that is accounted for by the equity method of
accounting will be included only to the extent of the amount of
dividends or distributions paid in cash to the specified Person or a
Restricted Subsidiary of the Person;
(2) the Net Income of any Restricted Subsidiary will be excluded
to the extent that the declaration or payment of dividends or similar
distributions by that Restricted Subsidiary of that Net Income is not
at the date of determination permitted without any prior governmental
approval (that has not been obtained) or, directly or indirectly, by
operation of the terms of its charter or any agreement, instrument,
judgment, decree, order, statute, rule or governmental regulation
applicable to that Restricted Subsidiary or its stockholders;
(3) the Net Income of any Person acquired in a pooling of
interests transaction for any period prior to the date of such
acquisition will be excluded;
(4) the cumulative effect of a change in accounting principles
will be excluded; and
(5) the Net Income (but not loss) of any Unrestricted Subsidiary
will be included only to the extent distributed to the specified
Person or one of its Restricted Subsidiaries.
"CONSOLIDATED TANGIBLE ASSETS" means, with respect to the Company as
of any date, the aggregate of the Tangible Assets of the Company and its
Restricted Subsidiaries as of such date, on a consolidated basis, determined in
accordance with GAAP. In the event that information relating to Consolidated
Tangible Assets is not available as of any date, then the most recently
available information will be utilized.
"CONTINUING DIRECTORS" means, as of any date of determination, any
member of the Board of Directors of the Company who:
(1) was a member of such Board of Directors on the date of this
Indenture;
(2) was nominated for election or elected to such Board of
Directors with the approval of a majority of the Continuing Directors
who were members of such Board at the time of such nomination or
election; or
(3) was nominated by the Principals pursuant to a stockholders',
voting or similar agreement.
"CORPORATE TRUST OFFICE OF THE TRUSTEE" will be at the address of the
Trustee specified in Section 14.02 hereof or such other address as to which the
Trustee may give notice to the Company.
"CREDIT AGREEMENT" means that certain Credit Agreement, dated as of
the date of this Indenture, by and among the Company and the other borrowers
named therein and the credit parties and lenders named therein as well as
General Electric Capital Corporation as Arranger and Administrative Agent,
providing for up to $150.0 million of revolving credit borrowings, including any
related notes, guarantees, collateral documents, instruments and agreements
executed in connection therewith, and in
6
each case as amended, modified, renewed, refunded, replaced or refinanced from
time to time, including increases in principal amount and extensions of term
loans of other financings.
"CREDIT AGREEMENT AGENT" means, at any time, the Person serving at
such time as the "Agent" or "Administrative Agent" under (and as such term is
defined in) the Credit Agreement.
"CREDIT BID RIGHTS" means, in respect of any order relating to a sale
of assets in any Insolvency or Liquidation Proceeding, that:
(1) such order grants the Holders of Notes (individually and in
any combination) the right to bid at the sale of such assets and the
right to offset such Holders' claims secured by Note Liens upon such
assets against the purchase price of such assets if:
(a) the bid of such Holders is the highest bid or otherwise
determined by the Court to be the best offer at the sale;
and
(b) the bid of such Holders includes a cash purchase price
component payable at the closing of the sale in an amount
that would be sufficient on the date of the closing of
the sale to achieve the Discharge of Priority Lien
Indebtedness and to satisfy all liens entitled to
priority over the Priority Liens that attach to the
proceeds of the sale, if such amount were applied on the
date of the sale to the payment in cash of:
(i) all unpaid Priority Lien Obligations (except
Unasserted Contingent Obligations);
(ii) all unpaid claims secured by any such liens
entitled to priority over the Priority Liens; and
(iii) all claims and costs, including those incurred in
connection with the sale by the Priority Lien Agent
or holders of Priority Lien Indebtedness, required
by such order to be paid from the proceeds of the
sale in priority over the Priority Lien
Obligations, whether or not the order requires or
permits such amount to be so applied; and
(2) such order allows the claims of the Holders of Notes in such
Insolvency or Liquidation Proceeding to the extent required for the
grant of such rights.
"CREDIT FACILITIES" means, one or more debt facilities (including,
without limitation, the Credit Agreement) or commercial paper facilities, in
each case with banks or other institutional lenders providing for revolving
credit loans, term loans, receivables financing (including through the sale of
receivables to such lenders or to special purpose entities formed to borrow from
such lenders against such receivables) or letters of credit, in each case, as
amended, restated, modified, renewed, refunded, replaced or refinanced in whole
or in part from time to time; PROVIDED, that no document or facility, other than
the Credit Agreement, will constitute a Credit Facility unless the Company so
identifies such document or facility in an Officers' Certificate and delivers
such certificate to the Trustee; PROVIDED FURTHER, that while the Credit
Agreement remains in effect, the Company is entitled to so identify such
document or facility only in accordance with the terms of the Credit Agreement
(or deliver an Officers' Certificate to the Trustee that the Credit Agreement is
no longer in effect).
"CUSTODIAN" means the Trustee, as custodian with respect to the Notes
in global form, or any successor entity thereto.
7
"DEFAULT" means any event that is, or with the passage of time or the
giving of notice or both would be, an Event of Default.
"DEFINITIVE NOTE" means a certificated Note registered in the name of
the Holder thereof and issued in accordance with Section 2.06 hereof,
substantially in the form of Exhibit A1 hereto except that such Note shall not
bear the Global Note Legend and shall not have the "Schedule of Exchanges of
Interests in the Global Note" attached thereto.
"DEPOSITARY" means, with respect to the Notes issuable or issued in
whole or in part in global form, the Person specified in Section 2.03 hereof as
the Depositary with respect to the Notes, and any and all successors thereto
appointed as depositary hereunder and having become such pursuant to the
applicable provision of this Indenture.
"DEFAULT PURCHASE OPTION" means the right (without any obligation) to
purchase, at any time in the period that begins when all commitments to extend
credit constituting all Priority Lien Indebtedness have terminated and all
Priority Lien Indebtedness has matured (whether at the stated maturity, upon
acceleration or otherwise, including by virtue of the commencement of an
Insolvency or Liquidation Proceeding) and ends on the 20th Business Day after
receipt by the Trustee of written notice of such maturity or termination from
the Priority Lien Agent, all, but not less than all, of the principal of and
interest on and all prepayment or acceleration penalties and premiums in respect
of all Priority Lien Indebtedness outstanding at the time of purchase and all
other Priority Lien Obligations (except Unasserted Contingent Obligations) then
outstanding, together with all Liens securing such Priority Lien Indebtedness
and all Guarantees and other supporting obligations relating to such Priority
Lien Indebtedness:
(1) for a purchase price equal to 100% of the principal amount
and accrued interest outstanding on the Priority Lien Indebtedness on
the date of purchase plus all other Priority Lien Obligations (except
any prepayment or acceleration penalty or premium and any Unasserted
Contingent Obligations) then unpaid;
(2) with such purchase price payable in cash on the date of
purchase against transfer to an Eligible Purchaser or its nominee or
transferee (without recourse and without any representation or
warranty whatsoever, whether as to the enforceability of any Priority
Lien Indebtedness or the validity, enforceability, perfection,
priority or sufficiency of any Lien securing or Guarantee or other
supporting obligation for any Priority Lien Indebtedness or as to any
other matter whatsoever, except only the representation and warranty
that the transferor is transferring free and clear of all Liens and
encumbrances (other than those that will be satisfied and discharged
concurrently with the closing of the purchase from the proceeds of the
purchase price), and has good right to convey, whatever claims and
interests it may have in respect of Priority Lien Indebtedness and any
such Liens, Guarantees and supporting obligations pursuant to the
Priority Lien Documents); and
(3) with such purchase accompanied by a deposit of cash
collateral under the dominion and control of the Priority Lien Agent
in an amount equal to 105% of the undrawn amount of each letter of
credit then outstanding as Priority Lien Indebtedness, as security for
the additional obligation of the purchaser to purchase, at par plus
accrued interest, the reimbursement obligation in respect of such
letter of credit as and when such letter of credit is funded and to
pay all Priority Lien Obligations (other than Unasserted Contingent
Obligations) then outstanding relating to such letter of credit,
8
granted by each holder of Priority Lien Indebtedness in such manner as to be
exercisable and legally enforceable against such holder and its transferees and
successors upon at least ten Business Days' prior written notice of exercise
given to the Priority Lien Agent by (and at the sole option of) an Eligible
Purchaser.
"DISCHARGE OF PARITY LIEN INDEBTEDNESS" means termination of all
commitments to extend credit or purchase debt securities that would constitute
Parity Lien Indebtedness and payment in full in cash of the principal of and
interest and premium (if any) on all Parity Lien Indebtedness and all other
Parity Lien Obligations that are due and payable at the time the Parity Lien
Indebtedness is paid in full in cash.
"DISCHARGE OF PRIORITY LIEN INDEBTEDNESS" means termination of all
commitments to extend credit that would constitute Priority Lien Indebtedness,
payment in full in cash of the principal of and interest and premium (if any) on
all Priority Lien Indebtedness other than undrawn letters of credit, discharge
or cash collateralization (at 105% of the aggregate undrawn amount) of all
letters of credit constituting Priority Lien Indebtedness, and payment in full
in cash of all other Priority Lien Obligations (except Unasserted Contingent
Obligations) that are unpaid at the time the Priority Lien Indebtedness is paid
in full in cash.
"DISQUALIFIED STOCK" means any Capital Stock that, by its terms (or by
the terms of any security into which it is convertible, or for which it is
exchangeable, in each case at the option of the holder of the Capital Stock), or
upon the happening of any event, matures or is mandatorily redeemable, pursuant
to a sinking fund obligation or otherwise, or redeemable at the option of the
holder of the Capital Stock, in whole or in part, on or prior to the date on
which the Notes mature. Notwithstanding the preceding sentence, any Capital
Stock that would constitute Disqualified Stock solely because the holders of the
Capital Stock have the right to require the Company to repurchase such Capital
Stock upon the occurrence of a change of control or an asset sale will not
constitute Disqualified Stock if the terms of such Capital Stock provide that
the Company may not repurchase or redeem any such Capital Stock pursuant to such
provisions unless such repurchase or redemption complies with Section 4.07.
"DOMESTIC RESTRICTED SUBSIDIARY" means any Restricted Subsidiary of
the Company that was formed under the laws of the United States or any state of
the United States or the District of Columbia or that guarantees or otherwise
provides direct credit support for any Indebtedness of the Company.
"ELIGIBLE PURCHASER" means any Person or Persons at any time or from
time to time designated by the holders of at least 25% in outstanding principal
amount of the Notes and Parity Lien Indebtedness (if any), voting as a single
class, as entitled to exercise all Default Purchase Options as to Priority Lien
Indebtedness then outstanding.
"EQUITY INTERESTS" means Capital Stock and all warrants, options or
other rights to acquire Capital Stock (but excluding any debt security that is
convertible into, or exchangeable for, Capital Stock).
"EXCLUDED ASSETS" means:
(1) leasehold interests in real estate;
(2) any fee interest in real estate that, in the good faith
judgment of the Company, has a fair market value of less than $5.0
million;
(3) deposit accounts, as defined in Article 9 of the
New York
Uniform Commercial Code (except that the exclusion of deposit accounts
from the Collateral will not affect, limit or impair
9
any security interest of the Collateral Agent upon any proceeds of
Collateral at any time on deposit in any deposit account);
(4) inventory held for sale or lease (including rental equipment)
that is (i) subject to a perfected purchase money security interest
(as defined in Article 9 of the
New York Uniform Commercial Code)
constituting a Permitted Lien of the type described in clause (8) or
clause (9) of the definition of "Permitted Liens" and (ii) not subject
to any Priority Lien, and (to the extent the holder of any such
purchase-money security interest has a security interest therein that
is entitled as a matter of law, by reason of its purchase-money
priority, to priority over a conflicting security interest) the
identifiable proceeds of any such inventory, except that if at any
time, any Priority Lien attaches to any such inventory or proceeds
under any circumstances, then concurrently and automatically, without
need for any additional grant of a security interest therein, such
inventory or proceeds shall cease to be an Excluded Asset and shall
become and remain part of the Collateral and subject in all respect to
all Note Liens and Parity Liens granted as to inventory in the
Second-Lien Security Documents; and
(5) personal property that is excluded from the coverage of
Article 9 of the
New York Uniform Commercial Code or in respect of
which a security interest created thereunder may not be perfected by
the filing of a financing statement and that has, in the good faith
judgment of the Company, an aggregate fair market value, for all such
personal property, of less than $3.0 million.
"EUROCLEAR" means Euroclear Bank S.A./N.V., as operator of the
Euroclear system.
"EXCHANGE ACT" means the Securities Exchange Act of 1934, as amended.
"EXCHANGE NOTES" means the Notes issued in the Exchange Offer pursuant
to Section 2.06(f) hereof.
"EXCHANGE OFFER" has the meaning set forth in the Registration Rights
Agreement.
"EXCHANGE OFFER REGISTRATION STATEMENT" has the meaning set forth in
the Registration Rights Agreement.
"EXISTING INDEBTEDNESS" means Indebtedness of the Company and its
Subsidiaries (other than Indebtedness under the Credit Agreement) in existence
on the date of this Indenture, until such amounts are repaid.
"FIXED CHARGES" means, with respect to any specified Person for any
period, the sum, without duplication, of:
(1) the consolidated interest expense of such Person and its
Restricted Subsidiaries for such period, whether paid or accrued,
including, without limitation, original issue discount, non-cash
interest payments, the interest component of any deferred payment
obligations, the interest component of all payments associated with
Capital Lease Obligations, imputed interest with respect to
Attributable Debt, commissions, discounts and other fees and charges
incurred in respect of letter of credit or bankers' acceptance
financings, and net of the effect of all payments made or received
pursuant to Hedging Obligations but excluding the amortization of debt
issuance costs; PLUS
(2) the consolidated interest of such Person and its Restricted
Subsidiaries that was capitalized during such period (other than debt
issuance costs); PLUS
10
(3) any interest expense on Indebtedness of another Person that
is Guaranteed by such Person or one of its Restricted Subsidiaries or
secured by a Lien on assets of such Person or one of its Restricted
Subsidiaries, whether or not such Guarantee or Lien is called upon;
PLUS
(4) the product of (a) all dividends, whether paid or accrued and
whether or not in cash, on any series of preferred stock of such
Person or any of its Restricted Subsidiaries, excluding dividends on
Equity Interests payable or accruing solely in Equity Interests of the
Company that are not Disqualified Stock, or to the Company or a
Restricted Subsidiary of the Company, times (b) a fraction, the
numerator of which is one and the denominator of which is one minus
the then current combined federal, state and local statutory tax rate
of such Person, expressed as a decimal, in each case, on a
consolidated basis and in accordance with GAAP.
"FIXED CHARGE COVERAGE RATIO" means with respect to any specified
Person for any period, the ratio of the Consolidated Cash Flow of such Person
for such period to the Fixed Charges of such Person for such period. In the
event that the specified Person or any of its Restricted Subsidiaries incurs,
assumes, Guarantees, repays, repurchases or redeems any Indebtedness (other than
ordinary working capital borrowings) or issues, repurchases or redeems preferred
stock subsequent to the commencement of the period for which the Fixed Charge
Coverage Ratio is being calculated and on or prior to the date on which the
event for which the calculation of the Fixed Charge Coverage Ratio is made (the
"Calculation Date"), then the Fixed Charge Coverage Ratio will be calculated
giving pro forma effect to such incurrence, assumption, Guarantee, repayment,
repurchase or redemption of Indebtedness, or such issuance, repurchase or
redemption of preferred stock, and the use of the proceeds therefrom as if the
same had occurred at the beginning of the applicable four-quarter reference
period.
In addition, for purposes of calculating the Fixed Charge Coverage
Ratio:
(1) acquisitions that have been made by the specified Person or
any of its Restricted Subsidiaries, including through mergers or
consolidations and including any related financing transactions,
during the four-quarter reference period or subsequent to such
reference period and on or prior to the Calculation Date will be given
pro forma effect as if they had occurred on the first day of the
four-quarter reference period and Consolidated Cash Flow for such
reference period will be calculated on a pro forma basis in accordance
with Regulation S-X under the Securities Act, but without giving
effect to clause (3) of the proviso set forth in the definition of
Consolidated Net Income;
(2) the Consolidated Cash flow attributable to discontinued
operations, as determined in accordance with GAAP and operations or
businesses disposed of prior to the Calculation Date, will be
excluded; and
(3) the Fixed Charges attributable to discontinued operations, as
determined in accordance with GAAP, and operations or businesses
disposed of prior to the Calculation Date, will be excluded, but only
to the extent that the obligations giving rise to such Fixed Charges
will not be obligations of the specified Person or any of its
Restricted Subsidiaries following the Calculation Date.
"GAAP" means generally accepted accounting principles set forth in the
opinions and pronouncements of the Accounting Principles Board of the American
Institute of Certified Public Accountants and statements and pronouncements of
the Financial Accounting Standards Board or in such other statements by such
other entity as have been approved by a significant segment of the accounting
11
profession, which are in effect on the date of this Indenture, PROVIDED that
charges for impairments to goodwill will be disregarded for all purposes under
this Indenture.
"GLOBAL NOTES" means, individually and collectively, each of the
Restricted Global Notes and the Unrestricted Global Notes, substantially in the
form of Exhibit A hereto issued in accordance with Section 2.01, 2.06(b)(3),
2.06(b)(4), 2.06(d)(2) or 2.06(f) hereof.
"GLOBAL NOTE LEGEND" means the legend set forth in Section 2.06(g)(2),
which is required to be placed on all Global Notes issued under this Indenture.
"GOVERNMENT SECURITIES" means direct obligations of, or obligations
guaranteed by, the United States of America, and the payment for which the
United States pledges its full faith and credit.
"GUARANTEE" means a guarantee other than by endorsement of negotiable
instruments for collection in the ordinary course of business, direct or
indirect, in any manner including, without limitation, by way of a pledge of
assets or through letters of credit or reimbursement agreements in respect
thereof, of all or any part of any Indebtedness
"GUARANTORS" means each of:
(1) GNE Investments, Inc.;
(2) Great Northern Equipment, Inc.; and
(3) any other subsidiary that executes a Subsidiary Guarantee in
accordance with the provisions of this Indenture;
and their respective successors and assigns.
"HEDGING OBLIGATIONS" means, with respect to any specified Person, the
obligations of such Person under:
(1) interest rate swap agreements, interest rate cap agreements
and interest rate collar agreements; and
(2) other agreements or arrangements designed to protect such
Person against fluctuations in interest rates, currency rates or
commodity prices.
"HOLDER" means a Person in whose name a Note is registered.
"HOLDINGS" means H&E Holdings L.L.C.
"IAI GLOBAL NOTE" means a Global Note substantially in the form of
Exhibit A1 hereto bearing the Global Note Legend and the Private Placement
Legend and deposited with or on behalf of and registered in the name of the
Depositary or its nominee that will be issued in a denomination equal to the
outstanding principal amount of the Notes sold to Institutional Accredited
Investors.
"INDEBTEDNESS" means, with respect to any specified Person, any
indebtedness of such Person, whether or not contingent:
(1) in respect of borrowed money;
12
(2) evidenced by bonds, notes, debentures or similar instruments
or letters of credit (or reimbursement agreements in respect thereof);
(3) in respect of banker's acceptances;
(4) representing Capital Lease Obligations;
(5) representing the balance deferred and unpaid of the purchase
price of any property, except any such balance that constitutes an
accrued expense, trade payable or representing secured floor plan
financing; or
(6) representing any Hedging Obligations,
if and to the extent any of the preceding items (other than letters of credit
and Hedging Obligations) would appear as a liability upon a balance sheet of the
specified Person prepared in accordance with GAAP. In addition, the term
"Indebtedness" includes all Indebtedness of others secured by a Lien on any
asset of the specified Person (whether or not such Indebtedness is assumed by
the specified Person) and, to the extent not otherwise included, the Guarantee
by the specified Person of any indebtedness of any other Person; PROVIDED that
Indebtedness shall not include the pledge of the Capital Stock of an
Unrestricted Subsidiary to secure Indebtedness of such Unrestricted Subsidiary.
The amount of any Indebtedness outstanding as of any date will be:
(1) the accreted value of the Indebtedness, in the case of any
Indebtedness issued with original issue discount; and
(2) the principal amount of the Indebtedness, together with any
interest on the Indebtedness that is more than 30 days past due, in
the case of any other Indebtedness.
"INDENTURE" means this Indenture, as amended or supplemented from time
to time.
"INDIRECT PARTICIPANT" means a Person who holds a beneficial interest
in a Global Note through a Participant.
"INITIAL NOTES" means the first $200 million aggregate principal
amount of Notes issued under this Indenture on the date hereof.
"INITIAL PURCHASERS" means Credit Suisse First Boston Corporation,
Banc of America Securities LLC and Fleet Securities, Inc.
"INSOLVENCY OR LIQUIDATION PROCEEDING" means:
(1) any case commenced by or against the Company or any other
Obligor under any Bankruptcy Law, any other proceeding for the
reorganization, recapitalization or adjustment or marshalling of the
assets or liabilities of the Company or any other Obligor, any
receivership or assignment for the benefit of creditors relating to
the Company or any other Obligor or any similar case or proceeding
relative to the Company or any other Obligor or its creditors, as
such, in each case whether or not voluntary;
13
(2) any liquidation, dissolution, marshalling of assets or
liabilities or other winding up of or relating to the Company or any
other Obligor, in each case whether or not voluntary and whether or
not involving bankruptcy or insolvency; or
(3) any other proceeding of any type or nature in which
substantially all claims of creditors of the Company or any other
Obligor are determined and any payment or distribution is or may be
made on account of such claims.
"INSTITUTIONAL ACCREDITED INVESTOR" means an institution that is an
"accredited investor" as defined in Rule 501(a)(1), (2), (3) or (7) under the
Securities Act, who are not also QIBs.
"INTANGIBLE ASSETS" means goodwill, patents, trade names, trade marks,
copyrights, franchises, experimental expense, organization expenses and any
other assets properly classified as intangible assets in accordance with GAAP.
"INTERCREDITOR AGREEMENT" means any agreement at any time entered into
by the Collateral Agent:
(1) with any Priority Lien Agent, to confirm, elaborate, perform,
implement or give further assurance for any of obligations of the
Holders of notes, the Trustee and the Collateral Agent under Article
10 hereof in any respect that is not materially inconsistent with the
provisions, intents and purposes of Article 10 hereof; or
(2) with the holder of any other Lien upon any Collateral, on
terms not materially inconsistent with the terms of any comparable
agreement entered into with such holder by the Priority Lien Agent in
respect of Priority Liens upon such Collateral or on any other terms
approved by the Trustee (as to which the Trustee is entitled to rely
exclusively on a certificate from an Officer of the Company):
(a) to confirm the priority of such Lien, as against the Note
Liens and any Parity Liens, as to such Collateral;
(b) to subordinate such Lien to the Note Liens and any Parity
Liens or any other Lien;
(c) to confirm the release of any Collateral from such Lien;
(d) to confirm consent by the holder of such Lien to the
attachment of the Note Liens and any Parity Liens to such
Collateral;
(e) to permit the Priority Lien Agent to exercise all powers
granted by the holder of such Lien under such agreement
and to waive or change any of the rights or benefits
granted by such holder thereunder, so long as the waiver
or change applies with like effect to the Note Liens and
Parity Liens as to the Priority Liens; or
(f) to grant, confirm or alter any other rights or
obligations of the holder of such Lien or the Collateral
Agent, as holders of Liens, in respect of such
Collateral, all as the Trustee may determine not to be
materially inconsistent with the provisions, intents and
purposes of "--Security--Ranking of Note Liens" or to be
favorable to the holders of Note Liens or Note
Obligations (which
14
determination may be made solely and conclusively by the
Trustee (as to which the Trustee is entitled to rely
exclusively on a certificate from an Officer of the
Company) and shall be conclusively proven by the
execution and delivery of such agreement by the
Collateral Agent upon the direction of the Trustee).
"INVESTMENTS" means, with respect to any Person, all direct or
indirect investments by such Person in other Persons (including Affiliates) in
the forms of loans (including Guarantees or other obligations), advances or
capital contributions (excluding commission, travel and similar advances to
officers and employees made in the ordinary course of business), purchases or
other acquisitions for consideration of Indebtedness, Equity Interests or other
securities, together with all items that are or would be classified as
investments on a balance sheet prepared in accordance with GAAP. If the Company
or any Restricted Subsidiary of the Company sells or otherwise disposes of any
Equity Interests of any direct or indirect Restricted Subsidiary of the Company
such that, after giving effect to any such sale or disposition, such Person is
no longer a Subsidiary of the Company, the Company will be deemed to have made
an Investment on the date of any such sale or disposition equal to the fair
market value of the Company's Investments in such Subsidiary that were not sold
or disposed of in an amount determined as provided in the final paragraph of
Section 4.07. The acquisition by the Company or any Restricted Subsidiary of the
Company of a Person that holds an Investment in a third Person will be deemed to
be an Investment by the Company or such Restricted Subsidiary in such third
Person in an amount equal to the fair market value of the Investments held by
the acquired Person in such third Person in an amount determined as provided in
the final paragraph of Section 4.07.
"JOINT COLLATERAL AGENT" means a bank or trust company that:
(1) is authorized to exercise corporate trust powers;
(2) is reasonably satisfactory to the Trustee; and
(3) has been appointed by the Company and has agreed, pursuant to
a Joint Collateral Agent Undertaking, to act as collateral agent for
the equal and ratable benefit of all present and future holders of
Notes and Parity Lien Indebtedness, whenever incurred, and also for
the benefit of the present and future holders of all other Note
Obligations and Parity Lien Obligations, in its capacity as such
collateral agent, and any successor in such capacity.
"JOINT COLLATERAL AGENT UNDERTAKING" means a declaration of trust for
a collateral trust, a collateral trust agreement or a collateral agency
agreement executed and delivered by the Company and the Joint Collateral Agent
on customary terms reasonably satisfactory to the Trustee.
"LEGAL HOLIDAY" means a Saturday, a Sunday or a day on which banking
institutions in The City of
New York or at a place of payment are authorized by
law, regulation or executive order to remain closed. If a payment date is a
Legal Holiday at a place of payment, payment may be made at that place on the
next succeeding day that is not a Legal Holiday, and no interest shall accrue on
such payment for the intervening period.
"LETTER OF TRANSMITTAL" means the letter of transmittal to be prepared
by the Company and sent to all Holders of the Notes for use by such Holders in
connection with the Exchange Offer.
"LIEN" means, with respect to any asset, any mortgage, lien, pledge,
charge, security interest or encumbrance of any kind in respect of such asset,
whether or not filed, recorded or otherwise perfected under applicable law,
including any conditional sale or other title retention agreement, any lease in
the nature thereof, any option or other agreement to sell or give a security
interest in and any filing of or
15
agreement to give any financing statement under the Uniform Commercial Code (or
equivalent statutes) of any jurisdiction.
"LIQUIDATED DAMAGES" means all liquidated damages then owing pursuant
to the Registration Rights Agreement.
"MANAGEMENT AGREEMENT" means the agreement the Company entered into in
connection with the ICM Equipment Company L.L.C. recapitalization and the Head &
▇▇▇▇▇▇▇▇ Equipment, L.L.C. recapitalizations with each of BRS and Bruckmann,
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ & Co., L.L.C. ("BRS LLC"), whereby BRS and BRS LLC agreed to
provide certain advisory and consulting services to the Company.
"NET INCOME" means, with respect to any specified Person, the net
income (loss) of such Person, determined in accordance with GAAP and before any
reduction in respect of preferred stock dividends, excluding, however:
(1) any gain (but not loss), together with any related provision
for taxes on such gain (but not loss), realized in connection with:
(a) any Asset Sale; or (b) the disposition of any securities by such
Person or any of its Restricted Subsidiaries or the extinguishment of
any Indebtedness of such Person or any of its Restricted Subsidiaries;
and
(2) any extraordinary gain (but not loss), together with any
related provision for taxes on such extraordinary gain (but not loss).
"NET PROCEEDS" means the aggregate cash proceeds received by the
Company or any of its Restricted Subsidiaries in respect of any Asset Sale
(including, without limitation, any cash received upon the sale or other
disposition of any non-cash consideration received in any Asset Sale), net of
the direct costs relating to such Asset Sale, including, without limitation,
legal, accounting and investment banking fees, and sales commissions, and any
relocation expenses incurred as a result of the Asset Sale, taxes paid or
payable as a result of the Asset Sale, in each case, after taking into account
any available tax credits or deductions and any tax sharing arrangements, and
amounts required to be applied to the repayment of Indebtedness, other than
Indebtedness under a Credit Facility and any reserve for adjustment in respect
of the sale price of such asset or assets established in accordance with GAAP.
"NON-RECOURSE DEBT" means Indebtedness:
(1) as to which neither the Company nor any of its Restricted
Subsidiaries (a) provides credit support of any kind (including any
undertaking, agreement or instrument that would constitute
Indebtedness) (other than the stock of an Unrestricted Subsidiary
pledged to secure Indebtedness of such Unrestricted Subsidiary), (b)
is directly or indirectly liable as a guarantor or otherwise, or (c)
constitutes the lender;
(2) no default with respect to which (including any rights that
the holders of the Indebtedness may have to take enforcement action
against an Unrestricted Subsidiary) would permit upon notice, lapse of
time or both any holder of any other Indebtedness (other than the
Notes) of the Company or any of its Restricted Subsidiaries to declare
a default on such other Indebtedness or cause the payment of the
Indebtedness to be accelerated or payable prior to its stated
maturity; and
(3) as to which the lenders have been notified in writing that
they will not have any recourse to the stock or assets of the Company
or any of its Restricted Subsidiaries (other than the
16
stock of an Unrestricted Subsidiary pledged to secure Indebtedness of
such Unrestricted Subsidiary).
"NON-U.S. PERSON" means a Person who is not a U.S. Person.
"NOTES" has the meaning assigned to it in the preamble to this
Indenture. The Initial Notes and the Additional Notes shall be treated as a
single class for all purposes under this Indenture, and unless the context
otherwise requires, all references to the Notes shall include the Initial Notes
and any Additional Notes.
"NOTE DOCUMENTS" means this Indenture, the Notes, the Subsidiary
Guarantees and the Second-Lien Security Documents.
"NOTE LIEN" means, to the extent securing Note Obligations, a Lien
granted by a Second-Lien Security Document as security for Note Obligations or,
if held by the Joint Collateral Agent, as security for Note Obligations and
Parity Lien Obligations.
"NOTE LIEN ASSIGNMENT" means an instrument reasonably satisfactory to
the Trustee assigning to the Joint Collateral Agent, without recourse and
without any representation, warranty or liability whatsoever, the Note Liens and
all rights, interests, powers and benefits of the Collateral Agent under the
Second-Lien Security Documents.
"NOTE OBLIGATIONS" means the Notes, the Subsidiary Guarantees and all
other Obligations in respect of the Note Documents.
"OBLIGATIONS" means any principal, interest, penalties, fees, taxes,
costs, indemnifications, reimbursements, damages and other liabilities payable
under the documentation governing, securing or relating to any Indebtedness,
whether or not a claim in respect thereof has been asserted.
"OBLIGOR" means a Person obligated as an issuer or guarantor of the
Notes.
"OFFERING CIRCULAR" means the offering circular dated June 3, 2002
relating to the Notes.
"OFFICER" means, with respect to any Person, the Chairman of the
Board, the Chief Executive Officer, the President, the Chief Operating Officer,
the Chief Financial Officer, the Treasurer, any Assistant Treasurer, the
Controller, the Secretary or any Vice-President of such Person.
"OFFICERS' CERTIFICATE" means a certificate signed on behalf of the
Company by two Officers of the Company, one of whom must be the principal
executive officer, the principal financial officer, or the principal accounting
officer of the Company, that meets the requirements of Section 14.05 hereof.
"OPINION OF COUNSEL" means an opinion from legal counsel who is
reasonably acceptable to the Trustee, that meets the requirements of Section
14.05 hereof. The counsel may be an employee of or counsel to the Company, any
Subsidiary of the Company or the Trustee.
"PARITY LIEN" means, to the extent securing Parity Lien Obligations, a
Lien granted by a Second-Lien Security Document and held by the Joint Collateral
Agent as security for Note Obligations and Parity Lien Obligations.
"PARITY LIEN INDEBTEDNESS" means the principal of and interest and
premium (if any) on Indebtedness of the Company permitted to be incurred by
Section 4.09 that:
17
(1) is guaranteed by each Restricted Subsidiary of the Company
which, on the date of incurrence of such Indebtedness, is obligated
under the Subsidiary Guarantees;
(2) is subject to an indenture or agreement which provides, upon
terms substantially comparable to those provisions of this Indenture
described above under Article 10, that the Notes and Subsidiary
Guarantees are equally and ratably secured by all Liens at any time
granted by the Company or any of its Restricted Subsidiaries as
security for such Indebtedness; and
(3) is designated by the Company, in an Officers' Certificate
delivered to the Trustee on or before such date, as Parity Lien
Indebtedness for the purposes of this Indenture.
"PARITY LIEN OBLIGATIONS" means Parity Lien Indebtedness and all other
Obligations in respect thereof.
"PARTICIPANT" means, with respect to the Depositary, Euroclear or
Clearstream, a Person who has an account with the Depositary, Euroclear or
Clearstream, respectively (and, with respect to DTC, shall include Euroclear and
Clearstream).
"PERMITTED BUSINESS" means the equipment sale, rental and leasing
business, the fleet management business and any business that is complementary,
incidental, ancillary or related thereto.
"PERMITTED GROUP" means any group of investors that is deemed to be a
"person" (as that term is used in Section 13(d)(3) of the Exchange Act) at any
time prior to the Company's initial public offering of common stock, by virtue
of the Securityholders Agreement, as the same may be amended, modified or
supplemented from time to time, PROVIDED that no single Person (other than the
Principals and their Related Parties) Beneficially Owns (together with its
Affiliates) more of the Voting Stock of the Company that is Beneficially Owned
by such group of investors than is then collectively Beneficially Owned by the
Principals and their Related Parties in the aggregate.
"PERMITTED INVESTMENTS" means:
(1) any Investment in the Company or in a Restricted Subsidiary
of the Company;
(2) any Investment in Cash Equivalents;
(3) any Investment by the Company or any Restricted Subsidiary of
the Company in a Person, if as a result of such Investment:
(a) such Person becomes a Restricted Subsidiary of the
Company; or
(b) such Person is merged, consolidated or amalgamated
with or into, or transfers or conveys substantially all of its
assets to, or is liquidated into, the Company or a Restricted
Subsidiary of the Company;
(4) any Investment made as a result of the receipt of non-cash
consideration from an Asset Sale that was made pursuant to and in
compliance with Section 4.10;
(5) any acquisition of assets solely in exchange for the issuance
of Equity Interests (other than Disqualified Stock) of the Company;
18
(6) any Investments received in compromise of obligations of such
persons incurred in the ordinary course of trade creditors or
customers that were incurred in the ordinary course of business,
including pursuant to any plan of reorganization or similar
arrangement upon the bankruptcy or insolvency of any trade creditor or
customer;
(7) Hedging Obligations; and
(8) other Investments in any Person having an aggregate fair
market value (measured on the date each such Investment was made and
without giving effect to subsequent changes in value), when taken
together with all other Investments made pursuant to this clause (8)
since the date of this Indenture not to exceed $10.0 million at any
one time outstanding.
"PERMITTED LIENS" means:
(1) Note Liens;
(2) Priority Liens and Parity Liens;
(3) Liens on assets of the Company or any Guarantor securing
Indebtedness and other Obligations under Credit Facilities that were
incurred pursuant to clauses (1) or (12) of the definition of
Permitted Debt;
(4) Liens in favor of the Company or the Guarantors;
(5) Liens on property of a Person existing at the time such
Person is merged with or into or consolidated with the Company or any
Subsidiary of the Company; PROVIDED that such Liens were not incurred
in contemplation of such merger or consolidation and do not extend to
any assets other than those of the Person merged into or consolidated
with the Company or the Subsidiary;
(6) Liens on property existing at the time of acquisition of the
property by the Company or any Subsidiary of the Company, PROVIDED
that such Liens were not incurred in contemplation of such
acquisition;
(7) Liens to secure the performance of statutory obligations,
surety or appeal bonds, performance bonds or other obligations of a
like nature incurred in the ordinary course of business;
(8) purchase money security interests (as defined in Article 9 of
the
New York Uniform Commercial Code) to secure Indebtedness permitted
by clause (4) of the second paragraph of Section 4.09 covering only
inventory held for sale or lease (including rental equipment)
purchased as described therein and the proceeds thereof;
(9) Liens existing on the date of this Indenture and securing
Indebtedness outstanding on the date of this Indenture;
(10) Liens to secure Permitted Refinancing Indebtedness incurred
to refinance Existing Debt or Permitted Refinancing Indebtedness which
is secured by Liens permitted by this clause (10); PROVIDED, that such
Liens do not extend to any categories of assets other than the
categories of assets securing Existing Debt as of the date of this
Indenture;
19
(11) Liens for taxes, assessments or governmental charges or
claims that are not yet delinquent or that are being contested in good
faith by appropriate proceedings promptly instituted and diligently
concluded, PROVIDED that any reserve or other appropriate provision as
is required in conformity with GAAP has been made therefor;
(12) Liens on assets of Unrestricted Subsidiaries that secure
Non-Recourse Debt of Unrestricted Subsidiaries;
(13) easements, rights-of-way, zoning and similar restrictions
and other similar encumbrances or title defects incurred or imposed,
as applicable, in the ordinary course of business and consistent with
industry practices;
(14) any interest or title of a lessor under any Capital Lease
Obligation;
(15) Liens securing reimbursement obligations with respect to
commercial letters of credit which encumber documents and other
property relating to such letters of credit and products and proceeds
thereof;
(16) Liens encumbering deposits made to secure obligations
arising from statutory, regulatory, contractual or warranty
requirements of the Company or any of its Restricted Subsidiaries,
including rights of offset and set-off;
(17) Liens securing Hedging Obligations;
(18) leases or subleases granted to others that do not materially
interfere with the ordinary course of business of the Company and its
Restricted Subsidiaries;
(19) Liens arising from filing Uniform Commercial Code financing
statements regarding leases; and
(20) Liens incurred in the ordinary course of business of the
Company, or any Restricted Subsidiary of the Company with respect to
obligations that do not exceed $10.0 million at any one time
outstanding.
"PERMITTED REFINANCING INDEBTEDNESS" means any Indebtedness of
the Company or any of its Restricted Subsidiaries issued in exchange
for, or the net proceeds of which are used to extend, refinance,
renew, replace, defease or refund other indebtedness of the Company or
any of its Restricted Subsidiaries (other than intercompany
Indebtedness); PROVIDED that:
(1) the principal amount (or accreted value, if applicable) of
such Permitted Refinancing Indebtedness does not exceed the principal
amount (or accreted value, if applicable) of the Indebtedness
extended, refinanced, renewed, replaced, defeased or refunded (plus
all accrued interest on the Indebtedness and the amount of all
expenses and premiums incurred in connection therewith);
(2) such Permitted Refinancing Indebtedness has a final maturity
date later than the final maturity date of, and has a Weighted Average
Life to Maturity equal to or greater than the Weighted Average Life to
Maturity of, the Indebtedness being extended, refinanced, renewed,
replaced, defeased or refunded;
20
(3) if the Indebtedness being extended, refinanced, renewed,
replaced, defeased or refunded is subordinated in right of payment to
the Notes, such Permitted Refinancing Indebtedness is subordinated in
right of payment to, the Notes on terms at least as favorable to the
Holders of Notes as those contained in the documentation governing the
Indebtedness being extended, refinanced, renewed, replaced, defeased
or refunded; and
(4) such Indebtedness is incurred either by the Company or by the
Restricted Subsidiary who is the obligor on the Indebtedness being
extended, refinanced, renewed, replaced, defeased or refunded.
"PERSON" means any individual, corporation, partnership, joint
venture, association, joint-stock company, trust, unincorporated organization,
limited liability company or government or other entity.
"PREFERRED STOCK" means Capital Stock with a preference upon
liquidation or on dividends.
"PRINCIPALS" means Bruckmann, ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ & Co., L.P., a Delaware
limited partnership, BRS Partners, LP and BRSE LLC.
"PRIORITY LIEN" means, to the extent securing Priority Lien
Obligations, a Lien granted to any holder, or representative of holders, of
Priority Lien Obligations as security for Priority Lien Obligations.
"PRIORITY LIEN AGENT" means the Credit Agreement Agent or, after the
Credit Agreement and all commitments to extend credit thereunder have been
terminated, all letters of credit (if any) issued under the Credit Agreement
have been discharged or cash collateralized (at 105% of the aggregate undrawn
amount), and all Priority Lien Obligations (except Unasserted Contingent
Obligations) outstanding under the Credit Agreement have been paid in full in
cash, a single representative of all holders of Priority Liens most recently
designated by the Company in an Officers' Certificate delivered to the Trustee
and Collateral Agent or the successor of such representative in its capacity as
such.
"PRIORITY LIEN DOCUMENTS" means the Credit Agreement, the Priority
Lien Security Documents and all other agreements governing, securing or relating
to any Priority Lien Obligations.
"PRIORITY LIEN INDEBTEDNESS" means, so long as the agreements
governing or securing such Indebtedness grant a Default Purchase Option:
(1) the principal of and interest on Indebtedness under the
Credit Agreement which, when advanced (or, in the case of any
reimbursement obligation for a letter of credit issued under the
Credit Agreement, when such letter of credit was issued), either (a)
was permitted to be incurred by clause (1) or clause (12) of the
definition of "Permitted Debt" or (b) was advanced (or, in the case of
any such reimbursement obligation, relates to a letter of credit that
was issued) upon delivery to the Credit Agreement Agent of a written
document executed by an officer of the Company to the effect that such
Indebtedness was permitted to be incurred by clause (1) or clause (12)
of the definition of "Permitted Debt;"
(2) Hedging Obligations permitted to be incurred by clause (7) of
the definition of "Permitted Debt" that, pursuant to the Credit
Agreement, are equally and ratably secured by any and all Liens
securing Indebtedness outstanding under the Credit Agreement; and
(3) the principal of and interest on Indebtedness under any
Credit Facility other than the Credit Agreement to the extent such
Indebtedness was permitted to he incurred by clause (1) or clause (12)
of the definition of "Permitted Debt," but only if on or before the
day on which such
21
Indebtedness was incurred by the Company or any of its Restricted
Subsidiaries such Indebtedness is designated by the Company, in an
Officers' Certificate delivered to the Trustee on or before such date,
as Priority Lien Indebtedness for the purposes of this Indenture.
"PRIORITY LIEN OBLIGATIONS" means Priority Lien Indebtedness and all
other Obligations in respect thereof or arising under the Priority Lien Security
Documents.
"PRIORITY LIEN SECURITY DOCUMENTS" means one or more security
agreements, pledge agreements, collateral assignment, mortgages, deed of trust
or other grants or transfers for security executed and delivered by the Company
or any other Obligor creating a Lien upon property owned or to be acquired by
the Company or such other Obligor in favor of any holder or holders of Priority
Lien Indebtedness or any trustee, agent or representative acting for any such
holders, as security for any Priority Lien Obligations.
"PRIVATE PLACEMENT LEGEND" means the legend set forth in Section
2.06(g)(1) to be placed on all Notes issued under this Indenture except where
otherwise permitted by the provisions of this Indenture.
"QIB" means a "qualified institutional buyer" as defined in Rule 144A.
"REGISTRATION RIGHTS AGREEMENT" means the Registration Rights
Agreement, dated as of June 17, 2002, among the Company, the Guarantors and the
other parties named on the signature pages thereof, as such agreement may be
amended, modified or supplemented from time to time and, with respect to any
Additional Notes, one or more registration rights agreements among the Company,
the Guarantors and the other parties thereto, as such agreement(s) may be
amended, modified or supplemented from time to time, relating to rights given by
the Company to the purchasers of Additional Notes to register such Additional
Notes under the Securities Act.
"REGULATION S" means Regulation S promulgated under the Securities
Act.
"REGULATION S GLOBAL NOTE" means a Regulation S Temporary Global Note
or Regulation S Permanent Global Note, as appropriate.
"REGULATION S PERMANENT GLOBAL NOTE" means a permanent Global Note in
the form of Exhibit A1 hereto bearing the Global Note Legend and the Private
Placement Legend and deposited with or on behalf of and registered in the name
of the Depositary or its nominee, issued in a denomination equal to the
outstanding principal amount of the Regulation S Temporary Global Note upon
expiration of the Restricted Period.
"REGULATION S TEMPORARY GLOBAL NOTE" means a temporary Global Note in
the form of Exhibit A2 hereto deposited with or on behalf of and registered in
the name of the Depositary or its nominee, issued in a denomination equal to the
outstanding principal amount of the Notes initially sold in reliance on Rule 903
of Regulation S.
"RELATED PARTY" means:
(1) any controlling stockholder, a majority owned Subsidiary, or
immediate family member (in the case of an individual) of any
Principal; or
(2) any trust, corporation, partnership or other entity, the
beneficiaries, stockholders, partners, owners or Persons beneficially
holding a majority interest of which consist of any one or more
Principals and/or such other Persons referred to in the immediately
preceding clause (1).
22
"RESPONSIBLE OFFICER," when used with respect to the Trustee, means
any officer within the corporate trust department of the Trustee (or any
successor group of the Trustee) 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 DEFINITIVE NOTE" means a Definitive Note bearing the
Private Placement Legend.
"RESTRICTED GLOBAL NOTE" means a Global Note bearing the Private
Placement Legend.
"RESTRICTED INVESTMENT" means an Investment other than a Permitted
Investment.
"RESTRICTED PERIOD" means the 40-day distribution compliance period as
defined in Regulation S.
"RESTRICTED SUBSIDIARY" of a Person means any Subsidiary of the
referent Person that is not an Unrestricted Subsidiary.
"RULE 144" means Rule 144 promulgated under the Securities Act.
"RULE 144A" means Rule 144A promulgated under the Securities Act.
"RULE 903" means Rule 903 promulgated under the Securities Act.
"RULE 904" means Rule 904 promulgated the Securities Act.
"SEC" means the Securities and Exchange Commission.
"SECOND-LIEN SECURITY DOCUMENTS" means one or more security
agreements, pledge agreements, collateral assignments, mortgages, deed of trust
or other grants or transfers for security executed and delivered by the Company
or any other Obligor creating a Lien upon property owned or to be acquired by
the Company or such other Obligor in favor of the Collateral Agent for the
benefit of the holders of Note Obligations or, if held by the Joint Collateral
Agent, for the equal and ratable benefit of all present and future holders of
Notes and Parity Lien Indebtedness, whenever incurred, and also for the benefit
of the present and future holders of all other Note Obligations and Parity Lien
Obligations.
"SECURITIES ACT" means the Securities Act of 1933, as amended.
"SENIOR SUBORDINATED NOTES" means the Company's senior subordinated
notes due 2013 to be issued concurrently with the closing of the offering of the
Notes.
"SHELF REGISTRATION STATEMENT" means the Shelf Registration Statement
as defined in the Registration Rights Agreement.
"SIGNIFICANT SUBSIDIARY" means any Subsidiary that would be a
"significant subsidiary" as defined in Article 1, Rule 1-02 of Regulation S-X,
promulgated pursuant to the Securities Act, as such Regulation is in effect on
the date hereof.
"STATED MATURITY" means, with respect to any installment of interest
or principal on any series of Indebtedness, the date on which the payment of
interest or principal was scheduled to be paid in the original documentation
governing such Indebtedness, and will not include any contingent obligations to
repay, redeem or repurchase any such interest or principal prior to the date
originally scheduled for the payment thereof.
23
"SUBSIDIARY" means, with respect to any specified Person:
(1) any corporation, association or other business entity of
which more than 50% of the total voting power of shares of Capital
Stock entitled (without regard to the occurrence of any contingency)
to vote in the election of directors, managers or trustees of the
corporation, association or other business entity is at the time owned
or controlled, directly or indirectly, by that Person or one or more
of the other Subsidiaries of that Person (or a combination thereof);
and
(2) any partnership (a) the sole general partner or the managing
general partner of which is such Person or a Subsidiary of such Person
or (b) the only general partners of which are that Person or one or
more Subsidiaries of that Person (or any combination thereof).
"SUBSIDIARY GUARANTEE" means the Guarantee by each Guarantor of the
Company's payment obligations under this Indenture and on the Notes, executed
pursuant to the provisions of this Indenture.
"TANGIBLE ASSETS" means all assets of the Company and its Restricted
Subsidiaries, excluding all Intangible Assets.
"TIA" means the Trust Indenture Act of 1939 (15 U.S.C. Sections
77aaa-77bbbb) as in effect on the date on which this Indenture is qualified
under the TIA, except as provided in Section 9.03..
"TRUSTEE" means the party named as such in the preamble to this
Indenture until a successor replaces it in accordance with the applicable
provisions of this Indenture and thereafter means the successor serving
hereunder.
"UNASSERTED CONTINGENT OBLIGATIONS" means, at any time, Obligations
for taxes, costs, indemnifications, reimbursements, damages and other
liabilities (except for (i) the principal of and interest or premiums (if any)
on, and fees relating to, Indebtedness and (ii) contingent reimbursement
obligations in respect of amounts that may be drawn under letters of credit) in
respect of which no claim or demand for payment has been made (or, in the case
of Obligations for indemnification, no notice for indemnification has been
issued by the indemnitee) at such time.
"UNRESTRICTED DEFINITIVE NOTE" means one or more Definitive Notes that
do not bear and are not required to bear the Private Placement Legend.
"UNRESTRICTED GLOBAL NOTE" means a permanent global Note substantially
in the form of Exhibit A1 attached hereto that bears the Global Note Legend and
that has the "Schedule of Exchanges of Interests in the Global Note" attached
thereto, and that is deposited with or on behalf of and registered in the name
of the Depositary, representing a series of Notes that do not bear the Private
Placement Legend.
"UNRESTRICTED SUBSIDIARY" means any Subsidiary of the Company (and any
Subsidiary of such Subsidiary) that is designated by the Board of Directors as
an Unrestricted Subsidiary pursuant to a Board Resolution (if that designation
would not cause a Default), but only to the extent that such Subsidiary:
(1) has no Indebtedness other than Non-Recourse Debt;
(2) is not party to any agreement, contract, arrangement or
understanding with the Company or any Restricted Subsidiary of the
Company unless the terms of any such agreement, contract, arrangement
or understanding are no less favorable to the Company or such
Restricted Subsidiary than those that might be obtained at the time
from Persons who are not Affiliates of the Company;
24
(3) is a Person with respect to which neither the Company nor any
of its Restricted Subsidiaries has any direct or indirect obligation
(a) to subscribe for additional Equity Interests or (b) to maintain or
preserve such Person's financial condition or to cause such Person to
achieve any specified levels of operating results;
(4) has not guaranteed or otherwise directly or indirectly
provided credit support for any Indebtedness of the Company or any of
its Restricted Subsidiaries (other than through the pledge of Equity
Interests in such Subsidiary); and
(5) has at least one director on its Board of Directors that is
not a director or executive officer of the Company or any of its
Restricted Subsidiaries.
Any designation of a Subsidiary of the Company as an Unrestricted
Subsidiary will be evidenced to the Trustee by filing with the Trustee a
certified copy of the Board Resolution giving effect to such designation and an
Officers' Certificate certifying that such designation complied with the
preceding conditions and was permitted by Section 4.07. If, at any time, any
Unrestricted Subsidiary would fail to meet the preceding requirements as an
Unrestricted Subsidiary, it will thereafter cease to be an Unrestricted
Subsidiary for purposes of this Indenture and any Indebtedness of such
Subsidiary will be deemed to be incurred by a Restricted Subsidiary of the
Company as of such date and, if such Indebtedness is not permitted to be
incurred as of such date under Section 4.09, the Company will be in default of
such covenant. The Board of Directors of the Company may at any time designate
any Unrestricted Subsidiary to be a Restricted Subsidiary; PROVIDED that such
designation will be deemed to be an incurrence of Indebtedness by a Restricted
Subsidiary of the Company of any outstanding Indebtedness of such Unrestricted
Subsidiary and such designation will only be permitted if (1) such Indebtedness
is permitted under Section 4.09, calculated on a pro forma basis as if such
designation had occurred at the beginning of the four-quarter reference period;
and (2) no Default or Event of Default would be in existence following such
designation (including without limitation under Section 4.17).
"U.S. PERSON" means a U.S. Person as defined in Rule 902(o) under the
Securities Act.
"VOTING STOCK" of any Person as of any date means the Capital Stock of
such Person that is at the time entitled to vote in the election of the Board of
Directors of such Person.
"WEIGHTED AVERAGE LIFE TO MATURITY" means, when applied to any
Indebtedness at any date, the number of years obtained by dividing:
(1) the sum of the products obtained by multiplying (a) the
amount of each then remaining installment, sinking fund, serial
maturity or other required payments of principal, including payment at
final maturity, in respect of the Indebtedness, by (b) the number of
years (calculated to the nearest one-twelfth) that will elapse between
such date and the making of such payment; by
(2) the then outstanding principal amount of such Indebtedness.
"WHOLLY OWNED RESTRICTED SUBSIDIARY" of any specified Person means a
Restricted Subsidiary of such Person all of the outstanding Capital Stock or
other ownership interests of which (other than directors' qualifying shares)
will at the time be owned by such Person or by one or more Wholly Owned
Restricted Subsidiaries of such Person and one or more Wholly Owned Restricted
Subsidiaries of such Person.
25
Section 1.02 OTHER DEFINITIONS.
Defined
in
Term Section
---- -------
"AFFILIATE TRANSACTION"....................... 4.11
"ASSET SALE OFFER"............................ 3.09
"AUTHENTICATION ORDER"........................ 2.02
"CHANGE OF CONTROL OFFER"..................... 4.15
"CHANGE OF CONTROL PAYMENT"................... 4.15
"CHANGE OF CONTROL PAYMENT DATE".............. 4.15
"COVENANT DEFEASANCE"......................... 8.03
"DTC"......................................... 2.03
"EVENT OF DEFAULT"............................ 6.01
"EXCESS PROCEEDS"............................. 4.10
"INCUR"....................................... 4.09
"LEGAL DEFEASANCE"............................ 8.02
"OFFER AMOUNT"................................ 3.09
"OFFER PERIOD"................................ 3.09
"PAYING AGENT"................................ 2.03
"PERMITTED DEBT".............................. 4.09
"PURCHASE DATE"............................... 3.09
"REGISTRAR"................................... 2.03
"RESTRICTED PAYMENTS"......................... 4.07
Section 1.03 INCORPORATION BY REFERENCE OF TRUST INDENTURE ACT.
Whenever this Indenture refers to a provision of the TIA, the
provision is incorporated by reference in and made a part of this Indenture.
The following TIA terms used in this Indenture have the following
meanings:
"INDENTURE SECURITIES" means the Notes;
"INDENTURE SECURITY HOLDER" means a Holder of a Note;
"INDENTURE TO BE QUALIFIED" means this Indenture;
"INDENTURE TRUSTEE" or "INSTITUTIONAL TRUSTEE" means the Trustee; and
"OBLIGOR" on the Notes and the Subsidiary Guarantees means the Company
and the Guarantors, respectively, and any successor obligor upon the Notes and
the Subsidiary Guarantees, respectively.
All other terms used in this Indenture that are defined by the TIA,
defined by TIA reference to another statute or defined by SEC rule under the TIA
have the meanings so assigned to them.
26
Section 1.04 RULES OF CONSTRUCTION.
Unless the context otherwise requires:
(1) a term has the meaning assigned to it;
(2) an accounting term not otherwise defined has the meaning
assigned to it in accordance with GAAP;
(3) "or" is not exclusive;
(4) words in the singular include the plural, and in the plural
include the singular;
(5) "will" shall be interpreted to express a command;
(6) provisions apply to successive events and transactions; and
(7) references to sections of or rules under the Securities Act
will be deemed to include substitute, replacement of successor
sections or rules adopted by the SEC from time to time.
ARTICLE 2.
THE NOTES
Section 2.01 FORM AND DATING.
(a) GENERAL. The Notes and the Trustee's certificate of authentication
will be substantially in the form of Exhibit A1 hereto. The Notes may have
notations, legends or endorsements required by law, stock exchange rule or
usage. Each Note will be dated the date of its authentication. The Notes shall
be in denominations of $1,000 and integral multiples thereof.
The terms and provisions contained in the Notes will constitute, and
are hereby expressly made, a part of this Indenture and the Company, the
Guarantors and the Trustee, by their execution and delivery of this Indenture,
expressly agree to such terms and provisions and to be bound thereby. However,
to the extent any provision of any Note conflicts with the express provisions of
this Indenture, the provisions of this Indenture shall govern and be
controlling.
(b) GLOBAL NOTES. Notes issued in global form will be substantially in
the form of Exhibits A1 or A2 attached hereto (including the Global Note Legend
thereon and the "Schedule of Exchanges of Interests in the Global Note" attached
thereto). Notes issued in definitive form will be substantially in the form of
Exhibit A1 attached hereto (but without the Global Note Legend thereon and
without the "Schedule of Exchanges of Interests in the Global Note" attached
thereto). Each Global Note will represent such of the outstanding Notes as will
be specified therein and each shall provide that it represents the aggregate
principal amount of outstanding Notes from time to time endorsed thereon and
that the aggregate principal amount of outstanding Notes represented thereby may
from time to time be reduced or increased, as appropriate, to reflect exchanges
and redemptions. Any endorsement of a Global Note to reflect the amount of any
increase or decrease in the aggregate principal amount of outstanding Notes
represented thereby will be made by the Trustee or the Custodian, at the
direction of the Trustee, in accordance with instructions given by the Holder
thereof as required by Section 2.06 hereof.
(c) TEMPORARY GLOBAL NOTES. Notes offered and sold in reliance on
Regulation S will be issued initially in the form of the Regulation S Temporary
Global Note, which will be deposited on behalf of the
27
purchasers of the Notes represented thereby with the Trustee, at its
New York
office, as custodian for the Depositary, and registered in the name of the
Depositary or the nominee of the Depositary for the accounts of designated
agents holding on behalf of Euroclear or Clearstream Bank, duly executed by the
Company and authenticated by the Trustee as hereinafter provided. The Restricted
Period will be terminated upon the receipt by the Trustee of:
(1) a written certificate from the Depositary, together with
copies of certificates from Euroclear and Clearstream Bank certifying
that they have received certification of non-United States beneficial
ownership of 100% of the aggregate principal amount of the Regulation
S Temporary Global Note (except to the extent of any beneficial owners
thereof who acquired an interest therein during the Restricted Period
pursuant to another exemption from registration under the Securities
Act and who will take delivery of a beneficial ownership interest in a
144A Global Note or an IAI Global Note bearing a Private Placement
Legend, all as contemplated by Section 2.06(b) hereof); and
(2) an Officers' Certificate from the Company.
Following the termination of the Restricted Period, beneficial
interests in the Regulation S Temporary Global Note will be exchanged for
beneficial interests in Regulation S Permanent Global Notes pursuant to the
Applicable Procedures. Simultaneously with the authentication of Regulation S
Permanent Global Notes, the Trustee will cancel the Regulation S Temporary
Global Note. The aggregate principal amount of the Regulation S Temporary Global
Note and the Regulation S Permanent Global Notes may from time to time be
increased or decreased by adjustments made on the records of the Trustee and the
Depositary or its nominee, as the case may be, in connection with transfers of
interest as hereinafter provided.
(3) EUROCLEAR AND CLEARSTREAM PROCEDURES APPLICABLE. The
provisions of the "Operating Procedures of the Euroclear System" and
"Terms and Conditions Governing Use of Euroclear" and the "General
Terms and Conditions of Clearstream Banking" and "Customer Handbook"
of Clearstream will be applicable to transfers of beneficial interests
in the Regulation S Temporary Global Note and the Regulation S
Permanent Global Notes that are held by Participants through Euroclear
or Clearstream.
Section 2.02 EXECUTION AND AUTHENTICATION.
Two Officers must sign the Notes for the Company by manual or
facsimile signature.
If an Officer whose signature is on a Note no longer holds that office
at the time a Note is authenticated, the Note will nevertheless be valid.
A Note will not be valid until authenticated by the manual signature
of the Trustee. The signature will be conclusive evidence that the Note has been
authenticated under this Indenture.
The Trustee will, upon receipt of a written order of the Company
signed by two Officers (an "AUTHENTICATION ORDER"), authenticate Notes for
original issue up to the aggregate principal amount stated in the Notes. There
may be an unlimited aggregate principal amount of Notes outstanding at any time.
The Trustee may appoint an authenticating agent acceptable to the
Company to authenticate Notes. An authenticating agent may authenticate Notes
whenever the Trustee may do so. Each reference in this Indenture to
authentication by the Trustee includes authentication by such agent. An
authenticating agent has the same rights as an Agent to deal with Holders or an
Affiliate of the Company.
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Section 2.03 REGISTRAR AND PAYING AGENT.
The Company will maintain an office or agency where Notes may be
presented for registration of transfer or for exchange ("REGISTRAR") and an
office or agency where Notes may be presented for payment ("PAYING AGENT"). The
Registrar will keep a register of the Notes and of their transfer and exchange.
The Company may appoint one or more co-registrars and one or more additional
paying agents. The term "Registrar" includes any co-registrar and the term
"Paying Agent" includes any additional paying agent. The Company may change any
Paying Agent or Registrar without notice to any Holder. The Company will notify
the Trustee in writing of the name and address of any Agent not a party to this
Indenture. If the Company fails to appoint or maintain another entity as
Registrar or Paying Agent, the Trustee shall act as such. The Company or any of
its Subsidiaries may act as Paying Agent or Registrar.
The Company initially appoints The Depository Trust Company ("DTC") to
act as Depositary with respect to the Global Notes.
The Company initially appoints the Trustee to act as the Registrar and
Paying Agent and to act as Custodian with respect to the Global Notes.
Section 2.04 PAYING AGENT TO HOLD MONEY IN TRUST.
The Company will require each Paying Agent other than the Trustee to
agree in writing that the Paying Agent will hold in trust for the benefit of
Holders or the Trustee all money held by the Paying Agent for the payment of
principal, premium or Liquidated Damages, if any, or interest on the Notes, and
will notify the Trustee of any default by the Company in making any such
payment. While any such default continues, the Trustee may require a Paying
Agent to pay all money held by it to the Trustee. The Company at any time may
require a Paying Agent to pay all money held by it to the Trustee. Upon payment
over to the Trustee, the Paying Agent (if other than the Company or a
Subsidiary) will have no further liability for the money. If the Company or a
Subsidiary acts as Paying Agent, it will segregate and hold in a separate trust
fund for the benefit of the Holders all money held by it as Paying Agent. Upon
any bankruptcy or reorganization proceedings relating to the Company, the
Trustee will serve as Paying Agent for the Notes.
Section 2.05 HOLDER LISTS.
The Trustee will preserve in as current a form as is reasonably
practicable the most recent list available to it of the names and addresses of
all Holders and shall otherwise comply with TIA Section 312(a). If the Trustee
is not the Registrar, the Company will furnish to the Trustee at least 15 days
before each interest payment date and at such other times as the Trustee may
request in writing, a list in such form and as of such date as the Trustee may
reasonably require of the names and addresses of the Holders of Notes and the
Company shall otherwise comply with TIA Section 312(a).
Section 2.06 TRANSFER AND EXCHANGE.
(a) TRANSFER AND EXCHANGE OF GLOBAL NOTES. A Global Note may not be
transferred as a whole except by the Depositary to a nominee of the Depositary,
by a nominee of the Depositary to the Depositary or to another nominee of the
Depositary, or by the Depositary or any such nominee to a successor Depositary
or a nominee of such successor Depositary. All Global Notes will be exchanged by
the Company for Definitive Notes if:
(1) the Company delivers to the Trustee notice from the
Depositary that it is unwilling or unable to continue to act as
Depositary or that it is no longer a clearing agency registered under
29
the Exchange Act and, in either case, a successor Depositary is not
appointed by the Company within 120 days after the date of such notice
from the Depositary; or
(2) the Company in its sole discretion determines that the Global
Notes (in whole but not in part) should be exchanged for Definitive
Notes and delivers a written notice to such effect to the Trustee;
PROVIDED that in no event shall the Regulation S Temporary Global Note
be exchanged by the Company for Definitive Notes prior to (x) the
expiration of the Restricted Period and (y) the receipt by the
Registrar of any certificates required pursuant to Rule
903(b)(3)(ii)(B) under the Securities Act.
Upon the occurrence of either of the preceding events in (1) or (2)
above, Definitive Notes shall be issued in such names as the Depositary shall
instruct the Trustee. Global Notes also may be exchanged or replaced, in whole
or in part, as provided in Sections 2.07 and 2.10 hereof. Every Note
authenticated and delivered in exchange for, or in lieu of, a Global Note or any
portion thereof, pursuant to this Section 2.06 or Section 2.07 or 2.10 hereof,
shall be authenticated and delivered in the form of, and shall be, a Global
Note. A Global Note may not be exchanged for another Note other than as provided
in this Section 2.06(a), however, beneficial interests in a Global Note may be
transferred and exchanged as provided in Section 2.06(b), (c) or (f) hereof.
(b) TRANSFER AND EXCHANGE OF BENEFICIAL INTERESTS IN THE GLOBAL NOTES.
The transfer and exchange of beneficial interests in the Global Notes will be
effected through the Depositary, in accordance with the provisions of this
Indenture and the Applicable Procedures. Beneficial interests in the Restricted
Global Notes will be subject to restrictions on transfer comparable to those set
forth herein to the extent required by the Securities Act. Transfers of
beneficial interests in the Global Notes also will require compliance with
either subparagraph (1) or (2) below, as applicable, as well as one or more of
the other following subparagraphs, as applicable:
(1) TRANSFER OF BENEFICIAL INTERESTS IN THE SAME GLOBAL NOTE.
Beneficial interests in any Restricted Global Note may be transferred
to Persons who take delivery thereof in the form of a beneficial
interest in the same Restricted Global Note in accordance with the
transfer restrictions set forth in the Private Placement Legend;
PROVIDED, HOWEVER, that prior to the expiration of the Restricted
Period, transfers of beneficial interests in the Regulation S
Temporary Global Note may not be made to a U.S. Person or for the
account or benefit of a U.S. Person (other than an Initial Purchaser).
Beneficial interests in any Unrestricted Global Note may be
transferred to Persons who take delivery thereof in the form of a
beneficial interest in an Unrestricted Global Note. No written orders
or instructions shall be required to be delivered to the Registrar to
effect the transfers described in this Section 2.06(b)(1).
(2) ALL OTHER TRANSFERS AND EXCHANGES OF BENEFICIAL INTERESTS IN
GLOBAL NOTES. In connection with all transfers and exchanges of
beneficial interests that are not subject to Section 2.06(b)(1) above,
the transferor of such beneficial interest must deliver to the
Registrar either:
(A) both:
(i) a written order from a Participant or an
Indirect Participant given to the Depositary in
accordance with the Applicable Procedures directing the
Depositary to credit or cause to be credited a beneficial
interest in another Global Note in an amount equal to the
beneficial interest to be transferred or exchanged; and
30
(ii) instructions given in accordance with the
Applicable Procedures containing information regarding
the Participant account to be credited with such
increase; or
(B) both:
(i) a written order from a Participant or an
Indirect Participant given to the Depositary in
accordance with the Applicable Procedures directing the
Depositary to cause to be issued a Definitive Note in an
amount equal to the beneficial interest to be transferred
or exchanged; and
(ii) instructions given by the Depositary to the
Registrar containing information regarding the Person in
whose name such Definitive Note shall be registered to
effect the transfer or exchange referred to in (1) above;
provided that in no event shall Definitive Notes be
issued upon the transfer or exchange of beneficial
interests in the Regulation S Temporary Global Note prior
to (A) the expiration of the Restricted Period and (B)
the receipt by the Registrar of any certificates required
pursuant to Rule 903 under the Securities Act. Upon
consummation of an Exchange Offer by the Company in
accordance with Section 2.06(f) hereof, the requirements
of this Section 2.06(b)(2) shall be deemed to have been
satisfied upon receipt by the Registrar of the
instructions contained in the Letter of Transmittal
delivered by the Holder of such beneficial interests in
the Restricted Global Notes. Upon satisfaction of all of
the requirements for transfer or exchange of beneficial
interests in Global Notes contained in this Indenture and
the Notes or otherwise applicable under the Securities
Act, the Trustee shall adjust the principal amount of the
relevant Global Note(s) pursuant to Section 2.06(h)
hereof.
(3) TRANSFER OF BENEFICIAL INTERESTS TO ANOTHER RESTRICTED GLOBAL
NOTE. A beneficial interest in any Restricted Global Note may be
transferred to a Person who takes delivery thereof in the form of a
beneficial interest in another Restricted Global Note if the transfer
complies with the requirements of Section 2.06(b)(2) above and the
Registrar receives the following:
(A) if the transferee will take delivery in the form of a
beneficial interest in the 144A Global Note, then the transferor
must deliver a certificate in the form of Exhibit B hereto,
including the certifications in item (1) thereof;
(B) if the transferee will take delivery in the form of a
beneficial interest in the Regulation S Temporary Global Note or
the Regulation S Global Note, then the transferor must deliver a
certificate in the form of Exhibit B hereto, including the
certifications in item (2) thereof; and
(C) if the transferee will take delivery in the form of a
beneficial interest in the IAI Global Note, then the transferor
must deliver a certificate in the form of Exhibit B hereto,
including the certifications, certificates and Opinion of Counsel
required by item (3) thereof, if applicable.
(4) TRANSFER AND EXCHANGE OF BENEFICIAL INTERESTS IN A RESTRICTED
GLOBAL NOTE FOR BENEFICIAL INTERESTS IN AN UNRESTRICTED GLOBAL NOTE. A
beneficial interest in any Restricted Global Note may be exchanged by
any holder thereof for a beneficial interest in an Unrestricted Global
Note or transferred to a Person who takes delivery thereof in the form
of a beneficial
31
interest in an Unrestricted Global Note if the exchange or transfer
complies with the requirements of Section 2.06(b)(2) above and:
(A) such exchange or transfer is effected pursuant to the
Exchange Offer in accordance with the Registration Rights
Agreement and the holder of the beneficial interest to be
transferred, in the case of an exchange, or the transferee, in
the case of a transfer, certifies in the applicable Letter of
Transmittal that it is not (i) a Broker-Dealer, (ii) a Person
participating in the distribution of the Exchange Notes or (iii)
a Person who is an affiliate (as defined in Rule 144) of the
Company;
(B) such transfer is effected pursuant to the Shelf
Registration Statement in accordance with the Registration Rights
Agreement;
(C) such transfer is effected by a Broker-Dealer pursuant
to the Exchange Offer Registration Statement in accordance with
the Registration Rights Agreement; or
(D) the Registrar receives the following:
(i) if the holder of such beneficial interest in
a Restricted Global Note proposes to exchange such
beneficial interest for a beneficial interest in an
Unrestricted Global Note, a certificate from such holder
in the form of Exhibit C hereto, including the
certifications in item (1)(a) thereof; or
(ii) if the holder of such beneficial interest in
a Restricted Global Note proposes to transfer such
beneficial interest to a Person who shall take delivery
thereof in the form of a beneficial interest in an
Unrestricted Global Note, a certificate from such holder
in the form of Exhibit B hereto, including the
certifications in item (4) thereof;
and, in each such case set forth in this subparagraph (D), if the
Registrar so requests or if the Applicable Procedures so require,
an Opinion of Counsel in form reasonably acceptable to the
Registrar to the effect that such exchange or transfer is in
compliance with the Securities Act and that the restrictions on
transfer contained herein and in the Private Placement Legend are
no longer required in order to maintain compliance with the
Securities Act.
If any such transfer is effected pursuant to subparagraph (B) or (D)
above at a time when an Unrestricted Global Note has not yet been issued, the
Company shall issue and, upon receipt of an Authentication Order in accordance
with Section 2.02 hereof, the Trustee shall authenticate one or more
Unrestricted Global Notes in an aggregate principal amount equal to the
aggregate principal amount of beneficial interests transferred pursuant to
subparagraph (B) or (D) above.
Beneficial interests in an Unrestricted Global Note cannot be
exchanged for, or transferred to Persons who take delivery thereof in the form
of, a beneficial interest in a Restricted Global Note.
(c) TRANSFER OR EXCHANGE OF BENEFICIAL INTERESTS FOR DEFINITIVE NOTES.
(1) BENEFICIAL INTERESTS IN RESTRICTED GLOBAL NOTES TO RESTRICTED
DEFINITIVE NOTES. If any holder of a beneficial interest in a
Restricted Global Note proposes to exchange such beneficial interest
for a Restricted Definitive Note or to transfer such beneficial
interest to a Person who
32
takes delivery thereof in the form of a Restricted Definitive Note,
then, upon receipt by the Registrar of the following documentation:
(A) if the holder of such beneficial interest in a
Restricted Global Note proposes to exchange such beneficial
interest for a Restricted Definitive Note, a certificate from
such holder in the form of Exhibit C hereto, including the
certifications in item (2)(a) thereof;
(B) if such beneficial interest is being transferred to a
QIB in accordance with Rule 144A, a certificate to the effect set
forth in Exhibit B hereto, including the certifications in item
(1) thereof;
(C) if such beneficial interest is being transferred to a
Non-U.S. Person in an offshore transaction in accordance with
Rule 903 or Rule 904, a certificate to the effect set forth in
Exhibit B hereto, including the certifications in item (2)
thereof;
(D) if such beneficial interest is being transferred
pursuant to an exemption from the registration requirements of
the Securities Act in accordance with Rule 144, a certificate to
the effect set forth in Exhibit B hereto, including the
certifications in item (3)(a) thereof;
(E) if such beneficial interest is being transferred to
an Institutional Accredited Investor in reliance on an exemption
from the registration requirements of the Securities Act other
than those listed in subparagraphs (B) through (D) above, a
certificate to the effect set forth in Exhibit B hereto,
including the certifications, certificates and Opinion of Counsel
required by item (3) thereof, if applicable;
(F) if such beneficial interest is being transferred to
the Company or any of its Subsidiaries, a certificate to the
effect set forth in Exhibit B hereto, including the
certifications in item (3)(b) thereof; or
(G) if such beneficial interest is being transferred
pursuant to an effective registration statement under the
Securities Act, a certificate to the effect set forth in Exhibit
B hereto, including the certifications in item (3)(c) thereof,
the Trustee shall cause the aggregate principal amount of the applicable Global
Note to be reduced accordingly pursuant to Section 2.06(h) hereof, and the
Company shall execute and the Trustee shall authenticate and deliver to the
Person designated in the instructions a Definitive Note in the appropriate
principal amount. Any Definitive Note issued in exchange for a beneficial
interest in a Restricted Global Note pursuant to this Section 2.06(c) shall be
registered in such name or names and in such authorized denomination or
denominations as the holder of such beneficial interest shall instruct the
Registrar through instructions from the Depositary and the Participant or
Indirect Participant. The Trustee shall deliver such Definitive Notes to the
Persons in whose names such Notes are so registered. Any Definitive Note issued
in exchange for a beneficial interest in a Restricted Global Note pursuant to
this Section 2.06(c)(1) shall bear the Private Placement Legend and shall be
subject to all restrictions on transfer contained therein.
(2) BENEFICIAL INTERESTS IN REGULATION S TEMPORARY GLOBAL
NOTE TO DEFINITIVE NOTES. Notwithstanding Sections 2.06(c)(1)(A)
and (C) hereof, a beneficial interest in the Regulation S
Temporary Global Note may not be exchanged for a Definitive Note
or transferred to a Person who takes delivery thereof in the form
of a Definitive Note prior
33
to (A) the expiration of the Restricted Period and (B) the
receipt by the Registrar of any certificates required pursuant to
Rule 903(b)(3)(ii)(B) under the Securities Act, except in the
case of a transfer pursuant to an exemption from the registration
requirements of the Securities Act other than Rule 903 or Rule
904.
(2) BENEFICIAL INTERESTS IN RESTRICTED GLOBAL NOTES TO
UNRESTRICTED DEFINITIVE NOTES. A holder of a beneficial interest in a
Restricted Global Note may exchange such beneficial interest for an
Unrestricted Definitive Note or may transfer such beneficial interest
to a Person who takes delivery thereof in the form of an Unrestricted
Definitive Note only if:
(A) such exchange or transfer is effected pursuant to the
Exchange Offer in accordance with the Registration Rights
Agreement and the holder of such beneficial interest, in the case
of an exchange, or the transferee, in the case of a transfer,
certifies in the applicable Letter of Transmittal that it is not
(i) a Broker-Dealer, (ii) a Person participating in the
distribution of the Exchange Notes or (iii) a Person who is an
affiliate (as defined in Rule 144) of the Company;
(B) such transfer is effected pursuant to the Shelf
Registration Statement in accordance with the Registration Rights
Agreement;
(C) such transfer is effected by a Broker-Dealer pursuant
to the Exchange Offer Registration Statement in accordance with
the Registration Rights Agreement; or
(D) the Registrar receives the following:
(i) if the holder of such beneficial interest in
a Restricted Global Note proposes to exchange such
beneficial interest for a Definitive Note that does not
bear the Private Placement Legend, a certificate from
such holder in the form of Exhibit C hereto, including
the certifications in item (1)(b) thereof; or
(ii) if the holder of such beneficial interest in
a Restricted Global Note proposes to transfer such
beneficial interest to a Person who shall take delivery
thereof in the form of a Definitive Note that does not
bear the Private Placement Legend, a certificate from
such holder in the form of Exhibit B hereto, including
the certifications in item (4) thereof;
and, in each such case set forth in this subparagraph (D), if the
Registrar so requests or if the Applicable Procedures so require,
an Opinion of Counsel in form reasonably acceptable to the
Registrar to the effect that such exchange or transfer is in
compliance with the Securities Act and that the restrictions on
transfer contained herein and in the Private Placement Legend are
no longer required in order to maintain compliance with the
Securities Act.
(3) BENEFICIAL INTERESTS IN UNRESTRICTED GLOBAL NOTES TO
UNRESTRICTED DEFINITIVE NOTES. If any holder of a beneficial interest
in an Unrestricted Global Note proposes to exchange such beneficial
interest for a Definitive Note or to transfer such beneficial interest
to a Person who takes delivery thereof in the form of a Definitive
Note, then, upon satisfaction of the conditions set forth in Section
2.06(b)(2) hereof, the Trustee will cause the aggregate principal
amount of the applicable Global Note to be reduced accordingly
pursuant to Section 2.06(h) hereof, and the Company will execute and
the Trustee will authenticate and deliver to the Person designated in
the instructions a Definitive Note in the appropriate principal
amount. Any Definitive Note
34
issued in exchange for a beneficial interest pursuant to this Section
2.06(c)(3) will be registered in such name or names and in such
authorized denomination or denominations as the holder of such
beneficial interest requests through instructions to the Registrar
from or through the Depositary and the Participant or Indirect
Participant. The Trustee will deliver such Definitive Notes to the
Persons in whose names such Notes are so registered. Any Definitive
Note issued in exchange for a beneficial interest pursuant to this
Section 2.06(c)(3) will not bear the Private Placement Legend.
(d) TRANSFER AND EXCHANGE OF DEFINITIVE NOTES FOR BENEFICIAL
INTERESTS.
(1) RESTRICTED DEFINITIVE NOTES TO BENEFICIAL INTERESTS IN
RESTRICTED GLOBAL NOTES. If any Holder of a Restricted Definitive Note
proposes to exchange such Note for a beneficial interest in a
Restricted Global Note or to transfer such Restricted Definitive Notes
to a Person who takes delivery thereof in the form of a beneficial
interest in a Restricted Global Note, then, upon receipt by the
Registrar of the following documentation:
(A) if the Holder of such Restricted Definitive Note
proposes to exchange such Note for a beneficial interest in a
Restricted Global Note, a certificate from such Holder in the
form of Exhibit C hereto, including the certifications in item
(2)(b) thereof;
(B) if such Restricted Definitive Note is being
transferred to a QIB in accordance with Rule 144A, a certificate
to the effect set forth in Exhibit B hereto, including the
certifications in item (1) thereof;
(C) if such Restricted Definitive Note is being
transferred to a Non-U.S. Person in an offshore transaction in
accordance with Rule 903 or Rule 904, a certificate to the effect
set forth in Exhibit B hereto, including the certifications in
item (2) thereof;
(D) if such Restricted Definitive Note is being
transferred pursuant to an exemption from the registration
requirements of the Securities Act in accordance with Rule 144, a
certificate to the effect set forth in Exhibit B hereto,
including the certifications in item (3)(a) thereof;
(E) if such Restricted Definitive Note is being
transferred to an Institutional Accredited Investor in reliance
on an exemption from the registration requirements of the
Securities Act other than those listed in subparagraphs (B)
through (D) above, a certificate to the effect set forth in
Exhibit B hereto, including the certifications, certificates and
Opinion of Counsel required by item (3) thereof, if applicable;
(F) if such Restricted Definitive Note is being
transferred to the Company or any of its Subsidiaries, a
certificate to the effect set forth in Exhibit B hereto,
including the certifications in item (3)(b) thereof; or
(G) if such Restricted Definitive Note is being
transferred pursuant to an effective registration statement under
the Securities Act, a certificate to the effect set forth in
Exhibit B hereto, including the certifications in item (3)(c)
thereof,
the Trustee will cancel the Restricted Definitive Note, increase
or cause to be increased the aggregate principal amount of, in
the case of clause (A) above, the appropriate Restricted Global
Note, in the case of clause (B) above, the 144A Global Note, in
the
35
case of clause (C) above, the Regulation S Global Note, and in
all other cases, the IAI Global Note.
(2) RESTRICTED DEFINITIVE NOTES TO BENEFICIAL INTERESTS IN
UNRESTRICTED GLOBAL NOTES. A Holder of a Restricted Definitive Note
may exchange such Note for a beneficial interest in an Unrestricted
Global Note or transfer such Restricted Definitive Note to a Person
who takes delivery thereof in the form of a beneficial interest in an
Unrestricted Global Note only if:
(A) such exchange or transfer is effected pursuant to the
Exchange Offer in accordance with the Registration Rights
Agreement and the Holder, in the case of an exchange, or the
transferee, in the case of a transfer, certifies in the
applicable Letter of Transmittal that it is not (i) a
Broker-Dealer, (ii) a Person participating in the distribution of
the Exchange Notes or (iii) a Person who is an affiliate (as
defined in Rule 144) of the Company;
(B) such transfer is effected pursuant to the Shelf
Registration Statement in accordance with the Registration Rights
Agreement;
(C) such transfer is effected by a Broker-Dealer pursuant
to the Exchange Offer Registration Statement in accordance with
the Registration Rights Agreement; or
(D) the Registrar receives the following:
(i) if the Holder of such Definitive Notes
proposes to exchange such Notes for a beneficial interest
in the Unrestricted Global Note, a certificate from such
Holder in the form of Exhibit C hereto, including the
certifications in item (1)(c) thereof; or
(ii) if the Holder of such Definitive Notes
proposes to transfer such Notes to a Person who shall
take delivery thereof in the form of a beneficial
interest in the Unrestricted Global Note, a certificate
from such Holder in the form of Exhibit B hereto,
including the certifications in item (4) thereof;
and, in each such case set forth in this subparagraph (D), if the
Registrar so requests or if the Applicable Procedures so require,
an Opinion of Counsel in form reasonably acceptable to the
Registrar to the effect that such exchange or transfer is in
compliance with the Securities Act and that the restrictions on
transfer contained herein and in the Private Placement Legend are
no longer required in order to maintain compliance with the
Securities Act.
Upon satisfaction of the conditions of any of the subparagraphs
in this Section 2.06(d)(2), the Trustee will cancel the Definitive
Notes and increase or cause to be increased the aggregate principal
amount of the Unrestricted Global Note.
(3) UNRESTRICTED DEFINITIVE NOTES TO BENEFICIAL INTERESTS IN
UNRESTRICTED GLOBAL NOTES. A Holder of an Unrestricted Definitive Note
may exchange such Note for a beneficial interest in an Unrestricted
Global Note or transfer such Definitive Notes to a Person who takes
delivery thereof in the form of a beneficial interest in an
Unrestricted Global Note at any time. Upon receipt of a request for
such an exchange or transfer, the Trustee will cancel the applicable
Unrestricted Definitive Note and increase or cause to be increased the
aggregate principal amount of one of the Unrestricted Global Notes.
36
If any such exchange or transfer from a Definitive Note to a
beneficial interest is effected pursuant to subparagraphs (2)(B),
(2)(D) or (3) above at a time when an Unrestricted Global Note has not
yet been issued, the Company will issue and, upon receipt of an
Authentication Order in accordance with Section 2.02 hereof, the
Trustee will authenticate one or more Unrestricted Global Notes in an
aggregate principal amount equal to the principal amount of Definitive
Notes so transferred.
(e) TRANSFER AND EXCHANGE OF DEFINITIVE NOTES FOR DEFINITIVE NOTES.
Upon request by a Holder of Definitive Notes and such Holder's compliance with
the provisions of this Section 2.06(e), the Registrar will register the transfer
or exchange of Definitive Notes. Prior to such registration of transfer or
exchange, the requesting Holder must present or surrender to the Registrar the
Definitive Notes duly endorsed or accompanied by a written instruction of
transfer in form satisfactory to the Registrar duly executed by such Holder or
by its attorney, duly authorized in writing. In addition, the requesting Holder
must provide any additional certifications, documents and information, as
applicable, required pursuant to the following provisions of this Section
2.06(e).
(1) RESTRICTED DEFINITIVE NOTES TO RESTRICTED DEFINITIVE NOTES.
Any Restricted Definitive Note may be transferred to and registered in
the name of Persons who take delivery thereof in the form of a
Restricted Definitive Note if the Registrar receives the following:
(A) if the transfer will be made pursuant to Rule 144A
under the Securities Act, then the transferor must deliver a
certificate in the form of Exhibit B hereto, including the
certifications in item (1) thereof;
(B) if the transfer will be made pursuant to Rule 903 or
Rule 904, then the transferor must deliver a certificate in the
form of Exhibit B hereto, including the certifications in item
(2) thereof; and
(C) if the transfer will be made pursuant to any other
exemption from the registration requirements of the Securities
Act, then the transferor must deliver a certificate in the form
of Exhibit B hereto, including the certifications, certificates
and Opinion of Counsel required by item (3) thereof, if
applicable.
(2) RESTRICTED DEFINITIVE NOTES TO UNRESTRICTED DEFINITIVE NOTES.
Any Restricted Definitive Note may be exchanged by the Holder thereof
for an Unrestricted Definitive Note or transferred to a Person or
Persons who take delivery thereof in the form of an Unrestricted
Definitive Note if:
(A) such exchange or transfer is effected pursuant to the
Exchange Offer in accordance with the Registration Rights
Agreement and the Holder, in the case of an exchange, or the
transferee, in the case of a transfer, certifies in the
applicable Letter of Transmittal that it is not (i) a
broker-dealer, (ii) a Person participating in the distribution of
the Exchange Notes or (iii) a Person who is an affiliate (as
defined in Rule 144) of the Company;
(B) any such transfer is effected pursuant to the Shelf
Registration Statement in accordance with the Registration Rights
Agreement;
(C) any such transfer is effected by a Broker-Dealer
pursuant to the Exchange Offer Registration Statement in
accordance with the Registration Rights Agreement; or
37
(D) the Registrar receives the following:
(i) if the Holder of such Restricted Definitive
Notes proposes to exchange such Notes for an Unrestricted
Definitive Note, a certificate from such Holder in the
form of Exhibit C hereto, including the certifications in
item (1)(d) thereof; or
(ii) if the Holder of such Restricted Definitive
Notes proposes to transfer such Notes to a Person who
shall take delivery thereof in the form of an
Unrestricted Definitive Note, a certificate from such
Holder in the form of Exhibit B hereto, including the
certifications in item (4) thereof;
and, in each such case set forth in this subparagraph (D), if the
Registrar so requests, an Opinion of Counsel in form reasonably
acceptable to the Company to the effect that such exchange or
transfer is in compliance with the Securities Act and that the
restrictions on transfer contained herein and in the Private
Placement Legend are no longer required in order to maintain
compliance with the Securities Act.
(3) UNRESTRICTED DEFINITIVE NOTES TO UNRESTRICTED DEFINITIVE
NOTES. A Holder of Unrestricted Definitive Notes may transfer such
Notes to a Person who takes delivery thereof in the form of an
Unrestricted Definitive Note. Upon receipt of a request to register
such a transfer, the Registrar shall register the Unrestricted
Definitive Notes pursuant to the instructions from the Holder thereof.
(f) EXCHANGE OFFER. Upon the occurrence of the Exchange Offer in
accordance with the Registration Rights Agreement, the Company will issue and,
upon receipt of an Authentication Order in accordance with Section 2.02 hereof,
the Trustee will authenticate:
(1) one or more Unrestricted Global Notes in an aggregate
principal amount equal to the principal amount of the beneficial
interests in the Restricted Global Notes tendered into the Exchange
Offer by Persons that certify in the applicable Letters of Transmittal
that (A) they are not Broker-Dealers, (B) they are not participating
in a distribution of the Exchange Notes and (z) they are not
affiliates (as defined in Rule 144) of the Company; and
(2) Unrestricted Definitive Notes in an aggregate principal
amount equal to the principal amount of the Restricted Definitive
Notes accepted for exchange in the Exchange Offer.
Concurrently with the issuance of such Notes, the Trustee will cause
the aggregate principal amount of the applicable Restricted Global Notes to be
reduced accordingly, and the Company will execute and the Trustee will
authenticate and deliver to the Persons designated by the Holders of Definitive
Notes so accepted Unrestricted Definitive Notes in the appropriate principal
amount.
(g) LEGENDS. The following legends will appear on the face of all
Global Notes and Definitive Notes issued under this Indenture unless
specifically stated otherwise in the applicable provisions of this Indenture.
(1) Private Placement Legend.
(A) Except as permitted by subparagraph (B) below, each
Global Note and each Definitive Note (and all Notes issued in
exchange therefor or substitution thereof) shall bear the legend
in substantially the following form:
38
"THIS NOTE (OR ITS PREDECESSOR) WAS ORIGINALLY ISSUED IN A TRANSACTION EXEMPT
FROM REGISTRATION UNDER THE UNITED STATES SECURITIES ACT OF 1933 (THE
"SECURITIES ACT"), AND THIS NOTE MAY NOT BE OFFERED, SOLD OR OTHERWISE
TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR AN APPLICABLE EXEMPTION
THEREFROM. EACH PURCHASER OF THIS NOTE IS HEREBY NOTIFIED THAT THE SELLER OF
THIS NOTE MAY BE RELYING ON THE EXEMPTION FROM THE PROVISIONS OF SECTION 5 OF
THE SECURITIES ACT PROVIDED BY RULE 144A THEREUNDER. THE HOLDER OF THIS NOTE
AGREES FOR THE BENEFIT OF THE COMPANY THAT (A) THIS NOTE MAY BE OFFERED, RESOLD,
PLEDGED OR OTHERWISE TRANSFERRED, ONLY (I) IN THE UNITED STATES TO A PERSON WHOM
THE SELLER REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER (AS DEFINED IN
RULE 144A UNDER THE SECURITIES ACT) IN A TRANSACTION MEETING THE REQUIREMENTS OF
RULE 144A, (II) OUTSIDE THE UNITED STATES IN AN OFFSHORE TRANSACTION IN
ACCORDANCE WITH RULE 904 UNDER THE SECURITIES ACT, (III) PURSUANT TO AN
EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT PROVIDED BY RULE 144
THEREUNDER (IF AVAILABLE) OR (IV) PURSUANT TO AN EFFECTIVE REGISTRATION
STATEMENT UNDER THE SECURITIES ACT, IN EACH OF CASES (I) THROUGH (IV) IN
ACCORDANCE WITH ANY APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED
STATES, AND (B) THE HOLDER WILL, AND EACH SUBSEQUENT HOLDER IS REQUIRED TO,
NOTIFY ANY PURCHASER OF THIS NOTE FROM IT OF THE RESALE RESTRICTIONS REFERRED TO
IN (A) ABOVE."
(B) Notwithstanding the foregoing, any Global Note or
Definitive Note issued pursuant to subparagraphs (b)(4), (c)(3),
(c)(4), (d)(2), (d)(3), (e)(2), (e)(3) or (f) of this Section
2.06 (and all Notes issued in exchange therefor or substitution
thereof) will not bear the Private Placement Legend.
(2) GLOBAL NOTE LEGEND. Each Global Note will bear a legend in
substantially the following form:
"THIS GLOBAL NOTE IS HELD BY THE DEPOSITARY (AS DEFINED IN THE INDENTURE
GOVERNING THIS NOTE) OR ITS NOMINEE IN CUSTODY FOR THE BENEFIT OF THE BENEFICIAL
OWNERS HEREOF, AND IS NOT TRANSFERABLE TO ANY PERSON UNDER ANY CIRCUMSTANCES
EXCEPT THAT (1) THE TRUSTEE MAY MAKE SUCH NOTATIONS HEREON AS MAY BE REQUIRED
PURSUANT TO SECTION 2.06 OF THE INDENTURE, (2) THIS GLOBAL NOTE MAY BE EXCHANGED
IN WHOLE BUT NOT IN PART PURSUANT TO SECTION 2.06(a) OF THE INDENTURE, (3) THIS
GLOBAL NOTE MAY BE DELIVERED TO THE TRUSTEE FOR CANCELLATION PURSUANT TO SECTION
2.11 OF THE INDENTURE AND (IV) THIS GLOBAL NOTE MAY BE TRANSFERRED TO A
SUCCESSOR DEPOSITARY WITH THE PRIOR WRITTEN CONSENT OF THE COMPANY.
UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR NOTES IN DEFINITIVE
FORM, THIS NOTE 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 OR BY THE DEPOSITARY OR ANY SUCH NOMINEE TO A
SUCCESSOR DEPOSITARY OR A NOMINEE OF SUCH SUCCESSOR DEPOSITARY. UNLESS THIS
CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST
COMPANY (55 ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇) ("▇▇▇"), TO THE COMPANY OR ITS
AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE
ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR SUCH OTHER NAME AS MAY BE
39
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO
CEDE & CO. OR SUCH OTHER ENTITY AS MAY BE REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN."
(3) REGULATION S TEMPORARY GLOBAL NOTE LEGEND. The Regulation S
Temporary Global Note will bear a legend in substantially the
following form:
"THE RIGHTS ATTACHING TO THIS REGULATION S TEMPORARY GLOBAL NOTE, AND THE
CONDITIONS AND PROCEDURES GOVERNING ITS EXCHANGE FOR CERTIFICATED NOTES, ARE AS
SPECIFIED IN THE INDENTURE (AS DEFINED HEREIN). NEITHER THE HOLDER NOR THE
BENEFICIAL OWNERS OF THIS REGULATION S TEMPORARY GLOBAL NOTE SHALL BE ENTITLED
TO RECEIVE PAYMENT OF INTEREST HEREON."
(h) CANCELLATION AND/OR ADJUSTMENT OF GLOBAL NOTES. At such time as
all beneficial interests in a particular Global Note have been exchanged for
Definitive Notes or a particular Global Note has been redeemed, repurchased or
canceled in whole and not in part, each such Global Note will be returned to or
retained and canceled by the Trustee in accordance with Section 2.11 hereof. At
any time prior to such cancellation, if any beneficial interest in a Global Note
is exchanged for or transferred to a Person who will take delivery thereof in
the form of a beneficial interest in another Global Note or for Definitive
Notes, the principal amount of Notes represented by such Global Note will be
reduced accordingly and an endorsement will be made on such Global Note by the
Trustee or by the Depositary at the direction of the Trustee to reflect such
reduction; and if the beneficial interest is being exchanged for or transferred
to a Person who will take delivery thereof in the form of a beneficial interest
in another Global Note, such other Global Note will be increased accordingly and
an endorsement will be made on such Global Note by the Trustee or by the
Depositary at the direction of the Trustee to reflect such increase.
(i) GENERAL PROVISIONS RELATING TO TRANSFERS AND EXCHANGES.
(1) To permit registrations of transfers and exchanges, the
Company will execute and the Trustee will authenticate Global Notes
and Definitive Notes upon receipt of an Authentication Order in
accordance with Section 2.02 or at the Registrar's request.
(2) No service charge will be made to a Holder of a Global Note
or to a Holder of a Definitive Note for any registration of transfer
or exchange, but the Company may require payment of a sum sufficient
to cover any transfer tax or similar governmental charge payable in
connection therewith (other than any such transfer taxes or similar
governmental charge payable upon exchange or transfer pursuant to
Sections 2.10, 3.06, 3.09, 4.10, 4.15 and 9.05 hereof).
(3) The Registrar will not be required to register the transfer
of or exchange any Note selected for redemption in whole or in part,
except the unredeemed portion of any Note being redeemed in part.
(4) All Global Notes and Definitive Notes issued upon any
registration of transfer or exchange of Global Notes or Definitive
Notes will be the valid obligations of the Company, evidencing the
same debt, and entitled to the same benefits under this Indenture, as
the Global Notes or Definitive Notes surrendered upon such
registration of transfer or exchange.
(5) The Company will not be required:
40
(A) to issue, to register the transfer of or to exchange
any Notes during a period beginning at the opening of business 15
days before the day of any selection of Notes for redemption
under Section 3.02 hereof and ending at the close of business on
the day of selection;
(B) to register the transfer of or to exchange any Note
selected for redemption in whole or in part, except the
unredeemed portion of any Note being redeemed in part; or
(C) to register the transfer of or to exchange a Note
between a record date and the next succeeding interest payment
date.
(6) Prior to due presentment for the registration of a transfer
of any Note, the Trustee, any Agent and the Company may deem and treat
the Person in whose name any Note is registered as the absolute owner
of such Note for the purpose of receiving payment of principal of and
interest on such Notes and for all other purposes, and none of the
Trustee, any Agent or the Company shall be affected by notice to the
contrary.
(7) The Trustee will authenticate Global Notes and Definitive
Notes in accordance with the provisions of Section 2.02 hereof.
(8) All certifications, certificates and Opinions of Counsel
required to be submitted to the Registrar pursuant to this Section
2.06 to effect a registration of transfer or exchange may be submitted
by facsimile.
(9) The Trustee shall have no obligation or duty to monitor,
determine or inquire as to compliance with any restrictions on
transfer imposed under this Indenture or under applicable law with
respect to any transfer of any interest in any Note (including any
transfers between or among Depositary participants or beneficial
owners of interests in any Global Note) other than to require delivery
of such certificates and other documentation or evidence as are
expressly required by, and to do so if and when expressly required by
the terms of this Indenture and to examine the same to determine
substantial compliance as to form with the express requirements
hereof.
Section 2.07 REPLACEMENT NOTES.
If any mutilated Note is surrendered to the Trustee or the Company and
the Trustee receives evidence to its satisfaction of the destruction, loss or
theft of any Note, the Company will issue and the Trustee, upon receipt of an
Authentication Order, will authenticate a replacement Note if the Trustee's
requirements are met. An indemnity bond must be supplied by the Holder that is
sufficient in the judgment of the Trustee and the Company to protect the
Company, the Trustee, any Agent and any authenticating agent from any loss that
any of them may suffer if a Note is replaced. The Company may charge for its
expenses in replacing a Note.
Every replacement Note is an additional obligation of the Company and
will be entitled to all of the benefits of this Indenture equally and
proportionately with all other Notes duly issued hereunder.
Section 2.08 OUTSTANDING NOTES.
The Notes outstanding at any time are all the Notes authenticated by
the Trustee except for those canceled by it, those delivered to it for
cancellation, those reductions in the interest in a Global Note effected by the
Trustee in accordance with the provisions hereof, and those described in this
Section as
41
not outstanding. Except as set forth in Section 2.09 hereof, a Note does not
cease to be outstanding because the Company or an Affiliate of the Company holds
the Note.
If a Note is replaced pursuant to Section 2.07 hereof, it ceases to be
outstanding unless the Trustee receives proof satisfactory to it that the
replaced Note is held by a protected purchaser.
If the principal amount of any Note is considered paid under Section
4.01 hereof, it ceases to be outstanding and interest on it ceases to accrue.
If the Paying Agent (other than the Company, a Subsidiary or an
Affiliate of any thereof) holds, on a redemption date or maturity date, money
sufficient to pay Notes payable on that date, then on and after that date such
Notes will be deemed to be no longer outstanding and will cease to accrue
interest.
Section 2.09 TREASURY NOTES.
In determining whether the Holders of the required principal amount of
Notes have concurred in any direction, waiver or consent, Notes owned by the
Company, or by any Person directly or indirectly controlling or controlled by or
under direct or indirect common control with the Company, will be considered as
though not outstanding, except that for the purposes of determining whether the
Trustee will be protected in relying on any such direction, waiver or consent,
only Notes that a Responsible Officer of the Trustee actually knows are so owned
will be so disregarded.
Section 2.10 TEMPORARY NOTES.
Until certificates representing Notes are ready for delivery, the
Company may prepare and the Trustee, upon receipt of an Authentication Order,
will authenticate temporary Notes. Temporary Notes will be substantially in the
form of certificated Notes but may have variations that the Company considers
appropriate for temporary Notes and as may be reasonably acceptable to the
Trustee. Without unreasonable delay, the Company will prepare and the Trustee
will authenticate definitive Notes in exchange for temporary Notes.
Holders of temporary Notes will be entitled to all of the benefits of
this Indenture.
Section 2.11 CANCELLATION.
The Company at any time may deliver Notes to the Trustee for
cancellation. The Registrar and Paying Agent will forward to the Trustee any
Notes surrendered to them for registration of transfer, exchange or payment. The
Trustee and no one else will cancel all Notes surrendered for registration of
transfer, exchange, payment, replacement or cancellation and will dispose of
such cancelled Notes in accordance with its customary procedures (subject to the
record retention requirement of the Exchange Act). The Company may not issue new
Notes to replace Notes that it has paid or that have been delivered to the
Trustee for cancellation.
Section 2.12 DEFAULTED INTEREST.
If the Company defaults in a payment of interest on the Notes, it will
pay the defaulted interest in any lawful manner plus, to the extent lawful,
interest payable on the defaulted interest, to the Persons who are Holders on a
subsequent special record date, in each case at the rate provided in the Notes
and in Section 4.01 hereof. The Company will notify the Trustee in writing of
the amount of defaulted interest proposed to be paid on each Note and the date
of the proposed payment. The Company will fix or cause to be fixed each such
special record date and payment date, PROVIDED that no such special record date
may
42
be less than 10 days prior to the related payment date for such defaulted
interest. At least 15 days before the special record date, the Company (or, upon
the written request of the Company, the Trustee in the name and at the expense
of the Company) will mail or cause to be mailed to Holders a notice that states
the special record date, the related payment date and the amount of such
interest to be paid.
Section 2.13 CUSIP NUMBERS.
The Company in issuing the Notes 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 Notes or as contained in any notice and that reliance
may be placed only on the other identification numbers printed on the Notes, and
any such redemption shall not be affected by any defect in or omission of such
numbers. The Company will promptly notify the Trustee of any change in the
"CUSIP" numbers.
ARTICLE 3.
REDEMPTION AND PREPAYMENT
Section 3.01 NOTICES TO TRUSTEE.
If the Company elects to redeem Notes pursuant to the optional
redemption provisions of Section 3.07 hereof, it must furnish to the Trustee, at
least 30 days but not more than 60 days before a redemption date, an Officers'
Certificate setting forth:
(1) the clause of this Indenture pursuant to which the redemption
shall occur;
(2) the redemption date;
(3) the principal amount of Notes to be redeemed; and
(4) the redemption price.
Section 3.02 SELECTION OF NOTES TO BE REDEEMED OR PURCHASED.
If less than all of the Notes are to be redeemed at any time, the
Trustee will select Notes for redemption as follows:
(1) if the Notes are listed on any national securities exchange,
in compliance with the requirements of the principal national
securities exchange on which the Notes are listed; or
(2) if the Notes are not listed on any national securities
exchange, on a PRO RATA basis, by lot or by such method as the Trustee
shall deem fair and appropriate.
In the event of partial redemption or purchase by lot, the particular
Notes to be redeemed or purchased will be selected, unless otherwise provided
herein, not less than 30 nor more than 60 days prior to the redemption or
purchase date by the Trustee from the outstanding Notes not previously called
for redemption or purchase.
The Trustee will promptly notify the Company in writing of the Notes
selected for redemption or purchase and, in the case of any Note selected for
partial redemption or purchase, the principal amount thereof to be redeemed or
purchased. Notes and portions of Notes selected will be in amounts of $1,000
43
or whole multiples of $1,000; except that if all of the Notes of a Holder are to
be redeemed or purchased, the entire outstanding amount of Notes held by such
Holder, even if not a multiple of $1,000, shall be redeemed or purchased. Except
as provided in the preceding sentence, provisions of this Indenture that apply
to Notes called for redemption or purchase also apply to portions of Notes
called for redemption or purchase.
Section 3.03 NOTICE OF REDEMPTION.
Subject to the provisions of Section 3.09 hereof, at least 30 days but
not more than 60 days before a redemption date, the Company will mail or cause
to be mailed, by first class mail, a notice of redemption to each Holder whose
Notes are to be redeemed at its registered address, except that redemption
notices may be mailed more than 60 days prior to a redemption date if the notice
is issued in connection with a defeasance of the Notes or a satisfaction and
discharge of this Indenture pursuant to Articles 8 or 13 of this Indenture.
The notice will identify the Notes to be redeemed (including CUSIP
numbers) and will state:
(1) the redemption date;
(2) the redemption price;
(3) if any Note is being redeemed in part, the portion of the
principal amount of such Note to be redeemed and that, after the
redemption date upon surrender of such Note, a new Note or Notes in
principal amount equal to the unredeemed portion will be issued upon
cancellation of the original Note;
(4) the name and address of the Paying Agent;
(5) that Notes called for redemption must be surrendered to the
Paying Agent to collect the redemption price;
(6) that, unless the Company defaults in making such redemption
payment, interest on Notes called for redemption ceases to accrue on
and after the redemption date;
(7) the paragraph of the Notes and/or Section of this Indenture
pursuant to which the Notes called for redemption are being redeemed;
and
(8) that no representation is made as to the correctness or
accuracy of the CUSIP number, if any, listed in such notice or printed
on the Notes.
At the Company's request, the Trustee will give the notice of
redemption in the Company's name and at its expense; PROVIDED, HOWEVER, that the
Company has delivered to the Trustee, at least 45 days prior to the redemption
date, an Officers' Certificate requesting that the Trustee give such notice and
setting forth the information to be stated in such notice as provided in the
preceding paragraph.
Section 3.04 EFFECT OF NOTICE OF REDEMPTION.
Once notice of redemption is mailed in accordance with Section 3.03
hereof, Notes called for redemption become irrevocably due and payable on the
redemption date at the redemption price. A notice of redemption may not be
conditional.
44
Section 3.05 DEPOSIT OF REDEMPTION OR PURCHASE PRICE.
One Business Day prior to the redemption or purchase price date, the
Company will deposit with the Trustee or with the Paying Agent money sufficient
to pay the redemption or purchase price of and accrued interest and Liquidated
Damages, if any, on all Notes to be redeemed or purchased on that date. The
Trustee or the Paying Agent will promptly return to the Company any money
deposited with the Trustee or the Paying Agent by the Company in excess of the
amounts necessary to pay the redemption or purchase price of, and accrued
interest and Liquidated Damages, if any, on, all Notes to be redeemed or
purchased.
If the Company complies with the provisions of the preceding
paragraph, on and after the redemption or purchase date, interest will cease to
accrue on the Notes or the portions of Notes called for redemption or purchase.
If a Note is redeemed or purchased on or after an interest record date but on or
prior to the related interest payment date, then any accrued and unpaid interest
shall be paid to the Person in whose name such Note was registered at the close
of business on such record date. If any Note called for redemption or purchase
is not so paid upon surrender for redemption or purchase because of the failure
of the Company to comply with the preceding paragraph, interest shall be paid on
the unpaid principal, from the redemption or purchase date until such principal
is paid, and to the extent lawful on any interest not paid on such unpaid
principal, in each case at the rate provided in the Notes and in Section 4.01
hereof.
Section 3.06 NOTES REDEEMED OR PURCHASED IN PART.
Upon surrender of a Note that is redeemed or purchased in part, the
Company will issue and, upon receipt of an Authentication Order, the Trustee
will authenticate for the Holder at the expense of the Company a new Note equal
in principal amount to the unredeemed or unpurchased portion of the Note
surrendered.
Section 3.07 OPTIONAL REDEMPTION.
(a) At any time prior to June 15, 2005, the Company may on one or more
occasions redeem an aggregate of up to 35% of the aggregate principal amount of
Notes issued under this Indenture at a redemption price of 111.125% of the
principal amount, plus accrued and unpaid interest and Liquidated Damages, if
any, to the redemption date, with the net cash proceeds of an offering of Equity
Interests (other than Disqualified Stock) of the Company or Holdings (so long as
such net cash proceeds are contributed to the Company from Holdings as common
equity); PROVIDED that:
(1) at least 65% of the aggregate principal amount of Notes
issued under this Indenture remains outstanding immediately after the
occurrence of such redemption (excluding Notes held by the Company and
its Subsidiaries); and
(2) the redemption occurs within 60 days of the date of the
closing of such offering.
(b) Except pursuant to the preceding paragraph, the Notes will not be
redeemable at the Company's option prior to June 15, 2007.
(c) After June 15, 2007, the Company may redeem all or a part of the
Notes upon not less than 30 nor more than 60 days' notice, at the redemption
prices (expressed as percentages of principal amount) set forth below plus
accrued and unpaid interest and Liquidated Damages, if any, on the Notes
redeemed, to the applicable redemption date, if redeemed during the twelve-month
period beginning on June 15 of the years indicated below:
45
Year Percentage
---- ----------
2007......................................... 105.563%
2008......................................... 103.708%
2009......................................... 101.854%
2010 and thereafter.......................... 100.000%
Any redemption pursuant to this Section 3.07 shall be made pursuant to
the provisions of Section 3.01 through 3.06 hereof.
Section 3.08 MANDATORY REDEMPTION.
The Company is not required to make mandatory redemption or sinking
fund payments with respect to the Notes.
Section 3.09 OFFER TO PURCHASE BY APPLICATION OF EXCESS PROCEEDS.
In the event that, pursuant to Section 4.10 hereof, the Company is
required to commence an offer to all Holders to purchase Notes (an "ASSET SALE
OFFER"), it will follow the procedures specified below.
The Asset Sale Offer shall be made to all Holders and all holders of
other Indebtedness that is PARI PASSU with the Notes containing provisions
similar to those set forth in this Indenture with respect to offers to purchase
or redeem with the proceeds of sales and assets. The Asset Sale Offer will
remain open for a period of at least 20 Business Days following its commencement
and not more than 30 Business Days, except to the extent that a longer period is
required by applicable law (the "OFFER PERIOD"). No later than three Business
Days after the termination of the Offer Period (the "PURCHASE DATE"), the
Company will apply all Excess Proceeds (the "Offer Amount") to the purchase of
Notes and such other PARI PASSU Indebtedness (on a pro rata basis, if
applicable) or, if less than the Offer Amount has been tendered, all Notes and
other Indebtedness tendered in response to the Asset Sale Offer. Payment for any
Notes so purchased will be made in the same manner as interest payments are
made.
If the Purchase Date is on or after an interest record date and on or
before the related interest payment date, any accrued and unpaid interest, and
Liquidated Damages, if any, will be paid to the Person in whose name a Note is
registered at the close of business on such record date, and no additional
interest will be payable to Holders who tender Notes pursuant to the Asset Sale
Offer.
Upon the commencement of an Asset Sale Offer, the Company will send,
by first class mail, a notice to the Trustee and each of the Holders, with a
copy to the Trustee. The notice will contain all instructions and materials
necessary to enable such Holders to tender Notes pursuant to the Asset Sale
Offer. The notice, which will govern the terms of the Asset Sale Offer, will
state:
(1) that the Asset Sale Offer is being made pursuant to this
Section 3.09 and Section 4.10 hereof and the length of time the Asset
Sale Offer will remain open;
(2) the Offer Amount, the purchase price and the Purchase Date;
(3) that any Note not tendered or accepted for payment will
continue to accrue interest;
(4) that, unless the Company defaults in making such payment, any
Note accepted for payment pursuant to the Asset Sale Offer will cease
to accrue interest after the Purchase Date;
46
(5) that Holders electing to have a Note purchased pursuant to an
Asset Sale Offer may elect to have Notes purchased in integral
multiples of $1,000 only;
(6) that Holders electing to have a Note purchased pursuant to
any Asset Sale Offer will be required to surrender the Note, with the
form entitled "Option of Holder to Elect Purchase" on the reverse of
the Note completed, or transfer by book-entry transfer, to the
Company, a Depositary, if appointed by the Company, or a Paying Agent
at the address specified in the notice at least three days before the
Purchase Date;
(7) that Holders will be entitled to withdraw their election if
the Company, the Depositary or the Paying Agent, as the case may be,
receives, not later than the expiration of the Offer Period, a
facsimile transmission or letter setting forth the name of the Holder,
the principal amount of the Note the Holder delivered for purchase and
a statement that such Holder is withdrawing his election to have such
Note purchased;
(8) that, if the aggregate principal amount of Notes and other
PARI PASSU Indebtedness surrendered by Holders exceeds the Offer
Amount, the Company will select the Notes and other PARI PASSU
Indebtedness to be purchased on a PRO RATA basis based on the
principal amount of Notes and such other PARI PASSU Indebtedness
surrendered (with such adjustments as may be deemed appropriate by the
Company so that only Notes in denominations of $1,000, or integral
multiples thereof, will be purchased); and
(9) that Holders whose Notes were purchased only in part will be
issued new Notes equal in principal amount to the unpurchased portion
of the Notes surrendered (or transferred by book-entry transfer).
On or before the Purchase Date, the Company will, to the extent
lawful, accept for payment, on a PRO RATA basis to the extent necessary, the
Offer Amount of Notes or portions thereof tendered pursuant to the Asset Sale
Offer, or if less than the Offer Amount has been tendered, all Notes tendered,
and will deliver to the Trustee an Officers' Certificate stating that such Notes
or portions thereof were accepted for payment by the Company in accordance with
the terms of this Section 3.09. The Company, the Depositary or the Paying Agent,
as the case may be, will promptly (but in any case not later than five days
after the Purchase Date) mail or deliver to each tendering Holder an amount
equal to the purchase price of the Notes tendered by such Holder and accepted by
the Company for purchase, and the Company will promptly issue a new Note, and
the Trustee, upon written request from the Company will authenticate and mail or
deliver such new Note to such Holder, in a principal amount equal to any
unpurchased portion of the Note surrendered. Any Note not so accepted shall be
promptly mailed or delivered by the Company to the Holder thereof.
Other than as specifically provided in this Section 3.09, any purchase
pursuant to this Section 3.09 shall be made pursuant to the provisions of
Sections 3.01 through 3.06 hereof.
ARTICLE 4.
COVENANTS
Section 4.01 PAYMENT OF NOTES.
The Company will pay or cause to be paid the principal of, premium, if
any, and interest and Liquidated Damages, if any, on the Notes on the dates and
in the manner provided in the Notes. Principal, premium, if any, and interest
and Liquidated Damages, if any will be considered paid on the date due if the
Paying Agent, if other than the Company or a Subsidiary thereof, holds as of
10:00 a.m.
47
Eastern Time on the due date money deposited by the Company in
immediately available funds and designated for and sufficient to pay all
principal, premium, if any, and interest then due. The Company will pay all
Liquidated Damages, if any, in the same manner on the dates and in the amounts
set forth in the Registration Rights Agreement.
The Company will pay interest (including post-petition interest in any
proceeding under any Bankruptcy Law) on overdue principal at the rate equal to
1% per annum in excess of the then applicable interest rate on the Notes to the
extent lawful; it will pay interest (including post-petition interest in any
proceeding under any Bankruptcy Law) on overdue installments of interest and
Liquidated Damages (without regard to any applicable grace period) at the same
rate to the extent lawful.
Section 4.02 MAINTENANCE OF OFFICE OR AGENCY.
The Company will maintain in the Borough of Manhattan, the City of
New
York, an office or agency (which may be an office of the Trustee or an affiliate
of the Trustee, Registrar or co-registrar) where Notes may be surrendered for
registration of transfer or for exchange and where notices and demands to or
upon the Company in respect of the Notes 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
fails to maintain any such required office or agency or fails 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.
The Company may also from time to time designate one or more other
offices or agencies where the Notes may be presented or surrendered for any or
all such purposes and may from time to time rescind such designations; PROVIDED,
HOWEVER, that no such designation or rescission will in any manner relieve the
Company of its obligation to maintain an office or agency in the Borough of
Manhattan, the City of New York 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.
The Company hereby designates the Corporate Trust Office of the
Trustee as one such office or agency of the Company in accordance with Section
2.03 hereof.
Section 4.03 REPORTS.
Whether or not required by the Commission, so long as any Notes are
outstanding, the Company will furnish to the Holders of Notes, within the time
periods specified in the Commission's rules and regulations:
(1) all quarterly and annual financial information that would be
required to be contained in a filing with the Commission on Forms 10-Q
and 10-K if the Company were required to file such Forms, including a
"Management's Discussion and Analysis of Financial Condition and
Results of Operations" and, with respect to the annual information
only, a report on the annual financial statements by the Company's
certified independent accountants; and
(2) all current reports that would be required to be filed with
the Commission on Form 8-K if the Company were required to file such
reports.
If the Company has designated any of its Subsidiaries as Unrestricted
Subsidiaries, then the quarterly and annual financial information required by
the preceding paragraph will include a reasonably detailed presentation, either
on the face of the financial statements or in the footnotes thereto, and in
Management's Discussion and Analysis of Financial Condition and Results of
Operations, of the financial
48
condition and results of operations of the Company and its Restricted
Subsidiaries separate from the financial condition and results of operations of
the Unrestricted Subsidiaries of the Company.
In addition, following the consummation of the exchange offer
contemplated by the registration rights agreement, whether or not required by
the Commission, the Company will file a copy of all of the information and
reports referred to in clauses (1) and (2) above with the Commission for public
availability within the time periods specified in the Commission's rules and
regulations (unless the Commission will not accept such a filing) and make such
information available to securities analysts and prospective investors upon
request. In addition, the Company and the Subsidiary Guarantors have agreed
that, for so long as any Notes remain outstanding, they will furnish to the
Holders and to securities analysts and prospective investors, upon their
request, the information required to be delivered pursuant to Rule 144A(d)(4)
under the Securities Act.
Delivery of such reports, information and documents to the Trustee is
for informational purposes only and the Trustee's receipt of such shall not
constitute constructive notice of any information contained therein or
determinable from information contained therein, including the Company's
compliance with any of its covenants hereunder (as to which the Trustee is
entitled to rely exclusively on Officers' Certificates).
Section 4.04 COMPLIANCE CERTIFICATE.
(a) The Company and each Guarantor (to the extent that such Guarantor
is so required under the TIA) shall deliver to the Trustee, within 90 days after
the end of each fiscal year, an Officers' Certificate stating that a review of
the activities of the Company and its Subsidiaries during the preceding fiscal
year has been made under the supervision of the signing Officers with a view to
determining whether the Company has kept, observed, performed and fulfilled its
obligations under this Indenture, and further stating, as to each such Officer
signing such certificate, that to the best of his or her knowledge the Company
has kept, observed, performed and fulfilled each and every covenant contained in
this Indenture and is not in default in the performance or observance of any of
the terms, provisions and conditions of this Indenture (or, if a Default or
Event of Default has occurred, describing all such Defaults or Events of Default
of which he or she may have knowledge and what action the Company is taking or
proposes to take with respect thereto) and that to the best of his or her
knowledge no event has occurred and remains in existence by reason of which
payments on account of the principal of or interest, if any, on the Notes is
prohibited or if such event has occurred, a description of the event and what
action the Company is taking or proposes to take with respect thereto.
(b) So long as not contrary to the then current recommendations of the
American Institute of Certified Public Accountants, the Company shall use its
best efforts to ensure that the year-end financial statements delivered pursuant
to Section 4.03 above shall be accompanied by a written statement of the
Company's independent public accountants (who shall be a firm of established
national reputation) that in making the examination necessary for certification
of such financial statements, nothing has come to their attention that would
lead them to believe that the Company has violated any provisions of Article 4
or Article 5 hereof or, if any such violation has occurred, specifying the
nature and period of existence thereof, it being understood that such
accountants shall not be liable directly or indirectly to any Person for any
failure to obtain knowledge of any such violation.
(c) So long as any of the Notes are outstanding, the Company will
deliver to the Trustee, forthwith upon any Officer becoming aware of any Default
or Event of Default, an Officers' Certificate specifying such Default or Event
of Default and what action the Company is taking or proposes to take with
respect thereto.
49
Section 4.05 TAXES.
The Company will pay, and will cause each of its Subsidiaries to pay,
prior to delinquency, all material taxes, assessments, and governmental levies
except such as are contested in good faith and by appropriate proceedings or
where the failure to effect such payment is not adverse in any material respect
to the Holders of the Notes.
Section 4.06 STAY, EXTENSION AND USURY LAWS.
The Company and each of the Guarantors covenants (to the extent that
it may lawfully do so) that it will not at any time insist upon, plead, or in
any manner whatsoever claim or take the benefit or advantage of, any stay,
extension or usury law wherever enacted, now or at any time hereafter in force,
that may affect the covenants or the performance of this Indenture; and the
Company and each of the Guarantors (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, by resort to any such law, 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 has been enacted.
Section 4.07 RESTRICTED PAYMENTS.
The Company will not, and will not permit any of its Restricted
Subsidiaries to, directly or indirectly:
(1) declare or pay any dividend or make any other payment or
distribution on account of the Company's Equity Interests (including,
without limitation, any payment in connection with any merger or
consolidation involving the Company or any of its Restricted
Subsidiaries) or to the direct or indirect holders of the Company's or
any of its Restricted Subsidiaries' Equity Interests in their capacity
as such (other than dividends or distributions payable in Equity
Interests (other than Disqualified Stock) of the Company);
(2) purchase, redeem or otherwise acquire or retire for value
(including, without limitation, in connection with any merger or
consolidation involving the Company) any Equity Interests of the
Company;
(3) make any payment on or with respect to, or purchase, redeem,
defease or otherwise acquire or retire for value any Indebtedness that
is subordinated to the Notes or the Subsidiary Guarantees, except a
payment of interest or principal at the Stated Maturity thereof; or
(4) make any Restricted Investment (all such payments and other
actions set forth in these clauses (1) through (4) above being
collectively referred to as "Restricted Payments"),
unless, at the time of and after giving effect to such Restricted Payment:
(1) no Default or Event of Default has occurred and is continuing
or would occur as a consequence of such Restricted Payment; and
(2) the Company would, at the time of such Restricted Payment
after giving pro forma effect thereto as if such Restricted Payment
had been made at the beginning of the applicable four-quarter period,
have been permitted to incur at least $1.00 of additional Indebtedness
pursuant to the Fixed Charge Coverage Ratio test set forth in the
first paragraph of Section 4.09; and
50
(3) such Restricted Payment, together with the aggregate amount
of all other Restricted Payments made by the Company and its
Restricted Subsidiaries after the date of this Indenture (excluding
Restricted Payments permitted by clauses (2) through (10) inclusive,
of the next succeeding paragraph), is less than the sum, without
duplication, of:
(a) 50% of the Consolidated Net Income of the Company for
the period (taken as one accounting period) from the beginning of
the first fiscal quarter commencing after the date of this
Indenture to the end of the Company's most recently ended fiscal
quarter for which internal financial statements are available at
the time of such Restricted Payment (or, if such Consolidated Net
Income for such period is a deficit, less 100% of such deficit),
PLUS
(b) 100% of the aggregate net cash proceeds received by
the Company since the date of this Indenture as a contribution to
its common equity capital or from the issue or sale of Equity
Interests of the Company (other than Disqualified Stock and other
than Equity Interests sold to members of management) or from the
issue or sale of convertible or exchangeable Disqualified Stock
or convertible or exchangeable debt securities of the Company
that have been converted into or exchanged for such Equity
Interests (other than Equity Interests (or Disqualified Stock or
debt securities) sold to a Subsidiary of the Company), PLUS
(c) to the extent that any Restricted Investment that was
made after the date of this Indenture is sold for cash or
otherwise liquidated or repaid for cash, the cash return of
capital with respect to such Restricted Investment (less the cost
of disposition, if any), PLUS
(d) if any Unrestricted Subsidiary (i) is redesignated as
a Restricted Subsidiary, the fair market value of such
redesignated Subsidiary (as determined in good faith by the Board
of Directors) as of the date of its redesignation or (ii) pays
any cash dividends or cash distributions to the Company or any of
its Restricted Subsidiaries, 100% of any such cash dividends or
cash distributions made after the date of this Indenture.
The preceding provisions will not prohibit:
(1) so long as no Default has occurred and is continuing or would
be caused thereby, the payment of any dividend within 60 days after
the date of declaration of the dividend, if at the date of declaration
the dividend payment would have complied with the provisions of this
Indenture;
(2) so long as no Default has occurred and is continuing or would
be caused thereby, the redemption, repurchase, retirement, defeasance
or other acquisition of any subordinated Indebtedness of the Company
or any Restricted Subsidiary or of any Equity Interests of the Company
in exchange for, or out of the net cash proceeds of the substantially
concurrent sale (other than to a Restricted Subsidiary of the Company)
of, Equity Interests of the Company (other than Disqualified Stock);
PROVIDED that the amount of any such net cash proceeds that are
utilized for any such redemption, repurchase, retirement, defeasance
or other acquisition will be excluded from clause (3)(b) of the
preceding paragraph;
(3) the defeasance, redemption, repurchase or other acquisition
of subordinated Indebtedness of the Company or any Guarantor with the
net cash proceeds from an incurrence of Permitted Refinancing
Indebtedness;
51
(4) the payment of any dividend by a Restricted Subsidiary of the
Company to the holders of its Equity Interests on a pro rata basis;
and
(5) so long as no Default has occurred and is continuing or would
be caused thereby, the repurchase, redemption or other acquisition or
retirement for value of (including any disbursements to Holdings for
such purpose) any Equity Interests of Holdings, the Company or any
Restricted Subsidiary of the Company held by any member or former
member of Holdings, the Company's (or any of its Restricted
Subsidiaries') management pursuant to any equity subscription
agreement, stock option agreement or similar agreement; PROVIDED that
the aggregate price paid for all such repurchased, redeemed, acquired
or retired Equity Interests shall not exceed (a) $1.0 million in any
calendar year (with unused amounts in any calendar year being carried
over to succeeding calendar years subject to a maximum (without giving
effect to clause (b)) of $2.0 million in any calendar year), PLUS (b)
the aggregate cash proceeds received by the Company and its Restricted
Subsidiaries from any issuance or reissuance of Equity Interests to
members of management and the proceeds of any "key man" life insurance
policies in any calendar year; PROVIDED, FURTHER that the cancellation
of Indebtedness owing to the Company or its Restricted Subsidiaries
from members of management in connection with such repurchase of
Equity Interests will not be deemed to be a Restricted Payment;
(6) distributions or payments to Holdings in amounts necessary to
permit Holdings to satisfy income tax obligations of Holdings that are
actually due and owing and are attributable to its ownership of the
Company, PROVIDED that such amounts do not exceed the amount that
would otherwise be due and owing if the Company and its Restricted
Subsidiaries filed separate tax returns, PROVIDED HOWEVER, that (1)
notwithstanding the foregoing, in the case of determining the amount
payable by the Company to Holdings for income tax obligations, such
payment shall not exceed an amount determined on the basis of assuming
that the Company is the parent company of an affiliated group filing a
consolidated federal income tax return and that Holdings and the
Restricted Subsidiaries are members of such affiliated group and (2)
any payments for income tax obligations shall either be used by
Holdings to pay tax liabilities within 90 days of Holding's receipt of
such payment or refunded to the Company and (b) to Holdings to pay the
necessary fees and expenses to maintain its corporate existence and
good standing and, so long as no Default has occurred and is
continuing, other general and administrative expenses (which amounts
in the aggregate shall not exceed $500,000 per year);
(7) so long as no Default has occurred and is continuing, the
declaration and payment of dividends on Disqualified Stock, that was
issued in compliance with this Indenture;
(8) repurchases of Equity Interests deemed to occur upon the
exercise of stock options to the extent such Equity Interests
represent a portion of the exercise price thereof;
(9) purchases of fractional Equity Interests of the Company, or
distributions to Holdings to permit it to purchase fractional Equity
Interests of Holdings, for aggregate consideration not to exceed
$100,000 since the date of this Indenture; and
(10) so long as no Default has occurred and is continuing, other
Restricted Payments in an amount not to exceed $1.0 million.
The amount of all Restricted Payments (other than cash) will be the
fair market value on the date of the Restricted Payment of the asset(s) or
securities proposed to be transferred or issued by the Company or such
Restricted Subsidiary, as the case may be, pursuant to the Restricted Payment.
The fair market value of any assets or securities that are required to be valued
by this Section 4.07 will be
52
determined by the Board of Directors whose resolution with respect thereto will
be delivered to the Trustee. The Board of Directors' determination must be based
upon an opinion or appraisal issued by an accounting, appraisal or investment
banking firm of national standing if the fair market value exceeds $15.0
million. Not later than the date of making any Restricted Payment, the Company
will deliver to the Trustee an Officers' Certificate stating that such
Restricted Payment is permitted under the terms of this Indenture and setting
forth the basis upon which the calculations required by this Section 4.07 were
computed, together with a copy of any fairness opinion or appraisal required by
this Indenture.
Section 4.08 DIVIDEND AND OTHER PAYMENT RESTRICTIONS AFFECTING RESTRICTED
SUBSIDIARIES.
The Company will not, and will not permit any of its Restricted
Subsidiaries to, directly or indirectly, create or permit to exist or become
effective any consensual encumbrance or restriction on the ability of any
Restricted Subsidiary to:
(1) pay dividends or make any other distributions on its Capital
Stock to the Company or any of its Restricted Subsidiaries, or with
respect to any other interest or participation in, or measured by, its
profits, or pay any indebtedness owed to the Company or any of its
Restricted Subsidiaries;
(2) make loans or advances to the Company or any of its
Restricted Subsidiaries; or
(3) transfer any of its properties or assets to the Company or
any of its Restricted Subsidiaries.
However, the preceding restrictions will not apply to encumbrances or
restrictions existing under or by reason of:
(1) agreements governing Existing Indebtedness and Credit
Facilities as in effect on the date of this Indenture and any
amendments, modifications, restatements, renewals, increases,
supplements, refundings, replacements or refinancings of those
agreements, PROVIDED that the amendments, modifications, restatements,
renewals, increases, supplements, refundings, replacement or
refinancings are no more restrictive, taken as a whole, with respect
to such dividend and other payment restrictions than those contained
in those agreements or the Security Documents on the date of this
Indenture;
(2) this Indenture, the Notes, the Senior Subordinated Notes and
the related Subsidiary Guarantees and the Exchange Notes and related
Subsidiary Guarantees, relating to the Notes and the Senior
Subordinated Notes or the Second-Lien Security Documents;
(3) applicable law, rule, regulation or order;
(4) any instrument governing Indebtedness or Capital Stock of a
Person acquired by the Company or any of its Restricted Subsidiaries
as in effect at the time of such acquisition (except to the extent
such Indebtedness or Capital Stock was incurred in connection with or
in contemplation of such acquisition), which encumbrance or
restriction is not applicable to any Person, or the properties or
assets of any Person, other than the Person, or the property or assets
of the Person, so acquired, PROVIDED that, in the case of
Indebtedness, such Indebtedness was permitted by the terms of this
Indenture to be incurred;
(5) customary non-assignment provisions in leases entered into in
the ordinary course of business and consistent with past practices;
53
(6) purchase money obligations for property acquired in the
ordinary course of business that impose restrictions on that property
of the nature described in clause (3) of the preceding paragraph;
(7) any agreement for the sale or other disposition of a
Restricted Subsidiary that restricts distributions by that Restricted
Subsidiary pending its sale or other disposition;
(8) Permitted Refinancing Indebtedness, PROVIDED that the
restrictions contained in the agreements governing such Permitted
Refinancing Indebtedness are no more restrictive, taken as a whole,
than those contained in the agreements governing the Indebtedness
being refinanced;
(9) Liens securing Indebtedness otherwise permitted to be
incurred under the provisions of Section 4.12 that limit the right of
the debtor to dispose of the assets subject to such Liens;
(10) provisions with respect to the disposition or distribution
of assets or property in joint venture agreements, assets sale
agreements, stock sale agreements and other similar agreements entered
into in the ordinary course of business; and
(11) restrictions on cash or other deposits or net worth imposed
by customers under contracts entered into in the ordinary course of
business.
Section 4.09 INCURRENCE OF INDEBTEDNESS AND ISSUANCE OF PREFERRED STOCK.
The Company will not, and will not permit any of its Restricted
Subsidiaries to, directly or indirectly, create, incur, issue, assume, guarantee
or otherwise become directly or indirectly liable, contingently or otherwise,
with respect to (collectively, "incur") any Indebtedness (including Acquired
Debt), and the Company will not issue any Disqualified Stock and will not permit
any of its Restricted Subsidiaries to issue any shares of preferred stock;
PROVIDED, HOWEVER, that the Company may incur Indebtedness (including Acquired
Debt) or issue Disqualified Stock, if the Fixed Charge Coverage Ratio for the
Company's most recently ended four full fiscal quarters for which internal
financial statements are available immediately preceding the date on which such
additional Indebtedness is incurred or such Disqualified Stock is issued would
have been at least 2.5 to 1, determined on a pro forma basis (including a pro
forma application of the net proceeds therefrom), as if the additional
Indebtedness had been incurred or Disqualified Stock had been issued, as the
case may be, at the beginning of such four-quarter period.
The first paragraph of this covenant will not prohibit the incurrence
of any of the following items of Indebtedness (collectively, "Permitted Debt"):
(1) the incurrence by the Company and any Guarantor of additional
Indebtedness and letters of credit under Credit Facilities in an
aggregate principal amount at any one time outstanding under this
clause (1) (with letters of credit being deemed to have a principal
amount equal to the maximum potential liability of the Company and its
Restricted Subsidiaries thereunder) not to exceed a maximum of $150.0
million, LESS the aggregate amount of all Net Proceeds from Asset
Sales applied by H&E or any of its Restricted Subsidiaries since the
date of this Indenture to repay, repurchase, or redeem Senior Debt
pursuant to clause (1) of the third paragraph of Section 4.10 to the
extent such Net Proceeds exceed $25 million in the aggregate since the
date of this Indenture, PROVIDED that if after giving effect to the
incurrence of any Indebtedness pursuant to this clause (1), the Fixed
Charge Coverage Ratio for the Company's most recently ended four full
fiscal quarters for which internal financial statements are then
available would exceed 2.5 to 1.0, determined on a pro forma basis
(including a pro forma application of the net proceeds therefrom),
then such maximum amount shall be the greater of (x)
54
$150.0 million, LESS the aggregate amount of all Net Proceeds from
Asset Sales applied by H&E or any of its Restricted Subsidiaries since
the date of this Indenture to repay, repurchase, or redeem Senior Debt
pursuant to clause (1) of the third paragraph of Section 4.10 to the
extent such Net Proceeds exceed $25 million in the aggregate since the
date of this Indenture or (y) the Borrowing Base;
(2) the incurrence by the Company and its Restricted Subsidiaries
of the Existing Indebtedness;
(3) the incurrence by the Company and the Guarantors of
Indebtedness represented by the Notes, the Senior Subordinated Notes
and the related Subsidiary Guarantees to be issued on the date of this
Indenture and the Exchange Notes and the related Subsidiary Guarantees
relating to the Notes and the Senior Subordinated Notes to be issued
pursuant to the respective registration rights agreements;
(4) the incurrence by the Company or any of its Restricted
Subsidiaries of Indebtedness represented by purchase money obligations
to finance the purchase of inventory held for sale or lease (including
rental equipment) in the ordinary course of business not to exceed
$125.0 million in aggregate principal amount at any one time
outstanding;
(5) the incurrence by the Company or any of its Restricted
Subsidiaries of Permitted Refinancing Indebtedness in exchange for, or
the net proceeds of which are used to refund, refinance or replace
Indebtedness (other than intercompany Indebtedness) that was permitted
by this Indenture to be incurred under the first paragraph of this
covenant or clauses (2), (3), (4)(a), (5), or (10) of this paragraph;
(6) the incurrence by the Company or any of its Restricted
Subsidiaries of intercompany Indebtedness between or among the Company
and any of its Restricted Subsidiaries; PROVIDED, HOWEVER, that:
(a) if the Company or any Guarantor is the obligor on
such Indebtedness, such Indebtedness must be expressly
subordinated to the prior payment in full in cash of all
Obligations with respect to the Notes in the case of the Company,
or the Subsidiary Guarantee, in the case of a Guarantor; and
(b) (i) any subsequent issuance or transfer of Equity
Interests that results in any such Indebtedness being held by a
Person other than the Company or a Restricted Subsidiary of the
Company and (ii) any sale or other transfer of any such
Indebtedness to a Person that is not either the Company or a
Restricted Subsidiary of the Company; will be deemed, in each
case, to constitute an incurrence of such Indebtedness by the
Company or such Restricted Subsidiary, as the case may be, that
was not permitted by this clause (6);
(7) the incurrence by the Company or any of its Restricted
Subsidiaries of Hedging Obligations that are incurred in the ordinary
course of business for the purpose of fixing or hedging interest rate
risk, currency risk or commodity risk and not for speculative
purposes;
(8) the guarantee by the Company or any of the Guarantors of
Indebtedness of the Company or a Restricted Subsidiary of the Company
that was permitted to be incurred by another provision of this
covenant;
55
(9) the accrual of interest, the accretion or amortization of
original issue discount, the payment of interest on any Indebtedness
in the form of additional Indebtedness with the same terms, and the
payment of dividends on Disqualified Stock in the form of additional
shares of the same class of Disqualified Stock will not be deemed to
be an incurrence of Indebtedness or an issuance of Disqualified Stock
for purposes of this covenant; PROVIDED, in each such case, that the
amount thereof is included in Fixed Charges of the Company as accrued;
(10) Indebtedness incurred by the Company or any of its
Restricted Subsidiaries constituting reimbursement obligations with
respect to letters of credit issued in the ordinary course of
business, including without limitation letters of credit in respect to
workers' compensation claims or self-insurance, or other Indebtedness
with respect to reimbursement type obligations regarding workers'
compensation claims; PROVIDED, HOWEVER that upon the drawing of such
letters of credit or the incurrence of such Indebtedness, such
obligations are reimbursed within 30 days following such drawing or
incurrence;
(11) obligations in respect of performance and surety bonds and
completion guarantees provided by the Company or any of its Restricted
Subsidiaries in the ordinary course of business; and
(12) the incurrence by the Company or the Guarantors of
additional Indebtedness in an aggregate principal amount (or accreted
value, as applicable) at any time outstanding under this clause (12),
including all Permitted Refinancing indebtedness incurred to refund,
refinance or replace any Indebtedness incurred pursuant to this clause
(12), not to exceed $15.0 million.
The Company will not incur any Indebtedness (including Permitted Debt)
that is contractually subordinated in right of payment to any other Indebtedness
of the Company unless such Indebtedness is also contractually subordinated in
right of payment to the Notes on substantially identical terms; PROVIDED,
HOWEVER, that no Indebtedness of the Company will be deemed to be contractually
subordinated in right of payment to any other Indebtedness of the Company solely
by virtue of being unsecured, being secured to a lesser extent or being secured
by a Lien of lower priority.
For purposes of determining compliance with this Section 4.09, in the
event that an item of proposed Indebtedness meets the criteria of more than one
of the categories of Permitted Debt described in clauses (1) through (12) above,
or is entitled to be incurred pursuant to the first paragraph of this covenant,
the Company will be permitted to classify such item of Indebtedness on the date
of its incurrence, in any manner that complies with this covenant. Indebtedness
under Credit Facilities outstanding on the date on which Notes are first issued
and authenticated under this Indenture will be deemed to have been incurred on
such date in reliance on the exception provided by clause (1) of the definition
of Permitted Debt. In addition, the Company may, at any time, change the
classification of an item of Indebtedness (or any portion thereof) to any other
clause or to the first paragraph of this covenant provided that the Company or
its Restricted Subsidiaries would be permitted to incur such item of
Indebtedness (or portion thereof) pursuant to such other clause or the first
paragraph of this covenant, as the case may be, at such time of
reclassification.
Section 4.10 ASSET SALES.
The Company will not, and will not permit any of its Restricted
Subsidiaries to, consummate an Asset Sale unless:
56
(1) the Company (or the Restricted Subsidiary, as the case may
be) receives consideration at the time of the Asset Sale at least
equal to the fair market value of the assets or Equity Interests
issued or sold or otherwise disposed of;
(2) the fair market value is determined by the Company's Board of
Directors and evidenced by a resolution of the Board of Directors set
forth in an Officers' Certificate delivered to the Trustee; and
(3) at least 75% of the consideration received in the Asset Sale
by the Company or such Restricted Subsidiary is in the form of cash or
Cash Equivalents. For purposes of this provision, each of the
following will be deemed to be cash:
(a) any liabilities, as shown on the Company's most
recent consolidated balance sheet, of the Company or any
Restricted Subsidiary (other than contingent liabilities and
liabilities that are by their terms subordinated to the Notes or
any Subsidiary Guarantee) that are assumed by the transferee of
any such assets pursuant to a customary novation agreement that
releases the Company or such Restricted Subsidiary from further
liability; and
(b) any securities, notes or other obligations received
by the Company or any such Restricted Subsidiary from such
transferee that are converted by the Company or such Restricted
Subsidiary into cash or Cash Equivalents within 180 days, to the
extent of the cash received in that conversion.
The 75% limitation referred to in clause (3) above will not apply to
any Asset Sale in which the cash or Cash Equivalents portion of the
consideration received therefrom, determined in accordance with the subclauses
(a) and (b), is equal to or greater than what the after-tax proceeds would have
been had such Asset Sale complied with the aforementioned 75% limitation.
Within 365 days after the receipt of any Net Proceeds from an Asset
Sale, the Company may apply those Net Proceeds:
(1) to repay secured Indebtedness, including repayment of
revolving loans under the Credit Agreement without reduction of the
commitment thereunder; PROVIDED, to the extent that the aggregate
amount applied pursuant to this clause (1) exceeds $25.0 million since
the date of this Indenture such excess will be used to repay,
repurchase, or redeem secured Indebtedness and to the extent used to
repay revolving borrowings, to effect a reduction of the commitments
thereunder;
(2) to acquire all or substantially all of the assets of, or a
majority of the Voting Stock of, another Permitted Business;
(3) to make a capital expenditure or purchase construction or
industrial equipment; or
(4) to acquire other long-term assets that are used or useful in
a Permitted Business,
PROVIDED, HOWEVER, that in the case of any Asset Sale involving assets having a
fair market value of 5.5% or greater of the Company's Consolidated Tangible
Assets as of the date of such Asset Sale, not more than one-third of the Net
Proceeds from such Asset Sale may be applied to those items listed in clauses
(2), (3) and (4) above.
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Pending the final application of any Net Proceeds, the Company may
temporarily reduce revolving credit borrowings or otherwise invest the Net
Proceeds in any manner that is not prohibited by this Indenture.
Any Net Proceeds from Asset Sales that are not applied or invested as
provided in the preceding paragraph will constitute "Excess Proceeds." When the
aggregate amount of Excess Proceeds exceeds $10.0 million, the Company will make
an Asset Sale Offer to all Holders of Notes and all holders of other
Indebtedness that is PARI PASSU with the Notes containing provisions similar to
those set forth in this Indenture with respect to offers to purchase or redeem
with the proceeds of sales of assets to purchase the maximum principal amount of
Notes and such other PARI PASSU Indebtedness that may be purchased out of the
Excess Proceeds. The offer price in any Asset Sale Offer will be equal to 100%
of principal amount plus accrued and unpaid interest and Liquidated Damages, if
any, to the date of purchase, and will be payable in cash. If any Excess
Proceeds remain after consummation of an Asset Sale Offer, the Company may use
those Excess Proceeds for any purpose not otherwise prohibited by this
Indenture. If the aggregate principal amount of Notes and other PARI PASSU
Indebtedness tendered into such Asset Sale Offer exceeds the amount of Excess
Proceeds, the Trustee will select the Notes and such other PARI PASSU
Indebtedness to be purchased on a pro rata basis. Upon completion of each Asset
Sale Offer, the amount of Excess Proceeds will he reset at zero.
The Company will comply with the requirements of Rule 14e-1 under the
Exchange Act and any other securities laws and regulations thereunder to the
extent those laws and regulations are applicable in connection with each
repurchase of Notes pursuant to an Asset Sale Offer. To the extent that the
provisions of any securities laws or regulations conflict with the Asset Sale
provisions of this Indenture, the Company will comply with the applicable
securities laws and regulations and will not be deemed to have breached its
obligations under the Asset Sale provisions of this Indenture by virtue of such
conflict.
Section 4.11 TRANSACTIONS WITH AFFILIATES.
The Company will not, and will not permit any of its Restricted
Subsidiaries to, make any payment to, or sell, lease, transfer or otherwise
dispose of any of its properties or assets to, or purchase any property or
assets from, or enter into or make or amend any transaction, contract,
agreement, understanding, loan, advance or guarantee with, or for the benefit
of, any Affiliate (each, an "Affiliate Transaction"), unless:
(1) the Affiliate Transaction is on terms that are no less
favorable to the Company or the relevant Restricted Subsidiary than
those that would have been obtained in a comparable transaction by the
Company or such Restricted Subsidiary with an unrelated Person; and
(2) the Company delivers to the Trustee:
(a) with respect to any Affiliate Transaction or series
of related Affiliate Transactions involving aggregate
consideration in excess of $3.0 million, a resolution of the
Board of Directors set forth in an Officers' Certificate
certifying that such Affiliate Transaction complies with this
covenant and that such Affiliate Transaction has been approved by
a majority of the disinterested members of the Board of Directors
(or a majority of the Board of Directors if there are no
disinterested members); and
(b) with respect to any Affiliate Transaction or series
of related Affiliate Transactions involving aggregate
consideration in excess of $7.5 million, an opinion as to the
fairness to the Company of such Affiliate Transaction from a
financial point of view issued by an accounting, appraisal or
investment banking firm of national standing.
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The following items will not be deemed to be Affiliate Transactions
and, therefore, will not be subject to the provisions of the prior paragraph:
(1) any employment agreement entered into by the Company or any
of its Restricted Subsidiaries in the ordinary course of business and
consistent with the past practice of the Company or such Restricted
Subsidiary;
(2) transactions between or among the Company and/or its
Restricted Subsidiaries;
(3) transactions with a Person that is an Affiliate of the
Company solely because the Company owns an Equity Interest in, or
controls, such Person;
(4) sales of Equity Interests (other than Disqualified Stock) to
Affiliates of the Company;
(5) Restricted Payments that are permitted by the provisions of
this Indenture described above under Section 4.07;
(6) customary loans, advances, fees and compensation paid to, and
indemnity provided on behalf of, officers, directors, employees or
consultants of the Company or any of its Restricted Subsidiaries;
(7) so long as no Default has occurred and is continuing,
transactions pursuant to the Management Agreement and the other
Affiliate Agreements as all are in effect on the date of this
Indenture or as the same may be amended, modified or replaced from
time to time so long as any such amendment, modification or
replacement is no less favorable to the Holders than the contract or
agreement as in effect on the date of this Indenture; and
(8) payments in connection with the Transactions (including the
payment of fees and expenses with respect thereto), on the terms
described under the caption "Certain Relationships and Related
Transactions" in the Offering Circular.
Notwithstanding anything to the contrary in this Section 4.11, the
Company will not, and will not permit any of its Restricted Subsidiaries to,
make any payment pursuant to the Management Agreement if any Default has
occurred and is continuing or would be caused by such payment.
Section 4.12 LIENS.
The Company will not, and will not permit any of its Restricted
Subsidiaries to, directly or indirectly create, incur, assume or suffer to exist
any Lien of any kind:
(1) on any asset now owned or hereafter acquired, except
Permitted Liens;
(2) upon any property, except Excluded Assets, as security for
any Priority Lien Obligation or Parity Lien Obligation, unless the
Company or such Restricted Subsidiary concurrently (a) grants a Lien
of such kind, upon such property, pursuant to a Second-Lien Security
Document upon substantially the same terms but subject to the
provisions of this Indenture described above under Article 10, to the
Collateral Agent for the benefit of the holders of Note Obligations
or, if the Collateral Agent is a Joint Collateral Agent, for the
benefit of the holders of Note Obligations and Parity Lien Obligations
and (b) causes such Lien to be duly perfected;
59
(3) securing any Priority Lien Indebtedness if such Lien is
subject to an agreement that provides for contractual subordination of
such Lien to any other Priority Lien that secures Priority Lien
Indebtedness; or
(4) securing any Parity Lien Indebtedness, unless this Indenture
or agreement governing such Parity Lien Indebtedness provides, upon
terms substantially comparable to those set forth in the provisions of
this Indenture described above under Article 10, that the Notes and
Subsidiary Guarantees and all Parity Lien Indebtedness outstanding or
incurred from time to time are equally and ratably secured thereby.
Section 4.13 BUSINESS ACTIVITIES.
The Company will not, and will not permit any Restricted Subsidiary
to, engage in any business other than Permitted Businesses, except to such
extent as would not be material to the Company and its Restricted Subsidiaries
taken as a whole.
Section 4.14 CORPORATE EXISTENCE.
Subject to Article 5 hereof, the Company shall do or cause to be done
all things necessary to preserve and keep in full force and effect:
(1) its corporate or limited liability company existence, and the
corporate, partnership or other existence of each of its Subsidiaries,
in accordance with the respective organizational documents (as the
same may be amended from time to time) of the Company or any such
Subsidiary; and
(2) the rights (charter and statutory), licenses and franchises
of the Company and its Subsidiaries; PROVIDED, HOWEVER, that the
Company shall not be required to preserve any such right, license or
franchise, or the corporate, partnership or other existence of any of
its Subsidiaries, 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 its Subsidiaries, taken as a whole, and
that the loss thereof is not adverse in any material respect to the
Holders of the Notes.
Section 4.15 OFFER TO REPURCHASE UPON CHANGE OF CONTROL.
(a) Upon the occurrence of a Change of Control, the Company will make
an offer (a "CHANGE OF CONTROL OFFER") to each Holder to repurchase all or any
part (equal to $1,000 or an integral multiple of $1,000) of each Holder's Notes
at a purchase price in cash equal to 101% of the aggregate principal amount
thereof plus accrued and unpaid interest and Liquidated Damages on the Notes
repurchased, if any, to the date of purchase (the "CHANGE OF CONTROL PAYMENT").
Within 60 days following any Change of Control, the Company will mail a notice
to each Holder describing the transaction or transactions that constitute the
Change of Control and stating:
(1) that the Change of Control Offer is being made pursuant to
this Section 4.15 and that all Notes tendered will be accepted for
payment;
(2) the purchase price and the purchase date, which shall be no
later than 30 business days from the date such notice is mailed (the
"CHANGE OF CONTROL PAYMENT DATE");
(3) that any Note not tendered will continue to accrue interest;
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(4) that, unless the Company defaults in the payment of the
Change of Control Payment, all Notes accepted for payment pursuant to
the Change of Control Offer will cease to accrue interest after the
Change of Control Payment Date;
(5) that Holders electing to have any Notes purchased pursuant to
a Change of Control Offer will be required to surrender the Notes,
with the form entitled "Option of Holder to Elect Purchase" on the
reverse of the Notes completed, to the Paying Agent at the address
specified in the notice prior to the close of business on the third
Business Day preceding the Change of Control Payment Date;
(6) that Holders will be entitled to withdraw their election if
the Paying Agent receives, not later than the close of business on the
second Business Day preceding the Change of Control Payment Date, a
facsimile transmission or letter setting forth the name of the Holder,
the principal amount of Notes delivered for purchase, and a statement
that such Holder is withdrawing his election to have the Notes
purchased; and
(7) that Holders whose Notes are being purchased only in part
will be issued new Notes equal in principal amount to the unpurchased
portion of the Notes surrendered, which unpurchased portion must be
equal to $1,000 in principal amount or an integral multiple thereof.
The Company will comply with the requirements of Rule 14e-1 under the
Exchange Act and any other securities laws and regulations thereunder to the
extent those laws and regulations are applicable in connection with the
repurchase of the Notes as a result of a Change in Control. To the extent that
the provisions of any securities laws or regulations conflict with the
provisions of Sections 3.09 or 4.15 of this Indenture, the Company will comply
with the applicable securities laws and regulations and will not be deemed to
have breached its obligations under Section 3.09 or this Section 4.15 by virtue
of such conflict.
(b) On the Change of Control Payment Date, the Company will, to the
extent lawful:
(1) accept for payment all Notes or portions thereof properly
tendered pursuant to the Change of Control Offer;
(2) deposit with the Paying Agent an amount equal to the Change
of Control Payment in respect of all Notes or portions of Notes
properly tendered; and
(3) deliver or cause to be delivered to the Trustee the Notes
properly accepted together with an Officers' Certificate stating the
aggregate principal amount of Notes or portions of Notes being
purchased by the Company.
The Paying Agent will promptly mail to each Holder of Notes properly
tendered the Change of Control Payment for such Notes, and the Trustee will
promptly authenticate and mail (or cause to be transferred by book entry) to
each Holder a new Note equal in principal amount to any unpurchased portion of
the Notes surrendered, if any; PROVIDED that each new Note will be in a
principal amount of $1,000 or an integral multiple of $1,000. The Company will
publicly announce the results of the Change of Control Offer on or as soon as
practicable after the Change of Control Payment Date.
The provisions described above that require the Company to make a
Change of Control Offer following a Change of Control will be applicable whether
or not any other provisions of this Indenture are applicable. Except as
described above with respect to a Change of Control, this Indenture does not
61
contain provisions that permit the Holders of the Notes to require that the
Company repurchase or redeem the Notes in the event of a takeover,
recapitalization or similar transaction.
(c) Notwithstanding anything to the contrary in this Section 4.15, the
Company will not be required to make a Change of Control Offer upon a Change of
Control if a third party makes the Change of Control Offer in the manner, at the
times and otherwise in compliance with the requirements set forth in this
Section 4.15 and Section 3.09 hereof and purchases all Notes validly tendered
and not withdrawn under the Change of Control Offer.
Section 4.16 SALE AND LEASEBACK TRANSACTIONS.
The Company will not, and will not permit any of its Restricted
Subsidiaries to, enter into any sale and leaseback transaction; PROVIDED that
the Company or any Guarantor may enter into a sale and leaseback transaction if:
(1) the Company or that Guarantor, as applicable, could have (a)
incurred Indebtedness in an amount equal to the Attributable Debt
relating to such sale and leaseback transaction under the Fixed Charge
Coverage Ratio test in the first paragraph of Section 4.09 and (b)
incurred a Lien to secure such Indebtedness pursuant to Section 4.12;
(2) the gross cash proceeds of that sale and leaseback
transaction are at least equal to the fair market value, as determined
in good faith by the Board of Directors and set forth in an Officers'
Certificate delivered to the Trustee, of the property that is the
subject of that sale and leaseback transaction; and
(3) the transfer of assets in that sale and leaseback transaction
is permitted by, and the Company applies the proceeds of such
transaction in compliance with, Section 4.10.
Section 4.17 DESIGNATION OF RESTRICTED AND UNRESTRICTED SUBSIDIARIES.
The Board of Directors may designate any Restricted Subsidiary to be
an Unrestricted Subsidiary if that designation would not cause a Default. If a
Restricted Subsidiary is designated as an Unrestricted Subsidiary, the aggregate
fair market value of all outstanding Investments owned by the Company and its
Restricted Subsidiaries in the Subsidiary properly designated will be deemed to
be an Investment made as of the time of the designation and will reduce the
amount available for Restricted Payments under the first paragraph of Section
4.07 or Permitted Investments, as determined by the Company. That designation
will only be permitted if the Investment would be permitted at that time and if
the Restricted Subsidiary otherwise meets the definition of an Unrestricted
Subsidiary. The Board of Directors may redesignate any Unrestricted Subsidiary
to be a Restricted Subsidiary if the redesignation would not cause a Default.
Section 4.18 PAYMENTS FOR CONSENT.
The Company will not, and will not permit any of its Restricted
Subsidiaries to, directly or indirectly, pay or cause to be paid any
consideration to or for the benefit of any Holder of Notes for or as an
inducement to any consent, waiver or amendment of any of the terms or provisions
of this Indenture or the Notes unless such consideration is offered to be paid
and is paid to all Holders of the Notes that consent, waive or agree to amend in
the time frame set forth in the solicitation documents relating to such consent,
waiver or agreement.
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Section 4.19 ADDITIONAL SUBSIDIARY GUARANTEES AND LIENS.
The Company will be required to add additional Subsidiary Guarantees
and/or Liens in the following circumstances:
(1) If the Company or any of its Restricted Subsidiaries acquires
or creates another Domestic Restricted Subsidiary after the date of
this Indenture, then the Company will cause that newly acquired or
created Domestic Restricted Subsidiary to execute a Subsidiary
Guarantee pursuant to a supplemental indenture in form and substance
satisfactory to the Trustee and deliver an Opinion of Counsel
satisfactory to the Trustee within 10 Business Days of the date on
which it was acquired or created to the effect that such supplemental
indenture has been duly authorized, executed and delivered by that
Domestic Subsidiary and constitutes a valid and binding agreement of
that Domestic Subsidiary, enforceable in accordance with its terms
(subject to customary exception);
(2) If the Company or any of its Restricted Subsidiaries at any
time grants, assumes or becomes subject to any Lien upon any of its
property then owned or thereafter acquired, except an Excluded Asset,
as security for any Priority Lien Obligation or Parity Lien
Obligation, the Company will, or will cause such Restricted Subsidiary
to, concurrently:
(a) execute and deliver to the Collateral Agent a
Second-Lien Security Document upon substantially the same terms,
but subject to the provisions of this Indenture described above
under Article 10, granting a Lien upon such property to the
Collateral Agent for the benefit of the holders of Note
Obligations or, if the Collateral Agent is a Joint Collateral
Agent, for the benefit of the holders of Note Obligations and
Parity Lien Obligations;
(b) cause the Lien granted in such Second-Lien Security
Document to be duly perfected in any manner permitted by law; and
(c) deliver to the Trustee an Opinion of Counsel
reasonably satisfactory to the Trustee, confirming as to such
Second-Lien Security Document the matters set forth as to the
Second-Lien Security Documents and Liens thereunder in the
Opinions of Counsel delivered on behalf of the Company to the
initial purchasers in connection with the issuance of the Notes
and, if the property subject to such Second-Lien Security
Document is an interest in real estate, such local counsel
opinions, title and flood insurance policies, surveys and other
supporting documents as may have been delivered to the initial
purchasers of the Notes or in connection with the grant of a
Priority Lien or Parity Lien thereon or as the Collateral Agent
may reasonably request.
ARTICLE 5.
SUCCESSORS
Section 5.01 MERGER, CONSOLIDATION, OR SALE OF ASSETS.
The Company may not, directly or indirectly: (1) consolidate or merge
with or into another Person (whether or not the Company is the surviving
corporation); or (2) sell, assign, transfer, convey or otherwise dispose of all
or substantially all of the properties or assets of the Company and its
Restricted Subsidiaries taken as a whole, in one or more related transactions,
to another Person; unless:
63
(1) either: (a) the Company is the surviving corporation; or (b)
the Person formed by or surviving any such consolidation or merger (if
other than the Company) or to which such sale, assignment, transfer,
conveyance or other disposition has been made is either (i) a
corporation organized or existing under the laws of the United States,
any state of the United States or the District of Columbia or (ii)) is
a limited liability company organized or existing under the laws of
the United States, any state thereof or the District of Columbia that
has at least one Restricted Subsidiary that is a corporation organized
or existing under the laws of the United States, any state thereof or
the District of Columbia which corporation becomes a co-issuer of the
Notes pursuant to a supplemental indenture duly and validly executed
by the Trustee;
(2) the Person formed by or surviving any such consolidation or
merger (if other than the Company) or the Person to which such sale,
assignment, transfer, conveyance or other disposition has been made
assumes all the obligations of the Company under the Notes, this
Indenture, the registration rights agreement and the Second-Lien
Security Documents pursuant to written agreements reasonably
satisfactory to the Trustee;
(3) immediately after such transaction, no Default or Event of
Default exists; and
(4) the Company or the Person formed by or surviving any such
consolidation or merger (if other than the Company), or to which such
sale, assignment, transfer, conveyance or other disposition has been
made will, on the date of such transaction after giving pro forma
effect thereto and any related financing transactions as if the same
had occurred at the beginning of the applicable four-quarter period,
be permitted to incur at least $1.00 of additional Indebtedness
pursuant to the Fixed Charge Coverage Ratio test set forth in the
first paragraph of Section 4.09.
The preceding clause (4) shall not prohibit (i) a merger between the
Company and a Restricted Subsidiary or (ii) a merger between the Company and an
Affiliate with no substantial assets or liabilities for the sole purpose of
incorporating or reincorporating or organizing or reorganizing the Company in
another state of the United States, or the District of Columbia.
In addition, the Company may not, directly or indirectly, lease all or
substantially all of its properties or assets, in one or more related
transactions, to any other Person. This Section 5.01 will not apply to a sale,
assignment, transfer, conveyance or other disposition of assets between or among
the Company and any of its Restricted Subsidiaries.
Section 5.02 SUCCESSOR CORPORATION SUBSTITUTED.
Upon any consolidation or merger, or any sale, assignment, transfer,
lease, conveyance or other disposition of all or substantially all of the assets
of the Company in a transaction that is subject to, and that complies with the
provisions of, Section 5.01 hereof, the successor corporation formed by such
consolidation or into or with which the Company is merged or to which such sale,
assignment, transfer, lease, conveyance or other disposition is made shall
succeed to, and be substituted for (so that from and after the date of such
consolidation, merger, sale, lease, conveyance or other disposition, the
provisions of this Indenture referring to the "Company" shall refer instead to
the successor corporation and not to the Company), 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; PROVIDED, HOWEVER, that
the predecessor Company shall not be relieved from the obligation to pay the
principal of and interest on the Notes except in the case of a sale of all of
the Company's assets in a transaction that is subject to, and that complies with
the provisions of, Section 5.01 hereof.
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ARTICLE 6.
DEFAULTS AND REMEDIES
Section 6.01 EVENTS OF DEFAULT.
Each of the following is an "Event of Default":
(1) the Company defaults for 30 days in the payment when due of
interest on, or Liquidated Damages with respect to, the Notes;
(2) the Company defaults in the payment when due (at maturity,
upon redemption or otherwise) of the principal of, or premium, if any,
on the Notes;
(3) the Company or any of its Subsidiaries fails to comply with
the provisions of Section 4.15 hereof;
(4) the Company or any of its Subsidiaries fails to observe or
perform any other covenant, representation, warranty or other
agreement in this Indenture or the Second-Lien Security Documents for
60 days after notice to the Company by the Trustee or the Holders of
at least 25% in aggregate principal amount of the Notes then
outstanding voting as a single class;
(5) a default occurs under any mortgage, indenture or instrument
under which there may be issued or by which there may be secured or
evidenced any Indebtedness for money borrowed by the Company or any of
its Subsidiaries (or the payment of which is guaranteed by the Company
or any of its Subsidiaries), whether such Indebtedness or guarantee
now exists, or is created after the date of this Indenture, if that
default:
(A) is caused by a failure to pay principal of, or
interest or premium, if any, on such Indebtedness prior to the
expiration of the grace period provided in such Indebtedness on
the date of such default (a "PAYMENT DEFAULT"); or
(B) results in the acceleration of such Indebtedness
prior to its express maturity,
and, in each case, the principal amount of any such Indebtedness,
together with the principal amount of any other such Indebtedness
under which there has been a Payment Default or the maturity of
which has been so accelerated, aggregates $10.0 million or more;
(6) a final non-appealable judgment or final non-appealable
judgments for the payment of money are entered by a court or courts of
competent jurisdiction against the Company or any of its Restricted
Subsidiaries, which judgment or judgments are not paid, discharged or
stayed for a period of 60 days; PROVIDED that the aggregate of all
such undischarged judgments exceeds $10.0 million;
(7) the Company or any of its Restricted Subsidiaries pursuant to
or within the meaning of Bankruptcy Law:
(A) commences a voluntary case,
(B) consents to the entry of an order for relief against
it in an involuntary case,
65
(C) consents to the appointment of a custodian of it or
for all or substantially all of its property,
(D) makes a general assignment for the benefit of its
creditors, or
(E) generally is not paying its debts as they become due;
or
(8) a court of competent jurisdiction enters an order or decree
under any Bankruptcy Law that:
(A) is for relief against the Company or any of its
Restricted Subsidiaries in an involuntary case;
(B) appoints a custodian of the Company or any of its
Restricted Subsidiaries or for all or substantially all of the
property of the Company or any of its Restricted Subsidiaries; or
(C) orders the liquidation of the Company or any of its
Restricted Subsidiaries;
and the order or decree remains unstayed and in effect for 60
consecutive days; or
(9) any Second-Lien Security Document or any Lien purported to be
granted thereby is held in any judicial proceeding to be unenforceable
or invalid, in whole or in part, or ceases for any reason (other than
pursuant to a release that is delivered or becomes effective as set
forth in this Indenture) to be fully enforceable and perfected, and
such event continues for 30 days after written notice to the Company
by the Trustee or the Holders of at least 25% in aggregate principal
amount of the Notes then outstanding, voting as a single class;
(10) the Company or any of its Restricted Subsidiaries, or any
Person acting on behalf of any of them, denies or disaffirms, in
writing, any obligation of the Company or any of its Restricted
Subsidiaries set forth in or arising under any Second-Lien Security
Document; or
(11) except as permitted by this Indenture, any Subsidiary
Guarantee is held in any judicial proceeding to be unenforceable or
invalid or shall cease for any reason to be in full force and effect
or any Guarantor, or any Person acting on behalf of any Guarantor,
shall deny or disaffirm its obligations under its Subsidiary
Guarantee.
Section 6.02 ACCELERATION.
In the case of an Event of Default specified in clause (7) or (8) of
Section 6.01 hereof, with respect to the Company all outstanding Notes will
become due and payable immediately without further action or notice. If any
other Event of Default occurs and is continuing, the Trustee or the Holders of
at least 25% in principal amount of the then outstanding Notes may declare all
the Notes to be due and payable immediately.
Upon any such declaration, the Notes shall become due and payable
immediately. Notwithstanding the foregoing, if an Event of Default specified in
clause (7) or (8) of Section 6.01 hereof occurs with respect to the Company all
outstanding Notes shall be due and payable immediately without further action or
notice. The Holders of a majority in aggregate principal amount of the then
outstanding Notes by written notice to the Trustee may on behalf of all of the
Holders rescind an acceleration and its consequences if the rescission would not
conflict with any judgment or decree and if all existing Events
66
of Default (except nonpayment of principal, interest or premium that has become
due solely because of the acceleration) have been cured or waived.
Section 6.03 OTHER REMEDIES.
If an Event of Default occurs and is continuing, the Trustee may
pursue any available remedy to collect the payment of principal, premium and
Liquidated Damages, if any, and interest on the Notes or to enforce the
performance of any provision of the Notes or this Indenture.
The Trustee may maintain a proceeding even if it does not possess any
of the Notes or does not produce any of them in the proceeding. A delay or
omission by the Trustee or any Holder of a Note in exercising any right or
remedy accruing upon an Event of Default shall not impair the right or remedy or
constitute a waiver of or acquiescence in the Event of Default. All remedies are
cumulative to the extent permitted by law.
Section 6.04 WAIVER OF PAST DEFAULTS.
Holders of not less than a majority in aggregate principal amount of
the then outstanding Notes by notice to the Trustee may on behalf of the Holders
of all of the Notes waive an existing Default or Event of Default and its
consequences hereunder, except a continuing Default or Event of Default in the
payment of the principal of, premium and Liquidated Damages, if any, or interest
on, the Notes (including in connection with an offer to purchase); PROVIDED,
HOWEVER, that the Holders of a majority in aggregate principal amount of the
then outstanding Notes may rescind an acceleration and its consequences,
including any related payment default that resulted from such acceleration. 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 6.05 CONTROL BY MAJORITY.
Holders of a majority in principal amount of the then outstanding
Notes may direct the time, method and place of conducting any proceeding for
exercising any remedy available to the Trustee or exercising any trust or power
conferred on it. However, the Trustee may refuse to follow any direction that
conflicts with law or this Indenture that the Trustee determines may be unduly
prejudicial to the rights of other Holders of Notes or that may involve the
Trustee in personal liability.
Section 6.06 LIMITATION ON SUITS.
A Holder of a Note may pursue a remedy with respect to this Indenture
or the Notes only if:
(1) the Holder of a Note gives to the Trustee written notice of a
continuing Event of Default;
(2) the Holders of at least 25% in principal amount of the then
outstanding Notes make a written request to the Trustee to pursue the
remedy;
(3) such Holder of a Note or Holders of Notes offer and, if
requested, provide to the Trustee indemnity satisfactory to the
Trustee against any loss, liability or expense;
(4) the Trustee does not comply with the request within 60 days
after receipt of the request and the offer and, if requested, the
provision of indemnity; and
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(5) during such 60-day period the Holders of a majority in
principal amount of the then outstanding Notes do not give the Trustee
a direction inconsistent with the request.
A Holder of a Note may not use this Indenture to prejudice the rights
of another Holder of a Note or to obtain a preference or priority over another
Holder of a Note.
Section 6.07 RIGHTS OF HOLDERS OF NOTES TO RECEIVE PAYMENT.
Notwithstanding any other provision of this Indenture, the right of
any Holder of a Note to receive payment of principal, premium and Liquidated
Damages, if any, and interest on the Note, on or after the respective due dates
expressed in the Note (including in connection with an offer to purchase), or to
bring suit for the enforcement of any such payment on or after such respective
dates, shall not be impaired or affected without the consent of such Holder;
PROVIDED that a Holder shall not have the right to institute any such suit for
the enforcement of payment if and to the extent that the institution or
prosecution thereof or the entry of judgment therein would, under applicable
law, result in the surrender, impairment, waiver or loss of the Lien of this
Indenture upon any property subject to such Lien.
Section 6.08 COLLECTION SUIT BY TRUSTEE.
If an Event of Default specified in Section 6.01(1) or (2) occurs and
is continuing, the Trustee is authorized to recover judgment in its own name and
as Trustee of an express trust against the Company for the whole amount of
principal of, premium and Liquidated Damages, if any, and interest remaining
unpaid on the Notes and interest on overdue principal and, to the extent lawful,
interest and 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.
Section 6.09 TRUSTEE MAY FILE PROOFS OF CLAIM.
The Trustee is authorized to file such proofs of claim and other
papers or documents as may be necessary or advisable in order to have the claims
of the Trustee (including any claim for the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel) and the
Holders of the Notes allowed in any judicial proceedings relative to the Company
(or any other obligor upon the Notes), its creditors or its property and shall
be entitled and empowered to collect, receive and distribute any money or other
property payable or deliverable on any such claims and any custodian 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 to
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 7.07 hereof. To the extent that the payment of any such compensation,
expenses, disbursements and advances of the Trustee, its agents and counsel, and
any other amounts due the Trustee under Section 7.07 hereof out of the estate in
any such proceeding, shall be denied for any reason, payment of the same shall
be secured by a Lien on, and shall be paid out of, any and all distributions,
dividends, money, securities and other properties that the Holders may be
entitled to receive in such proceeding whether in liquidation or under any plan
of reorganization or arrangement or otherwise. Nothing herein contained 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 Notes or the rights of any Holder, or to authorize the
Trustee to vote in respect of the claim of any Holder in any such proceeding.
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Section 6.10 PRIORITIES.
If the Trustee collects any money pursuant to this Article 6, it shall
pay out the money in the following order:
FIRST: to the Trustee, its agents and attorneys for amounts due
under Section 7.07 hereof, including payment of all compensation,
expense and liabilities incurred, and all advances made, by the
Trustee and the costs and expenses of collection;
SECOND: to Holders of Notes for amounts due and unpaid on the
Notes for principal, premium and Liquidated Damages, if any, and
interest, ratably, without preference or priority of any kind,
according to the amounts due and payable on the Notes for principal,
premium and Liquidated Damages, if any and interest, respectively; and
THIRD: to the Company or to such party as a court of competent
jurisdiction shall direct.
The Trustee may fix a record date and payment date for any payment to
Holders of Notes pursuant to this Section 6.10.
Section 6.11 UNDERTAKING FOR COSTS.
In any suit for the enforcement of any right or remedy under this
Indenture or in any suit against the Trustee for any action taken or omitted by
it as a Trustee, a court in its discretion may require the filing by any party
litigant in the suit of an undertaking to pay the costs of the suit, and the
court in its discretion may assess reasonable costs, including reasonable
attorneys' fees and expenses, against any party litigant in the suit, having due
regard to the merits and good faith of the claims or defenses made by the party
litigant. This Section 6.11 does not apply to a suit by the Trustee, a suit by a
Holder of a Note pursuant to Section 6.07 hereof, or a suit by Holders of more
than 10% in principal amount of the then outstanding Notes.
ARTICLE 7.
TRUSTEE
Section 7.01 DUTIES OF TRUSTEE.
(a) If an Event of Default has occurred and is continuing, the Trustee
will exercise such of the rights and powers vested in it by this Indenture, and
use the same degree of care and skill in its exercise, as a prudent person would
exercise or use under the circumstances in the conduct of such person's own
affairs.
(b) Except during the continuance of an Event of Default:
(1) the duties of the Trustee will be determined solely by the
express provisions of this Indenture and the Trustee need perform only
those duties that are specifically set forth in this Indenture and no
others, and no implied covenants or obligations shall be read into
this Indenture against the Trustee; and
(2) in the absence of bad faith on its part, the Trustee may
conclusively rely, as to the truth of the statements and the
correctness of the opinions expressed therein, upon certificates or
opinions furnished to the Trustee and conforming to the requirements
of this Indenture.
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However, in the case of any such certificates or opinions by which any
provisions hereof are specifically required to be furnished to the
Trustee, the Trustee shall be under a duty to examine the same to
determine whether or not they conform to the requirements of this
Indenture (but need not confirm or investigate the accuracy of
mathematical calculations or other facts stated therein).
(c) The Trustee may not be relieved from liabilities for its own
negligent action, its own negligent failure to act, or its own willful
misconduct, except that:
(1) this paragraph does not limit the effect of paragraph (b) of
this Section 7.01;
(2) the Trustee will not be liable for any error of judgment made
in good faith by a Responsible Officer, unless it is proved that the
Trustee was negligent in ascertaining the pertinent facts; and
(3) the Trustee will not be liable with respect to any action it
takes or omits to take in good faith in accordance with a direction
received by it pursuant to Section 6.05 hereof.
(d) Whether or not therein expressly so provided, every provision of
this Indenture that in any way relates to the Trustee is subject to paragraphs
(a), (b), and (c) of this Section 7.01.
(e) No provision of this Indenture will require the Trustee to expend
or risk its own funds or incur any liability. The Trustee will be under no
obligation to exercise any of its rights and powers under this Indenture at the
request of any Holders, unless such Holder has offered to the Trustee security
and indemnity satisfactory to it against any loss, liability or expense.
(f) The Trustee will not be liable for interest on any money received
by it except as the Trustee may agree in writing with the Company. Money held in
trust by the Trustee need not be segregated from other funds except to the
extent required by law.
Section 7.02 RIGHTS OF TRUSTEE.
(a) The Trustee may conclusively rely upon any document believed by it
to be genuine and to have been signed or presented by the proper Person. The
Trustee need not investigate any fact or matter stated in the document.
(b) Before the Trustee acts or refrains from acting, it may require an
Officers' Certificate or an Opinion of Counsel or both. The Trustee will not be
liable for any action it takes or omits to take in good faith in reliance on
such Officers' Certificate or Opinion of Counsel. The Trustee may consult with
counsel of its selection and the written advice of such counsel or any Opinion
of Counsel will be full and complete authorization and protection from liability
in respect of any action taken, suffered or omitted by it hereunder in good
faith and in reliance thereon.
(c) The Trustee may act through its attorneys and agents and will not
be responsible for the misconduct or negligence of any agent appointed with due
care.
(d) The Trustee will not be liable for any action it takes or omits to
take in good faith that it believes to be authorized or within the rights or
powers conferred upon it by this Indenture.
(e) Unless otherwise specifically provided in this Indenture, any
demand, request, direction or notice from the Company will be sufficient if
signed by an Officer of the Company.
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(f) The Trustee will be under no obligation to exercise any of the
rights or powers vested in it by this Indenture at the request or direction of
any of the Holders unless such Holders have offered to the Trustee security or
indemnity reasonably satisfactory to it against the costs, expenses and
liabilities that might be incurred by it in compliance with such request or
direction.
(g) 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 or other paper or document, but the Trustee, in its
discretion, may make such further inquiry or investigation into such matters as
it may see fit.
(h) 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 a
default is received by the Trustee at the Corporate Trust Office of the Trustee,
and such notice references the Notes and this Indenture.
(i) The rights, privileges, protections, immunities and benefits given
to the Trustee, including without limitation, its right to be indemnified, are
extended to, and shall be enforceable by, the Trustee in each of its capacities
hereunder, and each agent custodian and other Person employed to act hereunder.
(j) The Trustee may request that the Company deliver an Officers'
Certificate setting forth the names of individuals and/or titles of officers
authorized at such time to take specified actions pursuant to this Indenture,
which Officers' Certificate may be signed by any person authorized to sign an
Officers' Certificate, including any person specified as so authorized in any
such certificate previously delivered and not superseded.
Section 7.03 INDIVIDUAL RIGHTS OF TRUSTEE.
The Trustee in its individual or any other capacity may become the
owner or pledgee of Notes and may otherwise deal with the Company or any
Affiliate of the Company with the same rights it would have if it were not
Trustee. However, in the event that the Trustee acquires any conflicting
interest it must eliminate such conflict within 90 days, apply to the SEC for
permission to continue as Trustee or resign. Any Agent may do the same with like
rights and duties. The Trustee is also subject to Sections 7.10 and 7.11 hereof.
Section 7.04 TRUSTEE'S DISCLAIMER.
The Trustee will not be responsible for and makes no representation as
to the validity or adequacy of this Indenture or the Notes, it shall not be
accountable for the Company's use of the proceeds from the Notes or any money
paid to the Company or upon the Company's direction under any provision of this
Indenture, it will not be responsible for the use or application of any money
received by any Paying Agent other than the Trustee, and it will not be
responsible for any statement or recital herein or any statement in the Notes or
any other document in connection with the sale of the Notes or pursuant to this
Indenture other than its certificate of authentication.
Section 7.05 NOTICE OF DEFAULTS.
If a Default or Event of Default occurs and is continuing and if it is
known to the Trustee, the Trustee will mail to Holders of Notes a notice of the
Default or Event of Default within 90 days after it occurs. Except in the case
of a Default or Event of Default in payment of principal of, premium or
Liquidated Damages, if any, or interest on any Note, the Trustee may withhold
the notice if and so long as
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a committee of its Responsible Officers in good faith determines that
withholding the notice is in the interests of the Holders of the Notes.
Section 7.06 REPORTS BY TRUSTEE TO HOLDERS OF THE NOTES.
(a) Within 60 days after each May 15 beginning with the May 15
following the date of the first issuance of the Notes under this Indenture, and
for so long as Notes remain outstanding, the Trustee will mail to the Holders of
the Notes a brief report dated as of such reporting date that complies with TIA
Section 313(a) (but if no event described in TIA Section 313(a) has occurred
within the twelve months preceding the reporting date, no report need be
transmitted). The Trustee also will comply with TIA Section 313(b)(2). The
Trustee will also transmit by mail all reports as required by TIA Section
313(c).
(b) A copy of each report at the time of its mailing to the Holders of
Notes will be mailed by the Trustee to the Company and filed by the Trustee with
the SEC and each stock exchange on which the Notes are listed in accordance with
TIA Section 313(d). The Company will promptly notify the Trustee when the Notes
are listed on any stock exchange or any delisting thereof.
Section 7.07 COMPENSATION AND INDEMNITY.
(a) The Company will pay to the Trustee from time to time such
compensation as shall be agreed in writing between the Company and the Trustee
for its acceptance of this Indenture and services hereunder. The Trustee's
compensation will not be limited by any law on compensation of a Trustee of an
express trust. The Company will reimburse the Trustee promptly upon request for
all reasonable disbursements, advances and expenses incurred or made by it in
addition to the compensation for its services. Such expenses will include the
reasonable compensation, disbursements and expenses of the Trustee's agents and
counsel.
(b) The Company and the Guarantor will indemnify each of the Trustee
and any predecessor Trustee against any and all losses, liabilities or expenses
incurred by it arising out of or in connection with the acceptance or
administration of its duties under this Indenture including taxes (other than
taxes based on the income of the Trustee), including the costs and expenses of
enforcing this Indenture against the Company and the Guarantors (including this
Section 7.07) and defending itself against any claim (whether asserted by the
Company, the Guarantors or any Holder or any other Person) or liability in
connection with the exercise or performance of any of its powers or duties
hereunder, except to the extent any such loss, liability or expense may be
attributable to its negligence or bad faith. The Trustee will notify the Company
promptly of any claim for which it may seek indemnity. Failure by the Trustee to
so notify the Company will not relieve the Company or any of the Guarantors of
their obligations hereunder. The Company or such Guarantor will defend the claim
and the Trustee will cooperate in the defense. The Trustee may have separate
counsel and the Company will pay the reasonable fees and expenses of such
counsel. Neither the Company nor any Guarantor need pay for any settlement made
without its consent, which consent will not be unreasonably withheld.
(c) The obligations of the Company and the Guarantors under this
Section 7.07 will survive the satisfaction and discharge of this Indenture.
(d) To secure the Company's payment obligations in this Section 7.07,
the Trustee will have a Lien prior to the Notes on all money or property held or
collected by the Trustee, except that held in trust to pay principal and
interest on particular Notes. Such Lien will survive the satisfaction and
discharge of this Indenture.
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(e) When the Trustee incurs expenses or renders services after an
Event of Default specified in Section 6.01(7) or (8) hereof occurs, the expenses
and the compensation for the services (including the fees and expenses of its
agents and counsel) are intended to constitute expenses of administration under
any Bankruptcy Law.
(f) The Trustee will comply with the provisions of TIA Section
313(b)(2) to the extent applicable.
Section 7.08 REPLACEMENT OF TRUSTEE.
(a) A resignation or removal of the Trustee and appointment of a
successor Trustee will become effective only upon the successor Trustee's
acceptance of appointment as provided in this Section 7.08.
(b) The Trustee may resign in writing at any time and be discharged
from the trust hereby created by so notifying the Company. The Holders of a
majority in principal amount of the then outstanding Notes may remove the
Trustee by so notifying the Trustee and the Company in writing. The Company may
remove the Trustee if:
(1) the Trustee fails to comply with Section 7.10 hereof;
(2) the Trustee is adjudged a bankrupt or an insolvent or an
order for relief is entered with respect to the Trustee under any
Bankruptcy Law;
(3) a custodian or public officer takes charge of the Trustee or
its property; or
(4) the Trustee becomes incapable of acting.
(c) If the Trustee resigns or is removed or if a vacancy exists in the
office of Trustee for any reason, the Company will promptly appoint a successor
Trustee. Within one year after the successor Trustee takes office, the Holders
of a majority in principal amount of the then outstanding Notes may appoint a
successor Trustee to replace the successor Trustee appointed by the Company.
(d) If a successor Trustee does not take office within 60 days after
the retiring Trustee resigns or is removed, the retiring Trustee, the Company,
or the Holders of at least 10% in principal amount of the then outstanding Notes
may petition,. at the expense of the Company, any court of competent
jurisdiction for the appointment of a successor Trustee.
(e) If the Trustee, after written request by any Holder who has been a
Holder for at least six months, fails to comply with Section 7.10, such Holder
may petition any court of competent jurisdiction for the removal of the Trustee
and the appointment of a successor Trustee.
(f) A successor Trustee will deliver a written acceptance of its
appointment to the retiring Trustee and to the Company. Thereupon, the
resignation or removal of the retiring Trustee will become effective, and the
successor Trustee will have all the rights, powers and duties of the Trustee
under this Indenture. The successor Trustee will mail a notice of its succession
to Holders. The retiring Trustee will promptly transfer all property held by it
as Trustee to the successor Trustee, PROVIDED all sums owing to the Trustee
hereunder have been paid and subject to the Lien provided for in Section 7.07
hereof. Notwithstanding replacement of the Trustee pursuant to this Section
7.08, the Company's obligations under Section 7.07 hereof will continue for the
benefit of the retiring Trustee.
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Section 7.09 SUCCESSOR TRUSTEE BY MERGER, ETC.
If the Trustee consolidates, merges or converts into, or transfers all
or substantially all of its corporate trust business to, another corporation,
the successor corporation without any further act will be the successor Trustee.
Section 7.10 ELIGIBILITY; DISQUALIFICATION.
There will at all times be a Trustee hereunder that is a corporation
organized and doing business under the laws of the United States of America or
of any state thereof that is authorized under such laws to exercise corporate
Trustee power, that is subject to supervision or examination by federal or state
authorities and that has a combined capital and surplus of at least $100 million
as set forth in its most recent published annual report of condition.
This Indenture will always have a Trustee who satisfies the
requirements of TIA Section 310(a)(1), (2) and (5). The Trustee is subject to
TIA Section 310(b).
Section 7.11 PREFERENTIAL COLLECTION OF CLAIMS AGAINST COMPANY.
The Trustee is subject to TIA Section 311(a), excluding any creditor
relationship listed in TIA Section 311(b). A Trustee who has resigned or been
removed shall be subject to TIA Section 311(a) to the extent indicated therein.
ARTICLE 8.
LEGAL DEFEASANCE AND COVENANT DEFEASANCE
Section 8.01 OPTION TO EFFECT LEGAL DEFEASANCE OR COVENANT DEFEASANCE.
The Company may, at the option of its Board of Directors evidenced by
a resolution set forth in an Officers' Certificate, at any time, elect to have
either Section 8.02 or 8.03 hereof be applied to all outstanding Notes upon
compliance with the conditions set forth below in this Article 8.
Section 8.02 LEGAL DEFEASANCE AND DISCHARGE.
Upon the Company's exercise under Section 8.01 hereof of the option
applicable to this Section 8.02, the Company and each of the Guarantors will,
subject to the satisfaction of the conditions set forth in Section 8.04 hereof,
be deemed to have been discharged from their obligations with respect to all
outstanding Notes (including the Subsidiary Guarantees) on the date the
conditions set forth below are satisfied (hereinafter, "LEGAL DEFEASANCE"). For
this purpose, Legal Defeasance means that the Company and the Guarantors will be
deemed to have paid and discharged the entire Indebtedness represented by the
outstanding Notes (including the Subsidiary Guarantees), which will thereafter
be deemed to be "outstanding" only for the purposes of Section 8.05 hereof and
the other Sections of this Indenture referred to in clauses (1) and (2) below,
and to have satisfied all their other obligations under such Notes, the
Subsidiary Guarantees and this Indenture (and the Trustee, on demand of and at
the expense of the Company, shall execute proper instruments acknowledging the
same), except for the following provisions which will survive until otherwise
terminated or discharged hereunder:
(1) the rights of Holders of outstanding Notes to receive
payments in respect of the principal of, or interest or premium and
Liquidated Damages, if any, on such Notes when such payments are due
from the trust referred to in Section 8.04 hereof;
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(2) the Company's obligations with respect to such Notes under
Article 2 and Section 4.02 hereof;
(3) the rights, powers, trusts, duties and immunities of the
Trustee hereunder and the Company's and the Guarantors' obligations in
connection therewith; and
(4) this Article 8.
Subject to compliance with this Article 8, the Company may exercise
its option under this Section 8.02 notwithstanding the prior exercise of its
option under Section 8.03 hereof.
Section 8.03 COVENANT DEFEASANCE.
Upon the Company's exercise under Section 8.01 hereof of the option
applicable to this Section 8.03, the Company and the Guarantors will, subject to
the satisfaction of the conditions set forth in Section 8.04 hereof, be released
from each of their obligations under the covenants contained in Sections 4.07,
4.08, 4.09, 4.10, 4.11, 4.12, 4.13, 4.15, 4.16, 4.17, 4.18, and 4.19 hereof and
clause (4) of Section 5.01 hereof with respect to the outstanding Notes on and
after the date the conditions set forth in Section 8.04 hereof are satisfied
(hereinafter, "COVENANT DEFEASANCE"), and the Notes will thereafter be deemed
not "outstanding" for the purposes of any direction, waiver, consent or
declaration or act of Holders (and the consequences of any thereof) in
connection with such covenants, but will continue to be deemed "outstanding" for
all other purposes hereunder (it being understood that such Notes will not be
deemed outstanding for accounting purposes). For this purpose, Covenant
Defeasance means that, with respect to the outstanding Notes and Subsidiary
Guarantees, the Company and the Guarantors may omit to comply with and will have
no liability in respect of any term, condition or limitation set forth in any
such covenant, whether directly or indirectly, by reason of any reference
elsewhere herein to any such covenant or by reason of any reference in any such
covenant to any other provision herein or in any other document and such
omission to comply will not constitute a Default or an Event of Default under
Section 6.01 hereof, but, except as specified above, the remainder of this
Indenture and such Notes and Subsidiary Guarantees will be unaffected thereby.
In addition, upon the Company's exercise under Section 8.01 hereof of the option
applicable to this Section 8.03 hereof, subject to the satisfaction of the
conditions set forth in Section 8.04 hereof, Sections 6.01(3) through 6.01(5)
hereof will not constitute Events of Default.
Section 8.04 CONDITIONS TO LEGAL OR COVENANT DEFEASANCE.
In order to exercise either Legal Defeasance or Covenant Defeasance
under either Section 8.02 or 8.03 hereof:
(1) the Company must irrevocably deposit with the Trustee, in
trust, for the benefit of the Holders, cash in United States dollars,
non-callable Government Securities, or a combination thereof, in
amounts as will be sufficient, in the opinion of a
nationally-recognized firm of independent public accountants, to pay
the principal of, or interest and premium and Liquidated Damages, if
any, on the outstanding Notes on the stated maturity or on the
applicable redemption date, as the case may be, and the Company must
specify whether the Notes are being defeased to maturity or to a
particular redemption date;
(2) in the case of an election under Section 8.02 hereof, the
Company has delivered to the Trustee an Opinion of Counsel in the
United States reasonably acceptable to the Trustee confirming that:
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(A) the Company has received from, or there has been
published by, the Internal Revenue Service a ruling; or
(B) since the 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
of Counsel shall confirm that, the Holders of the outstanding
Notes will not recognize income, gain or loss for federal income
tax purposes as a result of such Legal 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
Legal Defeasance had not occurred;
(3) in the case of an election under Section 8.03 hereof, the
Company must deliver to the Trustee an Opinion of Counsel in the
United States reasonably acceptable to the Trustee confirming that the
Holders of the outstanding Notes 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;
(4) no Default or Event of Default shall have occurred and be
continuing on the date of such deposit (other than a Default or Event
of Default resulting from the borrowing of funds to be applied to such
deposit);
(5) such Legal Defeasance or Covenant Defeasance will not result
in a breach or violation of, or constitute a default under, any
material agreement or instrument (other than this Indenture) to which
the Company or any of its Subsidiaries is a party or by which the
Company or any of its Subsidiaries is bound;
(6) the Company must deliver to the Trustee an Officers'
Certificate stating that the deposit was not made by the Company with
the intent of preferring the Holders of Notes over the other creditors
of the Company with the intent of defeating, hindering, delaying or
defrauding any other creditors of the Company or others; and
(7) the Company must deliver to the Trustee an Officers'
Certificate and an Opinion of Counsel which opinion may be subject to
customary assumptions and exclusions, each stating that all conditions
precedent provided for or relating to the Legal Defeasance or the
Covenant Defeasance have been complied with.
Section 8.05 DEPOSITED MONEY AND GOVERNMENT SECURITIES TO BE HELD IN TRUST;
OTHER MISCELLANEOUS PROVISIONS.
Subject to Section 8.06 hereof, all money and non-callable Government
Securities (including the proceeds thereof) deposited with the Trustee (or other
qualifying Trustee, collectively for purposes of this Section 8.05, the
"Trustee") pursuant to Section 8.04 hereof in respect of the outstanding Notes
will be held in trust and applied by the Trustee, in accordance with the
provisions of such Notes and this Indenture, to the payment, either directly or
through any Paying Agent (including the Company acting as Paying Agent) as the
Trustee may determine, to the Holders of such Notes of all sums due and to
become due thereon in respect of principal, premium and Liquidated Damages, if
any, and interest, but such money need not be segregated from other funds except
to the extent required by law.
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The Company will pay and indemnify the Trustee against any tax, fee or
other charge imposed on or assessed against the cash or non-callable Government
Securities deposited pursuant to Section 8.04 hereof or the principal and
interest received in respect thereof other than any such tax, fee or other
charge which by law is for the account of the Holders of the outstanding Notes.
Notwithstanding anything in this Article 8 to the contrary, the
Trustee will deliver or pay to the Company from time to time upon the written
request of the Company any money or non-callable Government Securities held by
it as provided in Section 8.04 hereof which, in the opinion of a nationally
recognized firm of independent public accountants expressed in a written
certification thereof delivered to the Trustee (which may be the opinion
delivered under Section 8.04(1) hereof), are in excess of the amount thereof
that would then be required to be deposited to effect an equivalent Legal
Defeasance or Covenant Defeasance.
Section 8.06 REPAYMENT TO COMPANY.
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, premium or
Liquidated Damages, if any, or interest on any Note and remaining unclaimed for
two years after such principal, premium or Liquidated Damages, if any, or
interest has become due and payable shall be paid to the Company on its request
or (if then held by the Company) will be discharged from such trust; and the
Holder of such Note will thereafter be permitted to 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, will thereupon cease; PROVIDED, HOWEVER, that the Trustee or such
Paying Agent, before being required to make any such repayment, shall at the
expense of the Company cause to be published once, in the New York Times and The
Wall Street Journal (national edition), notice that such money remains unclaimed
and that, after a date specified therein, which will not be less than 30 days
from the date of such notification or publication, any unclaimed balance of such
money then remaining will be repaid to the Company.
Section 8.07 REINSTATEMENT.
If the Trustee or Paying Agent is unable to apply any United States
dollars or non-callable Government Securities in accordance with Section 8.02 or
8.03 hereof, as the case may be, by reason of any order or judgment of any court
or governmental authority enjoining, restraining or otherwise prohibiting such
application, then the Company's and the Guarantor's obligations under this
Indenture and the Notes and the Subsidiary Guarantees will be revived and
reinstated as though no deposit had occurred pursuant to Section 8.02 or 8.03
hereof until such time as the Trustee or Paying Agent is permitted to apply all
such money in accordance with Section 8.02 or 8.03 hereof, as the case may be;
PROVIDED, HOWEVER, that, if the Company makes any payment of principal of,
premium or Liquidated Damages, if any, or interest on any Note following the
reinstatement of its obligations, the Company will be subrogated to the rights
of the Holders of such Notes to receive such payment from the money held by the
Trustee or Paying Agent.
ARTICLE 9.
AMENDMENT, SUPPLEMENT AND WAIVER
Section 9.01 WITHOUT CONSENT OF HOLDERS OF NOTES.
Notwithstanding Section 9.02 of this Indenture, the Company, the
Guarantors and the Trustee may amend or supplement this Indenture, the
Subsidiary Guarantees or the Notes without the consent of any Holder of a Note:
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(1) to cure any ambiguity, defect or inconsistency;
(2) to provide for uncertificated Notes in addition to or in
place of certificated Notes or to alter the provisions of Article 2
hereof (including the related definitions) in a manner that does not
materially adversely affect any Holder;
(3) to provide for the assumption of the Company's or a
Guarantor's obligations to the Holders of the Notes by a successor to
the Company pursuant to Article 5 or Article 12 hereof;
(4) to make any change that would provide any additional rights
or benefits to the Holders of the Notes or that does not adversely
affect the legal rights hereunder of any Holder of the Note;
(5) to comply with requirements of the SEC in order to effect or
maintain the qualification of this Indenture under the TIA;
(6) to provide for the issuance of Additional Notes in accordance
with the limitations set forth in this Indenture as of the date
hereof;
(7) to allow any Guarantor to execute a supplemental indenture
and/or a Subsidiary Guarantee with respect to the Notes;
(8) to make, complete or confirm any grant of Collateral
permitted or required by this Indenture or any release of Collateral
that becomes effective as set forth in this Indenture;
(9) to reflect any waiver or termination of any right arising
under Article 10 that otherwise would be enforceable by any holder of
a Parity Lien Obligation or Parity Lien, if such waiver or termination
is set forth or provided in this Indenture or agreement governing or
giving rise to such Parity Lien Obligation or Parity Lien, PROVIDED
that no such waiver or amendment pursuant to this clause (8) shall
adversely affect the rights of Holders of the Notes; or
(10) as provided in clause (2) of Section 10.07.
Upon the request of the Company accompanied by a resolution of its
Board of Directors authorizing the execution of any such amended or supplemental
Indenture, and upon receipt by the Trustee of the documents described in Section
7.02 hereof, the Trustee will join with the Company and the Guarantors in the
execution of any amended or supplemental Indenture authorized or permitted by
the terms of this Indenture and to make any further appropriate agreements and
stipulations that may be therein contained, but the Trustee will not be
obligated to enter into such amended or supplemental Indenture that affects its
own rights, duties or immunities under this Indenture or otherwise.
Section 9.02 WITH CONSENT OF HOLDERS OF NOTES.
Except as provided below in this Section 9.02, the Company and the
Trustee may amend or supplement this Indenture (including, without limitation,
Section 3.09, 4.10 and 4.15 hereof), the Subsidiary Guarantees, the Notes and
the Second-Lien Documents with the consent of the Holders of at least a majority
in principal amount of the Notes (including, without limitation, Additional
Notes, if any) then outstanding voting as a single class (including, without
limitation, consents obtained in connection with a tender offer or exchange
offer for, or purchase of, the Notes), and, subject to Sections 6.04 and 6.07
hereof, any existing Default or Event of Default (other than a Default or Event
of Default in the payment of the principal of, premium or Liquidated Damages, if
any, or interest on the Notes, except a
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payment default resulting from an acceleration that has been rescinded) or
compliance with any provision of this Indenture, the Subsidiary Guarantees, the
Notes or the Second-Lien Security Documents may be waived with the consent of
the Holders of a majority in principal amount of the then outstanding Notes
voting as a single class (including consents obtained in connection with a
tender offer or exchange offer for, or purchase of, the Notes). An amendment or
supplement to, or waiver of, the provision of Article 10 will become effective
only as set forth in Section 10.11.
Upon the request of the Company accompanied by a resolution of its
Board of Directors authorizing the execution of any such amended or supplemental
Indenture, and upon the filing with the Trustee of evidence satisfactory to the
Trustee of the consent of the Holders of Notes as aforesaid, and upon receipt by
the Trustee of the documents described in Section 7.02 hereof, the Trustee will
join with the Company in the execution of such amended or supplemental Indenture
unless such amended or supplemental Indenture directly affects the Trustee's own
rights, duties or immunities under this Indenture or otherwise, in which case
the Trustee may in its discretion, but will not be obligated to, enter into such
amended or supplemental Indenture.
It is not be necessary for the consent of the Holders of Notes under
this Section 9.02 to approve the particular form of any proposed amendment or
waiver, but it is sufficient if such consent approves the substance thereof.
After an amendment, supplement or waiver under this Section 9.02
becomes effective, the Company will mail to the Holders of Notes affected
thereby a notice briefly describing the amendment, supplement or waiver. Any
failure of the Company to mail such notice, or any defect therein, will not,
however, in any way impair or affect the validity of any such amended or
supplemental Indenture or waiver. Subject to Sections 6.04 and 6.07 hereof, the
Holders of a majority in aggregate principal amount of the Notes then
outstanding voting as a single class may waive compliance in a particular
instance by the Company with any provision of this Indenture or the Notes.
However, without the consent of each Holder affected, an amendment or waiver
under this Section 9.02 may not (with respect to any Notes held by a
non-consenting Holder):
(1) reduce the principal amount of Notes whose Holders must
consent to an amendment, supplement or waiver;
(2) reduce the principal of or change the fixed maturity of any
Note or alter the provisions with respect to the redemption of the
Notes except as provided above with respect to Sections 3.09, 4.10 and
4.15 hereof;
(3) reduce the rate of or change the time for payment of
interest, on any Note;
(4) waive a Default or Event of Default in the payment of
principal of, interest or premium, or Liquidated Damages, if any, on
the Notes (except a rescission of acceleration of the Notes by the
Holders of at least a majority in aggregate principal amount of the
Notes and a waiver of the payment default that resulted from such
acceleration);
(5) make any Note payable in money other than that stated in the
Notes;
(6) make any change in the provisions of this Indenture relating
to waivers of past Defaults or the rights of Holders of Notes to
receive payments of principal of, or interest or premium or Liquidated
Damages, if any, on the Notes;
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(7) waive a redemption payment with respect to any Note (other
than a payment required by one of the covenants described above under
Sections 4.10 or 4.15);
(8) make any change in Section 6.04 or 6.07 hereof or in the
foregoing amendment and waiver provisions; or
(9) release any Guarantor from any of its obligations under its
Subsidiary Guarantee or this Indenture, except in accordance with the
terms of this Indenture.
Section 9.03 COMPLIANCE WITH TRUST INDENTURE ACT.
Every amendment or supplement to this Indenture or the Notes will be
set forth in a amended or supplemental Indenture that complies with the TIA as
then in effect.
Section 9.04 REVOCATION AND EFFECT OF CONSENTS.
Until an amendment, supplement or waiver becomes effective, a consent
to it by a Holder of a Note is a continuing consent by the Holder of a Note and
every subsequent Holder of a Note or portion of a Note that evidences the same
debt as the consenting Holder's Note, even if notation of the consent is not
made on any Note. However, any such Holder of a Note or subsequent Holder of a
Note may revoke the consent as to its Note if the Trustee receives written
notice of revocation before the date the waiver, supplement or amendment becomes
effective. An amendment, supplement or waiver becomes effective in accordance
with its terms and thereafter binds every Holder.
Section 9.05 NOTATION ON OR EXCHANGE OF NOTES.
The Trustee may place an appropriate notation about an amendment,
supplement or waiver on any Note thereafter authenticated. The Company in
exchange for all Notes may issue and the Trustee shall, upon receipt of an
Authentication Order, authenticate new Notes that reflect the amendment,
supplement or waiver.
Failure to make the appropriate notation or issue a new Note will not
affect the validity and effect of such amendment, supplement or waiver.
Section 9.06 TRUSTEE TO SIGN AMENDMENTS, ETC.
The Trustee will sign any amended or supplemental Indenture authorized
pursuant to this Article 9 if the amendment or supplement does not adversely
affect the rights, duties, liabilities or immunities of the Trustee. The Company
may not sign an amendment or supplemental Indenture until the Board of Directors
approves it. In executing any amended or supplemental indenture, the Trustee
shall receive and (subject to Section 7.01 hereof) will be fully protected in
conclusively relying upon, in addition to the documents required by Section
14.04 hereof, an Officers' Certificate and an Opinion of Counsel stating that
the execution of such amended or supplemental Indenture is authorized or
permitted by this Indenture.
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ARTICLE 10.
RANKING OF NOTE LIENS
Section 10.01 AGREEMENT FOR THE BENEFIT OF HOLDERS OF PRIORITY AND PARITY
LIENS.
The Trustee and the Collateral Agent agree, and each Holder of Notes
by accepting a Note agrees, that:
(1) the Note Liens (and, to the extent the Trustee, the
Collateral Agent or any Holder of Notes has an interest therein, the
Parity Liens) upon any and all Collateral are, to the extent and in
the manner provided in this Article 10, subordinate in ranking to all
present and future Priority Liens; and
(2) the Note Liens upon any and all Collateral will be of equal
ranking with all present and future Parity Liens,
and that such agreements as to the ranking of the Note Liens:
(A) are enforceable by the holders of Priority Liens, for
the benefit of the holders of Priority Lien Obligations secured
thereby, and enforceable by the holders of Parity Liens, for the
benefit of the holders of Parity Lien Obligations secured
thereby;
(B) will remain enforceable by the holders of Priority
Liens until the Discharge of Priority Lien Indebtedness; and
(C) will remain enforceable by the holders of Parity
Liens until the Discharge of Parity Lien Indebtedness.
Section 10.02 RANKING.
Notwithstanding (a) anything to the contrary contained in the Note
Documents or the Priority Lien Documents, (b) the time, order or method of
attachment of the Note Liens, the Priority Liens or the Parity Liens, (c) the
time or order of filing or recording of financing statements or other documents
filed or recorded to perfect any Lien upon any Collateral, (d) the time of
taking possession or control over any Collateral, (e) the rules for determining
priority under the Uniform Commercial Code or any other law governing relative
priorities of secured creditors, (f) that any Priority Lien may not have been
perfected, (g) that any Priority Lien may be or have become subordinated, by
equitable subordination or otherwise, to any other Lien, or (h) any other
circumstance of any kind or nature whatsoever, whether similar or dissimilar to
any of the foregoing:
(1) the Note Liens and (to the extent the Trustee, the Collateral
Agent or any Holder of Notes has an interest therein) the Parity Liens
will in all circumstances be subordinate in ranking to all Priority
Liens, whenever granted upon any present or future Collateral, but
only to the extent such Priority Liens secure Priority Lien
Obligations; and
(2) the Note Liens will in all circumstances be of equal ranking
with all valid, enforceable and perfected Parity Liens, whenever
granted upon any present or future Collateral, but only to the extent
such Parity Liens secure Parity Lien Obligations.
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Section 10.03 LIEN SHARING WITH PARITY LIENS.
If the Company at any time delivers to the Trustee and the Collateral
Agent:
(1) an Officer's Certificate requesting that the Trustee direct
the Collateral Agent to transfer the Note Liens to a proposed Joint
Collateral Agent pursuant to a proposed Note Lien Assignment delivered
to the Trustee and Collateral Agent therewith and stating that:
(a) the Company intends to incur, on a date stated
therein, Indebtedness that will constitute Parity Lien Indebtedness;
(b) the Company has appointed such proposed Joint
Collateral Agent pursuant to a proposed Joint Collateral Agent
Undertaking executed and delivered by the Company and such proposed
Joint Collateral Agent and delivered to the Trustee and Collateral
Agent therewith;
(c) the Company will, on the date of such incurrence,
grant Liens to such proposed Joint Collateral Agent, for the benefit
of the holders of Note Obligations and Parity Lien Obligations and as
security for all present and future Note Obligations and Parity Lien
Obligations, upon all or substantially all of the Collateral that, on
such date, is subject to the Note Liens, pursuant to proposed
additional Second-Lien Security Documents delivered to the Trustee and
Collateral Agent therewith that are substantially the same as the
Second-Lien Security Documents in effect on such date, except in favor
of the proposed Joint Collateral Agent for the benefit of the holders
of Note Obligations and Parity Lien Obligations and as security for
all present and future Note Obligations and Parity Lien Obligations;
(d) the Liens granted by such proposed additional
Second-Lien Security Documents will not be subject or subordinate to
any Lien securing Indebtedness other than Priority Liens and Liens
permitted by clause (8) of the definition of "Permitted Liens"; and
(e) the Company and its Restricted Subsidiaries will, on
such date, enter into all amendments to the Second-Lien Security
Documents then in effect that are necessary to add Parity Lien
Obligations to the obligations secured thereby, pursuant to amendments
delivered to the Trustee and the Collateral Agent therewith, to be
executed on such date by the proposed Joint Collateral Agent and the
Company or the Restricted Subsidiary party to such Second-Lien
Security Documents;
and
(2) an Opinion of Counsel confirming on customary terms
confirming among other things:
(a) the existence, good standing, powers and authority of
the proposed Joint Collateral Agent;
(b) the validity and enforceability of the proposed Joint
Collateral Agent Undertaking, Note Lien Assignment and all additional
and amended Second-Lien Security Documents delivered to the Trustee;
(c) the validity, enforceability and perfection of the
Liens granted by such Second-Lien Security Documents; and
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(d) the continued perfection of the Note Liens, without
loss of priority as against any Lien other than Parity Liens, upon
giving effect to such Note Lien Assignment and any such amendment of
the Second-Lien Security Documents,
then the Trustee will direct the Collateral Agent to execute and deliver, and
upon such direction the Collateral Agent will be irrevocably and unconditionally
authorized and directed to execute and deliver, the proposed Note Lien
Assignment to such Joint Collateral Agent against delivery to the Trustee and
Collateral Agent of (x) written confirmation from such Joint Collateral Agent
that it accepts such Note Lien Assignment and will hold the Note Liens and all
such Second-Lien Security Documents and the Liens granted thereby for the
benefit of the holders of the Note Obligations and Parity Lien Obligations on
the terms of such Joint Collateral Agent Undertaking and (y) a further Officers'
Certificate stating that such Indebtedness has been incurred in conformity with
Section 4.09 and constitutes Parity Lien Indebtedness and that such Second-Lien
Security Documents have been duly executed and delivered by the parties thereto.
Section 10.04 RESTRICTION ON ENFORCEMENT OF NOTE LIENS AND PARITY LIENS.
(a) Subject to Section 10.04(g) and Section 10.14, the Collateral
Agent will not, and will not authorize or direct any Person acting for it, the
Trustee or any holder of Note Obligations or Parity Lien Obligations to exercise
any right or remedy with respect to any Collateral (including any right of
set-off) or take any action to enforce, collect or realize upon any Collateral,
including, without limitation, any right, remedy or action to:
(1) take possession of or control over any Collateral;
(2) exercise any collection rights in respect of any Collateral
or retain any proceeds of accounts and other obligations receivable
paid to it directly by any account debtor;
(3) exercise any right of set-off against any property subject to
any Priority Lien;
(4) foreclose upon any Collateral or take or accept any transfer
of title in lieu of foreclosure upon any Collateral;
(5) enforce any claim to the proceeds of insurance upon any
Collateral;
(6) deliver any notice, claim or demand relating to the
Collateral to any Person (including any securities intermediary,
depositary bank or landlord) in the possession or control of any
Collateral or acting as bailee, custodian or agent for any holder of
Priority Liens in respect of any Collateral;
(7) otherwise enforce any remedy available upon default for the
enforcement of any Lien upon the Collateral;
(8) deliver any notice or commence any proceeding for any of the
foregoing purposes; or
(9) seek relief in any Insolvency or Liquidation Proceeding
permitting it to do any of the foregoing,
and the Trustee and Holders of Notes will not authorize or instruct
the Collateral Agent to exercise any such right or remedy or take any such
action, except that, in any event, any such right or remedy may be exercised and
any such action may be taken, authorized or instructed:
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(A) at any time after the Discharge of Priority Lien
Indebtedness;
(B) if all Priority Lien Indebtedness has been purchased
by the Person entitled to purchase the outstanding Priority Lien
Indebtedness upon exercise of the Default Purchase Option;
(C) as necessary to redeem any Collateral in a creditor's
redemption permitted by law or to deliver (subject to the prior
Discharge of Priority Lien Indebtedness) any notice or demand
necessary to enforce any right to claim, take or receive proceeds
of Collateral remaining after the Discharge of Priority Lien
Indebtedness in the event of foreclosure or other enforcement of
any prior Lien (including Priority Liens), so long as the
enforcement of any Priority Lien is not materially affected or
delayed;
(D) as necessary to perfect a Lien upon any Collateral by
any method of perfection except through possession or control; or
(E) subject to all the other provisions of this Article
10, as necessary to prove (but not enforce) the Note Liens or
Parity Liens or any Obligation secured thereby or as necessary to
preserve or protect (but not enforce) the Note Liens or any
Parity Liens in any manner that is not materially adverse to the
grant, perfection, priority or enforcement of Priority Liens and
does not materially affect or delay or affect any exercise or
enforcement of the rights and remedies of the holders of Priority
Liens.
(b) Except for payments received free from the Priority Liens as
provided in Section 10.04(g), all proceeds of Collateral received by the Trustee
or the Collateral Agent at any time prior to the Discharge of Priority Lien
Indebtedness (whether received prior to, during or after completion of any
Insolvency or Liquidation Proceeding) will be held by the Trustee or the
Collateral Agent for account of the holders of Priority Liens and remitted, upon
demand of the Priority Lien Agent, to the Priority Lien Agent or a
representative of the holders of Priority Lien Obligations then outstanding and
secured by Priority Liens. To the extent provided by applicable law, the Note
Liens and any Parity Liens will remain attached to and, subject to this Article
10, enforceable against all proceeds so held or remitted.
(c) None of the rights and remedies otherwise available to the holders
of Priority Liens in respect of the foreclosure or other enforcement of Priority
Liens and none of the other rights and remedies of the holders of Priority Liens
and Priority Lien Obligations under the Priority Lien Documents will be
impaired, restricted or affected by this Article 10.
(d) Until the Discharge of Priority Lien Indebtedness, the holders of
Priority Liens will have the exclusive right to manage, perform and enforce the
terms of the Priority Lien Documents with respect to all Collateral and to
exercise and enforce all privileges and rights thereunder according to their
discretion and exercise of their business judgment, including, without
limitation, the exclusive right to take the actions enumerated in clauses (1)
through (9) of Section 10.04(a). In connection therewith, each of the Holders of
Notes, the Trustee and the Collateral Agent waives any and all rights to affect
the method or challenge the appropriateness of any action by any holder of any
Priority Lien and hereby consents to each holder of any Priority Lien exercising
or not exercising such rights and remedies as if no Note Lien or Parity Lien
existed, except only that the Holders of Notes, the Trustee and the Collateral
Agent reserve all rights granted by law:
(1) to request or receive notice of any sale of Collateral in
foreclosure of any Priority Lien; or
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(2) to redeem any Collateral or enforce any right to claim, take
or receive proceeds of Collateral remaining after the Discharge of
Priority Lien Indebtedness as provided in clause (C) of Section
10.04(a).
(e) Until the Discharge of Priority Lien Indebtedness:
(1) the Priority Lien Agent will have the sole right to adjust
settlement of all insurance claims and condemnation awards in the
event of any covered loss, theft, destruction or condemnation of any
Collateral and all claims under insurance constituting Collateral;
(2) all proceeds of insurance on or constituting Collateral and
all condemnation awards resulting from a taking of any Collateral will
inure to the benefit of, and will be paid to, the holders of the
Priority Liens; and
(3) the Collateral Agent will co-operate, if necessary and as
reasonably requested by the Priority Lien Agent, in effecting the
payment of insurance proceeds to the Priority Lien Agent.
(f) Until the Discharge of Priority Lien Indebtedness, neither the
Holders of Notes nor the Trustee nor the Collateral Agent will:
(1) request judicial relief, in an Insolvency or Liquidation
Proceeding or in any other court, that would hinder, delay, limit or
prohibit the exercise or enforcement of any right or remedy otherwise
available to the holders of Priority Liens or that would limit,
invalidate, avoid or set aside any Priority Lien or Priority Lien
Security Document or subordinate the Priority Liens to the Note Liens
or Parity Liens or grant the Priority Liens equal ranking to the Note
Liens or Parity Liens;
(2) oppose or otherwise contest any motion for relief from the
automatic stay or from any injunction against foreclosure or
enforcement of Priority Liens made by any holder of Priority Liens in
any Bankruptcy or Insolvency Proceeding;
(3) oppose or otherwise contest any exercise by any holder of
Priority Liens of the right to credit bid Priority Lien Indebtedness
at any sale in foreclosure of Priority Liens; or
(4) oppose or otherwise contest any other request for judicial
relief made in any court by any holder of Priority Liens relating to
the enforcement of any Priority Lien.
(g) Except for payments that are made from or constitute proceeds of
property subject to Priority Liens and that are (1) made in breach of any
provision of the Credit Agreement to purchase, redeem, prepay or pay the
principal of the Notes or to fund a legal defeasance or covenant defeasance
pursuant to Article 8, unless in connection with such payments the Trustee
received an Officers' Certificate or Opinion of Counsel, or a certificate of the
Credit Agreement Agent, that application of such payment to the principal of the
Notes was permitted under the Credit Agreement or (2) received by the Trustee or
the Collateral Agent or any holder of Note Obligations (A) as a result of any
breach of the provisions of this Article 10 or any Intercreditor Agreement, (B)
any time after the commencement of any Insolvency or Liquidation Proceeding in
respect of the Company or the grantor of a Lien on such property, or (C) at any
time after the Trustee and the Collateral Agent have received written notice
from the Priority Lien Agent stating that (i) any Priority Lien Indebtedness has
become due and payable in full (whether at maturity, upon acceleration or
otherwise) or (ii) the holders of Priority Liens have become entitled to and
desire to enforce any or all of the Priority Liens by reason of a default under
Priority Lien Documents:
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(1) no payment of money made by the Company or any of its
Restricted Subsidiaries to the Trustee, the Collateral Agent, any
Holder of Notes or any other holder of Note Obligations (including,
without limitation, payments and prepayments made for application to
Note Obligations and all other payments and deposits made pursuant to
any provision of this Indenture or any other Note Document) will in
any event be subject to the foregoing provisions of this Section 10.04
or otherwise affected by any of the provisions of this Article 10; and
(2) all payments permitted to be received under Section
10.04(g)(1) will be received by the Trustee, the Collateral Agent, the
Holders of Notes and the other holders of Note Obligation free from
the Priority Liens and all other Liens thereon except the Note Liens
and, as to any such payments held by a Joint Collateral Agent, the
Parity Liens.
Section 10.05 INSOLVENCY OR LIQUIDATION PROCEEDINGS.
(a) If, in any Insolvency or Liquidation Proceeding and prior to the
Discharge of Priority Lien Indebtedness, the holders of all Priority Lien
Indebtedness outstanding under the Credit Agreement (or such number of such
holders as may have the power to bind all of them) or the holders of all
outstanding Priority Lien Indebtedness (or such number of such holders as may
have the power to bind all of them):
(1) consent to any order for use of cash collateral;
(2) consent to any order approving a debtor-in-possession
financing secured by a Lien senior to or at parity with all Priority
Liens upon any property of the estate in such Insolvency or
Liquidation Proceeding;
(3) consent to any order granting any priming lien, replacement
lien, cash payment or other relief on account of Priority Lien
Obligations as adequate protection (or its equivalent) for the
interests of the holders of Priority Liens in property subject to the
Priority Liens, whether such order is entered in connection with any
order for use of cash collateral or debtor-in-possession financing or
otherwise; or
(4) consent to any order relating to any sale of assets of any
Obligor and providing, to the extent the sale is to be free and clear
of liens, that all such liens shall attach to the proceeds of the
sale, and, in connection therewith, consent to and support before the
Court any request for Credit Bid Rights made by the Trustee, the
Collateral Agent or any Holder of Notes (except that such Holders need
not admit, consent to or support any valuation of the Collateral
alleged in support of the allowance of any secured claim based upon
the Note Liens),
then, so long as:
(A) the holders of such Priority Lien Indebtedness do not
oppose or otherwise contest any request made by the holders of
Note Obligations (which may be made only if, pursuant to any such
order, the holders of Priority Liens or Priority Lien Obligations
are, or are to be, granted a Lien upon any property) for the
grant to the Collateral Agent, for the benefit of the holders of
Note Obligations and any outstanding Parity Lien Obligations and
as adequate protection (or its equivalent) for the Collateral
Agent's interest in the Collateral under the Note Liens and any
Parity Liens, of a junior lien upon such property that is
co-extensive in all respects with, but subordinated (as set forth
in this Article 10) in all respects to, all Priority Liens upon
such property and any such lien granted to the holders of
Priority Liens or Priority Lien Obligations pursuant to such
order; and
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(B) the aggregate principal amount of Indebtedness at any
one time permitted to be outstanding under any such
debtor-in-possession financing, when added to the principal
amount of Priority Lien Indebtedness then outstanding, is not
permitted, under the order approving such financing, to exceed
the sum of:
(i) the greater of (x) $200,000,000 and (y) the
maximum amount then permitted by clause (1) of the
definition of "Permitted Debt;"
(ii) the maximum amount then permitted by clause
(12) of the definition of "Permitted Debt"; and
(iii) $50,000,000,
the Holders of Notes, the Trustee and the Collateral Agent will not oppose or
otherwise contest the entry of such order, except that any such order relating
to a sale of assets may be opposed or otherwise contested by them (x) as
necessary to secure the grant of Credit Bid Rights or (y) based on any ground
that may be asserted by a holder of unsecured claims (but not except for Credit
Bid Rights on any grounds arising from or relating to any Note Lien or any
secured claim or secured creditor rights based upon any Note Lien).
(b) Except for any relief granting a junior lien as provided in
Section 10.05(a), the Holders of Notes, the Trustee and the Collateral Agent
will not, at any time prior to the Discharge of Priority Lien Indebtedness, file
or prosecute in any Insolvency or Liquidation Proceeding any motion for adequate
protection (or any comparable request for relief) based upon their interests in
the Collateral under the Note Liens or Parity Liens.
(c) If, in any Liquidation or Insolvency Proceeding, debt obligations
of the reorganized debtor secured by Liens upon any property of the reorganized
debtor are distributed, pursuant to a plan of reorganization or similar
dispositive restructuring plan, both on account of Priority Lien Indebtedness
and on account of the Notes, then, to the extent the debt obligations
distributed on account of the Priority Lien Indebtedness and on account of the
Notes are secured by Liens upon the same property, the provisions of this
Article 10 will survive the distribution of such debt obligations pursuant to
such plan and will apply with like effect to the Liens securing such debt
obligations.
(d) The Holders of Notes, the Trustee and the Collateral Agent will
not assert or enforce, at any time prior to the Discharge of Priority Lien
Indebtedness, any claim under Section 506(c) of the United States Bankruptcy
Code senior to or on a parity with the Priority Liens for costs or expenses of
preserving or disposing of any Collateral.
(e) If, for purposes of valuation of the secured claims of the holders
of Priority Lien Indebtedness in any Insolvency or Liquidation Proceeding, the
holders of Priority Lien Indebtedness determine, and the Priority Lien Agent
notifies the Trustee and the Collateral Agent, that the Collateral should be
valued as of any particular time in the period from the date of commencement of
such Insolvency or Liquidation Proceeding to the date of confirmation of any
plan of reorganization or other dispositive restructuring plan therein, then the
Holders of Notes, the Trustee and the Collateral Agent will not oppose or
otherwise contest that the date as of which such secured claims should be valued
is the date chosen by the holders of Priority Lien Indebtedness, but the Holders
of Notes, the Trustee and the Collateral Agent will remain free (i) to contest
without any restriction any valuation claimed or asserted by the holders of
Priority Lien Indebtedness as of such date and (ii) to assert and seek relief
determining that the Collateral should be valued at another date if a valuation
at the other date would have the effect of placing a higher value upon the
Collateral, taken as a whole.
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(f) If, in connection with the approval by creditors of any plan of
reorganization or other dispositive restructuring plan in any Insolvency or
Liquidation Proceeding, either:
(1) secured claims based upon the Notes and secured claims based
upon the Priority Lien Indebtedness are classified in the same class
of secured claims; or
(2) secured claims based upon the Notes are classified in a
separate class from secured claims based upon the Priority Lien
Indebtedness and are treated under such plan as an impaired secured
class, and such plan could not be lawfully be confirmed or approved by
the court in such Insolvency or Liquidation Proceeding unless the
class of secured claims based upon the Notes votes, as a class, to
accept such plan,
then the holders of secured claims based upon the Notes will not vote such
secured claims to accept such plan if:
(A) the Priority Lien Agent notifies the holders of such
secured claims (in such manner and to such Persons at such
addresses as the Trustee may direct), at least 10 Business Days
before ballots are due in the voting on such plan, that fewer
than the holders of two-thirds in amount of secured claims based
upon the Priority Lien Indebtedness will vote, as a separate
class (or as if they were a separate class), to accept such plan;
(B) such notice is not withdrawn by the Priority Lien
Agent by written notice to the Trustee or the Holders of Notes;
and
(C) such plan is not accepted by the holders of secured
claims based upon the Priority Lien Indebtedness voting as a
separate class (or as if they were a separate class).
The Holders of Notes will not otherwise be restricted in voting any secured
claims based upon the Notes and will not be in any respect restricted in voting
any unsecured claims based upon the Note Obligations.
The Trustee shall provide the Priority Lien Agent with such information as may
be available to the Trustee as to the names and notice addresses of the holders
of secured claims based upon the Notes. The notice described in clause (A) shall
be conclusively deemed sufficiently given if mailed by ordinary mail, postage
prepaid, to such names and addresses. No ballot voting a secured claim based
upon the Notes shall be delivered in respect of any such plan by any holder of
secured claims based upon the Notes prior to the last date on which the notice
described in clause (A) may be given by the Priority Lien Agent. Any ballot cast
in violation of this Section 10.05(f) will be invalid.
(g) If (i) any Priority Lien is avoided in any Insolvency or
Liquidation Proceeding, (ii) by reason of such avoidance, there is a resultant
reduction (a "Priority Lien Secured Claim Reduction") in the amount of the
secured claims (without regard to unsecured claims) that, but for such
avoidance, would have been allowed in such Insolvency or Liquidation Proceeding
on account of claims based upon Priority Lien Obligations, and (iii) a
distribution is made in such Insolvency or Liquidation Proceeding on account of
secured claims (without regard to any unsecured claims) based upon Note
Obligations, whether such distribution is made in cash, securities or otherwise,
or the Collateral Agent receives any proceeds from the foreclosure or other
enforcement of the Note Liens (such distribution or receipt, a "Second-Lien
Recovery"), then a portion of such Second-Lien Recovery (the "Shareable
Recovery") determined by multiplying:
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(1) a percentage determined by dividing (A) the aggregate amount
allowed in such Insolvency or Liquidation Proceeding on account of all
unsecured claims based upon Priority Lien Obligations (after giving
effect to such avoidance) by (B) the aggregate amount allowed in such
Insolvency or Liquidation Proceeding on account of all unsecured
claims based upon Priority Lien Obligations (after giving effect to
such avoidance) and all secured and unsecured claims based upon Note
Obligations
BY
(2) the lesser of (A) the amount of such Priority Lien Secured
Claim Reduction and (B) the amount of such Second-Lien Recovery,
shall be received and held by the Trustee subject to an option, exercisable
solely by the Priority Lien Agent by written notice delivered to the Trustee no
later than the 20th Business Day after the latest of:
(i) the date on which such Second-Lien Recovery is
received; and
(ii) the date on which the amount (if any) of secured
claims and unsecured claims based on the Priority
Lien Obligations and the Note Obligations are
allowed in such Insolvency or Liquidation
Proceeding; and
(iii) the date on which the amount of such Priority Lien
Secured Claim Reduction is determined,
to exchange the Shareable Recovery (in the form received, with any interest
accrued thereon) for an equivalent amount (net of any such accrued interest) of
unsecured claims allowed in such Insolvency or Liquidation Proceeding based upon
Priority Lien Obligations or for any substantially contemporaneous distribution
(exchanged in the form received, with any interest accrued thereon) made in such
Insolvency or Liquidation Proceeding on account of such equivalent amount of
unsecured claims based upon Priority Lien Obligations. Such exchange shall be
made by each party thereto without any recourse, representation, warranty or
liability whatsoever.
Section 10.06 RELEASE OF COLLATERAL OR SUBSIDIARY GUARANTEES UPON SALE OR OTHER
DISPOSITION.
(a) If the Company and, at any time prior to the Discharge of Priority
Lien Indebtedness, the Priority Lien Agent certifies to the Trustee and the
Collateral Agent that:
(1) any specified Collateral, or all Capital Stock owned by the
Company and its Subsidiaries in a Subsidiary which, directly or
indirectly through another Subsidiary, owns such Collateral, is sold,
transferred or otherwise disposed of:
(A) by the owner of such Collateral to a Person other
than the Company or a Restricted Subsidiary of the Company in a
transaction not prohibited under this Indenture or the Priority
Lien Documents; or
(B) by the holder of any Priority Lien in a foreclosure
or other enforcement of a Priority Lien which does not, taken
together with all other sales, transfers or dispositions made by
the Company or any of its Restricted Subsidiaries or any holder
of Priority Liens in connection therewith or in contemplation
thereof, constitute a sale, transfer or disposition of all or
substantially all of the assets of the Company and its Restricted
Subsidiaries, taken as a whole;
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and
(2) all Liens upon such Collateral securing Priority Lien
Obligations will be forever released and discharged upon such sale,
transfer or other disposition (whether or not such Liens attach to the
proceeds of the sale),
then (whether or not any Insolvency or Liquidation Proceeding is pending at the
time) the Note Liens and Parity Liens upon such Collateral will automatically be
released and discharged as and when and to the extent such Liens securing
Priority Lien Obligations are released and discharged.
(b) If the Company at any time prior to the Discharge of Priority Lien
Indebtedness, the Priority Lien Agent certifies to the Trustee and the
Collateral Agent that:
(1) all or substantially all Capital Stock owned by the Company
and its Subsidiaries in any Subsidiary of the Company (a "Sold
Subsidiary") is sold, transferred or otherwise disposed of (whether
directly by transfer of Capital Stock issued by the Sold Subsidiary or
indirectly by transfer of Capital Stock of other Subsidiaries which,
directly or indirectly, own Capital Stock issued by the Sold
Subsidiary):
(A) by the owner of such Capital Stock to a Person other
than the Company or a Restricted Subsidiary of the Company in a
transaction not prohibited under this Indenture or the Priority
Lien Documents; or
(B) by the holder of any Priority Lien in a foreclosure
or other enforcement of a Priority Lien which does not, taken
together with all other sales, transfers or dispositions made by
the Company or any of its Restricted Subsidiaries or any holder
of Priority Liens in connection therewith or in contemplation
thereof, constitute a sale, transfer or disposition of all or
substantially all of the assets of the Company and its Restricted
Subsidiaries, taken as a whole;
and
(2) all Guarantees of Priority Lien Obligations made by the Sold
Subsidiary and all Liens upon property of the Sold Subsidiary securing
Priority Lien Obligations will be forever released and discharged upon
such sale, transfer or other disposition (whether or not such Liens
attach to the proceeds of the sale),
then (whether or not any Insolvency or Liquidation Proceeding is pending at the
time) the Subsidiary Guarantee made by such Subsidiary and all Note Liens and
Parity Liens upon the property of such Subsidiary will automatically be released
and discharged as and when and to the extent such Guarantees of Priority Lien
Obligations and Liens securing Priority Lien Obligations are released and
discharged.
(c) Upon delivery to the Trustee and Collateral Agent of a certificate
of the Priority Lien Agent stating that any release of Note Liens and Parity
Liens has become effective pursuant to Section 10.06(a) or 10.06(b), the
Collateral Agent will promptly execute and deliver an instrument confirming such
release on customary terms and without any recourse, representation, warranty or
liability whatsoever. If the Collateral Agent unreasonably fails to do so, the
Priority Lien Agent is hereby irrevocably authorized and empowered, with full
power of substitution, to execute and deliver such instrument on such terms in
the name, place and stead of the Collateral Agent.
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Section 10.07 AMENDMENT OF SECOND-LIEN SECURITY DOCUMENTS.
(a) Prior to the Discharge of Priority Lien Indebtedness:
(1) The Collateral Agent will not enter into, and the Trustee and
the Holders of Notes will not authorize or direct, any amendment of or
supplement to any Second-Lien Security Document relating to any
Collateral that would make such Second-Lien Security Document
inconsistent in any material respect with the comparable provisions of
the Priority Lien Security Document upon such Collateral. No such
amendment or supplement will be enforceable.
(2) Without the consent of any Holder of Notes, the Trustee or
the Collateral Agent, any amendment, waiver or consent agreed to, upon
any terms and conditions, by the Company or any other Obligor and the
Priority Lien Agent in respect of any provision of any Priority Lien
Security Document, except to the extent effectuating or relating to
any release of Liens, will automatically apply, on the same terms and
subject to the same conditions, to the comparable provision of the
comparable Second-Lien Security Document, effective upon the delivery
by the Priority Lien Agent of written notice of such amendment, waiver
or consent, and the terms and conditions thereof, to the Trustee and
the Collateral Agent, if the notice states that such amendment, waiver
or consent has become effective as to such agreement and is, pursuant
to this Section 10.07(a)(2), likewise effective as to the comparable
provision of the comparable Second-Lien Security Document. Such
amendment, waiver or consent need not otherwise be confirmed by the
Trustee, the Collateral Agent or any Holder of Notes, in order to be
effective.
For the purposes of Section 10.07(a)(1), (i) no inconsistency reflected in the
Second-Lien Security Documents delivered in connection with the issuance of the
Notes, as compared with the comparable provisions of the comparable Priority
Lien Security Documents then in effect, will be subject to the provisions of
Section 10.07(a)(1) and (ii) any provision granting rights or powers to the
Collateral Agent that are not granted to the holders of Priority Liens securing
Priority Lien Indebtedness outstanding under the Credit Agreement will
constitute a material inconsistency.
(b) No amendment, supplement, waiver or change otherwise permitted by
this Indenture in respect of the Priority Lien Documents will be prohibited or
in any manner restricted or affected by, or by reason of, the provisions of this
Article 10.
Section 10.08 WAIVER OF CERTAIN SUBROGATION, MARSHALLING, APPRAISAL AND
VALUATION RIGHTS.
(a) To the fullest extent permitted by law, the Holders of Notes, the
Trustee and the Collateral Agent agree not to assert or enforce at any time
prior to the Discharge of Priority Lien Indebtedness:
(1) any right of subrogation to the rights or interests of
holders of Priority Liens or Priority Lien Obligations (or any claim
or defense based upon impairment of any such right of subrogation);
(2) any right of marshalling accorded to a junior lienholder, as
against a priority lienholder, under equitable principles; and
(3) any statutory right of appraisal or valuation accorded to a
junior lienholder in a proceeding to foreclose a senior lien,
that otherwise may be enforceable in respect of any Note Lien or Parity Lien as
against any holder of Priority Liens.
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(b) Without in any way limiting the generality of the foregoing, each
holder of Priority Lien Obligations or Priority Liens may at any time and from
time to time, without the consent of or notice to any holder of Note
Obligations, Parity Lien Obligations, Note Liens or Parity Liens, without
incurring any responsibility or liability to any holder of Note Obligations,
Parity Lien Obligations, Note Liens or Parity Liens and without in any manner
prejudicing, affecting or impairing the ranking agreements and other obligations
set forth in this Article 10:
(1) make loans and advances to the Company or any of its
Subsidiaries or issue, guaranty or obtain letters of credit for
account of the Company or any of its Subsidiaries or otherwise extend
credit to the Company or any of its Subsidiaries, in any amount
(subject to the provisions of this Indenture relating to the maximum
amount of the Priority Lien Indebtedness) and on any terms, whether
pursuant to a commitment or as a discretionary advance and whether or
not any default or event of default or failure of condition is then
continuing;
(2) change the manner, place or terms of payment or extend the
time of payment of, or renew or alter, compromise, accelerate, extend
or refinance, any Priority Lien Obligations or any agreement,
guaranty, Lien or obligation of the Company or any of its Subsidiaries
or any other person or entity in any manner related thereto, or
otherwise amend, supplement or change in any manner any Priority Lien
Obligations or Priority Liens or any such agreement, guaranty, lien or
obligation;
(3) increase or reduce the amount of any Priority Lien Obligation
(subject to the provisions of this Indenture relating to the maximum
amount of the Priority Lien Indebtedness) or the interest, premium,
fees or other amounts payable in respect thereof;
(4) release or discharge any Priority Lien Obligation or any
guaranty thereof or any agreement or obligation of the Company or any
of its Subsidiaries or any other person or entity with respect
thereto;
(5) take or fail to take any Priority Lien or any other
collateral security for any Priority Lien Obligation or take or fail
to take any action which may be necessary or appropriate to ensure
that any Priority Lien or any other Lien upon any property is duly
enforceable or perfected or entitled to priority as against any other
Lien or to ensure that any proceeds of any property subject to any
Lien are applied to the payment of any Priority Lien Obligation or any
other obligation secured thereby;
(6) release, discharge or permit the lapse of any or all Priority
Liens or any other Liens upon any property at any time securing any
Priority Lien Obligation;
(7) exercise or enforce, in any manner, order or sequence, or
fail to exercise or enforce, any right or remedy against the Company
or any other Obligor or any collateral security or any other person,
entity or property in respect of any Priority Lien Obligation or any
Priority Lien or other Lien securing any Priority Lien Obligation or
any right or power under this Article 10, and apply any payment or
proceeds of collateral in any order of application; or
(8) sell, exchange, release, foreclose upon or otherwise deal
with any property that may at any time be subject to any Priority Lien
or any other Lien securing any Priority Lien Obligation.
(c) No exercise, delay in exercising or failure to exercise any right
arising under this Article 10, no act or omission of any holder of Priority
Liens or Priority Lien Obligations in respect of the Company
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or any of its Restricted Subsidiaries or any other person or entity or any
collateral security for any Priority Lien Obligation or any right arising under
this Article 10, no change, impairment, or suspension of any right or remedy of
any holder of any Priority Liens or Priority Lien Obligations, and no other act,
failure to act, circumstance, occurrence or event which, but for this provision,
would or could act as a release or exoneration of any obligation under this
Article 10 will in any way affect, decrease, diminish or impair any of the
ranking agreements and other obligations of the Holders of Notes, the Trustee
and the Collateral Agent set forth in this Article 10.
(d) None of the Credit Agreement Agent, any other Priority Lien Agent,
any holder of Priority Liens or any holder of Priority Lien Obligations will
have any duty, express or implied, fiduciary or otherwise, to any holder of Note
Obligations, Parity Lien Obligations, Note Liens or Parity Liens.
(e) To the maximum extent permitted by law, each of the Holders of
Notes, the Trustee and the Collateral Agent waives any claim it may have against
the Credit Agreement Agent, any other Priority Lien Agent, any holder of
Priority Liens or any holder of Priority Lien Obligations with respect to or
arising out of any action or failure to act or any error of judgment or
negligence on the part of the Credit Agreement Agent or any other Priority Lien
Agent or any holder of Priority Liens or Priority Lien Obligations or their
respective directors, officers, employees or agents with respect to any exercise
of rights or remedies in respect of the Priority Liens or the Priority Lien
Obligations or under the Priority Lien Documents or any transaction relating to
the Collateral. Neither the Credit Agreement Agent nor any other Priority Lien
Agent nor any holder of Priority Liens or Priority Lien Obligations nor any of
their respective directors, officers, employees or agents will be liable for
failure to demand, collect or realize upon any of the Collateral or for any
delay in doing so, except to the extent arising out of the gross negligence or
willful misconduct of the Credit Agreement Agent or any other Priority Lien
Agent or any such holder or any of their respective directors, officers,
employees or agents, or will be under any obligation to sell or otherwise
dispose of any Collateral upon the request of the Company or any other Obligor
or upon the request of any holder of Note Obligations, Parity Lien Obligations,
Note Liens or Parity Liens or any other Person or to take any other action
whatsoever with regard to the Collateral or any part thereof.
(f) The holders of Priority Liens and Priority Lien Obligations, on
the one hand, and the holders of Note Obligations, Parity Lien Obligations, Note
Liens or Parity Liens, on the other hand, shall each be responsible for keeping
themselves informed of the financial condition of the Company and its
Subsidiaries and all other circumstances bearing upon the risk of nonpayment of
the Priority Lien Obligations or Note Obligations. The holders of Priority Liens
and Priority Lien Obligations and the Priority Lien Agent shall have no duty to
advise the Trustee or any holder of Note Obligations, Parity Lien Obligations,
Note Liens or Parity Liens of information regarding such condition or
circumstances or as to any other matter. If any holder of Priority Liens or
Priority Lien Obligations or the Priority Lien Agent, in its sole discretion,
undertakes at any time or from time to time to provide any such information to
the Trustee or any holder of Note Obligations, Parity Lien Obligations, Note
Liens or Parity Liens, it shall be under no obligation to provide any similar
information on any subsequent occasion, to provide any additional information,
to undertake any investigation, or to disclose any information which, pursuant
to accepted or reasonable commercial finance practice, it wishes to maintain
confidential.
Section 10.09 LIMITATION ON CERTAIN RELIEF AND DEFENSES.
(a) No action taken or omitted for the benefit of the holders of
Priority Liens or Parity Liens by the Company or any of its Restricted
Subsidiaries in breach of any covenant set forth in this Indenture will
constitute a defense to the enforcement of the provisions of this Article 10 by
such holders in accordance with the terms of this Article 10, if, when such
action was taken or omitted, such holders
93
received and in good faith relied on an Officers' Certificate or Opinion of
Counsel to the effect that such action was permitted under this Indenture.
(b) The Note Liens and any Parity Liens will not be forfeited,
invalidated, discharged or otherwise affected or impaired by any breach of any
obligation of the Holders of Notes, the Trustee or the Collateral Agent set
forth in Sections 10.04, 10.05, 10.06, 10.07, 10.08, 10.09, 10.10 and 10.11.
Section 10.10 REINSTATEMENT.
(a) If the payment of any amount applied to any Priority Lien
Indebtedness secured by any Priority Liens is later avoided or rescinded
(including by settlement of any claim for avoidance or rescission) or otherwise
set aside, then:
(1) to the fullest extent lawful, all claims for the payment of
such amount as Priority Lien Indebtedness and, to the extent securing
such claims, all such Priority Liens will be reinstated and entitled
to the benefits of this Article 10; and
(2) if a Discharge of Priority Lien Indebtedness became effective
prior to such reinstatement, all obligations of the Holders of Notes,
the Trustee and the Collateral Agent under this Article 10 that were
terminated as a result of such Discharge of Priority Lien Indebtedness
will be concurrently reinstated on the date and to the extent such
claims and Priority Liens are reinstated, beginning on such date but
prospectively only (and not retroactively), as though no Priority Lien
Indebtedness or Priority Liens had been outstanding at any time prior
to such date, and will remain effective until the claims for such
amount are paid in full in cash.
(b) If a Discharge of Priority Lien Indebtedness results from the
retirement of the Credit Agreement by voluntary payment or prepayment in full at
any time when no Default or Event of Default exists, without the Credit
Agreement being replaced at such time by a new Credit Facility, and if the
Company thereafter, at any time when no Default or Event of Default exists,
obtains a new Credit Facility that constitutes Priority Lien Indebtedness, then:
(1) the Company may reinstate the obligations of the Holders of
Notes, the Trustee and the Collateral Agent under this Article 10 that
were terminated as a result of such Discharge of Priority Lien
Indebtedness, but only as to Collateral that is or becomes subject to
Liens securing the new Credit Facility and only for the benefit of the
holders of Priority Lien Obligations arising in respect of the new
Credit Facility, by delivering to the Trustee and the Collateral
Agent, before any credit is extended under the new Credit Facility, an
Officers' Certificate describing the new Credit Facility and the
collateral security therefor and certifying that all extensions of
credit under the new Credit Facility will constitute Priority Lien
Indebtedness and that no Default or Event of Default existed at the
time of such Discharge of Priority Lien Indebtedness, exists on the
date of the Officers' Certificate or will exist on the date of the
first extension of credit under the new Credit Facility; and thereupon
(2) the obligations of the Holders of Notes, the Trustee and the
Collateral Agent under this Article 10 that were terminated as a
result of such Discharge of Priority Lien Indebtedness shall be
reinstated beginning on the date of the first extension of credit
under the new Credit Facility but prospectively only (and not
retroactively) and only for the benefit of the holders of Priority
Lien Obligations arising in respect of the new Credit Facility, as
though no other Priority Lien Indebtedness or Priority Liens had been
outstanding at any time prior to the date of such reinstatement.
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(c) No:
(1) action to enforce Note Liens or Parity Liens at any time
prior to the date of any reinstatement pursuant to Section 10.10(a) or
10.10(b);
(2) receipt or collection of Collateral or any other property by
the Holders of Notes, the Trustee or the Collateral Agent at any time
prior to the date of any such reinstatement;
(3) application of any Collateral or other property to the
payment of Note Obligations or Parity Lien Obligations at any time
prior to the date of any such reinstatement; or
(4) other action taken or omitted by the Holders of Notes, the
Trustee or the Collateral Agent or other event occurring at any time
prior to the date of any such reinstatement,
will, if it was permitted at such time under this Article 10 without giving
effect to any subsequent reinstatement under Section 10.10(a) or 10.10(b),
constitute a breach of any obligation of the Holders of Notes, the Trustee or
the Collateral Agent under this Article 10 or give rise to any right, claim or
interest whatsoever enforceable by any holder of Priority Liens or Priority Lien
Obligations or by any other Person.
Section 10.11 AMENDMENT; WAIVER.
(a) No amendment or supplement to the provisions of this Article 10
will:
(1) be effective unless set forth in a writing signed by the
Trustee with the consent of the holders of at least a majority in
principal amount of the Notes (including, without limitation,
Additional Notes) then outstanding voting as a single class, except
that any such amendment which increases the obligations or adversely
affects the rights of the Holders of Notes will be effective only with
the consent of the Holders of at least 66-2/3% in principal amount of
the Notes (including, without limitation, Additional Notes) then
outstanding, voting as a single class; and
(2) become effective at any time when any Priority Lien
Indebtedness, or any commitment to extend credit that will constitute
Priority Lien Indebtedness, is outstanding unless such amendment or
supplement is consented to in a writing signed either by the Priority
Lien Agent or by the holders of at least 80% in principal amount of
all Priority Lien Indebtedness then outstanding, voting as a single
class.
Any such amendment or supplement that:
(A) imposes any obligation upon the Company or adversely
affects the rights of the Company under Section 10.03 will become
effective only with the consent of the Company; or
(B) imposes any obligation upon the Collateral Agent or
adversely affects the rights of the Collateral Agent in its
individual capacity at any time when the Trustee is not the
Collateral Agent will become effective only with the consent of
the Collateral Agent.
95
(b) No waiver of any of the provisions of this Article 10 will in any
event be effective unless set forth in a writing signed and consented to, as
required for an amendment under Section 10.11, by the party to be bound thereby.
Section 10.12 ENFORCEMENT.
(a) The provisions of this Article 10 may be enforced solely by the
holders of Priority Liens and Priority Lien Obligations granted and outstanding
from time to time and, subject to Section 10.12(c), the holders of Parity Liens
and Parity Lien Obligations granted and outstanding from time to time and will
be enforceable by injunctive relief without need for any bond or undertaking or
any proof as to the adequacy of legal remedies or the nature, immediacy or
irreparability of any injury to any holder of Priority Liens or Parity Liens.
Neither the Company nor any other Obligor nor any other Person, except the
holders of Priority Liens, Priority Lien Obligations, Parity Liens and Parity
Lien Obligations, will be entitled to rely on, benefit from or enforce any of
the provisions of this Article 10, except, in the case of the Company only, the
provisions of Section 10.03.
(b) Each and all of the rights and powers granted in this Article 10
or in any of the Priority Lien Documents to the holders of Priority Liens or
Priority Lien Obligations or to the Priority Lien Agent may be exercised and
enforced by them in any manner determined by them to be appropriate in their own
interest or in the interests of the holders of Priority Lien Obligations,
without any duty whatsoever to any holder of Note Obligations, Parity Lien
Obligations, Note Liens or Parity Liens.
(c) The obligations of the Holders of Notes, the Trustee and the
Collateral Agent set forth in Sections 10.04, 10.05, 10.06, 10.07, 10.08, 10.09,
10.10 and 10.11 are intended solely for the benefit of the holders of Priority
Liens and Priority Lien Obligations and may not be enforced by any holder of
Parity Liens or Parity Lien Obligations or by any other Person.
(d) No right of any holder of Priority Liens or Parity Liens to
enforce the ranking agreements or any other obligation set forth in this Article
10 may be impaired by any act or failure to act by the Company, the Trustee or
any Holder of Notes or by the failure of the Company, the Trustee or any Holder
of Notes to comply with this Indenture.
(e) The obligations of the Holders of Notes, the Trustee and the
Collateral Agent are continuing obligations and may not be revoked at any time
when any Priority Lien Indebtedness, or any commitment to extend credit that
will constitute Priority Lien Indebtedness, is outstanding.
Section 10.13 NOTES, SUBSIDIARY GUARANTEES AND OTHER NOTE OBLIGATIONS NOT
SUBORDINATED.
The provisions of this Article 10 are intended solely to set forth the
relative ranking, as Liens, of (1) the Note Liens (and, to the extent the
Trustee, the Collateral Agent or any Holder of Notes has an interest therein,
the Parity Liens) as against the Priority Liens and (2) the Note Liens as
against the Parity Liens. The Notes and Subsidiary Guarantees are senior
non-subordinated obligations of the Company and Guarantors. Neither the Notes,
the Subsidiary Guarantees and other Note Obligations nor the exercise or
enforcement of any right or remedy for the payment or collection thereof are
intended to be, or will ever be by reason of the provisions of this Article 10,
in any respect subordinated, deferred, postponed, restricted or prejudiced.
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Section 10.14 RELATIVE RIGHTS.
This Article 10 defines the relative rights, as lienholders, of
holders of Note Liens and holders of Priority Liens and Parity Liens. Nothing in
this Indenture will:
(1) impair, as between the Company and Holders of Notes, the
obligation of the Company, which is absolute and unconditional, to pay
principal of, premium and interest and Liquidated Damages, if any, on
the Notes in accordance with their terms or any other obligation of
the Company or any other Obligor under the Note Documents;
(2) affect the relative rights of Holders of Notes and creditors
of the Company or any of its Restricted Subsidiaries;
(3) restrict the right of any Holder of Notes to ▇▇▇ for payments
that are then due and owing or to commence or take any action to
commence any Insolvency or Liquidation Proceeding; or
(4) prevent the Trustee or any Holder of Notes from exercising
against the Company or any other Obligor any of its other available
remedies upon a Default or Event of Default, subject to the rights of
holders of Priority Liens and Parity Liens, and the obligations of the
Holders of Notes, the Trustee and the Collateral Agent, under this
Article 10.
If the Company or any Restricted Subsidiary fails because of this
Article 10 to perform any obligation binding upon it under any Note Document,
the failure is still a Default or Event of Default.
ARTICLE 11.
COLLATERAL AND SECURITY
Section 11.01 SECOND-LIEN SECURITY DOCUMENTS.
(a) The payment of the principal of and interest and premium and
Liquidated Damages, if any, on the Notes when due, whether on an interest
payment date, at maturity, by acceleration, repurchase, redemption or otherwise
and whether by the Company pursuant to the Notes or by any Guarantor pursuant to
the Subsidiary Guarantees, the payment of all other Note Obligations and the
performance of all other obligations of the Company and its Restricted
Subsidiaries under the Note Documents are secured as provided in the Second-Lien
Security Documents which the Company and the Guarantors have entered into
simultaneously with the execution of this Indenture and will be secured by all
Second-Lien Security Documents hereafter delivered as required or permitted by
this Indenture.
(b) The Company will, and will cause each of its Restricted
Subsidiaries to, do or cause to be done all acts and things which may be
required, or which the Collateral Agent from time to time may reasonably
request, to assure and confirm that the Collateral Agent holds, for the benefit
of the holders of Note Obligations or, if the Collateral Agent is a Joint
Collateral Agent, for the benefit of the holders of Note Obligations and Parity
Lien Obligations, duly created, enforceable and perfected Liens upon the
Collateral as contemplated by this Indenture and the Second-Lien Security
Documents, so as to render the same available for the security and benefit of
this Indenture and of the Notes, Subsidiary Guarantees and all other Note
Obligations, according to the intent and purposes herein expressed.
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Section 11.02 COLLATERAL AGENT.
(a) The Trustee will act as Collateral Agent until such time, if any,
as the Note Liens are transferred to the Joint Collateral Agent pursuant to
Section 10.03.
(b) The Collateral Agent is authorized and empowered to appoint one or
more co-Collateral Agents as it deems necessary or appropriate.
(c) Neither the Trustee nor the Collateral Agent nor any of their
respective officers, directors, employees, attorneys or agents will be
responsible or liable for the existence, genuineness, value or protection of any
Collateral, for the legality, enforceability, effectiveness or sufficiency of
the Second-Lien Security Documents, for the creation, perfection, priority,
sufficiency or protection of any Note Lien, or for any defect or deficiency as
to any such matters, or for any failure to demand, collect, foreclose or realize
upon or otherwise enforce any of the Note Liens or Second-Lien Security
Documents or any delay in doing so.
(d) The Collateral Agent will be subject to such directions as may be
given it by the Trustee from time to time as required or permitted by this
Indenture. Except as directed by the Trustee as required or permitted by this
Indenture or any Joint Collateral Agent Undertaking, the Collateral Agent will
not be obligated:
(1) to act upon directions purported to be delivered to it by any
other Person;
(2) to foreclose upon or otherwise enforce any Note Lien; or
(3) to take any other action whatsoever with regard to any or all
of the Note Liens, Second-Lien Security Documents or Collateral.
(e) The Collateral Agent will be accountable only for amounts that it
actually receives as a result of the enforcement of the Note Liens or
Second-Lien Security Documents.
(f) In acting as Collateral Agent or Co-Collateral Agent, the
Collateral Agent and each Co-Collateral Agent may rely upon and enforce each and
all of the rights, powers, immunities, indemnities and benefits of the Trustee
under Article 7.
(g) For as long as the Trustee is the Collateral Agent, each successor
Trustee will become the successor Collateral Agent as and when the successor
Trustee becomes the Trustee.
(h) At all times when the Trustee is not itself the Collateral Agent,
the Company will deliver to the Trustee copies of all Second-Lien Security
Documents delivered to the Collateral Agent and copies of all documents
delivered to the Collateral Agent pursuant to the Second-Lien Security
Documents.
Section 11.03 AUTHORIZATION OF ACTIONS TO BE TAKEN.
(a) Each Holder of Notes, by its acceptance thereof, consents and
agrees to the terms of each Second-Lien Security Document and Intercreditor
Agreement, as originally in effect and as amended, supplemented or replaced from
time to time in accordance with its terms or the terms of this Indenture,
authorizes and directs the Trustee and the Collateral Agent to enter into the
Second-Lien Security Documents, authorizes and empowers the Trustee to direct
the Collateral Agent to enter into, and the Collateral Agent to execute and
deliver, each Intercreditor Agreement, and authorizes and empowers the Trustee
and the Collateral Agent to bind the Holders of Notes and other holders of Note
Obligations as set
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forth in the Second-Lien Security Documents and each Intercreditor Agreement and
to perform its obligations and exercise its rights and powers thereunder.
(b) The Collateral Agent and the Trustee are authorized and empowered
to receive for the benefit of the Holders of Notes any funds collected or
distributed under the Second-Lien Security Documents and to make further
distributions of such funds to the Holders of Notes according to the provisions
of this Indenture.
(c) Subject to the provisions of Section 7.01 and 7.02 and Article 10,
the Trustee may, in its sole discretion and without the consent of the Holders
of Notes, direct, on behalf of the Holders of Notes, the Collateral Agent to
take all actions it deems necessary or appropriate in order to:
(1) foreclose upon or otherwise enforce any or all of the Note
Liens;
(2) enforce any of the terms of the Second-Lien Security
Documents; or
(3) collect and receive payment of any and all Note Obligations.
The Trustee is authorized and empowered to institute and maintain, or direct the
Collateral Agent to institute and maintain, such suits and proceedings as it may
deem expedient to protect or enforce the Note Liens or the Second-Lien Security
Documents or to prevent any impairment of Collateral by any acts that may be
unlawful or in violation of the Second-Lien Security Documents or this
Indenture, and such suits and proceedings as the Trustee or the Collateral Agent
may deem expedient to preserve or protect its interests and the interests of the
Holders of Notes in the Collateral, including power to institute and maintain
suits or proceedings to restrain the enforcement of or compliance with any
legislative or other governmental enactment, rule or order that may be
unconstitutional or otherwise invalid if the enforcement of, or compliance with,
such enactment, rule or order would impair the security interest hereunder or be
prejudicial to the interests of Holders of Notes, the Trustee or the Collateral
Agent.
Section 11.04 RELEASE OF NOTE LIENS.
(a) The Note Liens will be released:
(1) in whole, upon payment in full of the principal of, accrued
and unpaid interest and premium and Liquidated Damages, if any, on the
Notes and payment in full of all other Note Obligations that are due
and payable at or prior to the time such principal, accrued and unpaid
interest and premium and Liquidated Damages, if any, are paid;
(2) in whole, upon satisfaction and discharge of this Indenture
pursuant to Section 12.01;
(3) in whole, upon a legal defeasance or covenant defeasance
pursuant to Article 8;
(4) in part, as to any property constituting Collateral that (a)
is sold or otherwise disposed of by the Company or one of its
Subsidiaries in a transaction permitted by this Indenture, at the time
of such sale or disposition, to the extent of the interest sold or
disposed of, or (b) is owned or at any time acquired by a Subsidiary
that has been released from its Subsidiary Guarantee, concurrently
with the release of such Subsidiary Guarantee; or
(5) in part, as to any specific item of Collateral, as provided
in Section 10.07(a)(2).
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(b) Upon delivery to the Trustee of an Officers' Certificate
requesting release of the Note Liens pursuant to Section 11.04(a), accompanied
by:
(1) an Opinion of Counsel confirming that such release is
required by Section 11.04(a);
(2) all instruments requested by the Company to effectuate or
confirm such release; and
(3) such other certificates and documents as the Trustee or
Collateral Agent may reasonably request to confirm the matters set
forth in Section 11.04(a),
the Trustee will, if such instruments and confirmation are reasonably
satisfactory to the Trustee and Collateral Agent, instruct the Collateral Agent
to execute and deliver, and the Collateral Agent will promptly execute and
deliver, such instruments.
(c) All instruments effectuating or confirming any release of any Note
Liens will have the effect solely of releasing such Note Liens as to the
Collateral described therein, on customary terms and without any recourse,
representation, warranty or liability whatsoever.
(d) The Trustee and Collateral Agent are not required to serve, file,
register or record any instrument releasing Collateral.
(e) The Company will bear and pay all costs and expenses associated
with any release of Note Liens pursuant to Section 10.06 or this Section 11.04,
including all reasonable fees and disbursements of any attorneys or
representatives acting for the Trustee or for the Collateral Agent.
Section 11.05 FILING, RECORDING AND OPINIONS.
(a) The Company will furnish to the Trustee and the Collateral Agent
immediately prior to the issuance of the Exchange Notes an Opinion of Counsel
either:
(1) stating that, in the opinion of such counsel, all action has
been taken with respect to the recording, registering and filing of
this Indenture, financing statements, mortgages, collateral
assignments, lien notices or other instruments necessary to make
effective and perfect the Liens intended to be created by the
Second-Lien Security Documents, and reciting the details of such
action; or
(2) stating that, in the opinion of such counsel, no such action
is necessary to make such Liens effective and perfected.
(b) The Company will furnish to the Trustee and the Collateral Agent
on March 31 in each year, beginning with March 31, 2003, an Opinion of Counsel,
dated as of such date, either:
(1) stating that, in the opinion of such counsel, (A) action has
been taken with respect to the recording, registering, filing,
re-recording, re-registering and re-filing of all supplemental
indentures, financing statements, continuation statements or notices,
recordations or instruments of further assurance as is necessary to
maintain and perfect the Liens intended to be created by the
Second-Lien Security Documents and reciting the details of such action
or referring to prior Opinions of Counsel in which such details are
given, and (B) based on relevant laws as in effect on the date of such
Opinion of Counsel, all financing statements and continuation
statements have been executed and filed that are necessary as of such
date and during the succeeding 13 months to
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perfect the Note Liens, to the extent the Note Liens can be perfected
by the filing of a financing statement; or
(2) stating that, in the opinion of such counsel, no such action
is necessary to maintain such Liens as effective and perfected.
(c) The Company will otherwise comply with the provisions of TIA
Section 314(b).
(d) To the extent applicable, the Company will cause TIA Section
313(b), relating to reports, and TIA Section 314(d), relating to the release of
property or securities from Note Liens or relating to the substitution therefor
of any property or securities to be subjected to the Lien of the Second-Lien
Security Documents, to be complied with. Any certificate or opinion required by
TIA Section 314(d) may be made by an Officer of the Company except in cases
where TIA Section 314(d) requires that such certificate or opinion be made by an
independent Person, which Person will be an independent engineer, appraiser or
other expert reasonably satisfactory to the Trustee and the Collateral Agent.
(e) To the extent applicable, the Company will furnish to the Trustee
and the Collateral Agent, prior to each proposed release of Collateral pursuant
to the Second-Lien Security Documents:
(1) all documents required by TIA Section 314(d); and
(2) an Opinion of Counsel to the effect that such accompanying
documents constitute all documents required by TIA Section 314(d).
The Trustee may, to the extent permitted by Sections 7.01 and 7.02 hereof,
accept as conclusive evidence of compliance with the foregoing provisions the
appropriate statements contained in such documents and Opinion of Counsel.
(f) If any Collateral is released in accordance with this Indenture or
any Second-Lien Security Document at a time when the Trustee is not itself also
the Collateral Agent and if the Company has delivered the certificates and
documents required by the Second-Lien Security Documents and this Sections
11.02, the Trustee will determine whether it has received all documentation
required by TIA Section 314(d) in connection with such release and, based on
such determination and the Opinion of Counsel delivered pursuant to Section
11.02, will deliver a certificate to the Collateral Agent setting forth such
determination.
ARTICLE 12.
subsidiary GUARANTEES
Section 12.01 GUARANTEE.
(a) Subject to this Article 12, each of the Guarantors hereby, jointly
and severally, unconditionally guarantees to each Holder of a Note authenticated
and delivered by the Trustee and to the Trustee and its successors and assigns,
irrespective of the validity and enforceability of this Indenture, the Notes or
the obligations of the Company hereunder or thereunder, that:
(1) the principal of, premium and Liquidated Damages, if any, and
interest on the Notes will be promptly paid in full when due, whether
at maturity, by acceleration, redemption or otherwise, and interest on
the overdue principal of and interest on the Notes, if any, if lawful,
and
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all other obligations of the Company to the Holders or the Trustee
hereunder or thereunder will be promptly paid in full or performed,
all in accordance with the terms hereof and thereof; and
(2) in case of any extension of time of payment or renewal of any
Notes or any of such other obligations, that same will be promptly
paid in full when due or performed in accordance with the terms of the
extension or renewal, whether at stated maturity, by acceleration or
otherwise.
Failing payment when due of any amount so guaranteed or any
performance so guaranteed for whatever reason, the Guarantors will be jointly
and severally obligated to pay the same immediately. Each Guarantor agrees that
this is a guarantee of payment and not a guarantee of collection.
(b) The Guarantors hereby agree that their obligations hereunder are
unconditional, irrespective of the validity, regularity or enforceability of the
Notes or this Indenture, the absence of any action to enforce the same, any
waiver or consent by any Holder of the Notes with respect to any provisions
hereof or thereof, the recovery of any judgment against the Company, any action
to enforce the same or any other circumstance which might otherwise constitute a
legal or equitable discharge or defense of a guarantor. Each Guarantor hereby
waives diligence, presentment, demand of payment, filing of claims with a court
in the event of insolvency or bankruptcy of the Company, any right to require a
proceeding first against the Company, protest, notice and all demands whatsoever
and covenant that this Subsidiary Guarantee will not be discharged except by
complete performance of the obligations contained in the Notes and this
Indenture.
(c) If any Holder or the Trustee is required by any court or otherwise
to return to the Company, the Guarantors or any custodian, trustee, liquidator
or other similar official acting in relation to either the Company or the
Guarantors, any amount paid by either to the Trustee or such Holder, this
Subsidiary Guarantee, to the extent theretofore discharged, will be reinstated
in full force and effect.
(d) Each Guarantor agrees that it will not be entitled to any right of
subrogation in relation to the Holders in respect of any obligations guaranteed
hereby until payment in full of all obligations guaranteed hereby. Each
Guarantor further agrees that, as between the Guarantors, on the one hand, and
the Holders and the Trustee, on the other hand, (1) the maturity of the
obligations guaranteed hereby may be accelerated as provided in Article 6 hereof
for the purposes of this Subsidiary Guarantee, notwithstanding any stay,
injunction or other prohibition preventing such acceleration in respect of the
obligations guaranteed hereby, and (2) in the event of any declaration of
acceleration of such obligations as provided in Article 6 hereof, such
obligations (whether or not due and payable) will forthwith become due and
payable by the Guarantors for the purpose of this Subsidiary Guarantee. The
Guarantors will have the right to seek contribution from any non-paying
Guarantor so long as the exercise of such right does not impair the rights of
the Holders under the Subsidiary Guarantee.
Section 12.02 LIMITATION ON GUARANTOR LIABILITY.
Each Guarantor, and by its acceptance of Notes, each Holder, hereby
confirms that it is the intention of all such parties that the Subsidiary
Guarantee of such Guarantor not constitute a fraudulent transfer or conveyance
for purposes of Bankruptcy Law, the Uniform Fraudulent Conveyance Act, the
Uniform Fraudulent Transfer Act or any similar federal or state law to the
extent applicable to any Subsidiary Guarantee. To effectuate the foregoing
intention, the Trustee, the Holders and the Guarantors hereby irrevocably agree
that the obligations of such Guarantor will be limited to the maximum amount
that will, after giving effect to such maximum amount and all other contingent
and fixed liabilities of such Guarantor that are relevant under such laws, and
after giving effect to any collections from, rights to receive contribution from
or payments made by or on behalf of any other Guarantor in respect of the
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obligations of such other Guarantor under this Article 12, result in the
obligations of such Guarantor under its Subsidiary Guarantee not constituting a
fraudulent transfer or conveyance.
Section 12.03 EXECUTION AND DELIVERY OF SUBSIDIARY GUARANTEE.
To evidence its Subsidiary Guarantee set forth in Section 12.01, each
Guarantor hereby agrees that a notation of such Subsidiary Guarantee
substantially in the form attached as Exhibit E hereto will be endorsed by an
Officer of such Guarantor on each Note authenticated and delivered by the
Trustee and that this Indenture will be executed on behalf of such Guarantor by
one of its Officers.
Each Guarantor hereby agrees that its Subsidiary Guarantee set forth
in Section 12.01 will remain in full force and effect notwithstanding any
failure to endorse on each Note a notation of such Subsidiary Guarantee.
If an Officer whose signature is on this Indenture or on the
Subsidiary Guarantee no longer holds that office at the time the Trustee
authenticates the Note on which a Subsidiary Guarantee is endorsed, the
Subsidiary Guarantee will be valid nevertheless.
The delivery of any Note by the Trustee, after the authentication
thereof hereunder, will constitute due delivery of the Subsidiary Guarantee set
forth in this Indenture on behalf of the Guarantors.
In the event that the Company creates or acquires any Domestic
Subsidiary after the date of this Indenture, if required by Section 4.24 hereof,
the Company will cause such Domestic Subsidiary to comply with the provisions of
Section 4.24 hereof and this Article 12, to the extent applicable.
Section 12.04 GUARANTORS MAY CONSOLIDATE, ETC., ON CERTAIN TERMS.
Except as otherwise provided in Section 12.05, no Guarantor may sell
or otherwise dispose of all or substantially all of its assets to, or
consolidate with or merge with or into (whether or not such Guarantor is the
surviving Person) another Person, other than the Company or another Guarantor,
unless:
(1) immediately after giving effect to such transaction, no
Default or Event of Default exists; and
(2) either:
(a) subject to Section 12.05 hereof, the Person acquiring
the property in any such sale or disposition or the Person formed by
or surviving any such consolidation or merger unconditionally assumes
all the obligations of that Guarantor, pursuant to a supplemental
indenture in form and substance reasonably satisfactory to the
Trustee, under the Notes, this Indenture and the Subsidiary Guarantee
on the terms set forth herein or therein; and
(b) the Net Proceeds of such sale or other disposition
are applied in accordance with the applicable provisions of this
Indenture, including without limitation, Section 4.10 hereof.
In case of any such consolidation, merger, sale or conveyance and upon
the assumption by the successor Person, by supplemental indenture, executed and
delivered to the Trustee and satisfactory in form to the Trustee, of the
Subsidiary Guarantee endorsed upon the Notes and the due and punctual
performance of all of the covenants and conditions of this Indenture to be
performed by the Guarantor, such successor Person will succeed to and be
substituted for the Guarantor with the same effect as if it had been named
herein as a Guarantor. Such successor Person thereupon may cause to be signed
any or
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all of the Subsidiary Guarantees to be endorsed upon all of the Notes issuable
hereunder which theretofore shall not have been signed by the Company and
delivered to the Trustee. All the Subsidiary Guarantees so issued will in all
respects have the same legal rank and benefit under this Indenture as the
Subsidiary Guarantees theretofore and thereafter issued in accordance with the
terms of this Indenture as though all of such Subsidiary Guarantees had been
issued at the date of the execution hereof.
Except as set forth in Articles 4 and 5 hereof, and notwithstanding
clauses (a) and (b) above, nothing contained in this Indenture or in any of the
Notes will prevent any consolidation or merger of a Guarantor with or into the
Company or another Guarantor, or will prevent any sale or conveyance of the
property of a Guarantor as an entirety or substantially as an entirety to the
Company or another Guarantor.
Section 12.05 RELEASES.
In the event of any sale or other disposition of all or substantially
all of the assets of any Guarantor, by way of merger, consolidation or
otherwise, or any sale of Capital Stock of any Guarantor, in each case to a
Person that is not (either before or after giving effect to such transactions) a
Restricted Subsidiary of the Company, then such Guarantor (in the event of a
sale, by way of merger, consolidation or otherwise, of the Capital Stock of such
Guarantor and so long as immediately following such sale such Guarantor is no
longer a Restricted Subsidiary) or the corporation acquiring the property (in
the event of a sale or other disposition of all or substantially all of the
assets of such Guarantor) will be released and relieved of any obligations under
its Subsidiary Guarantee; PROVIDED that the Net Proceeds of such sale or other
disposition are applied in accordance with the applicable provisions of this
Indenture, including without limitation Section 4.10 hereof. Upon delivery by
the Company to the Trustee of an Officers' Certificate and an Opinion of Counsel
to the effect that such sale or other disposition was made by the Company in
accordance with the provisions of this Indenture, including without limitation
Section 4.10 hereof, the Trustee will execute any documents reasonably required
in order to evidence the release of any Guarantor from its obligations under its
Subsidiary Guarantee.
If the Company designates any Restricted Subsidiary that is a
Guarantor as an Unrestricted Subsidiary in accordance with Section 4.17 then
such Guarantor will be released and relieved of any obligations under its
Subsidiary Guarantee
Any Guarantor not released from its obligations under its Subsidiary
Guarantee will remain liable for the full amount of principal of and interest on
the Notes and for the other obligations of any Guarantor under this Indenture as
provided in this Article 12.
ARTICLE 13.
SATISFACTION AND DISCHARGE
Section 13.01 SATISFACTION AND DISCHARGE.
This Indenture will be discharged and will cease to be of further
effect as to all Notes issued hereunder, when:
(1) either:
(a) all Notes that have been authenticated, except lost,
stolen or destroyed Notes that have been replaced or paid and Notes
for whose payment money has been deposited in trust and thereafter
repaid to the Company, have been delivered to the Trustee for
cancellation; or
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(b) all Notes that have not been delivered to the Trustee
for cancellation have become due and payable by reason of the mailing
of a notice of redemption or otherwise or will become due and payable
within one year and the Company or any Guarantor has irrevocably
deposited or caused to be deposited with the Trustee as trust funds in
trust solely for the benefit of the Holders, cash in U.S. dollars,
non-callable Government Securities, or a combination thereof, in
amounts as will be sufficient, without consideration of any
reinvestment of interest, in the opinion of an accounting, appraisal
or investment banking firm of national standing, to pay and discharge
the entire indebtedness on the Notes not delivered to the Trustee for
cancellation for principal, premium and Liquidated Damages, if any,
and accrued interest to the date of maturity or redemption;
(2) no Default or Event of Default has occurred and is continuing
on the date of such deposit or will occur as a result of such deposit
and such deposit will not result in a breach or violation of, or
constitute a default under, any other instrument to which the Company
or any Guarantor is a party or by which the Company or any Guarantor
is bound;
(3) the Company or any Guarantor has paid or caused to be paid
all sums payable by it under this Indenture; and
(4) the Company has delivered irrevocable instructions to the
Trustee under this Indenture to apply the deposited money toward the
payment of the Notes at maturity or the redemption date, as the case
may be.
In addition, the Company must deliver an Officers' Certificate and an Opinion of
Counsel to the Trustee stating that all conditions precedent to satisfaction and
discharge have been satisfied.
Notwithstanding the satisfaction and discharge of this Indenture, if
money has been deposited with the Trustee pursuant to subclause (b) of clause
(1) of this Section, the provisions of Section 13.02 and Section 8.06 will
survive. In addition, nothing in this Section 13.01 will be deemed to discharge
those provisions of Section 7.07 hereof, that, by their terms, survive the
satisfaction and discharge of this Indenture.
Section 13.02 APPLICATION OF TRUST MONEY.
Subject to the provisions of Section 8.06, all money deposited with
the Trustee pursuant to Section 13.01 shall be held in trust and applied by it,
in accordance with the provisions of the Notes 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 premium, if any) and interest for whose
payment such money has been deposited with the Trustee; but such money need not
be segregated from other funds except to the extent required by law.
If the Trustee or Paying Agent is unable to apply any money or
Government Securities in accordance with Section 13.01 by reason of any legal
proceeding or by reason of any order or judgment of any court or governmental
authority enjoining, restraining or otherwise prohibiting such application, the
Company's and any Guarantor's obligations under this Indenture and the Notes
shall be revived and reinstated as though no deposit had occurred pursuant to
Section 13.01; PROVIDED that if the Company has made any payment of principal
of, premium, if any, or interest on any Notes because of the reinstatement of
its obligations, the Company shall be subrogated to the rights of the Holders of
such Notes to receive such payment from the money or Government Securities held
by the Trustee or Paying Agent.
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ARTICLE 14.
MISCELLANEOUS
Section 14.01 TRUST INDENTURE ACT CONTROLS.
If any provision of this Indenture limits, qualifies or conflicts with
the duties imposed by TIA Section 318(c), the imposed duties will control.
Section 14.02 NOTICES.
Any notice or communication by the Company, any Guarantor or the
Trustee to the others is duly given if in writing and delivered in Person or
mailed by first class mail (registered or certified, return receipt requested),
telecopier or overnight air courier guaranteeing next day delivery, to the
others' address:
If to the Company and/or any Guarantor:
H&E Equipment Services L.L.C.
H&E Finance Corp.
▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Telecopier No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: Chief Financial Officer
With a copy to:
▇▇▇▇▇▇▇▇ & ▇▇▇▇▇
Citicorp Center
▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Telecopier No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇▇▇▇▇
If to the Trustee:
The Bank of New York
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇ ▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Telecopier No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: Corporate Trust Administration
The Company, any Guarantor or the Trustee, by notice to the others
may designate additional or different addresses for subsequent notices or
communications.
All notices and communications (other than those sent to Holders) will
be deemed to have been duly given: at the time delivered by hand, if personally
delivered; five Business Days after being deposited in the mail, postage
prepaid, if mailed; when receipt acknowledged, if telecopied; and the next
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Business Day after timely delivery to the courier, if sent by overnight air
courier guaranteeing next day delivery.
Any notice or communication to a Holder will be mailed by first class
mail, certified or registered, return receipt requested, or by overnight air
courier guaranteeing next day delivery to its address shown on the register kept
by the Registrar. Any notice or communication will also be so mailed to any
Person described in TIA Section 313(c), to the extent required by the TIA.
Failure to mail a notice or communication to a Holder or any defect in it will
not affect its sufficiency with respect to other Holders.
If a notice or communication is mailed in the manner provided above
within the time prescribed, it is duly given, whether or not the addressee
receives it.
If the Company mails a notice or communication to Holders, it will
mail a copy to the Trustee and each Agent at the same time.
Section 14.03 COMMUNICATION BY HOLDERS OF NOTES WITH OTHER HOLDERS OF NOTES.
Holders may communicate pursuant to TIA Section 312(b) with other
Holders with respect to their rights under this Indenture or the Notes. The
Company, the Trustee, the Registrar and anyone else shall have the protection of
TIA Section 312(c).
Section 14.04 CERTIFICATE AND OPINION AS TO CONDITIONS PRECEDENT.
Upon any request or application by the Company to the Trustee to take
any action under this Indenture (except in connection with the original issuance
of Notes), the Company shall furnish to the Trustee:
(1) an Officers' Certificate in form and substance reasonably
satisfactory to the Trustee (which must include the statements set
forth in Section 14.05 hereof) stating that, in the opinion of the
signers, all conditions precedent and covenants, if any, provided for
in this Indenture relating to the proposed action have been satisfied;
and
(2) an Opinion of Counsel in form and substance reasonably
satisfactory to the Trustee (which must include the statements set
forth in Section 14.05 hereof) stating that, in the opinion of such
counsel, all such conditions precedent and covenants have been
satisfied.
Section 14.05 STATEMENTS REQUIRED IN CERTIFICATE OR OPINION.
Each certificate or opinion with respect to compliance with a
condition or covenant provided for in this Indenture (other than a certificate
provided pursuant to TIA Section 314(a)(4)) must comply with the provisions of
TIA Section 314(e) and must include:
(1) a statement that the Person making such certificate or
opinion has read such covenant or condition;
(2) a brief statement as to the nature and scope of the
examination or investigation upon which the statements or opinions
contained in such certificate or opinion are based;
(3) a statement that, in the opinion of such Person, he or she
has made such examination or investigation as is necessary to enable
him or her to express an informed opinion as to whether or not such
covenant or condition has been satisfied; and
107
(4) a statement as to whether or not, in the opinion of such
Person, such condition or covenant has been satisfied.
Section 14.06 RULES BY TRUSTEE AND AGENTS.
The Trustee may make reasonable rules for action by or at a meeting of
Holders. The Registrar or Paying Agent may make reasonable rules and set
reasonable requirements for its functions.
Section 14.07 NO PERSONAL LIABILITY OF DIRECTORS, OFFICERS, EMPLOYEES AND
STOCKHOLDERS.
No director, officer, employee, incorporator or stockholder of the
Company or any Guarantor, as such, will have any liability for any obligations
of the Company or the Guarantors under the Notes, this Indenture, the Subsidiary
Guarantees, the Second-Lien Security Documents or for any claim based on, in
respect of, or by reason of, such obligations or their creation. Each Holder of
Notes by accepting a Note waives and releases all such liability. The waiver and
release are part of the consideration for issuance of the Notes. The waiver may
not be effective to waive liabilities under the federal securities laws.
Section 14.08 GOVERNING LAW.
THE INTERNAL LAW OF THE STATE OF NEW YORK WILL GOVERN AND BE USED TO
CONSTRUE THIS INDENTURE, THE NOTES, THE NOTE GUARANTEES AND THE SECOND-LIEN
SECURITY DOCUMENTS WITHOUT GIVING EFFECT TO APPLICABLE PRINCIPLES OF CONFLICTS
OF LAW TO THE EXTENT THAT THE APPLICATION OF THE LAWS OF ANOTHER JURISDICTION
WOULD BE REQUIRED THEREBY.
Section 14.09 NO ADVERSE INTERPRETATION OF OTHER AGREEMENTS.
This Indenture may not be used to interpret any other indenture, loan
or debt agreement of the Company or its Subsidiaries or of any other Person. Any
such indenture, loan or debt agreement may not be used to interpret this
Indenture.
Section 14.10 SUCCESSORS.
All agreements of the Company in this Indenture and the Notes will
bind its successors. All agreements of the Trustee in this Indenture will bind
its successors. All agreements of each Guarantor in this Indenture will bind its
successors, except as otherwise provided in Section 14.05.
Section 14.11 SEVERABILITY.
In case any provision in this Indenture or in the Notes is invalid,
illegal or unenforceable, the validity, legality and enforceability of the
remaining provisions will not in any way be affected or impaired thereby.
Section 14.12 COUNTERPART ORIGINALS.
The parties may sign any number of copies of this Indenture. Each
signed copy will be an original, but all of them together represent the same
agreement.
108
Section 14.13 TABLE OF CONTENTS, HEADINGS, ETC.
The Table of Contents, Cross-Reference Table and Headings of the
Articles and Sections of this Indenture have been inserted for convenience of
reference only, are not to be considered a part of this Indenture and will in no
way modify or restrict any of the terms or provisions hereof.
[Signatures on following page]
109
SIGNATURES
Dated as of June 17, 2002
H&E EQUIPMENT SERVICES L.L.C.
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇
--------------------------------------
Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇
Title: Senior Vice President,
Finance and Secretary
H&E FINANCE CORP.
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇
--------------------------------------
Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇
Title: Senior Vice President,
Finance and Secretary
GNE INVESTMENTS, INC.
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇
--------------------------------------
Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇
Title: Secretary
GREAT NORTHERN EQUIPMENT, INC.
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇
--------------------------------------
Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇
Title: Secretary
THE BANK OF NEW YORK, AS TRUSTEE
By: /s/ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇
--------------------------------------
Name: ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇
Title: Authorized Signatory
110
SCHEDULE I
SCHEDULE OF GUARANTORS
The following schedule lists each Guarantor under the Indenture as of
the date of the Indenture:
GNE Investments, Inc.
Great Northern Equipment, Inc.
I-1
EXHIBIT A1
[Face of Note]
--------------------------------------------------------------------------------
CUSIP/CINS ____________
11 1/8% Senior Secured Notes due 2012
No. ___ $____________
H&E EQUIPMENT SERVICES L.L.C.
H&E FINANCE CORP.
promises to pay to CEDE & CO.
or registered assigns,
the principal sum of____________________________________________________________
Dollars on June 15, 2012.
Interest Payment Dates: June 15 and December 15
Record Dates: June 1 and December 1
H&E EQUIPMENT SERVICES L.L.C. H&E FINANCE CORP.
By: By:
-------------------------------- ---------------------------------
Name: Name:
Title: Title:
By: By:
-------------------------------- ---------------------------------
Name: Name:
Title: Title:
This is one of the Notes referred to
in the within-mentioned Indenture:
THE BANK OF NEW YORK,
as Trustee
By:
-------------------------------
Authorized Signatory
Dated: _____________, 2002
--------------------------------------------------------------------------------
A1-1
[Back of Note]
11 1/8% Senior Secured Notes due 2012
[INSERT THE GLOBAL NOTE LEGEND, IF APPLICABLE PURSUANT TO THE PROVISIONS OF THE
INDENTURE]
[INSERT THE PRIVATE PLACEMENT LEGEND, IF APPLICABLE PURSUANT TO THE PROVISIONS
OF THE INDENTURE]
Capitalized terms used herein have the meanings assigned to them in
the Indenture referred to below unless otherwise indicated.
(1) INTEREST. H&E Equipment Services L.L.C., a Louisiana limited
liability company ("H&E LLC) and H&E Finance Corp., a Delaware
corporation ("H&E Finance" and together with H&E LLC, the "Company"),
promises to pay interest on the principal amount of this Note at
11 1/8% per annum from June 17, 2002 until maturity and shall pay the
Liquidated Damages, if any, payable pursuant to the Registration
Rights Agreement referred to below. The Company will pay interest and
Liquidated Damages, if any, semi-annually in arrears on June 15 and
December of each year, or if any such day is not a Business Day, on
the next succeeding Business Day (each, an "Interest Payment Date").
Interest on the Notes will accrue from the most recent date to which
interest has been paid or, if no interest has been paid, from the date
of issuance; PROVIDED that if there is no existing Default in the
payment of interest, and if this Note is authenticated between a
record date referred to on the face hereof and the next succeeding
Interest Payment Date, interest shall accrue from such next succeeding
Interest Payment Date; PROVIDED, FURTHER, that the first Interest
Payment Date shall be December 15, 2002. The Company will pay interest
(including post-petition interest in any proceeding under any
Bankruptcy Law) on overdue principal and premium, if any, from time to
time on demand at a rate that is 1% per annum in excess of the rate
then in effect; it will pay interest (including post-petition interest
in any proceeding under any Bankruptcy Law) on overdue installments of
interest and Liquidated Damages, if any, (without regard to any
applicable grace periods) from time to time on demand at the same rate
to the extent lawful. Interest will be computed on the basis of a
360-day year of twelve 30-day months.
(2) METHOD OF PAYMENT. The Company will pay interest on the Notes
(except defaulted interest) and Liquidated Damages, if any, to the
Persons who are registered Holders of Notes at the close of business
on the June 1 or December 1 next preceding the Interest Payment Date,
even if such Notes are canceled after such record date and on or
before such Interest Payment Date, except as provided in Section 2.12
of the Indenture with respect to defaulted interest. The Notes will be
payable as to principal, premium and Liquidated Damages, if any, and
interest at the office or agency of the Company maintained for such
purpose within or without the City and State of New York, or, at the
option of the Company, payment of interest and Liquidated Damages, if
any, may be made by check mailed to the Holders at their addresses set
forth in the register of Holders; PROVIDED that payment by wire
transfer of immediately available funds will be required with respect
to principal of and interest, premium and Liquidated Damages, if any,
on, all Global Notes and all other Notes the Holders of which will
have provided wire transfer instructions to the Company or the Paying
Agent. Such payment will be 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.
(3) PAYING AGENT AND REGISTRAR. Initially, The Bank of New York,
the Trustee under the Indenture, will act as Paying Agent and
Registrar. The Company may change any Paying
A1-2
Agent or Registrar without notice to any Holder. The Company or any of
its Subsidiaries may act in any such capacity.
(4) INDENTURE. The Company issued the Notes under an Indenture
dated as of June 17, 2002 (the "Indenture") among the Company, the
Guarantors and the Trustee. The terms of the Notes include those
stated in the Indenture and those made part of the Indenture by
reference to the Trust Indenture Act of 1939, as amended (15 U.S. Code
Sections 77aaa-77bbbb). The Notes are subject to all such terms, and
Holders are referred to the Indenture and such Act for a statement of
such terms. To the extent any provision of this Note conflicts with
the express provisions of the Indenture, the provisions of the
Indenture shall govern and be controlling. The Notes are secured
obligations of the Company.
(5) OPTIONAL REDEMPTION.
(a) Except as set forth in subparagraph (b) of this
Paragraph 5, the Company will not have the option to redeem the Notes
prior to June 15, 2007. Thereafter, the Company may redeem all or a
part of the Notes upon not less than 30 nor more than 60 days' notice,
at the redemption prices (expressed as percentages of principal
amount) set forth below plus accrued and unpaid interest and
Liquidated Damages, if any, on the Notes redeemed, to the applicable
redemption date, if redeemed during the twelve-month period beginning
on June 15 of the years indicated below:
YEAR PERCENTAGE
---- ----------
2007.................................................. 105.563%
2008.................................................. 103.708%
2009.................................................. 101.854%
2010 and thereafter................................... 100.000%
(b) At any time prior to June 15, 2005, the Company may
on one or more occasions redeem an aggregate of up to 35% of the
aggregate principal amount of Notes issued under this Indenture at a
redemption price of 111.125% of the principal amount, plus accrued and
unpaid interest and Liquidated Damages, if any, to the redemption
date, with the net cash proceeds of an offering of Equity Interests
(other than Disqualified Stock) of the Company or Holdings (so long as
such net cash proceeds are contributed to the Company from Holdings as
common equity); PROVIDED that (1) at least 65% of the aggregate
principal amount of Notes issued under this Indenture remains
outstanding immediately after the occurrence of such redemption
(excluding Notes held by the Company and its Subsidiaries); and (2)
the redemption occurs within 60 days of the date of the closing of
such offering.
(6) MANDATORY REDEMPTION.
The Company will not be required to make mandatory redemption payments
with respect to the Notes.
(7) REPURCHASE AT OPTION OF HOLDER.
(a) If there is a Change of Control, the Company will be
required to make an offer (a "Change of Control Offer") to repurchase
all or any part (equal to $1,000 or an integral multiple thereof) of
each Holder's Notes at a purchase price in cash equal to 101% of the
aggregate principal amount thereof plus accrued and unpaid interest
and Liquidated Damages
A1-3
thereon, if any, to the date of purchase (the "Change of Control
Payment"). Within 60 days following any Change of Control, the Company
will mail a notice to each Holder setting forth the procedures
governing the Change of Control Offer as required by the Indenture.
(b) If the Company or a Subsidiary consummates any Asset
Sales, within five days of each date on which the aggregate amount of
Excess Proceeds exceeds $5 million, the Company will commence an offer
to all Holders of Notes and all holders of other Indebtedness that is
PARI PASSU with the Notes containing provisions similar to those set
forth in the Indenture with respect to offers to purchase or redeem
with the proceeds of sales of assets (an "Asset Sale Offer") pursuant
to Section 3.09 of the Indenture to purchase the maximum principal
amount of Notes (including any Additional Notes) and other PARI PASSU
Indebtedness that may be purchased out of the Excess Proceeds at an
offer price in cash in an amount equal to 100% of the principal amount
thereof plus accrued and unpaid interest and Liquidated Damages
thereon, if any, to the date fixed for the closing of such offer, in
accordance with the procedures set forth in the Indenture. To the
extent that the aggregate amount of Notes (including any Additional
Notes) and other PARI PASSU Indebtedness tendered pursuant to an Asset
Sale Offer is less than the Excess Proceeds, the Company (or such
Subsidiary) may use such deficiency for any purpose not otherwise
prohibited by the Indenture. If the aggregate principal amount of
Notes and other PARI PASSU Indebtedness surrendered by holders thereof
exceeds the amount of Excess Proceeds, the Trustee shall select the
Notes and other PARI PASSU Indebtedness to be purchased on a PRO RATA
basis. Holders of Notes that are the subject of an offer to purchase
will receive an Asset Sale Offer from the Company prior to any related
purchase date and may elect to have such Notes purchased by completing
the form entitled "Option of Holder to Elect Purchase" on the reverse
of the Notes.
(8) NOTICE OF REDEMPTION. Notice of redemption will be mailed at
least 30 days but not more than 60 days before the redemption date to
each Holder whose Notes are to be redeemed at its registered address.
Notes in denominations larger than $1,000 may be redeemed in part but
only in whole multiples of $1,000, unless all of the Notes held by a
Holder are to be redeemed. On and after the redemption date interest
ceases to accrue on Notes or portions thereof called for redemption.
(9) DENOMINATIONS, TRANSFER, EXCHANGE. The Notes are in
registered form without coupons in denominations of $1,000 and
integral multiples of $1,000. The transfer of Notes may be registered
and Notes may be exchanged as provided in the Indenture. The Registrar
and the Trustee may require a Holder, among other things, to furnish
appropriate endorsements and transfer documents and the Company may
require a Holder to pay any taxes and fees required by law or
permitted by the Indenture. The Company need not exchange or register
the transfer of any Note or portion of a Note selected for redemption,
except for the unredeemed portion of any Note being redeemed in part.
Also, the Company need not exchange or register the transfer of any
Notes for a period of 15 days before a selection of Notes to be
redeemed or during the period between a record date and the
corresponding Interest Payment Date.
(10) PERSONS DEEMED OWNERS. The registered Holder of a Note may
be treated as its owner for all purposes.
(11) AMENDMENT, SUPPLEMENT AND WAIVER. Subject to certain
exceptions, the Indenture, the Subsidiary Guarantees or the Notes may
be amended or supplemented with the consent of the Holders of at least
a majority in principal amount of the then outstanding Notes and
Additional Notes, if any, voting as a single class, and any existing
default or compliance with any provision of the Indenture, the
Subsidiary Guarantees or the Notes may be waived with the
A1-4
consent of the Holders of a majority in principal amount of the then
outstanding Notes and Additional Notes, if any, voting as a single
class. Without the consent of any Holder of a Note, the Indenture, the
Subsidiary Guarantees or the Notes may be amended or supplemented to
cure any ambiguity, defect or inconsistency; to provide for
uncertificated Notes in addition to or in place of certificated Notes
or to alter the provisions of Article 2 of the Indenture (including
the related definitions) in a manner that does not materially
adversely affect any Holder; to provide for the assumption of the
Company's or a Guarantor's obligations to the Holders of the Notes by
a successor to the Company pursuant to Article 5 or Article 12 of the
Indenture; to make any change that would provide any additional rights
or benefits to the Holders of the Notes or that does not adversely
affect the legal rights hereunder of any Holder of the Note; to comply
with requirements of the SEC in order to effect or maintain the
qualification of this Indenture under the TIA; to provide for the
issuance of Additional Notes in accordance with the limitations set
forth in this Indenture as of the date hereof; to allow any Guarantor
to execute a supplemental indenture and/or a Subsidiary Guarantee with
respect to the Notes; to make, complete or confirm any grant of
Collateral permitted or required by this Indenture or any release of
Collateral that becomes effective as set forth in this Indenture; to
reflect any waiver or termination of any right arising under Article
10 of the Indenture that otherwise would be enforceable by any holder
of a Parity Lien Obligation or Parity Lien, if such waiver or
termination is set forth or provided in this Indenture or agreement
governing or giving rise to such Parity Lien Obligation or Parity
Lien, PROVIDED that no such waiver or amendment shall adversely affect
the rights of Holders of the Notes; or as provided in clause (2) of
Section 10.07.
(12) DEFAULTS AND REMEDIES. Each of the following is an Event of
Default: (1) the Company defaults for 30 days in the payment when due
of interest on, or Liquidated Damages with respect to, the Notes; (2)
the Company defaults in the payment when due (at maturity, upon
redemption or otherwise) of the principal of, or premium, if any, on
the Notes; (3) the Company or any of its Subsidiaries fails to comply
with the provisions of Section 4.15 of the Indenture; (4) the Company
or any of its Subsidiaries fails to observe or perform any other
covenant, representation, warranty or other agreement in this
Indenture or the Second-Lien Security Documents for 60 days after
notice to the Company by the Trustee or the Holders of at least 25% in
aggregate principal amount of the Notes then outstanding voting as a
single class; (5) a default occurs under any mortgage, indenture or
instrument under which there may be issued or by which there may be
secured or evidenced any Indebtedness for money borrowed by the
Company or any of its Subsidiaries (or the payment of which is
guaranteed by the Company or any of its Subsidiaries), whether such
Indebtedness or guarantee now exists, or is created after the date of
this Indenture, if that default: (A) is caused by a failure to pay
principal of, or interest or premium, if any, on such Indebtedness
prior to the expiration of the grace period provided in such
Indebtedness on the date of such default (a "PAYMENT DEFAULT"); or (B)
results in the acceleration of such Indebtedness prior to its express
maturity, and, in each case, the principal amount of any such
Indebtedness, together with the principal amount of any other such
Indebtedness under which there has been a Payment Default or the
maturity of which has been so accelerated, aggregates $10.0 million or
more; (6) a final non-appealable judgment or final non-appealable
judgments for the payment of money are entered by a court or courts of
competent jurisdiction against the Company or any of its Restricted
Subsidiaries, which judgment or judgments are not paid, discharged or
stayed for a period of 60 days; PROVIDED that the aggregate of all
such undischarged judgments exceeds $10.0 million; (7) the Company or
any of its Restricted Subsidiaries pursuant to or within the meaning
of Bankruptcy Law: (A) commences a voluntary case, (B)consents to the
entry of an order for relief against it in an involuntary case, (C)
consents to the appointment of a custodian of it or for all or
substantially all of its property, (D) makes a general assignment for
the benefit of its creditors, or (E) generally is not paying its debts
as they become due; (8) a court of competent jurisdiction enters an
order or decree under any Bankruptcy
A1-5
Law that: (A) is for relief against the Company or any of its
Restricted Subsidiaries in an involuntary case; (B) appoints a
custodian of the Company or any of its Restricted Subsidiaries or for
all or substantially all of the property of the Company or any of its
Restricted Subsidiaries; or (C) orders the liquidation of the Company
or any of its Restricted Subsidiaries; and the order or decree remains
unstayed and in effect for 60 consecutive days; (9)any Second-Lien
Security Document or any Lien purported to be granted thereby is held
in any judicial proceeding to be unenforceable or invalid, in whole or
in part, or ceases for any reason (other than pursuant to a release
that is delivered or becomes effective as set forth in this Indenture)
to be fully enforceable and perfected, and such event continues for 30
days after written notice to the Company by the Trustee or the Holders
of at least 25% in aggregate principal amount of the Notes then
outstanding, voting as a single class; (10) the Company or any of its
Restricted Subsidiaries, or any Person acting on behalf of any of
them, denies or disaffirms, in writing, any obligation of the Company
or any of its Restricted Subsidiaries set forth in or arising under
any Second-Lien Security Document; or (11) except as permitted by this
Indenture, any Subsidiary Guarantee is held in any judicial proceeding
to be unenforceable or invalid or shall cease for any reason to be in
full force and effect or any Guarantor, or any Person acting on behalf
of any Guarantor, shall deny or disaffirm its obligations under its
Subsidiary Guarantee.
(13) TRUSTEE DEALINGS WITH COMPANY. The Trustee, in its
individual or any other capacity, may make loans to, accept deposits
from, and perform services for the Company or its Affiliates, and may
otherwise deal with the Company or its Affiliates, as if it were not
the Trustee.
(14) LIEN SUBORDINATION AND SHARING. The Notes, the Subsidiary
Guarantees and the other Note Obligations are secured by Note Liens
upon the Collateral pursuant to the Second-Lien Security Documents.
The Note Liens are subordinate in ranking to all current and future
Priority Liens and of equal ranking with all current and future Parity
Liens as set forth in Article 10 of the Indenture.
(15) NO RECOURSE AGAINST OTHERS. A director, officer, employee,
incorporator or stockholder, of the Company or any of the Guarantors,
as such, will not have any liability for any obligations of the
Company or such Guarantor under the Notes, the Subsidiary Guarantees
or the Indenture or for any claim based on, in respect of, or by
reason of, such obligations or their creation. Each Holder by
accepting a Note waives and releases all such liability. The waiver
and release are part of the consideration for the issuance of the
Notes.
(16) AUTHENTICATION. This Note will not be valid until
authenticated by the manual signature of the Trustee or an
authenticating agent.
(17) ABBREVIATIONS. Customary abbreviations may be used in the
name of a Holder or an assignee, such as: TEN COM (= tenants in
common), TEN ENT (= tenants by the entireties), JT TEN (= joint
tenants with right of survivorship and not as tenants in common), CUST
(= Custodian), and U/G/M/A (= Uniform Gifts to Minors Act).
(18) ADDITIONAL RIGHTS OF HOLDERS OF RESTRICTED GLOBAL NOTES AND
RESTRICTED DEFINITIVE NOTES. In addition to the rights provided to
Holders of Notes under the Indenture, Holders of Restricted Global
Notes and Restricted Definitive Notes will have all the rights set
forth in the Registration Rights Agreement dated as of June 17, 2002,
among the Company, the Guarantors and the other parties named on the
signature pages thereof (the "Registration Rights Agreement").
A1-6
(19) CUSIP NUMBERS. Pursuant to a recommendation promulgated by
the Committee on Uniform Security Identification Procedures, the
Company has caused CUSIP numbers to be printed on the Notes and the
Trustee may use CUSIP numbers in notices of redemption as a
convenience to Holders. No representation is made as to the accuracy
of such numbers either as printed on the Notes or as contained in any
notice of redemption and reliance may be placed only on the other
identification numbers placed thereon.
(20) GOVERNING LAW. THE INTERNAL LAW OF THE STATE OF NEW YORK
WILL GOVERN AND BE USED TO CONSTRUE THIS NOTE WITHOUT GIVING EFFECT TO
APPLICABLE PRINCIPLES OF CONFLICTS OF LAW TO THE EXTENT THAT THE
APPLICATION OF THE LAWS OF ANOTHER JURISDICTION WOULD BE REQUIRED
THEREBY.
The Company will furnish to any Holder upon written request and
without charge a copy of the Indenture and/or the Registration Rights Agreement.
Requests may be made to:
H&E Equipment Services L.L.C.
H&E Finance Corp.
▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Telecopier No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: Chief Financial Officer
A1-7
ASSIGNMENT FORM
To assign this Note, fill in the form below:
(I) or (we) assign and transfer this Note to:___________________________________
(Insert assignee's legal name)
________________________________________________________________________________
(Insert assignee's soc. sec. or tax I.D. no.)
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(Print or type assignee's name, address and zip code)
and irrevocably appoint_________________________________________________________
to transfer this Note on the books of the Company. The agent may substitute
another to act for him.
Date: _______________
Your Signature:
----------------------------
(Sign exactly as your name appears on the
face of this Note)
Signature Guarantee*: _________________________
* Participant in a recognized Signature Guarantee Medallion Program (or
other signature guarantor acceptable to the Trustee).
A1-8
OPTION OF HOLDER TO ELECT PURCHASE
If you want to elect to have this Note purchased by the Company
pursuant to Section 4.10 or 4.15 of the Indenture, check the appropriate box
below:
/ /Section 4.10 / /Section 4.15
If you want to elect to have only part of the Note purchased by the
Company pursuant to Section 4.10 or Section 4.15 of the Indenture, state the
amount you elect to have purchased:
$_________________
Date: _______________
Your Signature:
---------------------------
(Sign exactly as your name appears on the
face of this Note)
Tax Identification No.:____________________
Signature Guarantee*:
---------------------
* Participant in a recognized Signature Guarantee Medallion Program (or
other signature guarantor acceptable to the Trustee).
A1-9
SCHEDULE OF EXCHANGES OF INTERESTS IN THE GLOBAL NOTE*
The following exchanges of a part of this Global Note for an interest
in another Global Note or for a Definitive Note, or exchanges of a part of
another Global Note or Definitive Note for an interest in this Global Note, have
been made:
Principal Amount
at maturity of this
Amount of decrease Amount of increase in Global Note Signature of
in Principal Amount Principal Amount following such authorized signatory
at maturity of at maturity of decrease of Trustee or
Date of Exchange this Global Note this Global Note (or increase) Custodian
---------------- ------------------- --------------------- ------------------- --------------------
* THIS SCHEDULE SHOULD BE INCLUDED ONLY IF THE NOTE IS ISSUED IN GLOBAL FORM.
A1-10
EXHIBIT A2
[Face of Regulation S Temporary Global Note]
--------------------------------------------------------------------------------
CUSIP/CINS __________
11 1/8% Senior Secured Notes due 2012
No. ___ $__________
H&E EQUIPMENT SERVICES L.L.C.
H&E FINANCE CORP.
promises to pay to CEDE & CO.
or registered assigns,
the principal sum of____________________________________________________________
Dollars on June 15, 2012.
Interest Payment Dates: June 15 and December 15
Record Dates: June 1 and December 1
H&E EQUIPMENT SERVICES L.L.C. H&E FINANCE CORP.
By: By:
----------------------------------- ----------------------------------
Name: Name:
Title: Title:
By: By:
----------------------------------- ----------------------------------
Name: Name:
Title: Title:
This is one of the Notes referred to
in the within-mentioned Indenture:
THE BANK OF NEW YORK,
as Trustee
By:
-----------------------------
Authorized Signatory
Dated: _______________, 2002.
--------------------------------------------------------------------------------
A2-1
[Back of Regulation S Temporary Global Note]
11 1/8% Senior Secured Notes due 2012
THE RIGHTS ATTACHING TO THIS REGULATION S TEMPORARY GLOBAL NOTE, AND THE
CONDITIONS AND PROCEDURES GOVERNING ITS EXCHANGE FOR CERTIFICATED NOTES, ARE AS
SPECIFIED IN THE INDENTURE (AS DEFINED HEREIN). NEITHER THE HOLDER NOR THE
BENEFICIAL OWNERS OF THIS REGULATION S TEMPORARY GLOBAL NOTE SHALL BE ENTITLED
TO RECEIVE PAYMENT OF INTEREST HEREON.
THIS GLOBAL NOTE IS HELD BY THE DEPOSITARY (AS DEFINED IN THE INDENTURE
GOVERNING THIS NOTE) OR ITS NOMINEE IN CUSTODY FOR THE BENEFIT OF THE BENEFICIAL
OWNERS HEREOF, AND IS NOT TRANSFERABLE TO ANY PERSON UNDER ANY CIRCUMSTANCES
EXCEPT THAT (1) THE TRUSTEE MAY MAKE SUCH NOTATIONS HEREON AS MAY BE REQUIRED
PURSUANT TO SECTION 2.06 OF THE INDENTURE, (2) THIS GLOBAL NOTE MAY BE EXCHANGED
IN WHOLE BUT NOT IN PART PURSUANT TO SECTION 2.06(a) OF THE INDENTURE, (3) THIS
GLOBAL NOTE MAY BE DELIVERED TO THE TRUSTEE FOR CANCELLATION PURSUANT TO SECTION
2.11 OF THE INDENTURE AND (IV) THIS GLOBAL NOTE MAY BE TRANSFERRED TO A
SUCCESSOR DEPOSITARY WITH THE PRIOR WRITTEN CONSENT OF THE COMPANY.
UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR NOTES IN DEFINITIVE
FORM, THIS NOTE 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 OR BY THE DEPOSITARY OR ANY SUCH NOMINEE TO A
SUCCESSOR DEPOSITARY OR A NOMINEE OF SUCH SUCCESSOR DEPOSITARY. UNLESS THIS
CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST
COMPANY (55 ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇) ("▇▇▇"), TO THE COMPANY OR ITS
AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE
ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR SUCH OTHER NAME AS MAY BE
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO
CEDE & CO. OR SUCH OTHER ENTITY AS MAY BE REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
Capitalized terms used herein have the meanings assigned to them in
the Indenture referred to below unless otherwise indicated.
(1) INTEREST. H&E Equipment Services L.L.C., a Louisiana limited
liability company ("H&E LLC") and H&E Finance Corp., a Delaware
corporation ("H&E Finance" and together with H&E LLC, the "Company"),
promises to pay interest on the principal amount of this Note at
11 1/8% per annum from June 17 until maturity and shall pay the
Liquidated Damages, if any, payable pursuant to the Registration
Rights Agreement referred to below. The Company will pay interest and
Liquidated Damages, if any, semi-annually in arrears on June 15 and
December 15 of each year, or if any such day is not a Business Day, on
the next succeeding Business Day (each, an "Interest Payment Date").
Interest on the Notes will accrue from the most recent date to which
interest has been paid or, if no interest has been paid, from the date
of issuance; PROVIDED that if there is no existing Default in the
payment of interest, and if this Note is authenticated between a
record date referred to on the face hereof and the next succeeding
Interest Payment Date, interest
A2-2
shall accrue from such next succeeding Interest Payment Date;
PROVIDED, FURTHER, that the first Interest Payment Date shall be
December 15, 2002. The Company will pay interest (including
post-petition interest in any proceeding under any Bankruptcy Law) on
overdue principal and premium, if any, from time to time on demand at
a rate that is 1% per annum in excess of the rate then in effect; it
will pay interest (including post-petition interest in any proceeding
under any Bankruptcy Law) on overdue installments of interest and
Liquidated Damages, if any, (without regard to any applicable grace
periods) from time to time on demand at the same rate to the extent
lawful. Interest will be computed on the basis of a 360-day year of
twelve 30-day months.
Until this Regulation S Temporary Global Note is exchanged for one or
more Regulation S Permanent Global Notes, the Holder hereof shall not be
entitled to receive payments of interest hereon; until so exchanged in full,
this Regulation S Temporary Global Note shall in all other respects be entitled
to the same benefits as other Notes under the Indenture.
(2) METHOD OF PAYMENT. The Company will pay interest on the Notes
(except defaulted interest) and Liquidated Damages, if any, to the
Persons who are registered Holders of Notes at the close of business
on the June 1 or December 1 next preceding the Interest Payment Date,
even if such Notes are canceled after such record date and on or
before such Interest Payment Date, except as provided in Section 2.12
of the Indenture with respect to defaulted interest. The Notes will be
payable as to principal, premium, interest and Liquidated Damages, if
any, at the office or agency of the Company maintained for such
purpose within or without the City and State of New York, or, at the
option of the Company, payment of interest and Liquidated Damages, if
any, may be made by check mailed to the Holders at their addresses set
forth in the register of Holders; PROVIDED that payment by wire
transfer of immediately available funds will be required with respect
to principal of and interest, premium and Liquidated Damages, if any,
on, all Global Notes and all other Notes the Holders of which will
have provided wire transfer instructions to the Company or the Paying
Agent. Such payment will be 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.
(3) PAYING AGENT AND REGISTRAR. Initially, The Bank of New York,
the Trustee under the Indenture, will act as Paying Agent and
Registrar. The Company may change any Paying Agent or Registrar
without notice to any Holder. The Company or any of its Subsidiaries
may act in any such capacity.
(4) INDENTURE. The Company issued the Notes under an Indenture
dated as of June 17, 2002 (the "Indenture") among the Company, the
Guarantors and the Trustee. The terms of the Notes include those
stated in the Indenture and those made part of the Indenture by
reference to the Trust Indenture Act of 1939, as amended (15 U.S. Code
Sections 77aaa-77bbbb). The Notes are subject to all such terms, and
Holders are referred to the Indenture and such Act for a statement of
such terms. To the extent any provision of this Note conflicts with
the express provisions of the Indenture, the provisions of the
Indenture shall govern and be controlling. The Notes are secured
obligations of the Company.
(5) OPTIONAL REDEMPTION.
(a) Except as set forth in subparagraph (b) of this
Paragraph 5, the Company will not have the option to redeem the Notes
prior to June 15, 2007. Thereafter, the Company may redeem all or a
part of the Notes upon not less than 30 nor more than 60 days' notice,
at the redemption prices (expressed as percentages of principal
amount) set forth below plus accrued and unpaid interest and
Liquidated Damages, if any, on the Notes redeemed, to the applicable
A2-3
redemption date, if redeemed during the twelve-month period beginning
on June 15 of the years indicated below:
Year Percentage
---- ----------
2007.................................................. 105.563%
2008.................................................. 103.708%
2009.................................................. 101.854%
2010 and thereafter................................... 100.000%
(b) At any time prior to June 15, 2005, the Company may
on one or more occasions redeem an aggregate of up to 35% of the
aggregate principal amount of Notes issued under this Indenture at a
redemption price of 111.125% of the principal amount, plus accrued and
unpaid interest and Liquidated Damages, if any, to the redemption
date, with the net cash proceeds of an offering of Equity Interests
(other than Disqualified Stock) of the Company or Holdings (so long as
such net cash proceeds are contributed to the Company from Holdings as
common equity); PROVIDED that (1) at least 65% of the aggregate
principal amount of Notes issued under this Indenture remains
outstanding immediately after the occurrence of such redemption
(excluding Notes held by the Company and its Subsidiaries); and (2)
the redemption occurs within 60 days of the date of the closing of
such offering.
(6) MANDATORY REDEMPTION.
The Company will not be required to make mandatory redemption payments
with respect to the Notes.
(7) REPURCHASE AT OPTION OF HOLDER.
(a) If there is a Change of Control, the Company will be
required to make an offer (a "Change of Control Offer") to repurchase
all or any part (equal to $1,000 or an integral multiple thereof) of
each Holder's Notes at a purchase price equal to 101% of the aggregate
principal amount thereof plus accrued and unpaid interest and
Liquidated Damages, if any, thereon, if any, to the date of purchase
(the "Change of Control Payment"). Within 60 days following any Change
of Control, the Company will mail a notice to each Holder setting
forth the procedures governing the Change of Control Offer as required
by the Indenture.
(b) If the Company or a Subsidiary consummates any Asset
Sales, within five days of each date on which the aggregate amount of
Excess Proceeds exceeds $5 million, the Company will commence an offer
to all Holders of Notes and all holders of other Indebtedness that is
PARI PASSU with the Notes containing provisions similar to those set
forth in the Indenture with respect to offers to purchase or redeem
with the proceeds of sales of assets (an "Asset Sale Offer") pursuant
to Section 3.09 of the Indenture to purchase the maximum principal
amount of Notes (including any Additional Notes) and other PARI PASSU
Indebtedness that may be purchased out of the Excess Proceeds at an
offer price in cash in an amount equal to 100% of the principal amount
thereof plus accrued and unpaid interest and Liquidated Damages
thereon, if any, to the date fixed for the closing of such offer, in
accordance with the procedures set forth in the Indenture. To the
extent that the aggregate amount of Notes (including any Additional
Notes) and other PARI PASSU Indebtedness tendered pursuant to an Asset
Sale Offer is less than the Excess Proceeds, the Company (or such
Subsidiary) may use such deficiency for any purpose not otherwise
prohibited by the Indenture. If the aggregate principal amount of
Notes and other PARI PASSU Indebtedness surrendered by holders thereof
exceeds the amount of Excess Proceeds, the
A2-4
Trustee shall select the Notes and other PARI PASSU Indebtedness to be
purchased on a PRO RATA basis. Holders of Notes that are the subject
of an offer to purchase will receive an Asset Sale Offer from the
Company prior to any related purchase date and may elect to have such
Notes purchased by completing the form entitled "Option of Holder to
Elect Purchase" on the reverse of the Notes.
(8) NOTICE OF REDEMPTION. Notice of redemption will be mailed at
least 30 days but not more than 60 days before the redemption date to
each Holder whose Notes are to be redeemed at its registered address.
Notes in denominations larger than $1,000 may be redeemed in part but
only in whole multiples of $1,000, unless all of the Notes held by a
Holder are to be redeemed. On and after the redemption date interest
ceases to accrue on Notes or portions thereof called for redemption.
(9) DENOMINATIONS, TRANSFER, EXCHANGE. The Notes are in
registered form without coupons in denominations of $1,000 and
integral multiples of $1,000. The transfer of Notes may be registered
and Notes may be exchanged as provided in the Indenture. The Registrar
and the Trustee may require a Holder, among other things, to furnish
appropriate endorsements and transfer documents and the Company may
require a Holder to pay any taxes and fees required by law or
permitted by the Indenture. The Company need not exchange or register
the transfer of any Note or portion of a Note selected for redemption,
except for the unredeemed portion of any Note being redeemed in part.
Also, the Company need not exchange or register the transfer of any
Notes for a period of 15 days before a selection of Notes to be
redeemed or during the period between a record date and the
corresponding Interest Payment Date.
This Regulation S Temporary Global Note is exchangeable in whole or in
part for one or more Global Notes only (i) on or after the termination of the
40-day restricted period (as defined in Regulation S) and (ii) upon presentation
of certificates (accompanied by an Opinion of Counsel, if applicable) required
by Article 2 of the Indenture. Upon exchange of this Regulation S Temporary
Global Note for one or more Global Notes, the Trustee shall cancel this
Regulation S Temporary Global Note.
(10) PERSONS DEEMED OWNERS. The registered Holder of a Note may
be treated as its owner for all purposes.
(11) AMENDMENT, SUPPLEMENT AND WAIVER. Subject to certain
exceptions, the Indenture, the Subsidiary Guarantees or the Notes may
be amended or supplemented with the consent of the Holders of at least
a majority in principal amount of the then outstanding Notes and
Additional Notes, if any, voting as a single class, and any existing
default or compliance with any provision of the Indenture, the
Subsidiary Guarantees or the Notes may be waived with the consent of
the Holders of a majority in principal amount of the then outstanding
Notes and Additional Notes, if any, voting as a single class. Without
the consent of any Holder of a Note, the Indenture, the Subsidiary
Guarantees or the Notes may be amended or supplemented to cure any
ambiguity, defect or inconsistency; to provide for uncertificated
Notes in addition to or in place of certificated Notes or to alter the
provisions of Article 2 of the Indenture (including the related
definitions) in a manner that does not materially adversely affect any
Holder; to provide for the assumption of the Company's or a
Guarantor's obligations to the Holders of the Notes by a successor to
the Company pursuant to Article 5 or Article 12 of the Indenture; to
make any change that would provide any additional rights or benefits
to the Holders of the Notes or that does not adversely affect the
legal rights hereunder of any Holder of the Note; to comply with
requirements of the SEC in order to effect or maintain the
qualification of this Indenture under the TIA; to provide for the
issuance of Additional Notes in accordance with the limitations set
forth in this Indenture as of the date hereof; to allow any Guarantor
to execute a supplemental
A2-5
indenture and/or a Subsidiary Guarantee with respect to the Notes; to
make, complete or confirm any grant of Collateral permitted or
required by this Indenture or any release of Collateral that becomes
effective as set forth in this Indenture; to reflect any waiver or
termination of any right arising under Article 10 of the Indenture
that otherwise would be enforceable by any holder of a Parity Lien
Obligation or Parity Lien, if such waiver or termination is set forth
or provided in this Indenture or agreement governing or giving rise to
such Parity Lien Obligation or Parity Lien, PROVIDED that no such
waiver or amendment shall adversely affect the rights of Holders of
the Notes; or as provided in clause (2) of Section 10.07.
(12) DEFAULTS AND REMEDIES. Each of the following is an Event of
Default: (1) the Company defaults for 30 days in the payment when due
of interest on, or Liquidated Damages with respect to, the Notes; (2)
the Company defaults in the payment when due (at maturity, upon
redemption or otherwise) of the principal of, or premium, if any, on
the Notes; (3) the Company or any of its Subsidiaries fails to comply
with the provisions of Section 4.15 of the Indenture; (4) the Company
or any of its Subsidiaries fails to observe or perform any other
covenant, representation, warranty or other agreement in this
Indenture or the Second-Lien Security Documents for 60 days after
notice to the Company by the Trustee or the Holders of at least 25% in
aggregate principal amount of the Notes then outstanding voting as a
single class; (5) a default occurs under any mortgage, indenture or
instrument under which there may be issued or by which there may be
secured or evidenced any Indebtedness for money borrowed by the
Company or any of its Subsidiaries (or the payment of which is
guaranteed by the Company or any of its Subsidiaries), whether such
Indebtedness or guarantee now exists, or is created after the date of
this Indenture, if that default: (A) is caused by a failure to pay
principal of, or interest or premium, if any, on such Indebtedness
prior to the expiration of the grace period provided in such
Indebtedness on the date of such default (a "PAYMENT DEFAULT"); or (B)
results in the acceleration of such Indebtedness prior to its express
maturity, and, in each case, the principal amount of any such
Indebtedness, together with the principal amount of any other such
Indebtedness under which there has been a Payment Default or the
maturity of which has been so accelerated, aggregates $10.0 million or
more; (6) a final non-appealable judgment or final non-appealable
judgments for the payment of money are entered by a court or courts of
competent jurisdiction against the Company or any of its Restricted
Subsidiaries, which judgment or judgments are not paid, discharged or
stayed for a period of 60 days; PROVIDED that the aggregate of all
such undischarged judgments exceeds $10.0 million; (7) the Company or
any of its Restricted Subsidiaries pursuant to or within the meaning
of Bankruptcy Law: (A) commences a voluntary case, (B)consents to the
entry of an order for relief against it in an involuntary case, (C)
consents to the appointment of a custodian of it or for all or
substantially all of its property, (D) makes a general assignment for
the benefit of its creditors, or (E) generally is not paying its debts
as they become due; (8) a court of competent jurisdiction enters an
order or decree under any Bankruptcy Law that: (A) is for relief
against the Company or any of its Restricted Subsidiaries in an
involuntary case; (B) appoints a custodian of the Company or any of
its Restricted Subsidiaries or for all or substantially all of the
property of the Company or any of its Restricted Subsidiaries; or (C)
orders the liquidation of the Company or any of its Restricted
Subsidiaries; and the order or decree remains unstayed and in effect
for 60 consecutive days; (9)any Second-Lien Security Document or any
Lien purported to be granted thereby is held in any judicial
proceeding to be unenforceable or invalid, in whole or in part, or
ceases for any reason (other than pursuant to a release that is
delivered or becomes effective as set forth in this Indenture) to be
fully enforceable and perfected, and such event continues for 30 days
after written notice to the Company by the Trustee or the Holders of
at least 25% in aggregate principal amount of the Notes then
outstanding, voting as a single class; (10) the Company or any of its
Restricted Subsidiaries, or any Person acting on behalf of any of
them, denies or disaffirms, in writing, any obligation of the Company
or any of its Restricted Subsidiaries set forth in or arising under
any ▇▇▇▇▇▇-▇▇▇▇
▇▇-▇
Security Document; or (11) except as permitted by this Indenture, any
Subsidiary Guarantee is held in any judicial proceeding to be
unenforceable or invalid or shall cease for any reason to be in full
force and effect or any Guarantor, or any Person acting on behalf of
any Guarantor, shall deny or disaffirm its obligations under its
Subsidiary Guarantee.
(13) TRUSTEE DEALINGS WITH COMPANY. The Trustee, in its
individual or any other capacity, may make loans to, accept deposits
from, and perform services for the Company or its Affiliates, and may
otherwise deal with the Company or its Affiliates, as if it were not
the Trustee.
(14) LIEN SUBORDINATION AND SHARING. The Notes, the Subsidiary
Guarantees and the other Note Obligations are secured by Note Liens
upon the Collateral pursuant to the Second-Lien Security Documents.
The Note Liens are subordinate in ranking to all current and future
Priority Liens and of equal ranking with all current and future Parity
Liens as set forth in Article 10 of the Indenture.
(15) NO RECOURSE AGAINST OTHERS. A director, officer, employee,
incorporator or stockholder, of the Company or any of the Guarantors,
as such, will not have any liability for any obligations of the
Company or such Guarantor under the Notes, the Subsidiary Guarantees
or the Indenture or for any claim based on, in respect of, or by
reason of, such obligations or their creation. Each Holder by
accepting a Note waives and releases all such liability. The waiver
and release are part of the consideration for the issuance of the
Notes.
(16) AUTHENTICATION. This Note will not be valid until
authenticated by the manual signature of the Trustee or an
authenticating agent.
(17) ABBREVIATIONS. Customary abbreviations may be used in the
name of a Holder or an assignee, such as: TEN COM (= tenants in
common), TEN ENT (= tenants by the entireties), JT TEN (= joint
tenants with right of survivorship and not as tenants in common), CUST
(= Custodian), and U/G/M/A (= Uniform Gifts to Minors Act).
(18) ADDITIONAL RIGHTS OF HOLDERS OF RESTRICTED GLOBAL NOTES AND
RESTRICTED DEFINITIVE NOTES. In addition to the rights provided to
Holders of Notes under the Indenture, Holders of Restricted Global
Notes and Restricted Definitive Notes will have all the rights set
forth in the Registration Rights Agreement dated as of June 17, 2002,
among the Company, the Guarantors and the other parties named on the
signature pages thereof (the "Registration Rights Agreement").
(19) CUSIP NUMBERS. Pursuant to a recommendation promulgated by
the Committee on Uniform Security Identification Procedures, the
Company has caused CUSIP numbers to be printed on the Notes and the
Trustee may use CUSIP numbers in notices of redemption as a
convenience to Holders. No representation is made as to the accuracy
of such numbers either as printed on the Notes or as contained in any
notice of redemption and reliance may be placed only on the other
identification numbers placed thereon.
(20) GOVERNING LAW. THE INTERNAL LAW OF THE STATE OF NEW YORK
WILL GOVERN AND BE USED TO CONSTRUE THIS NOTE WITHOUT GIVING EFFECT TO
APPLICABLE PRINCIPLES OF CONFLICTS OF LAW TO THE EXTENT THAT THE
APPLICATION OF THE LAWS OF ANOTHER JURISDICTION WOULD BE REQUIRED
THEREBY.
A2-7
The Company will furnish to any Holder upon written request and
without charge a copy of the Indenture and/or the Registration Rights Agreement.
Requests may be made to:
H&E Equipment Services L.L.C.
H&E Finance Corp.
▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Telecopier No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: Chief Financial Officer
A2-8
ASSIGNMENT FORM
To assign this Note, fill in the form below:
(I) or (we) assign and transfer this Note to:___________________________________
(Insert assignee's legal name)
________________________________________________________________________________
(Insert assignee's soc. sec. or tax I.D. no.)
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(Print or type assignee's name, address and zip code)
and irrevocably appoint_________________________________________________________
to transfer this Note on the books of the Company. The agent may substitute
another to act for him.
Date: _______________
Your Signature:
---------------------------
(Sign exactly as your name appears on the
face of this Note)
Signature Guarantee*:
------------------------
* Participant in a recognized Signature Guarantee Medallion Program (or
other signature guarantor acceptable to the Trustee).
A2-9
OPTION OF HOLDER TO ELECT PURCHASE
If you want to elect to have this Note purchased by the Company
pursuant to Section 4.10 or 4.15 of the Indenture, check the appropriate box
below:
/ /Section 4.10 / /Section 4.15
If you want to elect to have only part of the Note purchased by the
Company pursuant to Section 4.10 or Section 4.15 of the Indenture, state the
amount you elect to have purchased:
$_______________
Date: _______________
Your Signature:
---------------------------
(Sign exactly as your name appears on the
face of this Note)
Tax Identification No.:____________________
Signature Guarantee*:
----------------------
* Participant in a recognized Signature Guarantee Medallion Program (or
other signature guarantor acceptable to the Trustee).
A2-10
SCHEDULE OF EXCHANGES OF REGULATION S TEMPORARY GLOBAL NOTE
The following exchanges of a part of this Regulation S Temporary
Global Note for an interest in another Global Note, or of other Restricted
Global Notes for an interest in this Regulation S Temporary Global Note, have
been made:
Principal Amount
at maturity of this
Amount of decrease Amount of increase in Global Note Signature of
in Principal Amount Principal Amount following such authorized signatory
at maturity of at maturity of decrease of Trustee or
Date of Exchange this Global Note this Global Note (or increase) Custodian
---------------- ------------------- --------------------- ------------------- --------------------
A2-11
EXHIBIT B
FORM OF CERTIFICATE OF TRANSFER
H&E Equipment Services L.L.C.
H&E Finance Corp.
▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Chief Financial Officer
The Bank of New York
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇ ▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ 10286
Attention: Corporate Trust Administration
Re: 11 1/8% SENIOR SECURED NOTES DUE 2012
Reference is hereby made to the Indenture, dated as of June 17,, 2002
(the "INDENTURE"), among H&E Equipment Services L.L.C. and H&E Finance Corp.,
together as issuer (the "COMPANY"), the Guarantors named on the signature pages
thereto and The Bank of New York, as Trustee. Capitalized terms used but not
defined herein shall have the meanings given to them in the Indenture.
___________________, (the "TRANSFEROR") owns and proposes to transfer
the Note[s] or interest in such Note[s] specified in Annex A hereto, in the
principal amount of $___________ in such Note[s] or interests (the "TRANSFER"),
to ___________________________ (the "TRANSFEREE"), as further specified in Annex
A hereto. In connection with the Transfer, the Transferor hereby certifies that:
[CHECK ALL THAT APPLY]
1. / /CHECK IF TRANSFEREE WILL TAKE DELIVERY OF A BENEFICIAL INTEREST
IN THE 144A GLOBAL NOTE OR A DEFINITIVE NOTE PURSUANT TO RULE 144A. The Transfer
is being effected pursuant to and in accordance with Rule 144A under the
Securities Act of 1933, as amended (the "SECURITIES ACT"), and, accordingly, the
Transferor hereby further certifies that the beneficial interest or Definitive
Note is being transferred to a Person that the Transferor reasonably believed
and believes is purchasing the beneficial interest or Definitive Note for its
own account, or for one or more accounts with respect to which such Person
exercises sole investment discretion, and such Person and each such account is a
"qualified institutional buyer" within the meaning of Rule 144A in a transaction
meeting the requirements of Rule 144A and such Transfer is in compliance with
any applicable blue sky securities laws of any state of the United States. Upon
consummation of the proposed Transfer in accordance with the terms of the
Indenture, the transferred beneficial interest or Definitive Note will be
subject to the restrictions on transfer enumerated in the Private Placement
Legend printed on the 144A Global Note and/or the Definitive Note and in the
Indenture and the Securities Act.
2. / /CHECK IF TRANSFEREE WILL TAKE DELIVERY OF A BENEFICIAL INTEREST
IN THE TEMPORARY REGULATION S GLOBAL NOTE, THE REGULATION S GLOBAL NOTE OR A
DEFINITIVE NOTE PURSUANT TO REGULATION S. The Transfer is being effected
pursuant to and in accordance with Rule 903 or Rule 904 under the Securities Act
and, accordingly, the Transferor hereby further certifies that (i) the Transfer
is not being made to a Person in the United States and (x) at the time the buy
order was originated, the Transferee was outside the United States or such
Transferor and any Person acting on its behalf reasonably believed and believes
that the Transferee was outside the United States or (y) the transaction was
executed in, on or through the facilities of a designated offshore securities
market and neither such Transferor nor any Person acting on its behalf knows
that the transaction was prearranged with a buyer in the United States, (ii) no
directed selling efforts have been made in contravention of the requirements of
Rule 903(b) or
B-1
Rule 904(b) of Regulation S under the Securities Act, (iii) the transaction is
not part of a plan or scheme to evade the registration requirements of the
Securities Act and (iv) if the proposed transfer is being made prior to the
expiration of the Restricted Period, the transfer is not being made to a U.S.
Person or for the account or benefit of a U.S. Person (other than an Initial
Purchaser). Upon consummation of the proposed transfer in accordance with the
terms of the Indenture, the transferred beneficial interest or Definitive Note
will be subject to the restrictions on Transfer enumerated in the Private
Placement Legend printed on the Regulation S Global Note, the Temporary
Regulation S Global Note and/or the Definitive Note and in the Indenture and the
Securities Act.
3. / /CHECK AND COMPLETE IF TRANSFEREE WILL TAKE DELIVERY OF A
BENEFICIAL INTEREST IN THE IAI GLOBAL NOTE OR A DEFINITIVE NOTE PURSUANT TO ANY
PROVISION OF THE SECURITIES ACT OTHER THAN RULE 144A OR REGULATION S. The
Transfer is being effected in compliance with the transfer restrictions
applicable to beneficial interests in Restricted Global Notes and Restricted
Definitive Notes and pursuant to and in accordance with the Securities Act and
any applicable blue sky securities laws of any state of the United States, and
accordingly the Transferor hereby further certifies that (check one):
(a) / /such Transfer is being effected pursuant to and in
accordance with Rule 144 under the Securities Act;
or
(b) / /such Transfer is being effected to the Company or a
subsidiary thereof;
or
(c) / /such Transfer is being effected pursuant to an effective
registration statement under the Securities Act and in compliance with
the prospectus delivery requirements of the Securities Act;
or
(d) / /such Transfer is being effected to an Institutional
Accredited Investor and pursuant to an exemption from the registration
requirements of the Securities Act other than Rule 144A, Rule 144 or
Rule 904, and the Transferor hereby further certifies that it has not
engaged in any general solicitation within the meaning of Regulation D
under the Securities Act and the Transfer complies with the transfer
restrictions applicable to beneficial interests in a Restricted Global
Note or Restricted Definitive Notes and the requirements of the
exemption claimed, which certification is supported by (1) a
certificate executed by the Transferee in the form of Exhibit D to the
Indenture and (2) if such Transfer is in respect of a principal amount
of Notes at the time of transfer of less than $250,000, an Opinion of
Counsel provided by the Transferor or the Transferee (a copy of which
the Transferor has attached to this certification), to the effect that
such Transfer is in compliance with the Securities Act. Upon
consummation of the proposed transfer in accordance with the terms of
the Indenture, the transferred beneficial interest or Definitive Note
will be subject to the restrictions on transfer enumerated in the
Private Placement Legend printed on the IAI Global Note and/or the
Definitive Notes and in the Indenture and the Securities Act.
4. / /CHECK IF TRANSFEREE WILL TAKE DELIVERY OF A BENEFICIAL INTEREST
IN AN UNRESTRICTED GLOBAL NOTE OR OF AN UNRESTRICTED DEFINITIVE NOTE.
B-2
(a) / /CHECK IF TRANSFER IS PURSUANT TO RULE 144. (i) The Transfer is
being effected pursuant to and in accordance with Rule 144 under the Securities
Act and in compliance with the transfer restrictions contained in the Indenture
and any applicable blue sky securities laws of any state of the United States
and (ii) the restrictions on transfer contained in the Indenture and the Private
Placement Legend are not required in order to maintain compliance with the
Securities Act. Upon consummation of the proposed Transfer in accordance with
the terms of the Indenture, the transferred beneficial interest or Definitive
Note will no longer be subject to the restrictions on transfer enumerated in the
Private Placement Legend printed on the Restricted Global Notes, on Restricted
Definitive Notes and in the Indenture.
(b) / /CHECK IF TRANSFER IS PURSUANT TO REGULATION S. (i) The Transfer
is being effected pursuant to and in accordance with Rule 903 or Rule 904 under
the Securities Act and in compliance with the transfer restrictions contained in
the Indenture and any applicable blue sky securities laws of any state of the
United States and (ii) the restrictions on transfer contained in the Indenture
and the Private Placement Legend are not required in order to maintain
compliance with the Securities Act. Upon consummation of the proposed Transfer
in accordance with the terms of the Indenture, the transferred beneficial
interest or Definitive Note will no longer be subject to the restrictions on
transfer enumerated in the Private Placement Legend printed on the Restricted
Global Notes, on Restricted Definitive Notes and in the Indenture.
(c) / /CHECK IF TRANSFER IS PURSUANT TO OTHER EXEMPTION. (i) The
Transfer is being effected pursuant to and in compliance with an exemption from
the registration requirements of the Securities Act other than Rule 144, Rule
903 or Rule 904 and in compliance with the transfer restrictions contained in
the Indenture and any applicable blue sky securities laws of any State of the
United States and (ii) the restrictions on transfer contained in the Indenture
and the Private Placement Legend are not required in order to maintain
compliance with the Securities Act. Upon consummation of the proposed Transfer
in accordance with the terms of the Indenture, the transferred beneficial
interest or Definitive Note will not be subject to the restrictions on transfer
enumerated in the Private Placement Legend printed on the Restricted Global
Notes or Restricted Definitive Notes and in the Indenture.
This certificate and the statements contained herein are made for your
benefit and the benefit of the Company.
------------------------------------------
[Insert Name of Transferor]
By:
--------------------------------------
Name:
Title:
Dated:
------------------
B-3
ANNEX A TO CERTIFICATE OF TRANSFER
1. The Transferor owns and proposes to transfer the following:
[CHECK ONE OF (a) OR (b)]
(a) / /a beneficial interest in the:
(i) / / 144A Global Note (CUSIP _________), or
(ii) / / Regulation S Global Note (CUSIP _________), or
(iii) / / IAI Global Note (CUSIP _________); or
(b) / / a Restricted Definitive Note.
2. After the Transfer the Transferee will hold:
[CHECK ONE]
(a) / / a beneficial interest in the:
(i) / / 144A Global Note (CUSIP _________), or
(ii) / / Regulation S Global Note (CUSIP _________), or
(iii) / / IAI Global Note (CUSIP _________); or
(iv) / / Unrestricted Global Note (CUSIP _________); or
(b) / / a Restricted Definitive Note; or
(c) / / an Unrestricted Definitive Note,
in accordance with the terms of the Indenture.
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▇▇▇▇ ▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇ ▇▇▇▇▇▇▇▇
▇&▇ Equipment Services L.L.C.
H&E Finance Corp.
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▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Chief Financial Officer
The Bank of New York
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Attention: Corporate Trust Administration
Re: 11 1/8 % SENIOR SECURED NOTES DUE 2012 (CUSIP_____________)
Reference is hereby made to the Indenture, dated as of June 17, 2002
(the "INDENTURE"), among H&E Equipment Services L.L.C. and H&E Finance Corp.,
together as issuer (the "COMPANY"), the Guarantors named on the signature pages
thereto and The Bank of New York, as Trustee. Capitalized terms used but not
defined herein shall have the meanings given to them in the Indenture.
__________________________, (the "OWNER") owns and proposes to
exchange the Note[s] or interest in such Note[s] specified herein, in the
principal amount of $____________ in such Note[s] or interests (the "Exchange").
In connection with the Exchange, the Owner hereby certifies that:
1. EXCHANGE OF RESTRICTED DEFINITIVE NOTES OR BENEFICIAL INTERESTS
IN A RESTRICTED GLOBAL NOTE FOR UNRESTRICTED DEFINITIVE NOTES OR BENEFICIAL
INTERESTS IN AN UNRESTRICTED GLOBAL NOTE
(a) / / CHECK IF EXCHANGE IS FROM BENEFICIAL INTEREST IN A RESTRICTED
GLOBAL NOTE TO BENEFICIAL INTEREST IN AN UNRESTRICTED GLOBAL NOTE. In connection
with the Exchange of the Owner's beneficial interest in a Restricted Global Note
for a beneficial interest in an Unrestricted Global Note in an equal principal
amount, the Owner hereby certifies (i) the beneficial interest is being acquired
for the Owner's own account without transfer, (ii) such Exchange has been
effected in compliance with the transfer restrictions applicable to the Global
Notes and pursuant to and in accordance with the Securities Act of 1933, as
amended (the "SECURITIES Act"), (iii) the restrictions on transfer contained in
the Indenture and the Private Placement Legend are not required in order to
maintain compliance with the Securities Act and (iv) the beneficial interest in
an Unrestricted Global Note is being acquired in compliance with any applicable
blue sky securities laws of any state of the United States.
(b) / / CHECK IF EXCHANGE IS FROM BENEFICIAL INTEREST IN A RESTRICTED
GLOBAL NOTE TO UNRESTRICTED DEFINITIVE NOTE. In connection with the Exchange of
the Owner's beneficial interest in a Restricted Global Note for an Unrestricted
Definitive Note, the Owner hereby certifies (i) the Definitive Note is being
acquired for the Owner's own account without transfer, (ii) such Exchange has
been effected in compliance with the transfer restrictions applicable to the
Restricted Global Notes and pursuant to and in accordance with the Securities
Act, (iii) the restrictions on transfer contained in the Indenture and the
Private Placement Legend are not required in order to maintain compliance with
the Securities Act and (iv) the Definitive Note is being acquired in compliance
with any applicable blue sky securities laws of any state of the United States.
C-1
(c) / / CHECK IF EXCHANGE IS FROM RESTRICTED DEFINITIVE NOTE TO
BENEFICIAL INTEREST IN AN UNRESTRICTED GLOBAL NOTE. In connection with the
Owner's Exchange of a Restricted Definitive Note for a beneficial interest in an
Unrestricted Global Note, the Owner hereby certifies (i) the beneficial interest
is being acquired for the Owner's own account without transfer, (ii) such
Exchange has been effected in compliance with the transfer restrictions
applicable to Restricted Definitive Notes and pursuant to and in accordance with
the Securities Act, (iii) the restrictions on transfer contained in the
Indenture and the Private Placement Legend are not required in order to maintain
compliance with the Securities Act and (iv) the beneficial interest is being
acquired in compliance with any applicable blue sky securities laws of any state
of the United States.
(d) / / CHECK IF EXCHANGE IS FROM RESTRICTED DEFINITIVE NOTE TO
UNRESTRICTED DEFINITIVE NOTE. In connection with the Owner's Exchange of a
Restricted Definitive Note for an Unrestricted Definitive Note, the Owner hereby
certifies (i) the Unrestricted Definitive Note is being acquired for the Owner's
own account without transfer, (ii) such Exchange has been effected in compliance
with the transfer restrictions applicable to Restricted Definitive Notes and
pursuant to and in accordance with the Securities Act, (iii) the restrictions on
transfer contained in the Indenture and the Private Placement Legend are not
required in order to maintain compliance with the Securities Act and (iv) the
Unrestricted Definitive Note is being acquired in compliance with any applicable
blue sky securities laws of any state of the United States.
2. EXCHANGE OF RESTRICTED DEFINITIVE NOTES OR BENEFICIAL INTERESTS
IN RESTRICTED GLOBAL NOTES FOR RESTRICTED DEFINITIVE NOTES OR BENEFICIAL
INTERESTS IN RESTRICTED GLOBAL NOTES
(a) / / CHECK IF EXCHANGE IS FROM BENEFICIAL INTEREST IN A RESTRICTED
GLOBAL NOTE TO RESTRICTED DEFINITIVE NOTE. In connection with the Exchange of
the Owner's beneficial interest in a Restricted Global Note for a Restricted
Definitive Note with an equal principal amount, the Owner hereby certifies that
the Restricted Definitive Note is being acquired for the Owner's own account
without transfer. Upon consummation of the proposed Exchange in accordance with
the terms of the Indenture, the Restricted Definitive Note issued will continue
to be subject to the restrictions on transfer enumerated in the Private
Placement Legend printed on the Restricted Definitive Note and in the Indenture
and the Securities Act.
(b) / / CHECK IF EXCHANGE IS FROM RESTRICTED DEFINITIVE NOTE TO
BENEFICIAL INTEREST IN A RESTRICTED GLOBAL NOTE. In connection with the Exchange
of the Owner's Restricted Definitive Note for a beneficial interest in the
[CHECK ONE] / / 144A Global Note, / / Regulation S Global Note, / / IAI Global
Note with an equal principal amount, the Owner hereby certifies (i) the
beneficial interest is being acquired for the Owner's own account without
transfer and (ii) such Exchange has been effected in compliance with the
transfer restrictions applicable to the Restricted Global Notes and pursuant to
and in accordance with the Securities Act, and in compliance with any applicable
blue sky securities laws of any state of the United States. Upon consummation of
the proposed Exchange in accordance with the terms of the Indenture, the
beneficial interest issued will be subject to the restrictions on transfer
enumerated in the Private Placement Legend printed on the relevant Restricted
Global Note and in the Indenture and the Securities Act.
C-2
This certificate and the statements contained herein are made for your
benefit and the benefit of the Company.
------------------------------------------
[Insert Name of Transferor]
By:
--------------------------------------
Name:
Title:
Dated:
------------------
C-3
EXHIBIT D
FORM OF CERTIFICATE FROM
ACQUIRING INSTITUTIONAL ACCREDITED INVESTOR
H&E Equipment Services L.L.C.
H&E Finance Corp.
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▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Chief Financial Officer
The Bank of New York
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇ ▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ 10286
Attention: Corporate Trust Administration
Re: 11 1/8% SENIOR SECURED NOTES DUE 2012 (CUSIP______________)
Reference is hereby made to the Indenture, dated as of June 17, 2002
(the "INDENTURE"), among H&E Equipment Services L.L.C. and H&E Finance Corp.,
together as issuer (the "COMPANY"), the Guarantors named on the signature pages
thereto and The Bank of New York, as Trustee. Capitalized terms used but not
defined herein shall have the meanings given to them in the Indenture.
In connection with our proposed purchase of $____________ aggregate
principal amount of:
(a) / / a beneficial interest in a Global Note, or
(b) / / a Definitive Note,
we confirm that:
1. We understand that any subsequent transfer of the Notes or any
interest therein is subject to certain restrictions and conditions set forth in
the Indenture and the undersigned agrees to be bound by, and not to resell,
pledge or otherwise transfer the Notes or any interest therein except in
compliance with, such restrictions and conditions and the Securities Act of
1933, as amended (the "SECURITIES ACT").
2. We understand that the offer and sale of the Notes have not been
registered under the Securities Act, and that the Notes and any interest therein
may not be offered or sold except as permitted in the following sentence. We
agree, on our own behalf and on behalf of any accounts for which we are acting
as hereinafter stated, that if we should sell the Notes or any interest therein,
we will do so only (A) to the Company or any subsidiary thereof, (B) in
accordance with Rule 144A under the Securities Act to a "qualified institutional
buyer" (as defined therein), (C) to an institutional "accredited investor" (as
defined below) that, prior to such transfer, furnishes (or has furnished on its
behalf by a U.S. broker-dealer) to you and to the Company a signed letter
substantially in the form of this letter and, if such transfer is in respect of
a principal amount of Notes, at the time of transfer of less than $250,000, an
Opinion of Counsel in form reasonably acceptable to the Company to the effect
that such transfer is in compliance with the Securities Act, (D) outside the
United States in accordance with Rule 904 of Regulation S under the Securities
Act, (E) pursuant to the provisions of Rule 144(k) under the Securities Act or
(F) pursuant to an effective registration statement under the Securities Act,
and we further agree to provide to any Person purchasing the Definitive Note or
beneficial interest in a Global Note from us in a transaction meeting the
D-1
requirements of clauses (A) through (E) of this paragraph a notice advising such
purchaser that resales thereof are restricted as stated herein.
D-2
3. We understand that, on any proposed resale of the Notes or
beneficial interest therein, we will be required to furnish to you and the
Company such certifications, legal opinions and other information as you and the
Company may reasonably require to confirm that the proposed sale complies with
the foregoing restrictions. We further understand that the Notes purchased by us
will bear a legend to the foregoing effect.
4. We are an institutional "accredited investor" (as defined in Rule
501(a)(1), (2), (3) or (7) of Regulation D under the Securities Act) and have
such knowledge and experience in financial and business matters as to be capable
of evaluating the merits and risks of our investment in the Notes, and we and
any accounts for which we are acting are each able to bear the economic risk of
our or its investment.
5. We are acquiring the Notes or beneficial interest therein
purchased by us for our own account or for one or more accounts (each of which
is an institutional "accredited investor") as to each of which we exercise sole
investment discretion.
You and the Company are entitled to rely upon this letter and are
irrevocably authorized to produce this letter or a copy hereof to any interested
party in any administrative or legal proceedings or official inquiry with
respect to the matters covered hereby.
------------------------------------------
[Insert Name of Transferor]
By:
--------------------------------------
Name:
Title:
Dated:
----------------
D-3
EXHIBIT E
[FORM OF NOTATION OF GUARANTEE]
For value received, each Guarantor (which term includes any successor
Person under the Indenture) has, jointly and severally, unconditionally
guaranteed, to the extent set forth in the Indenture and subject to the
provisions in the Indenture dated as of June 17, 2002 (the "INDENTURE") among
H&E Equipment Services L.L.C. and H&E Finance Corp., (together the "COMPANY"),
the Guarantors listed on Schedule I thereto and The Bank of New York, as trustee
(the "TRUSTEE"), (a) the due and punctual payment of the principal of, premium
and Liquidated Damages, if any, and interest on the Notes (as defined in the
Indenture), whether at maturity, by acceleration, redemption or otherwise, the
due and punctual payment of interest on overdue principal of and interest on the
Notes, if any, if lawful, and the due and punctual performance of all other
obligations of the Company to the Holders or the Trustee all in accordance with
the terms of the Indenture and (b) in case of any extension of time of payment
or renewal of any Notes or any of such other obligations, that the same will be
promptly paid in full when due or performed in accordance with the terms of the
extension or renewal, whether at stated maturity, by acceleration or otherwise.
The obligations of the Guarantors to the Holders of Notes and to the Trustee
pursuant to the Subsidiary Guarantee and the Indenture are expressly set forth
in Article 12 of the Indenture and reference is hereby made to the Indenture for
the precise terms of the Subsidiary Guarantee. Each Holder of a Note, by
accepting the same, (a) agrees to and shall be bound by such provisions, (b)
authorizes and directs the Trustee, on behalf of such Holder, to take such
action as may be necessary or appropriate to effectuate the subordination as
provided in the Indenture and (c) appoints the Trustee attorney-in-fact of such
Holder for such purpose; PROVIDED, HOWEVER, that the Indebtedness evidenced by
this Subsidiary Guarantee shall cease to be so subordinated and subject in right
of payment upon any defeasance of this Note in accordance with the provisions of
the Indenture.
GNE INVESTMENTS, INC.
By:
------------------------------------
Name:
Title:
GREAT NORTHERN EQUIPMENT, INC.
By:
------------------------------------
Name:
Title:
E-1
EXHIBIT F
[FORM OF SUPPLEMENTAL INDENTURE
TO BE DELIVERED BY SUBSEQUENT GUARANTORS]
SUPPLEMENTAL INDENTURE (this "SUPPLEMENTAL INDENTURE"), dated as of
________________, 200__, among __________________ (the "GUARANTEEING
SUBSIDIARY"), a subsidiary of H&E Equipment Services L.L.C. (or its permitted
successor), a Louisiana limited liability company ("H&E LLC") or H&E Finance
Corp. ("H&E FINANCE") (or its permitted successor), a Delaware corporation
(collectively H&E LLC and H&E Finance Corp. are referred to herein as the
"COMPANY"), the Company, the other Guarantors (as defined in the Indenture
referred to herein) and The Bank of New York, as trustee under this Indenture
referred to below (the "TRUSTEE").
W I T N E S S E T H
WHEREAS, the Company has heretofore executed and delivered to the
Trustee an indenture (the "Indenture"), dated as of June 17, 2002 providing for
the issuance of an aggregate principal amount of up to $200 million of 11 1/8%
Senior Secured Notes due 2012 (the "NOTES");
WHEREAS, the Indenture provides that under certain circumstances the
Guaranteeing Subsidiary shall execute and deliver to the Trustee a supplemental
indenture pursuant to which the Guaranteeing Subsidiary shall unconditionally
guarantee all of the Company's Obligations under the Notes and the Indenture on
the terms and conditions set forth herein (the "SUBSIDIARY GUARANTEE"); and
WHEREAS, pursuant to Section 9.01 of the Indenture, the Trustee is
authorized to execute and deliver this Supplemental Indenture.
NOW THEREFORE, in consideration of the foregoing and for other good
and valuable consideration, the receipt of which is hereby acknowledged, the
Guaranteeing Subsidiary and the Trustee mutually covenant and agree for the
equal and ratable benefit of the Holders of the Notes as follows:
1. CAPITALIZED TERMS. Capitalized terms used herein without
definition shall have the meanings assigned to them in the Indenture.
2. AGREEMENT TO GUARANTEE. The Guaranteeing Subsidiary hereby agrees
as follows:
(a) Along with all Guarantors named in the Indenture,
to jointly and severally Guarantee to each Holder of a Note
authenticated and delivered by the Trustee and to the Trustee and
its successors and assigns, the Notes or the obligations of the
Company hereunder or thereunder, that:
(i) the principal of, and premium and Liquidated
Damages, if any, and interest on the Notes will be promptly paid
in full when due, whether at maturity, by acceleration,
redemption or otherwise, and interest on the overdue principal of
and interest on the Notes, if any, if lawful, and all other
obligations of the Company to the Holders or the Trustee
hereunder or thereunder will be promptly paid in full or
performed, all in accordance with the terms hereof and thereof;
and
(ii) in case of any extension of time of payment or
renewal of any Notes or any of such other obligations, that same
will be promptly paid in full when due or performed in accordance
with the terms of the extension or renewal, whether at stated
F-1
maturity, by acceleration or otherwise. Failing payment when due
of any amount so guaranteed or any performance so guaranteed for
whatever reason, the Guarantors shall be jointly and severally
obligated to pay the same immediately.
(b) The obligations hereunder shall be unconditional,
irrespective of the validity, regularity or enforceability of the
Notes or the Indenture, the absence of any action to enforce the
same, any waiver or consent by any Holder of the Notes with
respect to any provisions hereof or thereof, the recovery of any
judgment against the Company, any action to enforce the same or
any other circumstance which might otherwise constitute a legal
or equitable discharge or defense of a Guarantor.
(c) The following is hereby waived: diligence,
presentment, demand of payment, filing of claims with a court in
the event of insolvency or bankruptcy of the Company, any right
to require a proceeding first against the Company, protest,
notice and all demands whatsoever.
(d) This Subsidiary Guarantee shall not be discharged
except by complete performance of the obligations contained in
the Notes and the Indenture, and the Guaranteeing Subsidiary
accepts all obligations of a Guarantor under the Indenture.
(e) If any Holder or the Trustee is required by any
court or otherwise to return to the Company, the Guarantors, or
any custodian, trustee, liquidator or other similar official
acting in relation to either the Company or the Guarantors, any
amount paid by either to the Trustee or such Holder, this
Subsidiary Guarantee, to the extent theretofore discharged, shall
be reinstated in full force and effect.
(f) The Guaranteeing Subsidiary shall not be entitled
to any right of subrogation in relation to the Holders in respect
of any obligations guaranteed hereby until payment in full of all
obligations guaranteed hereby.
(g) As between the Guarantors, on the one hand, and the
Holders and the Trustee, on the other hand, (x) the maturity of
the obligations guaranteed hereby may be accelerated as provided
in Article 6 of the Indenture for the purposes of this Subsidiary
Guarantee, notwithstanding any stay, injunction or other
prohibition preventing such acceleration in respect of the
obligations guaranteed hereby, and (y) in the event of any
declaration of acceleration of such obligations as provided in
Article 6 of the Indenture, such obligations (whether or not due
and payable) shall forthwith become due and payable by the
Guarantors for the purpose of this Subsidiary Guarantee.
(h) The Guarantors shall have the right to seek
contribution from any non-paying Guarantor so long as the
exercise of such right does not impair the rights of the Holders
under the Subsidiary Guarantee.
(i) Pursuant to Section 12.02 of the Indenture, after
giving effect to any maximum amount and all other contingent and
fixed liabilities that are relevant under any applicable
Bankruptcy or fraudulent conveyance laws, and after giving effect
to any collections from, rights to receive contribution from or
payments made by or on behalf of any other Guarantor in respect
of the obligations of such other Guarantor under Article 12 of
the Indenture, this new Subsidiary Guarantee shall be limited to
the maximum amount permissible such that the obligations of such
Guarantor under this Subsidiary Guarantee will not constitute a
fraudulent transfer or conveyance.
F-2
3. EXECUTION AND DELIVERY. Each Guaranteeing Subsidiary agrees that
the Subsidiary Guarantees shall remain in full force and effect notwithstanding
any failure to endorse on each Note a notation of such Subsidiary Guarantee.
4. GUARANTEEING SUBSIDIARY MAY CONSOLIDATE, ETC. ON CERTAIN TERMS.
(a) The Guaranteeing Subsidiary may not sell or
otherwise dispose of all substantially all of its assets to, or
consolidate with or merge with or into (whether or not such
Guarantor is the surviving Person) another Person, other than the
Company or another Guarantor unless:
(i) immediately after giving effect to such
transaction, no Default or Event of Default exists; and
(ii) either (A) subject to Sections 12.04 and 12.05 of
the Indenture, the Person acquiring the property in any such sale
or disposition or the Person formed by or surviving any such
consolidation or merger unconditionally assumes all the
obligations of that Guarantor, pursuant to a supplemental
indenture in form and substance reasonably satisfactory to the
Trustee, under the Notes, the Indenture and the Subsidiary
Guarantee on the terms set forth herein or therein; or (B) the
Net Proceeds of such sale or other disposition are applied in
accordance with the applicable provisions of the Indenture,
including without limitation, Section 4.10 thereof.
(b) In case of any such consolidation, merger, sale or
conveyance and upon the assumption by the successor Person, by
supplemental indenture, executed and delivered to the Trustee and
satisfactory in form to the Trustee, of the Subsidiary Guarantee
endorsed upon the Notes and the due and punctual performance of
all of the covenants and conditions of the Indenture to be
performed by the Guarantor, such successor Person shall succeed
to and be substituted for the Guarantor with the same effect as
if it had been named herein as a Guarantor. Such successor Person
thereupon may cause to be signed any or all of the Subsidiary
Guarantees to be endorsed upon all of the Notes issuable under
the Indenture which theretofore shall not have been signed by the
Company and delivered to the Trustee. All the Subsidiary
Guarantees so issued shall in all respects have the same legal
rank and benefit under the Indenture as the Subsidiary Guarantees
theretofore and thereafter issued in accordance with the terms of
the Indenture as though all of such Subsidiary Guarantees had
been issued at the date of the execution hereof.
(c) Except as set forth in Articles 4 and 5 and Section
12.05 of Article 12 of the Indenture, and notwithstanding clauses
(a) and (b) above, nothing contained in the Indenture or in any
of the Notes shall prevent any consolidation or merger of a
Guarantor with or into the Company or another Guarantor, or shall
prevent any sale or conveyance of the property of a Guarantor as
an entirety or substantially as an entirety to the Company or
another Guarantor.
5. RELEASES.
(a) In the event of any sale or other disposition of
all or substantially all of the assets of any Guarantor, by way
of merger, consolidation or otherwise, or a sale or other
disposition of all of the capital stock of any Guarantor, in each
case to a Person that is not (either before or after giving
effect to such transaction) a Restricted Subsidiary of
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the Company, then such Guarantor (in the event of a sale or other
disposition, by way of merger, consolidation or otherwise, of all
of the capital stock of such Guarantor) or the corporation
acquiring the property (in the event of a sale or other
disposition of all or substantially all of the assets of such
Guarantor) will be released and relieved of any obligations under
its Subsidiary Guarantee; PROVIDED that the Net Proceeds of such
sale or other disposition are applied in accordance with the
applicable provisions of the Indenture, including without
limitation Section 4.10 of the Indenture. Upon delivery by the
Company to the Trustee of an Officers' Certificate and an Opinion
of Counsel to the effect that such sale or other disposition was
made by the Company in accordance with the provisions of the
Indenture, including without limitation Section 4.10 of the
Indenture, the Trustee shall execute any documents reasonably
required in order to evidence the release of any Guarantor from
its obligations under its Subsidiary Guarantee.
(b) Any Guarantor not released from its obligations
under its Subsidiary Guarantee shall remain liable for the full
amount of principal of and interest on the Notes and for the
other obligations of any Guarantor under the Indenture as
provided in Article 12 of the Indenture.
6. NO RECOURSE AGAINST OTHERS. No past, present or future director,
officer, employee, incorporator, stockholder or agent of the Guaranteeing
Subsidiary, as such, shall have any liability for any obligations of the Company
or any Guaranteeing Subsidiary under the Notes, any Subsidiary Guarantees, the
Indenture or this Supplemental Indenture or for any claim based on, in respect
of, or by reason of, such obligations or their creation. Each Holder of the
Notes by accepting a Note waives and releases all such liability. The waiver and
release are part of the consideration for issuance of the Notes. Such waiver may
not be effective to waive liabilities under the federal securities laws and it
is the view of the SEC that such a waiver is against public policy.
7. NEW YORK LAW TO GOVERN. THE INTERNAL LAW OF THE STATE OF NEW YORK
SHALL GOVERN AND BE USED TO CONSTRUE THIS SUPPLEMENTAL INDENTURE BUT WITHOUT
GIVING EFFECT TO APPLICABLE PRINCIPLES OF CONFLICTS OF LAW TO THE EXTENT THAT
THE APPLICATION OF THE LAWS OF ANOTHER JURISDICTION WOULD BE REQUIRED THEREBY.
8. COUNTERPARTS. The parties may sign any number of copies of this
Supplemental Indenture. Each signed copy shall be an original, but all of them
together represent the same agreement.
9. EFFECT OF HEADINGS. The Section headings herein are for
convenience only and shall not affect the construction hereof.
10. THE TRUSTEE. The Trustee shall not be responsible in any manner
whatsoever for or in respect of the validity or sufficiency of this Supplemental
Indenture or for or in respect of the recitals contained herein, all of which
recitals are made solely by the Guaranteeing Subsidiary and the Company.
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IN WITNESS WHEREOF, the parties hereto have caused this Supplemental
Indenture to be duly executed and attested, all as of the date first above
written.
Dated: __________, 20___
[GUARANTEEING SUBSIDIARY]
By:
--------------------------------------
Name:
Title:
H&E EQUIPMENT SERVICES L.L.C.
By:
--------------------------------------
Name:
Title:
H&E FINANCE CORP.
By:
--------------------------------------
Name:
Title:
GNE INVESTMENTS, INC.
By:
--------------------------------------
Name:
Title:
GREAT NORTHERN EQUIPMENT, INC.
By:
--------------------------------------
Name:
Title:
THE BANK OF NEW YORK,
as Trustee
By:
--------------------------------------
Name:
Title:
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