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EXHIBIT 10.1
INFORMATION STATEMENT
W.R. CARPENTER NORTH AMERICA, INC.
Consent and Waiver of Compliance under the Indenture Governing
its 10 5/8% Senior Subordinated Notes Due 2007
SUBJECT TO THE CONDITIONS DESCRIBED HEREIN, THE COMPANY WILL ACCEPT ALL CONSENTS
(AS DEFINED BELOW) RECEIVED PRIOR TO 5:00 P.M., NEW YORK TIME ON SEPTEMBER 22,
2000 (THE "EXPIRATION DATE"). IF THE REQUISITE NUMBER OF CONSENTS ARE NOT
RECEIVED BY THE EXPIRATION DATE, THE COMPANY MAY ELECT TO CONTINUE TO ACCEPT
ADDITIONAL CONSENTS UNTIL THE REQUISITE NUMBER OF CONSENTS HAVE BEEN RECEIVED.
CONSENTS MAY BE REVOKED AT ANY TIME PRIOR TO THE COMPANY'S RECEIPT OF THE
REQUISITE NUMBER OF CONSENTS.
W.R. Carpenter North America, Inc., a Delaware corporation (the "Company"), is
furnishing this Information Statement and the accompanying form of consent and
waiver (the "Consent") to holders of record (the "Noteholders") on September 1,
2000 (the "Record Date") of its 10 5/8% Senior Subordinated Notes Due 2007 (the
"Notes"), in connection with the consent and waiver of compliance regarding
certain provisions of the indenture dated as of June 10, 1997 (the "Indenture")
among the Company, certain guarantors, and U.S. Trust Company of California,
N.A., as Trustee (the "Trustee").
The Consent would waive any events of noncompliance and default under the
Indenture that would occur in connection with the proposed sale by the Company
(the "Horizon Transaction") of its wholly-owned subsidiary, Horizon High Reach,
Inc. ("Horizon") to United Rentals (North America), Inc. ("United") as a result
of the Company receiving less than 85% of the consideration from the sale of
Horizon in the form of cash or temporary cash investments, and otherwise would
consent to the Horizon Transaction.
United is a wholly-owned subsidiary of United Rentals, Inc., a New York Stock
Exchange-listed company.
A copy of the form of Consent is attached to this Information Statement as
Exhibit A. Capitalized terms used but not defined in this Information Statement
have the meanings set forth in the Indenture.
Approval of the Consent requires the consent of the holders of not less than a
majority in aggregate principal amount of the outstanding Notes, provided that
Notes owned by the Company or any of its affiliates will be disregarded as
though they were not outstanding (the "Requisite Consents"). The Company and
its affiliates currently own $60.85 million in aggregate principal amount of the
Notes.
Duly executed Consents should be sent to U.S. Trust Company, N.A., as Trustee,
by facsimile to (646) 458-8123, followed by hand delivery or overnight courier
of the original to:
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<CAPTION>
BY HAND BY OVERNIGHT COURIER OR FACSIMILE
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<S> <C>
U.S. Trust Company, National Association U.S. Trust Company, National Association
c/o United States Trust Company of New York c/o United States Trust Company of New York
30 Broad Street, B Level 30 Broad Street, 14th Floor
Corporate Trust Window New York, NY 10004-2304
New York, NY 10004-2304 Attn: Corporate Trust Operations
</TABLE>
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In no event should a Noteholder tender or deliver Notes.
If you require assistance, please contact the Trustee at (800) 548-6565 or
Graham D. Croot, Chief Financial Officer of the Company at (559) 353-3953. The
Company has made no arrangements and has no understanding with any dealer,
salesman or person regarding the Consents. No person has been authorized by the
Company to give any information or to make any representations in connection
with the Consents other than those contained herein, and, if given or made, such
other information or representations must not be relied upon as having been
authorized. The delivery of this Information Statement shall not, under any
circumstances, create any implication that the information herein is correct as
of any time subsequent to the date hereof.
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The request for Consents is not being made to, nor will the Company accept
Consents from, Noteholders in any jurisdiction in which the request would not be
in compliance with the securities or Blue Sky laws of such jurisdiction.
BACKGROUND
The Horizon Transaction
On August 10, 2000, the Company entered into a letter of intent (the "Letter of
Intent") with United pursuant to which the Company agreed to sell all of the
outstanding capital stock of Horizon to United for an aggregate consideration of
$90 million (subject to certain adjustments) pursuant to definitive agreements
(the "Horizon Transaction Documents"). The Letter of Intent provides for a
purchase price comprised of (i) approximately $50 million payable in cash upon
the closing of the Horizon Transaction, and (ii) two unsecured senior promissory
notes (the "United Notes"), with an aggregate original principal amount of
approximately $40 million. Consummation of the Horizon Transaction is subject
to, and will not take place without, applicable regulatory and governmental
approvals and other conditions, including the receipt by the Company of the
Requisite Consents. The Company intends to use the cash proceeds from the
Horizon Transaction to repay senior indebtedness of its subsidiaries and for
general corporate purposes as permitted under the Indenture. To facilitate the
Company's cash flow from this transaction, the Company may market and sell one
or both of the United Notes for cash to potential buyers, subject to applicable
securities laws and other considerations (including, but not limited to, market
conditions and restrictions on the transferability of the United Notes, as
further described below).
The United Notes
One of the United Notes (the "First Note") will be a senior unsecured promissory
note paying interest quarterly throughout its term at 10.20% per annum, with all
outstanding principal due at maturity. The original principal amount of the
First Note will be approximately $20 million. The First Note will not be
subject to any adjustment in principal amount and will be immediately marketable
by the Company. The other United Note (the "Second Note") also will be a senior
unsecured promissory note in an original principal amount of approximately $20
million, bearing interest at 10.20% per annum. The Second Note will be payable
in quarterly installments as follows: the first six installments will be
payments of interest only, and the remaining 14 installments will be comprised
of payments of interest and amortize 100% of the principal over the balance of
the term, with all outstanding principal and interest due at maturity. The
principal amount of the Second Note will be subject to increase or decrease as a
result of potential post-closing adjustments to, and setoffs against, the Second
Note. The Second Note also will not be marketable by the Company until
approximately 18 months after the Horizon Transaction closes.
The Company intends to use the proceeds that it receives from the sale or
prepayment of any of the United Notes for general corporate purposes as
permitted by the Indenture.
Each of the United Notes will constitute senior indebtedness of United, pari
passu with all other existing and future senior obligations of United and senior
to all subordinated indebtedness of United. Upon a change in control of United,
all outstanding principal and interest under each of the United Notes will be
immediately due and payable. In addition, United will have the right to prepay
each of the United Notes at any time without premium or penalty and the
obligation to prepay under certain other circumstances.
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Release of Horizon as Guarantor
In accordance with Section 11.04 of the Indenture, upon consummation of the
Horizon Transaction, Horizon will be released from all of its obligations under
Section 11 of the Indenture and its Guarantee.
NONCOMPLIANCE WITH INDENTURE
Limitation on Certain Asset Sales
Under Section 4.10(ii) of the Indenture, the Company may not consummate an Asset
Sale (as defined in the Indenture) unless, among other things, at least 85% of
the consideration that the Company receives for the assets being sold is in the
form of cash or Temporary Cash Investments (as defined in the Indenture). In
the Horizon Transaction, the Company will receive approximately $50 million of
the approximately $90 million purchase price in cash, which will be less than
the 85% required by Section 4.10(ii) of the Indenture.
If not waived by a majority in aggregate principal amount of the outstanding
Notes (excluding Notes owned by the Company or any of its affiliates), the
Company's failure to cure, within 60 days following receipt of notice from the
Trustee or the holders of not less than 25% in aggregate principal amount of the
Notes outstanding, its noncompliance with Section 4.10(ii) of the Indenture
would result in an Event of Default under Section 6.01(3) thereof, entitling the
Noteholders to accelerate the debt.
TERMS OF THE CONSENT
If approved, the Consent would waive compliance by the Company with the
provisions of Section 4.10(ii) of the Indenture in connection with the receipt
of the purchase price for the Horizon Transaction, and would otherwise consent
to the Horizon Transaction.
THE CONSENT PROCESS
Procedure for Giving Consents
Noteholders wishing to waive compliance with Section 4.10(ii) of the Indenture
and consent to the Consent should complete, sign, and date the accompanying form
of Consent (or a facsimile thereof) in accordance with the instructions set
forth herein and in the Consent and forward or hand deliver such Consent to the
Trustee on behalf of the Company at the appropriate address as set forth
therein.
Noteholders NOT wishing to waive compliance with Section 4.10(ii) of the
Indenture and consent to the Consent should mark the "Does Not Consent" box and
forward or hand deliver such Consent to the Trustee on behalf of the Company at
the appropriate address as set forth therein.
An "Accepted Consent" is a properly completed Consent executed by the Noteholder
of record on the Record Date (or the Noteholder's legal representative or
attorney-in-fact) that is (a) timely received by the Trustee on behalf of the
Company, and not thereafter revoked as provided herein and (b) accepted by the
Company in accordance with the provisions and subject to the terms and
conditions set forth in this Information Statement.
Only a registered Noteholder on the Record Date (or the Noteholder's legal
representative or attorney-in-fact) may deliver a Consent. Except as provided
below, any beneficial owner of Notes who is not the registered holder of such
Notes must arrange with the registered holder to execute and deliver a consent
on the beneficial owner's behalf.
CONSENTS SHOULD BE SENT TO THE TRUSTEE BY FACSIMILE, FOLLOWED BY DELIVERY OF THE
ORIGINAL BY HAND OR BY OVERNIGHT COURIER. IN NO EVENT SHOULD A NOTEHOLDER
TENDER OR DELIVER NOTES.
Consents should be delivered by facsimile with the original to follow by mail,
overnight express or hand to the Trustee at the address set forth herein and in
the Consent.
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All questions as to the validity, form, eligibility (including time of receipt),
and acceptance of Consents will be resolved by the Company, whose determination
shall be final and binding. The Company also reserves the right to waive any
irregularities or conditions of delivery as to particular Consents. Neither the
Company nor the Trustee shall be under any duty to give notification of any such
irregularities or waiver. Deliveries of such particular Consents will not be
deemed to have been made until such irregularities have been cured or waived.
Revocation of Consents
Section 9.04 of the Indenture provides that Consents may be revoked only before
the date the Consent becomes effective. Prior to such time, Consents may be
revoked upon receipt by the Company of a notice of revocation by a Noteholder on
the Record Date. The notice of revocation must indicate the serial number or
numbers of the Notes to which such revocation relates (or information sufficient
to enable the Company to identify such Notes), as well as the aggregate
principal amount represented by such Notes. A properly executed Consent with
the "Does Not Consent" box marked, submitted in accordance with the foregoing
procedures, will be treated as a revocation of the Consent regarding the Notes
to which it relates. A Noteholder on the Record Date who has delivered a
revocation may thereafter deliver a new Consent in accordance with the terms set
forth in this Information Statement. Except as discussed above, a Consent given
by a holder of any Note shall be conclusive and binding upon such holder and
upon all future holders and owners of such Note, and of any Note issued in
exchange for or in substitution therefor, whether or not any notation in regard
thereto is made on such Note. A revocation of a Consent shall be deemed to be
canceled by a subsequent delivered properly completed and executed Consent
relating to the same Note or Notes, if such subsequent Consent is given by the
same Noteholder of record.
Effective Date of the Consent
The Consents will be effective as of the date that the Company receives the
Requisite Consents.
CERTAIN FEDERAL INCOME TAX CONSIDERATIONS
The Company does not believe that the grant of the Consent, if approved, would
result in any tax consequence to the Noteholders for Federal income tax
purposes. Each Noteholder is, however, urged to consult with its tax advisor as
to any potential tax consequences to it resulting from the Consent (including
consequences resulting from the application of any state, local or foreign
income or other tax laws).
ADDITIONAL INFORMATION ABOUT THE COMPANY
W.R. Carpenter North America, Inc. is subject to the reporting and information
requirements of the Securities Exchange Act of 1934, as amended, and in
accordance therewith files reports and other information with the Securities and
Exchange Commission (the "Commission"). The Company has previously furnished to
the Noteholders the Company's Annual Report on Form 10-K for its fiscal year
ending June 27, 1999, which, among other matters, contains a description of the
Company's business and its consolidated financial statements, and the Company's
Quarterly Report on Form 10-Q for its fiscal quarter ending March 26, 2000.
Information as of particular dates concerning the Company's directors and
officers, the remuneration of such persons and any material interest of such
persons in transactions with the Company, as the case may be, is set forth in
other reports filed with the Commission. Such reports and other information may
be inspected and copies may be obtained at the principal offices of the
Commission at 450 Fifth Street, N.W., Washington, D.C. 20549; Citicorp Center,
500 West Madison Street, Suite 1400, Chicago, Illinois 60661; and 7 World Trade
Center, Suite 1300, New York, New York 10048. Copies of such material can be
obtained from the Public Reference Section of the Commission at 450 Fifth
Street, N.W., Washington, D.C. 20549, upon payment of the prescribed fees.
Such reports and other information may also be obtained from the Company.
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DELIVERY OF CONSENTS
Noteholders on the Record Date who wish to consent to the proposed Consent
should either (1) complete and sign the Consent (or a facsimile thereof) and
forward it by facsimile to the Trustee or (2) request their broker, bank or
trust company or nominee to do so on their behalf. Requests for additional
copies of this Information Statement and the Consent should be directed to the
Trustee at the address and telephone and facsimile numbers listed below.
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Consents Should Be Sent To:
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BY HAND BY OVERNIGHT COURIER OR FACSIMILE
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<S> <C>
U.S. Trust Company, National Association U.S. Trust Company, National Association
c/o United States Trust Company of New York c/o United States Trust Company of New York
30 Broad Street, B Level 30 Broad Street, 14th Floor
Corporate Trust Window New York, NY 10004-2304
New York, NY 10004-2304 Attn: Corporate Trust Operations
</TABLE>
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EXHIBITS
A - Form of Consent and Waiver
6
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CONSENT AND WAIVER
Reference is made to the Indenture ("Indenture") dated as of June 10, 1997 by
and among W. R. Carpenter North America, Inc. (the "Company"), the Guarantors
named therein, and U.S. Trust Company of California, N.A., as trustee.
Capitalized terms used herein have the meanings set forth in the Indenture
unless otherwise defined herein.
Pursuant to a letter of intent ("Letter of Intent") dated August 10, 2000 by and
between the Company and United Rentals (North America), Inc. ("United"), the
Company has agreed to sell all of the outstanding common stock of Horizon High
Reach, Inc. to United (the "Horizon Transaction"), subject, among other things,
to receiving this consent and waiver (without revocation) from holders
representing the majority in aggregate principal amount of the outstanding
Notes.
The undersigned, who represents and warrants to the Company that it is a
Noteholder of the Company's notes as of September 1, 2000, hereby:
[Please check only one box]
[_] CONSENTS
[_] DOES NOT CONSENT
and waives compliance by the Company with the provisions of Section
4.10(ii) of the Indenture in connection with the closing of the
Horizon Transaction and otherwise consents to the Horizon Transaction.
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Principal Amount of Notes Held Name of Noteholder:
Name of Noteholder Signatory:
Title:
Please fax this executed Consent prior to September 22, 2000 to U.S. Trust
Company, N.A., as Trustee, Facsimile: (646) 458-8123, Telephone: (800) 548-6565,
followed by hand delivery or overnight courier of the original to:
<TABLE>
<CAPTION>
BY HAND BY OVERNIGHT COURIER OR FACSIMILE
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<S> <C>
U.S. Trust Company, National Association U.S. Trust Company, National Association
c/o United States Trust Company of New York c/o United States Trust Company of New York
30 Broad Street, B Level 30 Broad Street, 14th Floor
Corporate Trust Window New York, NY 10004-2304
New York, NY 10004-2304 Attn: Corporate Trust Operations
</TABLE>
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