SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
--------------------
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (date of earliest event reported): May 21, 1998
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AMERICAN ECO CORPORATION
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(Exact name or registrant as specified in its charter)
Ontario, Canada 0-10621 52-1742490
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(State or other jurisdiction of (Commission (IRS Employer
incorporation or organization) File Number) Identification No.)
154 University Avenue, Toronto, Ontario M5H 3Y9
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (416) 340-2727
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N/A
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(Former name or former address, if changed since last report.)
<PAGE>
ITEM 5. OTHER EVENTS.
On May 21, 1998, American Eco Corporation (the "Company")
completed the sale of $120,000,000 in aggregate principal amount of its
9-5/8% Senior Notes due May 15, 2008 (the "Notes"). The Notes are
senior unsecured obligations of the Company ranking senior in right of
payment to any subordinated indebtedness of the Company to be incurred
in the future. The Notes are unconditionally guaranteed on a senior
unsecured basis by the Company's subsidiaries.
The issuance was made by means of an offering memorandum to
institutional investors pursuant to Rule 144A and other provisions of
the Securities Act of 1933, as amended (the "Securities Act"). The
Notes have not been registered under the Securities Act and may not be
offered or sold in the United States absent registration or an
applicable exemption from the registration requirements.
The net proceeds from the offering were approximately $115.7
million. Approximately $71.2 million of such proceeds were used to
repay outstanding indebtedness, including full repayment of $65.1
million of borrowings and accrued interest under the Credit and
Guaranty Agreement, dated as of August 22, 1997, among American Eco
Funding Corp., the Company, the Lenders and Issuing Banks thereunder
and Union Bank of California, N.A., as Agent. The Company intends to
use the remainder of the proceeds for potential acquisitions and
general corporate purposes.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS.
(c) Exhibits:
4.1 Indenture, dated as of May 21, 1998, among American Eco
Corporation, the Guarantors named therein and State
Street Bank and Trust Company, as Trustee.
10.1 Purchase Agreement, dated as of May 14, 1998, among
American Eco Corporation, the Guarantors named therein,
Jefferies & Company, Inc. and Nesbitt Burns Securities
Inc.
10.2 Registration Rights Agreement, dated as of May 21, 1998,
among American Eco Corporation, the Guarantors named
therein, Jefferies & Company, Inc. and Nesbitt Burns
Securities Inc.
99 Press Release.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act
of 1934, the Registrant has caused this report to be signed on its
behalf by the undersigned thereunto duly authorized.
AMERICAN ECO CORPORATION
Dated: May 21, 1998 By: /s/ David L. Norris
-------------------------
Name: David L. Norris
Title: Chief Administrative
Officer
<PAGE>
EXHIBIT INDEX
Exhibit Description
4.1 Indenture, dated as of May 21, 1998,
among American Eco Corporation, the
Guarantors named therein and State Street
Bank and Trust Company, as Trustee.
10.1 Purchase Agreement, dated as of May 14,
1998, among American Eco Corporation, the
Guarantors named therein, Jefferies &
Company, Inc. and Nesbitt Burns
Securities Inc.
10.2 Registration Rights Agreement, dated as
of May 21, 1998, among American Eco
Corporation, the Guarantors named
therein, Jefferies & Company, Inc. and
Nesbitt Burns Securities Inc.
99 Press Release.
=================================================================
AMERICAN ECO CORPORATION
AND
THE GUARANTORS NAMED ON THE SIGNATURE PAGE HERETO
SERIES A AND SERIES B
9 5/8% SENIOR NOTES DUE 2008
--------------------
INDENTURE
DATED AS OF MAY 21, 1998
--------------------
--------------------
STATE STREET BANK
AND TRUST COMPANY
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) . . . . . . . . . . . . . . . . . . . . . 11.03
(c) . . . . . . . . . . . . . . . . . . . . . 11.03
313(a) . . . . . . . . . . . . . . . . . . . . . 7.06
(b)(1) . . . . . . . . . . . . . . . . . . . . 7.06
(b)(2) . . . . . . . . . . . . . . . . . . . . 7.06, 7.07
(c) . . . . . . . . . . . . . . . . . . . . . 7.06, 11.02
(d) . . . . . . . . . . . . . . . . . . . . . 7.06
314(a) . . . . . . . . . . . . . . . . . . . . . 4.03, 11.02
(b) . . . . . . . . . . . . . . . . . . . . . N/A
(c)(1) . . . . . . . . . . . . . . . . . . . . 11.04
(c)(2) . . . . . . . . . . . . . . . . . . . . 11.04
(c)(3) . . . . . . . . . . . . . . . . . . . . N/A
(d) . . . . . . . . . . . . . . . . . . . . . N/A
(e) . . . . . . . . . . . . . . . . . . . . . 11.05
(f) . . . . . . . . . . . . . . . . . . . . . N/A
315(a) . . . . . . . . . . . . . . . . . . . . . 7.01
(b) . . . . . . . . . . . . . . . . . . . . . 7.05, 11.02
(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) . . . . . . . . . . . . . . . . . . . . . 11.01
(b) . . . . . . . . . . . . . . . . . . . . . N/A
(c) . . . . . . . . . . . . . . . . . . . . . 11.01
------------------
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 . . . . . . . . . . . 15
Section 1.03. Incorporation by Reference of Trust
Indenture Act . . . . . . . . . . . . . 15
Section 1.04. Rules of Construction . . . . . . . . . 16
ARTICLE 2
THE NOTES
Section 2.01. Form and Dating . . . . . . . . . . . . 16
Section 2.02. Execution and Authentication . . . . . . 18
Section 2.03. Registrar and Paying Agent . . . . . . . 19
Section 2.04. Paying Agent to Hold Money in Trust . . 19
Section 2.05. Holder Lists . . . . . . . . . . . . . . 19
Section 2.06. Transfer and Exchange . . . . . . . . . 20
Section 2.07. Replacement Notes . . . . . . . . . . . 27
Section 2.08. Outstanding Notes . . . . . . . . . . . 27
Section 2.09. Treasury Notes . . . . . . . . . . . . . 28
Section 2.10. Temporary Notes . . . . . . . . . . . . 28
Section 2.11. Cancellation . . . . . . . . . . . . . . 28
Section 2.12. Defaulted Interest . . . . . . . . . . . 29
ARTICLE 3
REDEMPTION AND PREPAYMENT
Section 3.01. Notices to Trustee . . . . . . . . . . . 29
Section 3.02. Selection of Notes to Be Redeemed . . . 29
Section 3.03. Notice of Redemption . . . . . . . . . . 30
Section 3.04. Effect of Notice of Redemption . . . . . 31
Section 3.05. Deposit of Redemption Price . . . . . . 31
Section 3.06. Notes Redeemed in Part . . . . . . . . . 31
Section 3.07. Optional Redemption . . . . . . . . . . 31
Section 3.08. Mandatory Redemption . . . . . . . . . . 32
Section 3.09. Offer to Purchase by Application of Excess
Proceeds . . . . . . . . . . . . . . . . 32
ARTICLE 4
COVENANTS
Section 4.01. Payment of Notes . . . . . . . . . . . . 34
Section 4.02. Maintenance of Office or Agency . . . . 35
Section 4.03. Reports . . . . . . . . . . . . . . . . 35
Section 4.04. Compliance Certificate . . . . . . . . . 35
Section 4.05. Taxes . . . . . . . . . . . . . . . . . 36
Section 4.06. Stay, Extension and Usury Laws . . . . . 36
Section 4.07. Restricted Payments . . . . . . . . . . 37
Section 4.08. Dividend and Other Payment Restrictions
Affecting Subsidiaries . . . . . . . . . 39
Section 4.09. Incurrence of Indebtedness and Issuance of
Disqualified Stock . . . . . . . . . . . 40
Section 4.10. Asset Sales . . . . . . . . . . . . . . 41
Section 4.11. Transactions with Affiliates . . . . . . 42
Section 4.12. Liens . . . . . . . . . . . . . . . . . 43
Section 4.13. Additional Subsidiary Guarantees . . . . 43
Section 4.14. Corporate Existence . . . . . . . . . . 43
Section 4.15. Offer to Purchase Upon Change of Control 44
Section 4.16. Issuances and Sales of Capital Stock of
Restricted Subsidiaries. . . . . . . . . 45
Section 4.17. Sale-and-leaseback Transactions . . . . 45
Section 4.18. No Inducements . . . . . . . . . . . . . 46
Section 4.19. Additional Amounts . . . . . . . . . . . 46
Section 4.20. Enforceability of Judgments; Indemnification
for Foreign Currency Judgments . . . . . 47
ARTICLE 5
SUCCESSORS
Section 5.01. Merger, Consolidation or Sale of Assets 47
Section 5.02. Successor Corporation Substituted . . . 48
ARTICLE 6
DEFAULTS AND REMEDIES
Section 6.01. Events of Default . . . . . . . . . . . 49
Section 6.02. Acceleration . . . . . . . . . . . . . . 50
Section 6.03. Other Remedies . . . . . . . . . . . . . 51
Section 6.04. Waiver of Past Defaults . . . . . . . . 51
Section 6.05. Control by Majority . . . . . . . . . . 51
Section 6.06. Limitation on Suits . . . . . . . . . . 52
Section 6.07. Rights of Holders of Notes to Receive
Payment . . . . . . . . . . . . . . . . 52
Section 6.08. Collection Suit by Trustee . . . . . . . 52
Section 6.09. Trustee May File Proofs of Claim . . . . 52
Section 6.10. Priorities . . . . . . . . . . . . . . . 53
Section 6.11. Undertaking for Costs . . . . . . . . . 53
ARTICLE 7
TRUSTEE
Section 7.01. Duties of Trustee . . . . . . . . . . . 54
Section 7.02. Rights of Trustee . . . . . . . . . . . 55
Section 7.03. Individual Rights of Trustee . . . . . . 55
Section 7.04. Trustee's Disclaimer . . . . . . . . . . 56
Section 7.05. Notice of Defaults . . . . . . . . . . . 56
Section 7.06. Reports by Trustee to Holders of the Notes 56
Section 7.07. Compensation and Indemnity . . . . . . . 56
Section 7.08. Replacement of Trustee . . . . . . . . . 57
Section 7.09. Successor Trustee by Merger, etc . . . . 58
Section 7.10. Eligibility; Disqualification . . . . . 58
Section 7.11. Preferential Collection of Claims Against
Company . . . . . . . . . . . . . . . . 58
ARTICLE 8
LEGAL DEFEASANCE AND COVENANT DEFEASANCE
Section 8.01. Option to Effect Legal Defeasance or
Covenant Defeasance . . . . . . . . . . 59
Section 8.02. Legal Defeasance and Discharge . . . . . 59
Section 8.03. Covenant Defeasance . . . . . . . . . . 59
Section 8.04. Conditions to Legal or Covenant Defeasance 60
Section 8.05. Deposited Money and Government Securities to
be Held in Trust; Other Miscellaneous
Provisions . . . . . . . . . . . . . . . 61
Section 8.06. Repayment to Company . . . . . . . . . . 62
Section 8.07. Reinstatement . . . . . . . . . . . . . 62
ARTICLE 9
AMENDMENT, SUPPLEMENT AND WAIVER
Section 9.01. Without Consent of Holders of Notes . . 62
Section 9.02. With Consent of Holders of Notes . . . . 63
Section 9.03. Compliance with Trust Indenture Act . . 64
Section 9.04. Revocation and Effect of Consents . . . 65
Section 9.05. Notation on or Exchange of Notes . . . . 65
Section 9.06. Trustee to Sign Amendments, etc. . . . . 65
ARTICLE 10
GUARANTEES OF NOTES
Section 10.01. Subsidiary Guarantees . . . . . . . . . 65
Section 10.02. Execution and Delivery of Subsidiary
Guarantee . . . . . . . . . . . . . . . 66
Section 10.03. Guarantors May Consolidate, etc., on Certain
Terms . . . . . . . . . . . . . . . . . 67
Section 10.04. Releases Following Sale of Assets . . . 68
Section 10.05. Releases Following Designation as an
Unrestricted Subsidiary . . . . . . . . . . . . . . 68
Section 10.06. Limitation on Guarantor Liability . . . 68
Section 10.07. "Trustee" to Include Paying Agent . . . 69
ARTICLE 11
MISCELLANEOUS
Section 11.01. Trust Indenture Act Controls . . . . . . 69
Section 11.02. Notices . . . . . . . . . . . . . . . . 69
Section 11.03. Communication by Holders of Notes with Other
Holders of Notes . . . . . . . . . . . . 70
Section 11.04. Certificate and Opinion as to Conditions
Precedent . . . . . . . . . . . . . . . 70
Section 11.05. Statements Required in Certificate or
Opinion . . . . . . . . . . . . . . . . 70
Section 11.06. Rules by Trustee and Agents . . . . . . 71
Section 11.07. No Personal Liability of Directors,
Officers, Employees and Shareholders . . 71
Section 11.08. Governing Law . . . . . . . . . . . . . 71
Section 11.09. No Adverse Interpretation of Other
Agreements . . . . . . . . . . . . . . . 71
Section 11.10. Successors . . . . . . . . . . . . . . . 71
Section 11.11. Severability . . . . . . . . . . . . . . 72
Section 11.12. Counterpart Originals . . . . . . . . . 72
Section 11.13. Table of Contents, Headings, etc . . . . 72
Section 11.14. Consent to Jurisdiction . . . . . . . . 72
EXHIBITS AND ANNEXES
EXHIBIT A-1 Form of Note . . . . . . . . . . . . . . . . A-1-1
EXHIBIT A-2 Form Regulation S Temporary Global Note . . A-2-1
EXHIBIT B-1 Certificate of Transferor from 144A Global Note to
Regulation S Global Note . . . . . . . . . . B-1-1
EXHIBIT B-2 Certificate of Transferor from Regulation S Global
Note to 144A Global Note . . . . . . . . . . B-2-1
EXHIBIT B-3 Certificate of Transferor of Definitive NotesB-3-1
EXHIBIT B-4 Certificate of Transferor from Global Note to
Definitive Note . . . . . . . . . . . . . . B-4-1
EXHIBIT C Certificate of Institutional Accredited Investor C-1
EXHIBIT D Form of Notation of Subsidiary Guarantee . . D-1
EXHIBIT E Form of Supplemental Indenture . . . . . . . E-1
ANNEX A Registration Rights Agreement . . . . . . . . . . . 1
This Indenture, dated as of May 21, 1998, is among American
Eco Corporation, an Ontario, Canada corporation (the "Company"),
the guarantors listed on the signature page hereto (each, a
"Guarantor" and, collectively, the "Guarantors") and State Street
Bank and Trust Company, a Massachusetts trust company, 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 of the 9 5/8% Series A Senior Notes due
2008 (the "Series A Notes") and the 9 5/8% Series B Senior Notes
due 2008 (the "Series B Notes" and, together with the Series A
Notes, the "Notes"), without preference of one series of Notes
over the other:
ARTICLE 1
DEFINITIONS AND INCORPORATION
BY REFERENCE
Section 1.01. Definitions.
"144A Global Note" means a permanent global senior note that
contains the paragraph referred to in footnote 1 and the
additional schedule referred to in footnote 3 to the form of the
Note attached hereto as Exhibit A-1, and that is deposited with
the Note Custodian and registered in the name of the Depository
or its nominee, representing a series of Notes sold in reliance
on Rule 144A or another exemption from the registration
requirements of the Securities Act, other than Regulation S.
"Acquired Indebtedness" means Indebtedness of a Person (a)
existing at the time such Person becomes a Restricted Subsidiary
or (b) assumed in connection with acquisitions of properties or
assets from such Person. Acquired Indebtedness shall be deemed
to be incurred on the date the acquired Person becomes a
Restricted Subsidiary or the date of the related acquisition of
properties or assets from such Person.
"Additional Amounts" has the meaning set forth in
Section 4.19 hereof.
"Affiliate" of any specified Person means an "affiliate" of
such Person, as such term is defined for purposes of Rule 144
under the Securities Act.
"Agent" means any Registrar, Paying Agent or co-registrar.
"Applicable Procedures" means, with respect to any transfer
or exchange of beneficial interests in a Global Note, the rules
and procedures of the Depository that apply to such transfer and
exchange.
"Asset Sale" means (a) the sale, lease, conveyance or other
disposition (a "disposition") of any properties, assets or rights
(including, without limitation, by way of a sale and leaseback),
excluding dispositions in the ordinary course of business
(provided that the disposition of all or substantially all of the
properties or assets of the Company and its Restricted
Subsidiaries taken as a whole will be governed by Sections 4.15
and/or 5.01 of this Indenture and not by the provisions of
Section 4.10 hereof), (b) the issue or sale by the Company or any
of its Restricted Subsidiaries of Equity Interests of any of the
Company's Subsidiaries, and (c) any Event of Loss, whether in the
case of clause (a), (b) or (c), in a single transaction or a
series of related transactions, provided that such related
transaction or series of related transactions (i) has a fair
market value in excess of $1.0 million (or the equivalent thereof
in any other currency or currency unit) or (ii) results in the
payment of net proceeds (including insurance proceeds from an
Event of Loss) in excess of $3.0 million (or the equivalent
thereof in any other currency or currency unit). Notwithstanding
the foregoing, the following transactions will be deemed not to
be Asset Sales: (A) a disposition of obsolete or excess
equipment or other properties or assets; (B) a disposition of
properties or assets by the Company to a Wholly Owned Restricted
Subsidiary or by a Wholly Owned Restricted Subsidiary to the
Company or to another Wholly Owned Restricted Subsidiary; (C) a
disposition of Equity Interests by a Wholly Owned Restricted
Subsidiary to the Company or to another Wholly Owned Restricted
Subsidiary; (D) a Permitted Investment or Restricted Payment that
is permitted by this Indenture; (E) a disposition of any of the
three notes receivable owned by the Company on the date of this
Indenture in the aggregate principal amount of approximately
$43.0 million; and (F) any trade or exchange by the Company or
any Restricted Subsidiary of equipment or other assets for
equipment or other assets owned or held by another Person,
provided that the fair market value of the assets traded or
exchanged by the Company or such Restricted Subsidiary (together
with any cash or Cash Equivalents) is reasonably equivalent to
the fair market value of the assets (together with any cash or
Cash Equivalents) to be received by the Company or such
Restricted Subsidiary. The fair market value of any non-cash
proceeds of a disposition of assets and of any assets referred to
in the foregoing clause (F) of this definition shall be
determined in the manner contemplated in the definition of the
term "fair market value," the results of which determination
shall be set forth in an Officers' Certificate delivered to the
Trustee.
"Attributable Indebtedness" in respect of a sale-and-
leaseback transaction means, at the time of determination, the
present value (discounted at the rate of interest implicit in
such transaction, determined in accordance with GAAP) of the
obligation of the lessee for net rental payments during the
remaining term of the lease included in such sale-and-lease-back
transaction (including any period for which such lease has been
extended or may, at the option of the lessor, be extended). As
used in the preceding sentence, the "net rental payments" under
any lease for any such period shall mean the sum of rental and
other payments required to be paid with respect to such period by
the lessee thereunder, excluding any amounts required to be paid
by such lessee on account of maintenance and repairs, insurance,
taxes, assessments, water rates or similar charges. In the case
of any lease that is terminable by the lessee upon payment of
penalty, such net rental payment shall also include the amount of
such penalty, but no rent shall be considered as required to be
paid under such lease subsequent to the first date upon which it
may be so terminated.
"Bankruptcy Law" means Title 11, United States Code, or any
similar federal or state law for the relief of debtors.
"Board of Directors" means the Board of Directors of the
Company, or any authorized committee of the Board of Directors.
"Business Day" means any day other than a Legal Holiday.
"Capital Lease Obligation" means, at the time any
determination thereof is to be made, the amount of the liability
in respect of a capital lease that would at such time be required
to be capitalized on a balance sheet in accordance with GAAP.
"Capital Stock" means (a) in the case of a corporation,
corporate stock, (b) in the case of an association or business
entity, any and all shares, interests, participations, rights or
other equivalents (however designated) of corporate stock, (c) in
the case of a partnership or limited liability company,
partnership or membership interests (whether general or limited)
and (d) 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.
"Cash Equivalents" means (a) United States dollars, (b)
securities issued or directly and fully guaranteed or insured by
the United States government or any agency or instrumentality
thereof having maturities of not more than six months from the
date of acquisition, (c) certificates of deposit and Eurodollar
time deposits with maturities of six months or less from the date
of acquisition, bankers' acceptances with maturities not
exceeding six months and overnight bank deposits, in each case
with any commercial bank organized under the laws of any country
that is a member of the Organization for Economic Cooperation and
Development having capital and surplus in excess of $500 million
(or the equivalent thereof in any other currency or currency
unit), (d) repurchase obligations with a term of not more than
seven days for underlying securities of the types described in
clauses (b) and (c) above entered into with any financial
institution meeting the qualifications specified in clause (c)
above, (e) commercial paper having the highest rating obtainable
from Moody's Investors Service, Inc. or Standard & Poor's
Ratings Service and in each case maturing within 270 days after
the date of acquisition, (f) deposits available for withdrawal on
demand with any commercial bank not meeting the qualifications
specified in clause (c) above, provided all such deposits do not
exceed $3.0 million (or the equivalent thereof in any other
currency or currency unit) in the aggregate at any one time, and
(g) money market mutual funds substantially all of the assets of
which are of the type described in any of the foregoing clauses
(a) through (e).
"Cedel" means Cedel bank, societe anonyme.
"Change of Control" means the occurrence of any of the
following: (a) the sale, lease, 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 assets of the Company and its Subsidiaries, taken as a
whole, (b) the adoption, by holders of Capital Stock of the
Company, of a plan relating to the liquidation or dissolution of
the Company, (c) the consummation of any transaction (including,
without limitation, any merger or consolidation) the result of
which is that any "person" (as such term is used in Section
13(d)(3) of the Exchange Act) becomes the "beneficial owner" (as
such term is defined in Rule 13d-3 and Rule 13d-5 under the
Exchange Act), directly or indirectly through one or more
intermediaries, of more than 50% of the voting power of the
outstanding voting stock of the Company or (d) the first day on
which more than a majority of the members of the Board of
Directors are not Continuing Directors; provided, however, that a
transaction in which the Company becomes a Subsidiary of another
Person (other than a Person that is an individual) shall not
constitute a Change of Control if (i) the shareholders of the
Company immediately prior to such transaction "beneficially own"
(as such term is defined in Rule 13d-3 and Rule 13d-5 under the
Exchange Act), directly or indirectly through one or more
intermediaries, at least a majority of the voting power of the
outstanding voting stock of the Company immediately following the
consummation of such transaction and (ii) immediately following
the consummation of such transaction, no "person" (as such term
is defined above), other than such other Person (but including
the holders of the Equity Interests of such other Person),
"beneficially owns" (as such term is defined above), directly or
indirectly through one or more intermediaries, more than 50% of
the voting power of the outstanding voting stock of the Company.
"Common Stock" means the common shares of the Company, no
par value.
"Consolidated Cash Flow" means, with respect to any Person
for any period, the Consolidated Net Income of such Person for
such period plus, to the extent deducted or excluded in
calculating Consolidated Net Income for such period,
(a) provision for taxes based on income or profits of such Person
and its Restricted Subsidiaries, (b) Consolidated Interest
Expense of such Person and its Restricted Subsidiaries, and (c)
depreciation and amortization (including amortization of goodwill
and other intangibles but excluding amortization of prepaid cash
expenses that were paid in a prior period) of such Person and its
Restricted Subsidiaries, in each case, on a consolidated basis
and determined in accordance with GAAP.
"Consolidated Interest Coverage Ratio" means with respect to
any Person for any period, the ratio of the Consolidated Cash
Flow of such Person for such period to the Consolidated Interest
Expense of such Person for such period; provided, however, that
the Consolidated Interest Coverage Ratio shall be calculated
giving pro forma effect to each of the following transactions as
if each such transaction had occurred at the beginning of the
applicable four-quarter reference period: (a) any incurrence,
assumption, guarantee, repayment, purchase or redemption by such
Person or any of its Restricted Subsidiaries of any Indebtedness
(other than revolving credit borrowings) subsequent to the
commencement of the period for which the Consolidated Interest
Coverage Ratio is being calculated but prior to the date on which
the event for which the calculation of the Consolidated Interest
Coverage Ratio is made (the "Calculation Date"); (b) any
acquisition that has been made by such Person or any of its
Restricted Subsidiaries, or approved and expected to be
consummated within 30 days of the Calculation Date, including, in
each case, through a merger or consolidation, 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; and (c) any other transaction that may be
given pro forma effect in accordance with Article 11 of
Regulation S-X under the Securities Act as in effect from time to
time; provided, further, however, that (i) 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, shall be excluded and (ii) the
Consolidated Interest Expense attributable to discontinued
operations, as determined in accordance with GAAP, and operations
or businesses disposed of prior to the Calculation Date, shall be
excluded, but only to the extent that the obligations giving rise
to such Consolidated Interest Expense will not be obligations of
the referent Person or any of its Restricted Subsidiaries
following the Calculation Date.
"Consolidated Interest Expense" means, with respect to any
Person for any period, the sum, without duplication, of (a) the
consolidated interest expense of such Person and its Restricted
Subsidiaries for such period, whether paid or accrued (including,
without limitation, amortization of 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, commissions, discounts
and other fees and charges incurred in respect of letter of
credit or bankers' acceptance financings, and net payments (if
any) pursuant to Hedging Obligations but excluding amortization
of debt issuance costs) and (b) the consolidated interest expense
of such Person and its Restricted Subsidiaries that was
capitalized during such period.
"Consolidated Net Income" means, with respect to any 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 (a) 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 shall be included only to the extent of the
amount of dividends or distributions paid in cash to the referent
Person or a Wholly Owned Restricted Subsidiary thereof, (b) the
Net Income of any Restricted Subsidiary shall 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 and (c) the cumulative effect of a change in
accounting principles shall be excluded.
"Consolidated Net Worth" means, with respect to any Person
as of any date, the consolidated stockholders' equity of such
Person and its Restricted Subsidiaries as of such date less the
amount of consolidated stockholders' equity attributable to
Disqualified Stock or treasury stock of such Person and its
Restricted Subsidiaries as of such date, in each case determined
in accordance with GAAP.
"Continuing Directors" means, as of any date of
determination, any member of the Board of Directors who (a) was a
member of the Board of Directors on the Issue Date or (b) was
nominated for election to the Board of Directors with the
approval of, or whose election to the Board of Directors was
ratified by, at least a majority of the members of the Board of
Directors who were members of the Board of Directors on the Issue
Date or who were so elected to the Board of Directors thereafter.
"Corporate Trust Office of the Trustee" shall be at the
address of the Trustee specified in Section 11.02 hereof or such
other address as to which the Trustee may give notice to the
Company.
"Credit Facilities" means, with respect to any Person, one
or more debt facilities or commercial paper facilities 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 trade letters of credit, and any renewals,
refinancings or replacements thereof.
"Custodian" means any receiver, trustee, assignee,
liquidator, sequestrator or similar official under any Bankruptcy
Law.
"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 Notes" means Notes that are in the form of
Exhibit A-1 attached hereto (but without including the text
referred to in footnotes 1 and 3 thereto).
"Depository" 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 Depository with respect to the
Notes, until a successor shall have been appointed and become
such pursuant to the applicable provision of this Indenture, and,
thereafter, "Depository" shall mean or include such successor.
"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), or upon the
happening of any event, matures (excluding any maturity as a
result of an optional redemption by the issuer thereof) or is
mandatorily redeemable, pursuant to a sinking fund obligation or
otherwise, or redeemable at the option of the holder thereof, in
whole or in part, on or prior to the date that is 91 days after
the date on which the Notes mature or are redeemed or retired in
full; provided, however, that any Capital Stock that would
constitute Disqualified Stock solely because the holders thereof
(or of any security into which it is convertible or for which it
is exchangeable) have the right to require the issuer to
repurchase such Capital Stock (or such security into which it is
convertible or for which it is exchangeable) upon the occurrence
of any of the events constituting an Asset Sale or a Change of
Control shall not constitute Disqualified Stock if such Capital
Stock (and all such securities into which it is convertible or
for which it is exchangeable) provides that the issuer thereof
will not repurchase or redeem any such Capital Stock (or any such
security into which it is convertible or for which it is
exchangeable) pursuant to such provisions prior to compliance by
the Company with Section 4.10 or 4.15 of this Indenture, as the
case may be.
"Eligible Receivables" means the consolidated U.S. or
Canadian trade receivables of the Company (other than the trade
receivables of Unrestricted Subsidiaries of the Company) not
overdue for more than 60 days, less the allowance for doubtful
accounts, as determined in accordance with GAAP.
"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).
"Euroclear" means Morgan Guaranty Trust Company of New York,
Brussels office, as operator of the Euroclear system.
"Event of Loss" means, with respect to any property or asset
of the Company or any Restricted Subsidiary, (a) any damage to
such property or asset that results in an insurance settlement
with respect thereto on the basis of a total loss or a
constructive or compromised total loss or (b) the confiscation,
condemnation or requisition of title to such property or asset by
any government or instrumentality or agency thereof. An Event of
Loss shall be deemed to occur as of the date of the insurance
settlement, confiscation, condemnation or requisition of title,
as applicable.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended.
"Exchange Offer" means the offer that may be made by the
Company pursuant to a Registration Rights Agreement to issue
Series B Notes in exchange for Series A Notes.
"Existing Indebtedness" means Indebtedness of the Company
and its Restricted Subsidiaries (other than Indebtedness under
the Credit Facilities) in existence on the date of this
Indenture, but shall not include any Indebtedness that is repaid
with the proceeds of the Original Notes, until such amounts are
repaid.
The term "fair market value" means, with respect to any
asset or Investment, the fair market value of such asset or
Investment at the time of the event requiring such determination,
as determined in good faith by the Company, or, with respect to
any asset or Investment in excess of $5.0 million (other than
cash or Cash Equivalents), as determined by a reputable appraisal
firm that is, in the judgment of such Board of Directors,
qualified to perform the task for which such firm has been
engaged and independent with respect to the Company.
"GAAP" means (i) generally accepted accounting principles in
Canada, which are in effect from time to time, so long as the
Company prepares its consolidated financial statements in
accordance with such principles, and (ii) otherwise generally
accepted accounting principles in the United States, which are in
effect from time to time.
"Global Note" means, individually and collectively, the
Regulation S Temporary Global Note, the Regulation S Permanent
Global Note and the 144A Global Note.
"Government Securities" means direct obligations of, or
obligations guaranteed by, the United States of America for the
payment of which guarantee or obligations the full faith and
credit of the United States is pledged.
"Guarantor" means (a) each Restricted Subsidiary of the
Company named on the signature page hereto, (b) any other
Restricted Subsidiary of the Company that executes a Subsidiary
Guarantee in accordance with Sections 4.13 and 10.02 hereof and
(c) the respective successors and assigns of such Restricted
Subsidiaries, as required under Article 10 hereof, in each case
until such time as any such Restricted Subsidiary shall be
released and relieved of its obligations pursuant to
Section 10.04 or 10.05 hereof.
"Hedging Obligations" means, with respect to any Person, the
obligations of such Person under (a) interest rate swap
agreements, interest rate cap agreements and interest rate collar
agreements, (b) other agreements or arrangements designed to
protect such Person against fluctuations in interest rates and
(c) any foreign currency futures contract, option or similar
agreement or arrangement designed to protect such Person against
fluctuations in foreign currency rates, in each case to the
extent such obligations are incurred in the ordinary course of
business of such Person.
"Holder" means a Person in whose name a Note is registered.
"Indebtedness" means, with respect to any Person, any
indebtedness of such Person, whether or not contingent, in
respect of borrowed money or evidenced by bonds, debentures,
notes or similar instruments or letters of credit (or
reimbursement agreements in respect thereof) or bankers'
acceptances or representing Capital Lease Obligations or the
balance deferred and unpaid of the purchase price of any property
or representing any Hedging Obligations, except any such balance
that constitutes an accrued expense or trade payable, if and to
the extent any of the foregoing indebtedness (other than letters
of credit and Hedging Obligations) would appear as a liability
upon a balance sheet of such Person prepared in accordance with
GAAP. The amount of any Indebtedness outstanding as of any date
shall be (a) the accreted value thereof, in the case of any
Indebtedness that does not require current payments of interest,
and (b) the principal amount thereof, 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 an interest
through a Participant.
"Initial Purchasers" means Jefferies & Company, Inc. and
Nesbitt Burns Securities Inc.
"Institutional Accredited Investor" means an "accredited
investor" as defined in Rule 501(a)(1), (2), (3) or (7) under the
Securities Act.
"Investments" means, with respect to any Person, all
investments by such Person in other Persons (including
Affiliates) in the forms of direct or indirect loans (including
guarantees by the referent Person of, and Liens on any assets of
the referent Person securing, Indebtedness or other obligations
of other Persons), 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; provided, however, that the following shall
not constitute Investments: (i) extensions of trade credit or
other advances to customers on commercially reasonable terms in
accordance with normal trade practices or otherwise in the
ordinary course of business, (ii) Hedging Obligations and
(iii) endorsements of negotiable instruments and documents in the
ordinary course of business. 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 Restricted Subsidiary of
the Company, the Company shall be deemed to have made an
Investment on the date of any such sale or disposition equal to
the fair market value of the Equity Interests of such Restricted
Subsidiary not sold or disposed of in an amount determined as
provided in Section 4.07 of this Indenture.
"Issue Date" means the first date on which the Series A
Notes are issued hereunder.
"Legal Holiday" means a Saturday, a Sunday or a day on which
banking institutions in the City of Houston, Texas, the City of
Hartford, Connecticut, the City of Boston, Massachusetts, the
City of New York, 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 for
the intervening period.
"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 agreement to give any
financing statement under the Uniform Commercial Code (or
equivalent statutes) of any jurisdiction other than a
precautionary financing statement respecting a lease not intended
as a security agreement).
"Liquidated Damages" means all liquidated damages then owing
pursuant to Section 5 of the Registration Rights Agreement
referred to in clause (a) of the definition of "Registration
Rights Agreement."
"Net Income" means, with respect to any Person, the net
income (or loss) of such Person, determined in accordance with
GAAP and before any reduction in respect of preferred stock
dividends, excluding, however, (a) any gain (but not loss),
together with any related provision for taxes on such gain (but
not loss), realized in connection with (i) any Asset Sale
(including, without limitation, dispositions pursuant to sale-
and-leaseback transactions) or (ii) 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 (b) any extraordinary or
nonrecurring gain (but not loss), together with any related
provision for taxes on such extraordinary or nonrecurring 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 (without duplication) (a) the
direct costs relating to such Asset Sale (including, without
limitation, legal, accounting and investment banking fees, sales
commissions, recording fees, title transfer fees, title insurance
premiums, appraiser fees and costs incurred in connection with
preparing such asset for sale) and any relocation expenses
incurred as a result thereof, (b) taxes paid or estimated to be
payable as a result thereof (after taking into account any
available tax credits or deductions and any tax sharing
arrangements), (c) amounts required to be applied to the
repayment of Indebtedness (other than under a revolving credit
facility) secured by a Lien on the asset or assets that were the
subject of such Asset Sale and (d) any reserve established in
accordance with GAAP or any amount placed in escrow, in either
case for adjustment in respect of the sale price of such asset or
assets, until such time as such reserve is reversed or such
escrow arrangement is terminated, in which case Net Proceeds
shall include only the amount of the reserve so reserved or the
amount returned to the Company or its Restricted Subsidiaries
from such escrow arrangement, as the case may be.
"Non-Recourse Debt" means Indebtedness (a) as to which
neither the Company nor any of its Restricted Subsidiaries (i)
provides credit support of any kind (including any undertaking,
agreement or instrument that would constitute Indebtedness) or is
otherwise directly or indirectly liable (as a guarantor or
otherwise) or (ii) constitutes the lender, (b) no default with
respect to which (including any rights that the holders thereof
may have to take enforcement action against an Unrestricted
Subsidiary) would permit (upon notice, lapse of time or both) the
holders of Indebtedness of the Company or any of its Restricted
Subsidiaries to declare a default on such Indebtedness or cause
the payment thereof to be accelerated or payable prior to its
stated maturity and (c) 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.
"Note Custodian" means the Trustee, as custodian with
respect to the Notes in global form, or any successor entity
thereto.
"Obligations" means any principal, interest, penalties,
fees, indemnifications, reimbursements, damages and other
liabilities payable under the documentation governing any
Indebtedness.
"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 Chief
Administrative 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, the treasurer or the principal accounting officer of the
Company, that meets the requirements of Section 11.05 hereof.
"Opinion of Counsel" means an opinion from legal counsel who
is reasonably acceptable to the Trustee, that meets the
requirements of Section 11.05 hereof. The counsel may be an
employee of or counsel to the Company, any Subsidiary of the
Company or the Trustee.
"Original Notes" has the meaning set forth in Section 2.02
hereof.
"Pari Passu Indebtedness" means, with respect to any Net
Proceeds from Asset Sales, Indebtedness of the Company and its
Restricted Subsidiaries the terms of which require the Company or
such Restricted Subsidiary to apply such Net Proceeds to offer to
repurchase such Indebtedness.
"Participant" means with respect to DTC, Euroclear or Cedel,
a Person who has an account with DTC, Euroclear or Cedel,
respectively (and, with respect to DTC, shall include Euroclear
and Cedel).
"Permitted Investments" means (a) any Investment in the
Company or in a Wholly Owned Restricted Subsidiary of the
Company, (b) any Investment in Cash Equivalents, (c) any
Investment by the Company or any Restricted Subsidiary of the
Company in a Person if as a result of such Investment (i) such
Person becomes a Wholly Owned Restricted Subsidiary of the
Company or (ii) such Person is merged or consolidated with or
into, or transfers or conveys all or substantially all of its
properties or assets to, or is liquidated into, the Company or a
Wholly Owned Restricted Subsidiary of the Company, and (d) any
Investment made as a result of the receipt of non-cash
consideration from (i) an Asset Sale that was made pursuant to
and in compliance with Section 4.10 hereof or (ii) a disposition
of assets that does not constitute an Asset Sale.
"Permitted Liens" means (a) Liens (excluding Liens referred
to in clauses (b) through (k) hereof) securing Indebtedness
incurred pursuant to clause (a) of the second paragraph of
Section 4.09 hereof, (b) Liens in favor of the Company and its
Restricted Subsidiaries, (c) Liens on property of a Person
existing at the time such Person is merged into or consolidated
with the Company or any Restricted Subsidiary of the Company,
provided that such Liens were in existence prior to the
contemplation of such merger or consolidation and do not extend
to any property other than those of the Person merged into or
consolidated with the Company or any of its Restricted
Subsidiaries, (d) Liens on property existing at the time of
acquisition thereof by the Company or any Restricted Subsidiary
of the Company, provided that such Liens were in existence prior
to the contemplation of such acquisition and do not extend to any
other property, (e) Liens to secure the performance of statutory
obligations, surety or appeal bonds, bid or performance bonds,
insurance obligations or other obligations of a like nature
incurred in the ordinary course of business, (f) Liens securing
Hedging Obligations, (g) Liens securing any Existing
Indebtedness, (h) Liens securing Non-Recourse Debt, (i) any
interest or title of a lessor under a Capital Lease Obligation or
an operating lease, (j) Liens arising by reason of deposits
necessary to obtain standby letters of credit in the ordinary
course of business, (k) Liens on real or personal property or
assets of the Company or a Restricted Subsidiary thereof to
secure Indebtedness incurred for the purpose of (i) financing all
or any part of the purchase price of such property or assets
incurred prior to, at the time of, or within 120 days after, the
acquisition of such property or assets or (ii) financing all or
any part of the cost of construction of any such property or
assets, provided that the amount of any such financing shall not
exceed the amount expended in the acquisition of, or the
construction of, such property or assets and such Liens shall not
extend to any other property or assets of the Company or a
Restricted Subsidiary (other than any associated accounts,
contracts and insurance proceeds) and (l) Liens securing
Permitted Refinancing Indebtedness with respect to any
Indebtedness referred to in clauses (c), (d), (g) and (k) above.
"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; provided,
however, that (a) the principal amount (or accreted value, if
applicable) of such Permitted Refinancing Indebtedness does not
exceed the principal amount of (or accreted value, if
applicable), plus premium, if any, and accrued interest on, the
Indebtedness so extended, refinanced, renewed, replaced, defeased
or refunded (plus the amount of reasonable expenses incurred in
connection therewith), (b) such Permitted Refinancing
Indebtedness has a final maturity date no earlier 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, (c) 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, taken as a whole, to
the Holders of Notes as those contained in the documentation
governing the Indebtedness being extended, refinanced, renewed,
replaced, defeased or refunded and (d) such Indebtedness is
incurred either by the Company or by the Restricted Subsidiary
that is the obligor on the Indebtedness being extended,
refinanced, renewed, replaced, defeased or refunded; provided,
however, that a Restricted Subsidiary that is also a Guarantor
may guarantee Permitted Refinancing Indebtedness incurred by the
Company, whether or not such Restricted Subsidiary was an obligor
or guarantor of the Indebtedness being extended, refinanced,
renewed, replaced, defeased or refunded; provided, further,
however, that if such Permitted Refinancing Indebtedness is
subordinated to the Notes, such guarantee shall be subordinated
to such Restricted Subsidiary's Subsidiary Guarantee to at least
the same extent.
"Person" means any individual, corporation, partnership,
limited liability company, joint venture, association, joint-
stock company, trust, unincorporated organization or government
or agency or political subdivision thereof (including any
subdivision or ongoing business of any such entity or
substantially all of the assets of any such entity, subdivision
or business).
"Productive Assets" means assets (other than assets that
would be classified as current assets in accordance with GAAP) of
the kind used or usable by the Company or its Restricted
Subsidiaries in the business of providing commercial and
industrial support and specialty fabrication services to a
variety of industries, including the energy, pulp and paper and
power generation industries (or any business that is reasonably
complementary or related thereto as determined in good faith by
the Board of Directors).
"QIB" means a "qualified institutional buyer" as defined in
Rule 144A under the Securities Act.
"Qualified Equity Offering" means (a) any sale of Equity
Interests (other than Disqualified Stock) of the Company pursuant
to an underwritten offering registered under the Securities Act
or (b) any sale of Equity Interests (other than Disqualified
Stock) of the Company so long as, at the time of consummation of
such sale, the Company has a class of common equity securities
registered pursuant to Section 12(b) or Section 12(g) under the
Exchange Act.
"Registration Rights Agreement" means (a) the Registration
Rights Agreement, dated as of May 21, 1998, by and among the
Company, the Guarantors and the Initial Purchasers relating to
the Original Notes, a copy of which is attached hereto as
Annex A, and (b) any similar agreement that the Company and the
Guarantors may enter into in relation to any other Series A
Notes, in each case as such agreement may be amended, modified or
supplemented from time to time.
"Regulation S" means Regulation S 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 that contains the paragraph referred to in footnote 1
and the additional schedule referred to in footnote 3 to the form
of the Note attached hereto as Exhibit A-1, and that is deposited
with the Note Custodian and registered in the name of the
Depository, representing a series of Notes sold in reliance on
Regulation S.
"Regulation S Temporary Global Note" means a single
temporary global senior note in the form of the Note attached
hereto as Exhibit A-2 that is deposited with the Note Custodian
and registered in the name of the Depository, representing a
series of Notes sold in reliance on Regulation S.
"Responsible Officer," when used with respect to the
Trustee, means any officer within the Corporate Trust Department
of the Trustee (or any successor department 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 Beneficial Interest" means any beneficial
interest of a Participant or Indirect Participant in a Restricted
Global Note.
"Restricted Definitive Notes" means the Definitive Notes
that are required to bear the legend set forth in Section 2.06(f)
hereof.
"Restricted Global Notes" means the 144A Global Note and the
Regulation S Global Note, each of which is required to bear the
legend set forth in Section 2.06(f) hereof.
"Restricted Investment" means an Investment other than a
Permitted Investment.
"Restricted Subsidiary" of a Person means any Subsidiary of
such Person that is not an Unrestricted Subsidiary.
"Rule 144A" means Rule 144A promulgated under the Securities
Act.
"SEC" means the Securities and Exchange Commission.
"Securities Act" means the Securities Act of 1933, as
amended.
"Significant Subsidiary" means any Restricted Subsidiary of
the Company that is incorporated or organized under the laws of
the United States, any state thereof or the District of Columbia
or Canada or any province thereof 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 of this Indenture.
"Stated Maturity" means, with respect to any mandatory
sinking fund or other installment of interest or principal on any
series of Indebtedness, the date on which such payment of
interest or principal was scheduled to be paid in the original
documentation governing such Indebtedness, and shall 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.
"Subsidiary" means, with respect to any Person, (a) 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 thereof
is at the time owned or controlled, directly or indirectly, by
such Person or one or more of the other Subsidiaries of that
Person (or a combination thereof), (b) any partnership (i) the
sole general partner or the managing general partner of which is
such Person or a Subsidiary of such Person or (ii) the only
general partners of which are such Person or of one or more
Subsidiaries of such Person (or any combination thereof) and (c)
any other Person whose results for financial reporting purposes
are consolidated with those of such Person in accordance with
GAAP.
"Subsidiary Guarantees" means the joint and several
guarantees issued by all of the Guarantors pursuant to Article 10
hereof.
"TIA" means the Trust Indenture Act of 1939 (15 U.S.C.
<section sign><section sign> 77aaa-77bbbb) as in effect on the
date on which this Indenture is qualified under the TIA.
"Transfer Restricted Securities" means securities that bear
or are required to bear the legend set forth in Section 2.06(f)
hereof.
"Trustee" means the party named as such above until a
successor replaces it in accordance with the applicable
provisions of this Indenture and thereafter means the successor
serving hereunder.
"Unrestricted Global Notes" means one or more Global Notes
that do not and are not required to bear the legend set forth in
Section 2.06(f) hereof.
"Unrestricted Subsidiary" means any Subsidiary that is
designated by the Board of Directors as an Unrestricted
Subsidiary pursuant to a resolution of the Board of Directors,
but only to the extent that such Subsidiary at the time of such
designation (a) has no Indebtedness other than Non-Recourse Debt,
(b) is not party to any agreement, contract, arrangement or
understanding with the Company or any Restricted Subsidiary of
the Company unless such agreement, contract, arrangement or
understanding does not violate the terms of this Indenture
described in Section 4.11 hereof, and (c) is a Person with
respect to which neither the Company nor any of its Restricted
Subsidiaries has any direct or indirect obligation (i) to
subscribe for additional Equity Interests or (ii) to maintain or
preserve such Person's financial condition or to cause such
Person to achieve any specified levels of operating results, in
each case, except to the extent otherwise permitted by this
Indenture. If, at any time, any Unrestricted Subsidiary would
fail to meet the foregoing requirements as an Unrestricted
Subsidiary, it shall thereafter cease to be an Unrestricted
Subsidiary for purposes of this Indenture and any Indebtedness of
such Subsidiary shall 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
pursuant to Section 4.09 hereof, the Company shall be in default
of such covenant).
"Weighted Average Life to Maturity" means, when applied to
any Indebtedness at any date, the number of years obtained by
dividing (a) the sum of the products obtained by multiplying (i)
the amount of each then remaining installment, sinking fund,
serial maturity or other required payments of principal,
including payment at final maturity, in respect thereof, by (ii)
the number of years (calculated to the nearest one-twelfth) that
will elapse between such date and the making of such payment, by
(b) the then outstanding principal amount of such Indebtedness.
"Wholly Owned Restricted Subsidiary" of any Person means a
Restricted Subsidiary of such Person to the extent (a) all of the
outstanding Capital Stock or other ownership interests of which
(other than directors' qualifying shares) shall at the time be
owned directly or indirectly by such Person or (b) such
Restricted Subsidiary is organized in a foreign jurisdiction and
is required by the applicable laws and regulations of such
foreign jurisdiction to be partially owned by the government of
such foreign jurisdiction or individual or corporate citizens of
such foreign jurisdiction or another foreign jurisdiction in
order for such Restricted Subsidiary to transact business in such
foreign jurisdiction, provided that such Person, directly or
indirectly, owns the remaining Capital Stock or ownership
interests in such Restricted Subsidiary and, by contract or
otherwise, derives the economic benefits of ownership of such
Restricted Subsidiary to substantially the same extent as if such
Restricted Subsidiary were a wholly owned Restricted Subsidiary.
Section 1.02. Other Definitions.
Defined in
Term Section
---- ----------
"Affiliate Transaction" . . . . . . . . . . . . 4.11
"Agreement Currency" . . . . . . . . . . . . . . 4.20
"Asset Sale Offer" . . . . . . . . . . . . . . . 3.09
"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
"Excluded Holder" . . . . . . . . . . . . . . . 4.19
"incur" or "incurrence" . . . . . . . . . . . . 4.09
"Judgment Currency" . . . . . . . . . . . . . . 4.20
"Legal Defeasance" . . . . . . . . . . . . . . 8.02
"Offer Amount" . . . . . . . . . . . . . . . . . 3.09
"Offer Period" . . . . . . . . . . . . . . . . . 3.09
"Paying Agent" . . . . . . . . . . . . . . . . . 2.03
"Payment Default" . . . . . . . . . . . . . . . 6.01
"Purchase Date" . . . . . . . . . . . . . . . . 3.09
"Registrar" . . . . . . . . . . . . . . . . . . 2.03
"Restricted Payments" . . . . . . . . . . . . . 4.07
"Taxes" . . . . . . . . . . . . . . . . . . . . 4.19
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. Any terms incorporated 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.
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) provisions apply to successive events and
transactions;
(6) the term "merger" includes an amalgamation and a
compulsory share exchange; and
(7) references to sections of or rules under the
Securities Act or the Exchange Act shall be deemed to
include substitute, replacement or successor sections or
rules adopted by the SEC from time to time.
ARTICLE 2
THE NOTES
Section 2.01. Form and Dating.
The Notes and the Trustee's certificate of authentication
shall be substantially in the form of Exhibit A-1 or Exhibit A-2
hereto. The Notes may have notations, legends or endorsements
required by law, stock exchange rule or usage. Each Note shall
be dated the date of its authentication. The Notes shall be
issued in denominations of $1,000 and integral multiples thereof.
The Series A Notes and the Series B Notes shall be
considered collectively to be a single class for all purposes of
this Indenture, including, without limitation, waivers,
amendments, redemptions and offers to purchase.
The terms and provisions contained in the Notes shall
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.
(a) Global Notes. Except as provided in Section 2.01(c),
Series A Notes offered and sold to QIBs in reliance on Rule 144A
shall be issued initially in the form of one or more 144A Global
Notes, which shall be deposited on behalf of the purchasers of
the Series A Notes represented thereby with the Note Custodian
and registered in the name of the Depository or a nominee of the
Depository, duly executed by the Company and authenticated by the
Trustee as hereinafter provided. The aggregate principal amount
of the 144A Global Notes may from time to time be increased or
decreased by adjustments made on the records of the Trustee and
the Depository or its nominee, as the case may be, in connection
with transfers of interests as hereinafter provided.
Series A Notes offered and sold in reliance on Regulation S,
if any, shall be issued initially in the form of the Regulation S
Temporary Global Note, which shall be deposited on behalf of the
purchasers of the Series A Notes represented thereby with the
Note Custodian and registered in the name of the Depository or
the nominee of the Depository for the accounts of designated
agents holding on behalf of Euroclear or Cedel, duly executed by
the Company and authenticated by the Trustee as hereinafter
provided. The "40-day restricted period" (as defined in
Regulation S) shall be terminated upon the receipt by the Trustee
of (i) a written certificate from the Depository, together with
copies of certificates from Euroclear and Cedel 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
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, all as contemplated by
Section 2.06(a)(ii) hereof), and (ii) an Officers' Certificate
from the Company. Following the termination of the 40-day
restricted period, beneficial interests in the Regulation S
Temporary Global Note shall be exchanged for beneficial interests
in one or more Regulation S Permanent Global Notes pursuant to
the Applicable Procedures. Simultaneously with the
authentication of Regulation S Permanent Global Notes, the
Trustee shall 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 Depository or its nominee, as the case may
be, in connection with transfers of interests as hereinafter
provided.
Each Global Note shall represent such of the outstanding
Notes as shall be specified therein and each shall provide that
it shall represent the aggregate amount of outstanding Notes from
time to time endorsed thereon and that the aggregate amount of
outstanding Notes represented thereby may from time to time be
reduced or increased, as appropriate, to reflect exchanges,
redemptions and transfers of interests. Any endorsement of a
Global Note to reflect the amount of any increase or decrease in
the amount of outstanding Notes represented thereby shall be made
by the Trustee or the Note Custodian, at the direction of the
Trustee, in accordance with instructions given by the Holder
thereof as required by Section 2.06 hereof.
The provisions of the "Operating Procedures of the Euroclear
System" and "Terms and Conditions Governing Use of Euroclear" and
the "Management Regulations" and "Instructions to Participants"
of Cedel shall be applicable to interests in the Regulation S
Temporary Global Note and the Regulation S Permanent Global
Notes, if any, that are held by Participants through Euroclear or
Cedel. The Trustee shall have no obligation to notify Holders of
any such procedures or to monitor or enforce compliance with the
same.
(b) Book-Entry Provisions. Participants shall have no
rights either under this Indenture with respect to any Global
Note held on their behalf by the Depository or by the Note
Custodian as custodian for the Depository or under such Global
Note, and the Depository may be treated by the Company, the
Trustee and any Agent of the Company or the Trustee as the
absolute owner of such Global Note for all purposes whatsoever
(except for the determination of Additional Amounts payable
pursuant to Section 4.19 hereof). Notwithstanding the foregoing,
nothing herein shall prevent the Company, the Trustee or any
Agent of the Company or the Trustee from giving effect to any
written certification, proxy or other authorization furnished by
the Depository or impair, as between the Depository and its
Participants, the operation of customary practices of such
Depository governing the exercise of the rights of an owner of a
beneficial interest in any Global Note.
(c) Definitive Notes. Series A Notes offered and sold to
Institutional Accredited Investors who are not QIBs otherwise
than in reliance on Regulation S, if any, or to other Persons who
elect to take their Series A Notes in definitive form shall be
issued initially in the form of Definitive Notes, duly executed
by the Company and authenticated by the Trustee as hereinafter
provided.
Section 2.02. Execution and Authentication.
One Officer shall sign the Notes for the Company by manual
or facsimile signature. The Company's seal may be reproduced on
the Notes and, if so, may be in facsimile form.
If an Officer whose signature is on a Note no longer holds
that office at the time a Note is authenticated, the Note shall
nevertheless be valid.
A Note shall not be valid until authenticated by the manual
signature of an authorized signatory of the Trustee. Such
signature shall be conclusive evidence that the Note has been
authenticated under this Indenture. The form of Trustee's
certificate of authentication to be borne by the Notes shall be
substantially as set forth in Exhibit A-1 or Exhibit A-2 hereto.
Each Note shall be dated the date of its authentication.
The Trustee shall authenticate (i) the Series A Notes for
original issue on the Issue Date in the aggregate principal
amount of $120,000,000 (the "Original Notes"), (ii) additional
Series A Notes for original issue from time to time after the
Issue Date in such principal amounts as may be set forth in a
written order of the Company described in this sentence and
(iii) the Series B Notes from time to time for issue only in
exchange for a like principal amount of Series A Notes, in each
case upon a written order of the Company signed by one Officer,
which written order shall specify (a) the amount of Notes to be
authenticated and the date of original issue thereof, (b) whether
the Notes are Series A Notes or Series B Notes, and (c) the
amount of Notes to be issued in global form or definitive form.
The aggregate principal amount of Notes outstanding at any time
may not exceed $120,000,000 plus such additional principal
amounts as may be issued and authenticated pursuant to clause
(ii) of this paragraph, except as provided in Section 2.07
hereof.
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 the Company, any
Guarantor or an Affiliate of the Company.
Section 2.03. Registrar and Paying Agent.
The Company shall maintain an office or agency where Notes
may be presented for registration of transfer or for exchange
("Registrar") and an office or agency in New York City where
Notes may be presented for payment ("Paying Agent"). The
Registrar shall 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 shall 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
shall enter into an appropriate agency agreement with any Agent
not a party to this Indenture, and such agreement shall
incorporate the TIA's provisions of this Indenture that relate to
such Agent. 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 Depository with respect to the Global Notes.
The Company initially appoints the Trustee to act as the
Registrar and Paying Agent and to act as Note Custodian with
respect to the Global Notes.
Section 2.04. Paying Agent to Hold Money in Trust.
The Company shall 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 of or premium,
interest or Liquidated Damages, if any, 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) shall have no further liability for the money. If
the Company or a Subsidiary acts as Paying Agent, it shall
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 shall serve as Paying Agent for the Notes.
Section 2.05. Holder Lists.
The Trustee shall 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 sign> 312(a). If the Trustee is not the
Registrar, the Company shall furnish to the Trustee at least
seven Business 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 sign> 312(a).
Section 2.06. Transfer and Exchange.
(a) Transfer and Exchange of Global Notes. The transfer
and exchange of Global Notes or beneficial interests therein
shall be effected through the Depository, in accordance with this
Indenture and the Applicable Procedures. Beneficial interests in
a Global Note may be transferred to Persons who take delivery
thereof in the form of a beneficial interest in the same Global
Note in accordance with the Applicable Procedures and, in the
case of a Transfer Restricted Security, the transfer restrictions
set forth in the legend in subsection (f) of this Section 2.06.
Transfers of beneficial interests in the Global Notes to Persons
required to take delivery thereof in the form of an interest in
another Global Note shall be permitted as follows:
(i) 144A Global Note to Regulation S Global Note. If,
at any time, an owner of a beneficial interest in a 144A
Global Note deposited with the Depository (or the Trustee as
custodian for the Depository) wishes to transfer its
beneficial interest in such 144A Global Note to a Person who
is required or permitted to take delivery thereof in the
form of an interest in a Regulation S Global Note, such
owner shall, subject to the Applicable Procedures, exchange
or cause the exchange of such interest for an equivalent
beneficial interest in a Regulation S Global Note as
provided in this Section 2.06(a)(i). Upon receipt by the
Trustee of (A) instructions given in accordance with the
Applicable Procedures from a Participant directing the
Trustee to credit or cause to be credited a beneficial
interest in the Regulation S Global Note in an amount equal
to the beneficial interest in the 144A Global Note to be
transferred, (B) a written order given in accordance with
the Applicable Procedures containing information regarding
the Participant account of the Depository and the Euroclear
or Cedel account to be credited with such increase and, in
the case of Global Notes that are Transfer Restricted
Securities, (C) a certificate in the form of Exhibit B-1
hereto given by the owner of such beneficial interest
stating that the transfer of such interest has been made in
compliance with the transfer restrictions applicable to the
Global Notes and pursuant to and in accordance with Rule 903
or Rule 904 of Regulation S, then the Trustee, as Registrar,
shall instruct the Depository to reduce or cause to be
reduced the aggregate principal amount of the applicable
144A Global Note and to increase or cause to be increased
the aggregate principal amount of the applicable
Regulation S Global Note by the principal amount of the
beneficial interest in the 144A Global Note to be
transferred, to credit or cause to be credited to the
account of the Person specified in such instructions, a
beneficial interest in the Regulation S Global Note equal to
the reduction in the aggregate principal amount of the 144A
Global Note, and to debit, or cause to be debited, from the
account of the Person making such transfer the beneficial
interest in the 144A Global Note that is being transferred.
(ii) Regulation S Global Note to 144A Global Note. If,
at any time, after the expiration of the 40-day restricted
period, an owner of a beneficial interest in a Regulation S
Global Note deposited with the Depository (or with the
Trustee as custodian for the Depository) wishes to transfer
its beneficial interest in such Regulation S Global Note to
a Person who is required or permitted to take delivery
thereof in the form of an interest in a 144A Global Note,
such owner shall, subject to the Applicable Procedures,
exchange or cause the exchange of such interest for an
equivalent beneficial interest in a 144A Global Note as
provided in this Section 2.06(a)(ii). Upon receipt by the
Trustee of (A) instructions from Euroclear or Cedel, if
applicable, and the Depository, directing the Trustee, as
Registrar, to credit or cause to be credited a beneficial
interest in the 144A Global Note equal to the beneficial
interest in the Regulation S Global Note to be transferred,
such instructions to contain information regarding the
Participant account with the Depository to be credited with
such increase, (B) a written order given in accordance with
the Applicable Procedures containing information regarding
the participant account of the Depository and, in the case
of Global Notes that are Transfer Restricted Securities, (C)
a certificate in the form of Exhibit B-2 attached hereto
given by the owner of such beneficial interest stating (1)
if the transfer is pursuant to Rule 144A, that the Person
transferring such interest in a Regulation S Global Note
reasonably believes that the Person acquiring such interest
in a 144A Global Note is a QIB and is obtaining such
beneficial interest in a transaction meeting the
requirements of Rule 144A, (2) that the transfer complies
with the requirements of Rule 144 under the Securities Act,
(3) if the transfer is pursuant to any other exemption from
the registration requirements of the Securities Act, that
the transfer of such interest has been made in compliance
with the transfer restrictions applicable to the Global
Notes and pursuant to and in accordance with the
requirements of the exemption claimed, such statement to be
supported by an Opinion of Counsel from the transferee or
the transferor in form reasonably acceptable to the Company
and to the Registrar and in each case of clause (1), (2) or
(3) above, in accordance with any applicable securities laws
of any state of the United States or any other applicable
jurisdiction or (4) such transfer is being effected pursuant
to an effective registration statement under the Securities
Act, then the Trustee, as Registrar, shall instruct the
Depository to reduce or cause to be reduced the aggregate
principal amount of such Regulation S Global Note and to
increase or cause to be increased the aggregate principal
amount of the applicable 144A Global Note by the principal
amount of the beneficial interest in the Regulation S Global
Note to be transferred, and the Trustee, as Registrar, shall
instruct the Depository, concurrently with such reduction,
to credit or cause to be credited to the account of the
Person specified in such instructions a beneficial interest
in the applicable 144A Global Note equal to the reduction in
the aggregate principal amount of such Regulation S Global
Note and to debit or cause to be debited from the account of
the Person making such transfer the beneficial interest in
the Regulation S Global Note that is being transferred.
(b) Transfer and Exchange of Definitive Notes. When
Definitive Notes are presented by a Holder to the Registrar with
a request to register the transfer of the Definitive Notes or to
exchange such Definitive Notes for an equal principal amount of
Definitive Notes of other authorized denominations, the Registrar
shall register the transfer or make the exchange as requested
only if the Definitive Notes are presented or surrendered for
registration of transfer or exchange, are endorsed or accompanied
by a written instrument of transfer in form satisfactory to the
Registrar duly executed by such Holder or by his attorney, duly
authorized in writing and the Registrar receives the following
documentation (all of which may be submitted by facsimile):
(i) in the case of Definitive Notes that are Transfer
Restricted Securities, such request shall be accompanied by
the following additional information and documents, as
applicable:
(A) if such Transfer Restricted Security is being
delivered to the Registrar by a Holder for registration
in the name of such Holder, without transfer, or such
Transfer Restricted Security is being transferred
(1) to the Company or any of its Subsidiaries or
(2) pursuant to an effective registration statement
under the Securities Act, a certification to that
effect from such Holder (in substantially the form of
Exhibit B-3 hereto);
(B) if such Transfer Restricted Security is being
transferred to a QIB in accordance with Rule 144A under
the Securities Act or pursuant to an exemption from
registration in accordance with Rule 144 under the
Securities Act or pursuant to an effective registration
statement under the Securities Act, a certification to
that effect from such Holder (in substantially the form
of Exhibit B-3 hereto);
(C) if such Transfer Restricted Security is being
transferred to a Non-U.S. Person in an offshore
transaction in accordance with Rule 904 under the
Securities Act, a certification to that effect from
such Holder (in substantially the form of Exhibit B-3
hereto but containing the certification called for by
clauses (1) through (4) of Exhibit B-1 hereto); or
(D) if such Transfer Restricted Security 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 subparagraph (B) or (C) above, a
certification to that effect from such Holder (in
substantially the form of Exhibit B-3 hereto), and a
certification substantially in the form of Exhibit C
hereto from the transferee, and, if such transfer is in
respect of an aggregate principal amount of Notes of
less than $100,000, an Opinion of Counsel acceptable to
the Company that such transfer is in compliance with
the Securities Act and any applicable blue sky laws of
any state of the United States.
(c) Transfer of a Beneficial Interest in a 144A Global Note
or Regulation S Permanent Global Note for a Definitive Note.
(i) Any Person having a beneficial interest in a 144A
Global Note or Regulation S Permanent Global Note may upon
request, subject to the Applicable Procedures, exchange such
beneficial interest for a Definitive Note, upon receipt by
the Trustee of written instructions or such other form of
instructions as is customary for the Depository (or
Euroclear or Cedel, if applicable), from the Depository or
its nominee on behalf of any Person having a beneficial
interest in a 144A Global Note or Regulation S Permanent
Global Note, and, in the case of a Transfer Restricted
Security, the following additional information and documents
(all of which may be submitted by facsimile):
(A) if such beneficial interest is being
transferred to the Person designated by the Depository
as being the beneficial owner or to the Company or any
of its Subsidiaries, a certification to that effect
from such Person (in substantially the form of Exhibit
B-4 hereto);
(B) if such beneficial interest is being
transferred to a QIB in accordance with Rule 144A under
the Securities Act or pursuant to an exemption from
registration in accordance with Rule 144 under the
Securities Act or pursuant to an effective registration
statement under the Securities Act, a certification to
that effect from the transferor (in substantially the
form of Exhibit B-4 hereto);
(C) if such beneficial interest is being
transferred to a Non-U.S. Person in an offshore
transaction in accordance with Rule 904 under the
Securities Act, a certification to that effect from the
transferor (in substantially the form of Exhibit B-4
hereto but containing the certification called for by
clauses (1) through (4) of Exhibit B-1 hereto); or
(D) if such beneficial interest is being
transferred to an Institutional Accredited Investor,
pursuant to a private placement exemption from the
registration requirements of the Securities Act other
than those listed in subparagraph (B) or (C) above, a
certification to that effect from such Holder (in
substantially the form of Exhibit B-4 hereto), a
certification from the applicable transferee (in
substantially the form of Exhibit C hereto) and, if
such transfer is in respect of an aggregate principal
amount of Notes of less than $100,000, an Opinion of
Counsel acceptable to the Company that such transfer is
in compliance with the Securities Act and any
applicable blue sky laws of any state of the United
States.
in which case the Trustee or the Note Custodian, at the
direction of the Trustee, shall, in accordance with the
standing instructions and procedures existing between the
Depository and the Note Custodian, cause the aggregate
principal amount of 144A Global Notes or Regulation S
Permanent Global Notes, as applicable, to be reduced
accordingly and, following such reduction, the Company shall
execute and, the Trustee shall authenticate and deliver to
the transferee a Definitive Note in the appropriate
principal amount.
(ii) Definitive Notes issued in exchange for a
beneficial interest in a 144A Global Note or Regulation S
Permanent Global Note, as applicable, pursuant to this
Section 2.06(c) shall be registered in such names and in
such authorized denominations as the Depository, pursuant to
instructions from its direct or Indirect Participants or
otherwise, shall instruct the Trustee. The Trustee shall
deliver such Definitive Notes to the Persons in whose names
such Notes are so registered. Following any such issuance
of Definitive Notes, the Trustee, as Registrar, shall
instruct the Depository to reduce or cause to be reduced the
aggregate principal amount of the applicable Global Note to
reflect the transfer.
(d) Restrictions on Transfer and Exchange of Global Notes.
Notwithstanding any other provision of this Indenture (other than
the provisions set forth in subsection (f) of this Section 2.06),
a Global Note may not be transferred as a whole except by the
Depository to a nominee of the Depository or by a nominee of the
Depository to the Depository or another nominee of the Depository
or by the Depository or any such nominee to a successor
Depository or a nominee of such successor Depository.
(e) Authentication of Definitive Notes in Absence of
Depository. If at any time the Depository for the Notes notifies
the Company that the Depository is unwilling or unable to
continue as Depository for the Global Notes and a successor
Depository for the Global Notes is not appointed by the Company
within 90 days after delivery of such notice then the Company
shall execute, and the Trustee shall, upon receipt of an
authentication order in accordance with Section 2.02 hereof,
authenticate and deliver, Definitive Notes in an aggregate
principal amount equal to the principal amount of the Global
Notes in exchange for such Global Notes.
(f) Legends.
(i) Except as permitted by the following paragraphs
(ii), (iii) and (iv), each Note certificate evidencing a
Global Note or a Definitive Note (and all Notes issued in
exchange therefor or substitution thereof) shall bear a
legend in substantially the following form, until the
expiration of the applicable holding period with respect to
the Notes set forth in Rule 144(k) promulgated under the
Securities Act:
"THE SECURITY (OR ITS PREDECESSOR) EVIDENCED
HEREBY WAS ORIGINALLY ISSUED IN A TRANSACTION
EXEMPT FROM REGISTRATION UNDER SECTION 5 OF THE
UNITED STATES SECURITIES ACT OF 1933, AS AMENDED
(THE "SECURITIES ACT"), AND THE SECURITY EVIDENCED
HEREBY MAY NOT BE OFFERED, SOLD OR OTHERWISE
TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR
AN APPLICABLE EXEMPTION THEREFROM. EACH PURCHASER
OF THE SECURITY EVIDENCED HEREBY IS HEREBY
NOTIFIED THAT THE SELLER MAY BE RELYING ON THE
EXEMPTION FROM THE PROVISIONS OF SECTION 5 OF THE
SECURITIES ACT PROVIDED BY RULE 144A THEREUNDER.
THE HOLDER OF THE SECURITY EVIDENCED HEREBY AGREES
FOR THE BENEFIT OF THE COMPANY THAT (A) SUCH
SECURITY MAY BE RESOLD, PLEDGED OR OTHERWISE
TRANSFERRED, ONLY (1) (a) TO A PERSON WHO 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, (b) IN A TRANSACTION
MEETING THE REQUIREMENTS OF RULE 144 UNDER THE
SECURITIES ACT, (c) OUTSIDE THE UNITED STATES TO A
NON-U.S. PERSON IN A TRANSACTION MEETING THE
REQUIREMENTS OF RULE 904 UNDER THE SECURITIES ACT
OR (d) IN ACCORDANCE WITH ANOTHER EXEMPTION FROM
THE REGISTRATION REQUIREMENTS OF THE SECURITIES
ACT (AND BASED UPON AN OPINION OF COUNSEL IF THE
COMPANY SO REQUESTS), (2) TO THE COMPANY OR
(3) PURSUANT TO AN EFFECTIVE REGISTRATION
STATEMENT AND, IN EACH CASE, IN ACCORDANCE WITH
THE APPLICABLE SECURITIES LAWS OF ANY STATE OF THE
UNITED STATES OR ANY OTHER APPLICABLE JURISDICTION
AND (B) THE HOLDER WILL, AND EACH SUBSEQUENT
HOLDER IS REQUIRED TO, NOTIFY ANY PURCHASER OF THE
SECURITY EVIDENCED HEREBY OF THE RESALE
RESTRICTIONS SET FORTH IN (A) ABOVE."
(ii) Upon any sale or transfer of a Transfer Restricted
Security (including any Transfer Restricted Security
represented by a Global Note) pursuant to Rule 144 under the
Securities Act or pursuant to an effective registration
statement under the Securities Act:
(A) in the case of any Transfer Restricted
Security that is a Definitive Note, the Registrar shall
permit the Holder thereof to exchange such Transfer
Restricted Security for a Definitive Note that does not
bear the legend set forth in (i) above and rescind any
restriction on the transfer of such Transfer Restricted
Security upon certification from the transferring
holder substantially in the form of Exhibit B-3 hereto;
and
(B) in the case of any Transfer Restricted
Security represented by a Global Note, such Transfer
Restricted Security shall not be required to bear the
legend set forth in (i) above, but shall continue to be
subject to the provisions of Section 2.06(a) and (c)
hereof; provided, however, that with respect to any
request for an exchange of a Transfer Restricted
Security that is represented by a Global Note for a
Definitive Note that does not bear the legend set forth
in (i) above, which request is made in reliance upon
Rule 144 or pursuant to an effective registration
statement, the Holder thereof shall certify in writing
to the Registrar that such request is being made
pursuant to Rule 144 or pursuant to an effective
registration statement (such certification to be
substantially in the form of Exhibit B-4 hereto).
(iii) Upon any sale or transfer of a Transfer
Restricted Security (including any Transfer Restricted
Security represented by a Global Note) in reliance on any
exemption from the registration requirements of the
Securities Act (other than exemptions pursuant to Rule 144
under the Securities Act) in which the Holder or the
transferee provides an Opinion of Counsel to the Company and
the Registrar in form and substance reasonably acceptable to
the Company and the Registrar (which Opinion of Counsel
shall also state that the transfer restrictions contained in
the legend are no longer applicable):
(A) in the case of any Transfer Restricted
Security that is a Definitive Note, the Registrar shall
permit the Holder thereof to exchange such Transfer
Restricted Security for a Definitive Note that does not
bear the legend set forth in (i) above and rescind any
restriction on the transfer of such Transfer Restricted
Security; and
(B) in the case of any Transfer Restricted
Security represented by a Global Note, such Transfer
Restricted Security shall not be required to bear the
legend set forth in (i) above, but shall continue to be
subject to the provisions of Section 2.06(a) and (c)
hereof.
(iv) Notwithstanding the foregoing, upon consummation
of an Exchange Offer, 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 aggregate principal amount
equal to the sum of (A) the principal amount of the
Restricted Beneficial Interests tendered for acceptance by
Persons that are not (1) broker-dealers, (2) Persons
participating in the distribution of the Series B Notes or
(3) Persons who are Affiliates of the Company and accepted
for exchange in the Exchange Offer and (B) the principal
amount of the Restricted Definitive Notes accepted for
exchange in the Exchange Offer, unless the Holders of such
Restricted Definitive Notes shall request the receipt of
Definitive Notes, in which case the Company shall execute
and the Trustee shall authenticate and deliver to the
Persons designated by the Holders of such Restricted
Definitive Notes one or more Definitive Notes without the
legend set forth in Section 2.06(f) in the appropriate
principal amount. Concurrently with the issuance of such
Unrestricted Global Notes, the Trustee shall cause the
aggregate principal amount of the applicable Restricted
Global Notes to be reduced accordingly.
(g) Cancellation or Adjustment of Global Notes. At such
time as all beneficial interests in Global Notes have been
exchanged for Definitive Notes, redeemed, repurchased or
cancelled, all Global Notes shall be returned to or retained and
cancelled 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 Definitive Notes,
redeemed, repurchased or cancelled, the principal amount of Notes
represented by such Global Note shall be reduced accordingly and
an endorsement shall be made on such Global Note, by the Trustee
or the Note Custodian, at the direction of the Trustee, to
reflect such reduction.
(h) General Provisions Relating to Transfers and Exchanges.
(i) To permit registrations of transfers and
exchanges, subject to this Section 2.06, the Company shall
execute and, upon the written order of the Company signed by
an Officer of the Company, the Trustee shall authenticate
Definitive Notes and Global Notes at the Registrar's
request.
(ii) No service charge shall be made to a Holder 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 3.07, 4.10, 4.15 and 9.05
hereof).
(iii) The Registrar shall 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.
(iv) All Definitive Notes and Global Notes issued upon
any registration of transfer or exchange of Definitive Notes
or Global Notes shall be the valid obligations of the
Company, evidencing the same debt, and entitled to the same
benefits under this Indenture, as the Definitive Notes or
Global Notes surrendered upon such registration of transfer
or exchange.
(v) The Company and the Registrar shall not be
required:
(A) to issue, to register the transfer of or to
exchange 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 so selected for redemption in whole or in
part, except the unredeemed portion of any Note being
redeemed in part;
(C) to register the transfer of or to exchange a
Note between a record date and the next succeeding
interest payment date; or
(D) to register the transfer of a Note other than
in amounts of $1,000 or multiple integrals thereof.
(vi) 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 neither the Trustee, any Agent nor the
Company shall be affected by notice to the contrary.
(vii) The Trustee shall authenticate Definitive
Notes and Global Notes in accordance with the provisions of
Section 2.02 hereof.
Section 2.07. Replacement Notes.
If any mutilated Note is surrendered to the Trustee or the
Company, or the Trustee receives evidence to its satisfaction of
the destruction, loss or theft of any Note, the Company shall
issue and the Trustee, upon the written order of the Company
signed by two Officers of the Company, shall authenticate a
replacement Note if the Trustee's requirements are met. If
required by the Trustee or the Company, 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. If, after the delivery of such
replacement Note, a bona fide purchaser of the original Note in
lieu of which such replacement Note was issued presents for
payment or registration such original Note, the Trustee shall be
entitled to recover such replacement Note from the Person to whom
it was delivered or any Person taking therefrom, except a bona
fide purchaser, and shall be entitled to recover upon the
security or indemnity provided therefor to the extent of any
loss, damage, cost or expense incurred by the Company, the
Trustee, any Agent and any authenticating agent in connection
therewith.
Subject to the provisions of the final sentence of the
preceding paragraph of this Section 2.07, every replacement Note
is an additional obligation of the Company and shall 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 cancelled 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 not outstanding. Except as set forth in Section 2.09 hereof,
a Note does not cease to be outstanding because the Company, any
Subsidiary of the Company or an Affiliate of the Company or any
Subsidiary 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 bona fide
purchaser.
If the entire principal of and premium, interest and
Liquidated Damages, if any, on any Note are considered paid under
Section 4.01 hereof, it ceases to be outstanding and interest and
Liquidated Damages, if any, on it cease to accrue.
If the Paying Agent (other than the Company, a Subsidiary of
the Company 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
shall be deemed to be no longer outstanding and shall cease to
accrue interest and Liquidated Damages, if any.
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, a Subsidiary of the Company
or an Affiliate, shall be considered as though not outstanding,
except that for the purposes of determining whether the Trustee
shall be protected in relying on any such direction, waiver or
consent, only Notes that a Trustee knows are so owned shall be so
disregarded. Notwithstanding the foregoing, Notes that the
Company, a Subsidiary of the Company or an Affiliate offers to
purchase or acquires pursuant to an offer, exchange offer, tender
offer or otherwise shall not be deemed to be owned by the
Company, a Subsidiary of the Company or an Affiliate until legal
title to such Notes passes to the Company, such Subsidiary or
such Affiliate as the case may be.
Section 2.10. Temporary Notes.
Until definitive Notes are ready for delivery, the Company
may prepare and the Trustee shall authenticate temporary Notes
upon a written order of the Company signed by two Officers of the
Company. Temporary Notes shall be substantially in the form of
definitive Notes but may have variations that the Company
considers appropriate for temporary Notes and as shall be
reasonably acceptable to the Trustee. Without unreasonable
delay, the Company shall prepare and the Trustee shall
authenticate definitive Notes in exchange for temporary Notes.
Until such exchange, Holders of temporary Notes shall 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 shall forward to
the Trustee any Notes surrendered to them for registration of
transfer, exchange or payment. The Trustee and no one else shall
cancel all Notes surrendered for registration of transfer,
exchange, payment, replacement or cancellation and, at the
request of the Company, shall destroy cancelled Notes (subject to
the record retention requirement of the Exchange Act).
Certification of the destruction of all cancelled Notes shall be
delivered to the Company. The Company may not issue new Notes to
replace Notes that it has paid or that have been delivered to the
Trustee for cancellation, other than as contemplated by the
Exchange Offer.
Section 2.12. Defaulted Interest.
If the Company defaults in a payment of interest on the
Notes, it shall 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 shall 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
shall fix or cause to be fixed each such special record date and
payment date, provided, however, that no such special record date
shall 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) shall 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.
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 shall
furnish to the Trustee, at least 30 days but not more than
60 days before a redemption date, an Officers' Certificate
setting forth (i) the clause of this Indenture pursuant to which
the redemption shall occur, (ii) the redemption date, (iii) the
principal amount of Notes to be redeemed and (iv) the redemption
price.
Section 3.02. Selection of Notes to Be Redeemed.
If less than all of the Notes are to be redeemed at any
time, the Trustee shall select the Notes to be redeemed among the
Holders of the Notes, on a pro rata basis, by lot or in
accordance with any other method the Trustee considers fair and
appropriate. In the event of partial redemption by lot, the
particular Notes to be redeemed shall be selected, unless
otherwise provided herein, not less than 30 days nor more than
60 days prior to the redemption date by the Trustee from the
outstanding Notes not previously called for redemption.
The Trustee shall promptly notify the Company in writing of
the Notes selected for redemption and, in the case of any Note
selected for partial redemption, the principal amount thereof to
be redeemed. Notes and portions of Notes selected shall be in
amounts of $1,000 or whole multiples of $1,000. Provisions of
this Indenture that apply to Notes called for redemption also
apply to portions of Notes called for redemption.
The provisions of the two preceding paragraphs of this
Section 3.02 shall not apply with respect to any redemption
affecting only a Global Note, whether such Global Note is to be
redeemed in whole or in part. In case of any such redemption in
part, the unredeemed portion of the principal amount of the
Global Note shall be in an authorized denomination.
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 shall 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.
The notice shall identify the Notes to be redeemed and shall
state:
(a) the redemption date;
(b) the redemption price;
(c) 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 a principal amount equal to the
unredeemed portion shall be issued upon cancellation of the
original Note;
(d) the name and address of the Paying Agent;
(e) that Notes called for redemption must be
surrendered to the Paying Agent to collect the redemption
price;
(f) that, unless the Company defaults in making such
redemption payment, interest and Liquidated Damages, if any,
on Notes called for redemption cease to accrue on and after
the redemption date;
(g) the paragraph of the Notes and/or Section of this
Indenture pursuant to which the Notes called for redemption
are being redeemed; and
(h) 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.
If any of the Notes to be redeemed is in the form of a
Global Note, then the Company shall modify such notice to the
extent necessary to accord with the procedures of the Depository
applicable to redemption.
At the Company's request, the Trustee shall give the notice
of redemption in the Company's name and at its expense; provided,
however, that the Company shall have delivered to the Trustee, at
least 45 days (unless the Company and the Trustee agree to a
shorter period) 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.
Section 3.05. Deposit of Redemption Price.
One Business Day prior to the redemption date, the Company
shall deposit with the Paying Agent (or, if the Company is acting
as its own Paying Agent, segregate and hold in trust as provided
in Section 2.04 hereof) money sufficient to pay the redemption
price of and accrued interest and Liquidated Damages, if any, on
all Notes to be redeemed on that date. The Paying Agent shall
promptly return to the Company any money deposited with the
Paying Agent by the Company in excess of the amounts necessary to
pay the redemption price of and accrued interest and Liquidated
Damages, if any, on all Notes to be redeemed.
If the Company complies with the provisions of the preceding
paragraph, on and after the redemption date, interest and
Liquidated Damages, if any, shall cease to accrue on the Notes or
the portions of Notes called for redemption. If a Note is
redeemed on or after an interest record date but on or prior to
the related interest payment date, then any accrued and unpaid
interest and Liquidated Damages, if any, 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
shall not be so paid upon surrender for redemption because of the
failure of the Company to comply with the preceding paragraph,
interest shall be paid on the unpaid principal, from the
redemption date until such principal is paid, and to the extent
lawful on any interest and Liquidated Damages, if any, 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 in Part.
Upon surrender of a Note that is redeemed in part, the
Company shall issue and the Trustee shall authenticate for the
Holder at the expense of the Company a new Note equal in
principal amount to the unredeemed portion of the Note
surrendered.
Section 3.07. Optional Redemption.
(a) Except as set forth in clause (b) or (c) of this
Section 3.07, the Company shall not have the option to redeem the
Notes pursuant to this Section 3.07 prior to May 15, 2003.
Thereafter, the Company shall have the option to redeem the
Notes, in whole or in part, at the redemption prices (expressed
as percentages of principal amount) set forth below plus accrued
and unpaid interest and Liquidated Damages, if any, thereon, to
the applicable redemption date, if redeemed during the twelve-
month period beginning on May 15 of the years indicated below:
YEAR PERCENTAGE
---- ----------
2003 . . . . . . . . . . . . . . . . . 104.813%
2004 . . . . . . . . . . . . . . . . . 103.208%
2005 . . . . . . . . . . . . . . . . . 101.604%
2006 and thereafter . . . . . . . . . . 100.000%
(b) Notwithstanding the provisions of clause (a) of this
Section 3.07, at any time prior to May 15, 2001, the Company may
redeem up to 35% of the aggregate principal amount of Notes
originally issued at a redemption price of 109.625% of the
principal amount thereof, plus accrued and unpaid interest and
Liquidated Damages, if any, thereon to the redemption date, with
the net cash proceeds of one or more Qualified Equity Offerings,
provided that (i) at least 65% of the aggregate principal amount
of Notes originally issued remains outstanding immediately after
the occurrence of each such redemption and (ii) each such
redemption shall occur within 60 days of the date of the closing
of each such Qualified Equity Offering.
(c) The Company may at any time redeem, in whole but not in
part, the Notes at a redemption price of 100% of the principal
amount thereof plus accrued and unpaid interest and Liquidated
Damages, if any, thereon to the date of redemption if it has
become or would become obligated to pay any Additional Amounts in
respect of the Notes as a result of (a)(i) any change in or
amendment to the laws (or regulations promulgated thereunder) of
Canada (or any political subdivision or taxing authority thereof
or therein) or (ii) any change in or amendment to any official
position regarding the application or interpretation of such laws
or regulations, which change or amendment is announced or is
effective on or after the date of this Indenture and (b) such
obligation cannot be avoided by the Company taking reasonable
measures available to it.
(d) Any redemption pursuant to this Section 3.07 shall be
made pursuant to the provisions of Section 3.01 through Section
3.06 hereof.
Section 3.08. Mandatory Redemption.
Except as set forth under Sections 4.10 and 4.15 hereof, the
Company shall not be required to purchase or 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 shall be required to commence an offer to all Holders to
purchase Notes (an "Asset Sale Offer"), it shall follow the
procedures specified below.
The Asset Sale Offer shall remain open for a period of 20
Business Days following its commencement and no longer, except to
the extent that a longer period is required by applicable law
(the "Offer Period"). No later than five Business Days after the
termination of the Offer Period (the "Purchase Date"), the
Company shall purchase the principal amount of Notes required to
be purchased pursuant to Section 4.10 hereof (the "Offer Amount")
or, if less than the Offer Amount has been tendered, all Notes
validly tendered in response to the Asset Sale Offer. Payment
for any Notes so purchased shall be made in the same manner as
interest payments are made. Further, the Company shall comply
with the requirements of Rule 14e-1 under the Exchange Act and
any other securities laws and regulations thereunder to the
extent such laws and regulations are applicable in connection
with the purchase of Notes as a result of an Asset Sale Offer.
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, shall 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 or
Liquidated Damages, if any, shall be payable to Holders who
tender Notes pursuant to the Asset Sale Offer.
Upon the commencement of an Asset Sale Offer, the Company
shall send, by first class mail, a notice to each of the Holders,
with a copy to the Trustee. The notice shall contain all
instructions and materials necessary to enable such Holders to
tender Notes pursuant to the Asset Sale Offer. The Asset Sale
Offer shall be made to all Holders. The notice, which shall
govern the terms of the Asset Sale Offer, shall state:
(a) 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 shall remain open;
(b) the Offer Amount, the purchase price and the
Purchase Date;
(c) that any Note not tendered or accepted for payment
shall continue to accrue interest and Liquidated Damages, if
any;
(d) that, unless the Company defaults in making such
payment, any Note accepted for payment pursuant to the Asset
Sale Offer shall cease to accrue interest and Liquidated
Damages, if any after the Purchase Date;
(e) that Holders electing to have a Note purchased
pursuant to an Asset Sale Offer may only elect to have all
of such Note purchased and may not elect to have only a
portion of such Note purchased;
(f) that Holders electing to have a Note purchased
pursuant to any Asset Sale Offer shall be required to
surrender the Note, with the form entitled "Option of Holder
to Elect Purchase" on the reverse of the Note completed, to
the Company or a Paying Agent at the address specified in
the notice at least three days before the Purchase Date;
(g) that Holders shall be entitled to withdraw their
election if the Company or the Paying Agent, as the case may
be, receives, not later than the expiration of the Offer
Period, a telegram, telex, 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;
(h) that, if the aggregate principal amount of Notes
surrendered by Holders exceeds the Offer Amount, the Trustee
shall select the Notes to be purchased on a pro rata basis
(with such adjustments as may be deemed appropriate by the
Trustee so that only Notes in denominations of $1,000, or
integral multiples thereof, shall be purchased); and
(i) that Holders whose Notes were purchased only in
part shall be issued new Notes equal in principal amount to
the unpurchased portion of the Notes surrendered (or
transferred by book-entry transfer).
If any of the Notes subject to an Asset Sale Offer is in the
form of a Global Note, then the Company shall modify such notice
to the extent necessary to accord with the procedures of the
Depository applicable to repurchases.
On or before the Purchase Date, the Company shall, 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 shall
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 or the Paying Agent, as the case may be, shall 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 shall
promptly issue a new Note, and the Trustee shall 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. The Company shall publicly
announce the results of the Asset Sale Offer on the Purchase
Date.
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 Section 3.01 through Section 3.06 hereof.
ARTICLE 4
COVENANTS
Section 4.01. Payment of Notes.
The Company shall pay or cause to be paid the principal of
and premium, interest and Liquidated Damages, if any, on the
Notes on the dates and in the manner provided in the Notes.
Principal, premium, interest and Liquidated Damages, if any,
shall 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. New York time on the due date money deposited by the Company
in immediately available funds and designated for and sufficient
to pay all principal, premium, interest and Liquidated Damages,
if any, then due.
The Company shall pay interest (including post-petition
interest in any proceeding under any Bankruptcy Law) on overdue
principal at the rate equal to the interest rate on the Notes to
the extent lawful; it shall 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 period), at the same rate to the
extent lawful.
Section 4.02. Maintenance of Office or Agency.
The Company shall maintain 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 presented or
surrendered for payment, 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 shall give prompt written
notice to the Trustee of the location, and any change in the
location, of such office or agency. If at any time the Company
shall fail to maintain any such required office or agency or
shall fail to furnish the Trustee with the address thereof, such
presentations, surrenders, notices and demands may be made or
served at the Corporate Trust Office of the Trustee.
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. Further, if at any time there
shall be no such office or agency in the City of New York where
the Notes may be presented or surrendered for payment, the
Company shall forthwith designate and maintain such an office or
agency in the City of New York, in order that the Notes shall at
all times be payable in the City of New York. The Company shall
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.
Section 4.03. Reports.
(a) Whether or not the Company is required to do so by the
rules and regulations of the SEC, the Company will file with the
SEC (unless the SEC will not accept such a filing) and, within 15
days of filing, or attempting to file, the same with the SEC,
furnish to the holders of the Notes (i) all quarterly and annual
financial and other information with respect to the Company and
its Subsidiaries that would be required to be contained in a
filing with the SEC 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
thereon by the Company's certified independent accountants, and
(ii) all current reports that would be required to be filed with
the SEC on Form 8-K if the Company were required to file such
reports. The Company shall at all times comply with TIA <section
sign> 314(a).
(b) The Company and the Guarantors shall furnish to the
Holders of the Notes and prospective purchasers of the Notes,
upon their request, the information, if any, required to be
delivered pursuant to Rule 144A(d)(4) under the Securities Act.
Section 4.04. Compliance Certificate.
(a) The Company 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
Restricted 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 shall have 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 or its equivalent body in Canada, as the case may be,
the year-end financial statements delivered pursuant to
Section 4.03(a) 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) The Company shall, so long as any of the Notes are
outstanding, 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.
Section 4.05. Taxes.
The Company shall pay, and shall 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 covenants (to the extent that it may lawfully do
so) that it shall 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 (to the extent
that it may lawfully do so) hereby expressly waives all benefit
or advantage of any such law, and covenants that it shall not, by
resort to any such law, hinder, delay or impede the execution of
any power herein granted to the Trustee, but shall suffer and
permit the execution of every such power as though no such law
has been enacted.
Section 4.07. Restricted Payments.
The Company shall not, and shall not permit any of its
Restricted Subsidiaries to, directly or indirectly, (i) declare
or pay any dividend or make any other payment or distribution on
account of the Company's or any of its Restricted Subsidiaries'
Equity Interests (including, without limitation, any payment in
connection with any merger or consolidation involving the
Company) or to the direct or indirect holders of the Company's
Equity Interests in their capacity as such (other than dividends
or distributions payable in Equity Interests (other than
Disqualified Stock) of the Company); (ii) 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 or any
of its Restricted Subsidiaries (other than any such Equity
Interests owned by the Company or any Wholly Owned Restricted
Subsidiary of the Company); (iii) make any payment on or with
respect to, or purchase, redeem, defease or otherwise acquire or
retire for value, any Indebtedness that is subordinated in right
of payment to the Notes or the Subsidiary Guarantees, as the case
may be, except a payment of interest or principal at Stated
Maturity; or (iv) make any Restricted Investment (all such
payments and other actions set forth in clauses (i) through (iv)
above being collectively referred to as "Restricted Payments"),
unless, at the time of and after giving effect to such Restricted
Payment:
(a) no Default or Event of Default shall have occurred
and be continuing or would occur as a consequence thereof;
(b) the Company would, at the time of such Restricted
Payment and 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
Consolidated Interest Coverage Ratio test set forth in
Section 4.09 hereof; and
(c) 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 (b), (c), (d) and (e), but including Restricted
Payments permitted by clauses (a) and (f), of the next
succeeding paragraph), is less than the sum of (A) 50% of
the cumulative Consolidated Net Income of the Company for
the period (taken as one accounting period) from June 1,
1998 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 from the issue or
sale since the date of this Indenture of Equity Interests of
the Company (other than Disqualified Stock) or of
Disqualified Stock or debt securities of the Company that
have been converted into such Equity Interests (other than
any such Equity Interests, Disqualified Stock or convertible
debt securities sold to a Restricted Subsidiary of the
Company and other than Disqualified Stock or convertible
debt securities that have been converted into Disqualified
Stock), 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)
in the event that any Unrestricted Subsidiary is
redesignated as a Restricted Subsidiary, the lesser of (1)
an amount equal to the fair market value of the Company's
Investments in such Restricted Subsidiary and (2) the amount
of Restricted Investments previously made by the Company and
its Restricted Subsidiaries in such Unrestricted Subsidiary,
plus (E) $10.0 million.
The foregoing provisions will not prohibit any of the
following: (a) the payment of any dividend within 60 days after
the date of declaration thereof, if at said date of declaration
such payment would have complied with the provisions of this
Indenture; (b) the redemption, repurchase, retirement, defeasance
or other acquisition of any subordinated Indebtedness or 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, other Equity Interests
of the Company (other than any 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 shall be excluded from clause (c)(B) of the preceding
paragraph; (c) the defeasance, redemption, repurchase, retirement
or other acquisition of subordinated Indebtedness with the net
cash proceeds from an incurrence of, or in exchange for,
Permitted Refinancing Indebtedness; (d) the payment of any
dividend or distribution by a Restricted Subsidiary of the
Company to the Company or any Wholly Owned Restricted Subsidiary
of the Company; (e) the acquisition of Equity Interests of the
Company in connection with the exercise of stock options or stock
appreciation rights by way of a cashless exercise or in
connection with the satisfaction of withholding tax obligations;
and (f) the repurchase, redemption or other acquisition of any
Equity Interests of the Company held by any employee of the
Company or any of its Restricted Subsidiaries, or on behalf of
any employee benefit plan, provided that the aggregate price paid
for all such repurchased, redeemed, acquired or retired Equity
Interests shall not exceed $750,000 (or the equivalent thereof in
any other currency or currency unit) in any calendar year.
The Board of Directors may designate any Restricted
Subsidiary to be an Unrestricted Subsidiary if such designation
would not cause a Default. For purposes of making such
determination, all outstanding Investments by the Company and its
Restricted Subsidiaries (except to the extent repaid in cash) in
the Subsidiary so designated shall be deemed to be Restricted
Payments at the time of such designation. All such outstanding
Investments will be deemed to constitute Investments in an amount
equal to the fair market value of such Investments at the time of
such designation. Such designation shall only be permitted if
such Restricted Payment would be permitted at such time and if
such Restricted Subsidiary otherwise meets the definition of an
Unrestricted Subsidiary.
The Board of Directors of the Company may at any time
designate any Unrestricted Subsidiary to be a Restricted
Subsidiary, provided that such designation shall 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 shall only be permitted if (a)
such Indebtedness is permitted under Section 4.09 hereof,
calculated on a pro forma basis as if such designation had
occurred at the beginning of the four-quarter reference period,
and (b) no Default or Event of Default would be in existence
following such designation.
Any designation of a Subsidiary as an Unrestricted
Subsidiary shall be evidenced to the Trustee by filing with the
Trustee a certified copy of a resolution of the Board of
Directors giving effect to such designation and an Officers'
Certificate certifying that such designation complied with the
terms of the definition of Unrestricted Subsidiary set forth in
this Indenture and with this Section 4.07.
The amount of all Restricted Payments (other than cash)
shall 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 non-cash Restricted Payment shall be determined in
the manner contemplated by the definition of the term "fair
market value," and the results of such determination shall be
evidenced by an Officers' Certificate delivered to the Trustee.
Not later than five Business Days following the date of making
any Restricted Payment (other than a Restricted Payment permitted
by clause (d) or (e) of the second full paragraph of this Section
4.07), the Company shall deliver to the Trustee an Officers'
Certificate stating that such Restricted Payment is permitted and
setting forth the basis upon which the calculations required by
this Section 4.07 were computed.
Section 4.08. Dividend and Other Payment Restrictions Affecting
Subsidiaries.
The Company shall not, and shall not permit any of its
Restricted Subsidiaries to, directly or indirectly, create or
otherwise cause or suffer to exist or become effective any
encumbrance or restriction on the ability of any Restricted
Subsidiary to (a)(i) pay dividends or make any other
distributions to the Company or any of its Restricted
Subsidiaries on its Capital Stock or (ii) pay any Indebtedness
owed to the Company or any of its Restricted Subsidiaries, (b)
make loans or advances to the Company or any of its Restricted
Subsidiaries or (c) transfer any of its properties or assets to
the Company or any of its Restricted Subsidiaries, except for
such encumbrances or restrictions existing under or by reason of
(1) the Credit Facilities or Existing Indebtedness, each as in
effect on the date of this Indenture, (2) this Indenture and the
Notes, (3) applicable law, (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 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) by reason of customary non-assignment provisions in
leases entered into in the ordinary course of business and
consistent with past practices, (6) purchase money obligations
for property acquired in the ordinary course of business that
impose restrictions of the nature described in clause (c) above
on the property so acquired, (7) customary provisions in bona
fide contracts for the sale of property or assets or (8)
Permitted Refinancing Indebtedness with respect to any
Indebtedness referred to in clauses (1) and (2) above, provided
that the restrictions contained in the agreements governing such
Permitted Refinancing Indebtedness are not materially more
restrictive, taken as a whole, than those contained in the
agreements governing the Indebtedness being refinanced.
Section 4.09. Incurrence of Indebtedness and Issuance of
Disqualified Stock.
The Company shall not, and shall 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" or an "incurrence") any Indebtedness
(including, without limitation, Acquired Indebtedness) and that
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 and its
Restricted Subsidiaries may incur Indebtedness, and the Company
may issue Disqualified Stock, if the Consolidated Interest
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 2.0 to 1, determined on a pro forma
basis (including a pro forma application of the net proceeds
therefrom), as if the additional Indebtedness or Disqualified
Stock had been issued or incurred at the beginning of such four-
quarter period.
The foregoing provisions shall not apply to:
(a) the incurrence by the Company and its Restricted
Subsidiaries of Indebtedness under Credit Facilities in an
aggregate principal amount at any one time outstanding not
to exceed the greater of (i) 85% of the amount of Eligible
Receivables and (ii) $30.0 million (or the equivalent
thereof in any other currency or currency unit), plus any
fees, premiums, expenses (including costs of collection),
indemnities and similar amounts payable in connection with
such Indebtedness, and less any amounts repaid permanently
in accordance with Section 4.10 hereof;
(b) the incurrence by the Company and its Restricted
Subsidiaries of Existing Indebtedness;
(c) the incurrence by the Company and its Restricted
Subsidiaries of Hedging Obligations;
(d) the incurrence by the Company and its Restricted
Subsidiaries of Indebtedness represented by the Original
Notes, any Series B Notes issued in exchange for Series A
Notes pursuant to an Exchange Offer, the Subsidiary
Guarantees and this Indenture;
(e) the incurrence of intercompany Indebtedness
between or among the Company and any of its Wholly Owned
Restricted Subsidiaries, provided that 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 Wholly Owned Restricted Subsidiary of the
Company, or any sale or other transfer of any such
Indebtedness to a Person that is neither the Company nor a
Wholly Owned Restricted Subsidiary of the Company, shall be
deemed to constitute an incurrence of such Indebtedness by
the Company or such Restricted Subsidiary, as the case may
be;
(f) Indebtedness in respect of bid, performance or
surety bonds issued for the account of the Company or any
Restricted Subsidiary thereof in the ordinary course of
business, including guarantees or obligations of the Company
or any Restricted Subsidiary thereof with respect to letters
of credit supporting such bid, performance or surety
obligations (in each case other than for an obligation for
money borrowed); and
(g) 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 extend, refinance, renew, replace, defease or
refund Indebtedness that was permitted by this Indenture to
be incurred (other than Indebtedness incurred pursuant to
clause (a) or (e) of this Section 4.09).
The Company shall not, and shall not permit any Guarantor
to, directly or indirectly, incur any Indebtedness which by its
terms (or by the terms of any agreement governing such
Indebtedness) is subordinated to any other Indebtedness of the
Company or of such Guarantor, as the case may be, unless such
Indebtedness is also by its terms (or by the terms of any
agreement governing such Indebtedness) made expressly subordinate
to the Notes or the Subsidiary Guarantees of such Guarantor, as
the case may be, to the same extent and in the same manner as
such Indebtedness is subordinated pursuant to subordination
provisions that are most favorable to the holders of any other
Indebtedness of the Company or of such guarantor, as the case may
be.
Section 4.10. Asset Sales.
The Company shall not, and shall not permit any of its
Restricted Subsidiaries to, consummate an Asset Sale unless (a)
the Company or such Restricted Subsidiary, as the case may be,
receives consideration at the time of such Asset Sale at least
equal to the fair market value (as determined in accordance with
the definition of such term, the results of which determination
shall be set forth in an Officers' Certificate delivered to the
Trustee) of the assets or Equity Interests issued or sold or
otherwise disposed of and (b) at least 75% of the consideration
therefor received by the Company or such Restricted Subsidiary is
in the form of cash or Cash Equivalents; provided, however, that
the amount of (i) any liabilities (as shown on the Company's or
such Restricted Subsidiary's most recent balance sheet) of the
Company or such Restricted Subsidiary (other than contingent
liabilities and liabilities that are by their terms subordinated
to the Notes or any guarantee thereof) 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 (ii) any securities, notes or other
obligations received by the Company or such Restricted Subsidiary
from such transferee that are converted within thirty Business
Days by the Company or such Restricted Subsidiary into cash (to
the extent of the cash received) shall be deemed to be cash for
purposes of this Section 4.10. Notwithstanding the foregoing,
the Company need not comply with the preceding clause (b) in
connection with any Asset Sale in exchange for a promissory note
on a basis consistent with past practice so long as the aggregate
outstanding amount of all such notes at any time outstanding does
not exceed 5.0% of the book value of the Company's Productive
Assets (as shown on the Company's most recent balance sheet,
prepared on a consolidated basis in accordance with GAAP, less
accumulated depreciation and amortization) immediately after
giving effect to any such Asset Sale.
Within 365 days after the receipt of any Net Proceeds from
an Asset Sale, the Company or any such Restricted Subsidiary may
apply such Net Proceeds to (a) permanently repay the principal of
any Indebtedness of the Company ranking in right of payment at
least pari passu with the Notes or (b) acquire (including by way
of a purchase of assets or stock, merger, consolidation or
otherwise) Productive Assets. Pending the final application of
any such Net Proceeds, the Company or any such Restricted
Subsidiary may temporarily reduce outstanding revolving credit
borrowings, including borrowings under the Credit Facilities, or
otherwise invest such 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 first
sentence of this paragraph shall be deemed to constitute "Excess
Proceeds." Within 30 days of each date on which the aggregate
amount of Excess Proceeds exceeds $5.0 million (or the equivalent
thereof in any other currency or currency unit), the Company
shall commence an Asset Sale Offer pursuant to Section 3.09
hereof to purchase the maximum principal amount of Notes that may
be purchased out of 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, if any,
thereon, to the date of purchase, in accordance with the
procedures set forth in Section 3.09 hereof; provided, however,
that, if the Company is required to apply such Excess Proceeds to
purchase, or to offer to purchase, any Pari Passu Indebtedness,
the Company shall only be required to offer to purchase the
maximum principal amount of Notes that may be purchased out of
the amount of such Excess Proceeds multiplied by a fraction, the
numerator of which is the aggregate principal amount of Notes
outstanding and the denominator of which is the aggregate
principal amount of Notes outstanding plus the aggregate
principal amount of Pari Passu Indebtedness outstanding. To the
extent that the aggregate principal amount of Notes tendered
pursuant to an Asset Sale Offer is less than the amount that the
Company is required to purchase, the Company may use any
remaining Excess Proceeds for general corporate purposes in any
manner not prohibited by this Indenture. If the aggregate
principal amount of Notes surrendered by holders thereof exceeds
the amount that the Company is required to purchase, the Trustee
shall select the Notes to be purchased on a pro rata basis (with
such adjustments as may be deemed appropriate by the Trustee so
that only Notes in denominations of $1,000, or integral multiples
thereof, shall be purchased). Upon completion of such offer to
purchase, the amount of Excess Proceeds shall be reset at zero.
Section 4.11. Transactions with Affiliates.
The Company shall not, and shall 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 of the foregoing, an "Affiliate
Transaction"), unless (a) such 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 or, if there is no such
comparable transaction, on terms that are fair and reasonable to
the Company or such Restricted Subsidiary, and (b) the Company
delivers to the Trustee (i) with respect to any Affiliate
Transaction or series of related Affiliate Transactions involving
aggregate consideration in excess of $1.0 million (or the
equivalent thereof in any other currency or currency unit), a
resolution of the Board of Directors set forth in an Officers'
Certificate certifying that such Affiliate Transaction complies
with clause (a) above and that such Affiliate Transaction has
been approved by a majority of the disinterested members of the
Board of Directors and (ii) with respect to any Affiliate
Transaction or series of related Affiliate Transactions involving
aggregate consideration in excess of $5.0 million (or the
equivalent thereof in any other currency or currency unit), an
opinion as to the fairness to the Company or the relevant
Subsidiary of such Affiliate Transaction from a financial point
of view issued by an accounting, appraisal or investment banking
firm that is, in the judgment of the Board of Directors,
qualified to render such opinion and is independent with respect
to the Company; provided, however, that the following shall be
deemed not to be Affiliate Transactions: (A) any employment
agreement or other employee compensation plan or arrangement
entered into by the Company or any of its Restricted Subsidiaries
in the ordinary course of business of the Company or such
Restricted Subsidiary; (B) transactions between or among the
Company and its Restricted Subsidiaries; (C) Permitted
Investments and Restricted Payments that are permitted by the
provisions of this Indenture; (D) loans or advances to officers,
directors and employees of the Company or any Restricted
Subsidiary made in the ordinary course of business and consistent
with past practices of the Company and its Restricted
Subsidiaries in an aggregate amount not to exceed $2.0 million
(or the equivalent thereof in any other currency or currency
unit) outstanding at any one time; (E) indemnities of officers,
directors and employees of the Company or any Restricted
Subsidiary permitted by bylaw or statutory provisions; and (F)
the payment of reasonable and customary regular fees to directors
of the Company or any of its Restricted Subsidiaries who are not
employees of the Company or any Subsidiary
Section 4.12. Liens.
The Company shall not, and shall not permit any of its
Restricted Subsidiaries to, directly or indirectly, create,
incur, assume or suffer to exist any Lien on any asset now owned
or hereafter acquired, or any income or profits therefrom or
assign or convey any right to receive income therefrom, except
Permitted Liens, to secure (a) any Indebtedness of the Company or
such Restricted Subsidiary (if it is not also a Guarantor),
unless prior to, or contemporaneously therewith, the Notes are
equally and ratably secured, or (b) any Indebtedness of any
Guarantor, unless prior to, or contemporaneously therewith, the
Subsidiary Guarantees are equally and ratably secured; provided,
however, that if such Indebtedness is expressly subordinated to
the Notes or the Subsidiary Guarantees, the Lien securing such
Indebtedness will be subordinated and junior to the Lien securing
the Notes or the Subsidiary Guarantees, as the case may be, with
the same relative priority as such Indebtedness has with respect
to the Notes or the Subsidiary Guarantees.
Section 4.13. Additional Subsidiary Guarantees.
If the Company or any of its Restricted Subsidiaries shall,
after the date of this Indenture, acquire or create another
Restricted Subsidiary, then such newly acquired or created
Restricted Subsidiary shall execute a Subsidiary Guarantee and
deliver an Opinion of Counsel and an Officers' Certificate in
accordance with the terms of Section 10.02 of this Indenture.
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 its corporate existence, and, subject to
Article 10 hereof, the corporate, partnership or other existence
of each of its Restricted Subsidiaries, in accordance with the
respective organizational documents (as the same may be amended
from time to time) of the Company or any such Restricted
Subsidiary; provided, however, that the Company shall not be
required to preserve the existence of any of its Restricted
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 Restricted Subsidiaries, taken as
a whole.
Section 4.15. Offer to Purchase Upon Change of Control.
(a) Upon the occurrence of a Change of Control, the Company
shall make an offer (a "Change of Control Offer") to purchase all
or any portion (equal to $1,000 or an integral multiple thereof)
of each Holder's Notes at an offer price in cash equal to 101% of
the aggregate principal amount thereof, plus accrued and unpaid
interest and Liquidated Damages, if any, thereon to the date of
purchase (the "Change of Control Payment"). Within 30 days
following a Change of Control, the Company shall mail a notice to
each Holder and the Trustee stating: (1) that the Change of
Control Offer is being made pursuant to this Section 4.15 and
that all Notes validly tendered and not withdrawn will be
accepted for payment; (2) the purchase price and the purchase
date, which shall be no earlier than 30 days but no later than 60
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 and Liquidated Damages, if any; (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 shall cease to accrue interest and Liquidated
Damages, if any, 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,
properly endorsed for transfer, together with the form entitled
"Option of Holder to Elect Purchase" on the reverse of the Notes
completed and such customary documents as the Company may
reasonably request, 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 telegram, telex, 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. If any of the Notes subject to a Change of Control
Offer is in the form of a Global Note, then the Company shall
modify such notice to the extent necessary to accord with the
procedures of the Depository applicable to repurchases. Further,
the Company shall comply with the requirements of Rule 14e-1
under the Exchange Act and any other securities laws and
regulations thereunder to the extent such laws and regulations
are applicable in connection with the purchase of Notes as a
result of a Change of Control. To the extent that the provisions
of any securities laws or regulations conflict with the
provisions relating to the Change of Control Offer, the Company
will comply with the applicable securities laws and regulations
and will not be deemed to have breached its obligations described
above by virtue thereof.
(b) On or before 10:00 a.m. New York time on the Change of
Control Payment Date, the Company shall, to the extent lawful,
(a) accept for payment all Notes or portions thereof properly
tendered pursuant to the Change of Control Offer, (b) deposit
with the Paying Agent an amount equal to the Change of Control
Payment in respect of all Notes or portions thereof so tendered
and (c) deliver or cause to be delivered to the Trustee the Notes
so accepted together with an Officers' Certificate stating the
aggregate principal amount of Notes or portions thereof being
purchased by the Company. The Paying Agent shall promptly mail to
each holder of Notes so tendered the Change of Control Payment
for such Notes, and the Trustee shall 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, however, that each such
new Note will be in a principal amount of $1,000 or an integral
multiple thereof. The Company shall publicly announce the results
of the Change of Control Offer on or as soon as practicable after
the Change of Control Payment Date.
(c) The Change of Control provisions described above shall
be applicable whether or nor any other provisions of this
Indenture are applicable.
(d) The Company shall not be required to make a Change of
Control Offer following a Change of Control if a third party
makes the Change of Control Offer in the manner, at the time and
otherwise in compliance with the requirements set forth in this
Indenture applicable to a Change of Control Offer made by the
Company and purchases all Notes validly tendered and not
withdrawn under such Change of Control Offer.
Section 4.16. Issuances and Sales of Capital Stock of Restricted
Subsidiaries.
The Company (i) shall not, and shall not permit any
Restricted Subsidiary of the Company to, transfer, convey, sell
or otherwise dispose of any Capital Stock of any Restricted
Subsidiary of the Company to any Person (other than the Company
or a Wholly Owned Restricted Subsidiary of the Company), unless
(a) such transfer, conveyance, sale or other disposition is of
all the Capital Stock of such Restricted Subsidiary and (b) the
Net Proceeds from such transfer, conveyance, sale or other
disposition are applied in accordance with Section 4.10 hereof,
and (ii) shall not permit any Restricted Subsidiary of the
Company to issue any of its Equity Interests to any Person other
than to the Company or a Wholly Owned Restricted Subsidiary of
the Company, except, in the case of both clauses (i) and (ii)
above, as would be permitted under the definition of "Wholly
Owned Restricted Subsidiary."
Section 4.17. Sale-and-leaseback Transactions.
The Company shall not, and shall not permit any of its
Restricted Subsidiaries to, enter into any sale-and-leaseback
transaction; provided, however, that the Company or any
Restricted Subsidiary, as applicable, may enter into a sale-and-
leaseback transaction if (i) the Company or such Restricted
Subsidiary could have (a) incurred Indebtedness in an amount
equal to the Attributable Indebtedness relating to such sale-and-
leaseback transaction pursuant to the Consolidated Interest
Coverage Ratio test set forth in the first paragraph of Section
4.09 hereof and (b) incurred a Lien to secure such Indebtedness
pursuant to Section 4.12 hereof, (ii) the gross cash proceeds of
such sale-and-leaseback transaction are at least equal to the
fair market value (as determined in accordance with the
definition of such term, the results of which determination shall
be set forth in an Officers' Certificate delivered to the
Trustee) of the property that is the subject of such sale-and-
leaseback transaction and (iii) the transfer of assets in such
sale-and-leaseback transaction is permitted by, and the Company
applies the proceeds of such transaction in compliance with,
Section 4.10 hereof.
Section 4.18. No Inducements.
The Company shall not, and the Company shall not permit any
of its Subsidiaries, either directly or indirectly, to pay (or
cause to be paid) any consideration, whether by way of interest,
fee or otherwise, to any Holder for or as an inducement to any
consent, waiver, amendment or supplement of any terms or
provisions of this Indenture or the Notes, unless such
consideration is offered to be paid (or agreed to be paid) to all
Holders which so consent, waive or agree to amend or supplement
in the time frame set forth on solicitation documents relating to
such consent, waiver or agreement.
Section 4.19. Additional Amounts.
All payments made by or on behalf of the Company under or
with respect to the Notes shall be made free and clear of and
without withholding or deduction for or on account of any present
or future tax, duty, levy, interest, assessment or other
governmental charge imposed or levied by or on behalf of the
Government of Canada or any province or territory thereof or by
any authority or agency therein or thereof having power to tax
("Taxes"), unless the Company (or any Paying Agent) is required
to withhold or deduct Taxes under Canadian law or by the
interpretation or administration thereof by the relevant taxing
authority. If the Company (or any Paying Agent) is so required
to withhold or deduct any amount for or on account of Taxes from
any payment made under or with respect to the Notes, the Company
(and each Paying Agent) shall pay to each Holder of Notes that
are outstanding on the day of the required payment, such
additional amounts ("Additional Amounts") as may be necessary so
that the net amount received by such Holder (including the
Additional Amounts) after such withholding or deduction will not
be less than the amount such Holder would have received if such
Taxes had not been withheld or deducted, provided that no
Additional Amounts will be payable with respect to a payment made
to a Holder (an "Excluded Holder") (i) with which the Company
does not deal at arm's length (within the meaning of the Income
Tax Act (Canada)) at the time of making such payment or
(ii) which is subject to such Taxes by reason of the Holder's
being connected with Canada or any province or territory thereof
otherwise than by the mere holding of the Notes or the receipt of
payments thereunder. The Company shall also (i) make such
withholding or deduction and (ii) remit the full amount deducted
or withheld to the relevant authority in accordance with
applicable law.
The Company shall furnish, within 30 days after the date the
payment of any Taxes is due pursuant to applicable law, to the
Holders of Notes that are outstanding on the date of the required
payment, copies of tax receipts evidencing that such payment has
been made by the Company. The Company shall indemnify and hold
harmless each Holder of Notes that are outstanding on the date of
the required payment (other than an Excluded Holder) and upon
written request reimburse each such Holder for the amount of
(i) any Taxes so levied or imposed and paid by such Holder as a
result of payments made under or with respect to the Notes,
(ii) any liability (including, without limitation, penalties,
interest and expense) arising therefrom or with respect thereto,
and (iii) any Taxes imposed with respect to any reimbursement
under clause (i) or (ii) above.
At least 30 days prior to each date on which any payment
under or with respect to the Notes is due and payable, if the
Company becomes obligated to pay Additional Amounts with respect
to such payment, the Company shall deliver to each Paying Agent
an Officers' Certificate stating the fact that such Additional
Amounts will be payable, and the amounts so payable and will set
forth such other information as is necessary to enable such
Paying Agent to pay such Additional Amounts to the Holders on the
payment date. Whenever in this Indenture there is mentioned, in
any context, (a) the payment of principal (and premium, if any),
(b) purchase prices in connection with a purchase of the Notes by
the Company, (c) interest, or (d) any other amount payable on or
with respect to any of the Notes, such mention shall be deemed to
include mention of the payment of Additional Amounts provided for
in this Section 4.19 to the extent that, in such context,
Additional Amounts are, were or would be payable in respect
thereof.
The obligations of the Company under this Section 4.19 shall
survive the satisfaction and discharge of this Indenture.
Section 4.20. Enforceability of Judgments; Indemnification for
Foreign Currency Judgments.
The obligations of the Company to any Holder or the Trustee
shall, notwithstanding any judgment in a currency (the "Judgment
Currency") other than United States dollars (the "Agreement
Currency"), be discharged only to the extent that on the day
following receipt by such Holder or the Trustee, as the case may
be, of any amount in the Judgment Currency, such Holder or the
Trustee may in accordance with normal banking procedures purchase
the Agreement Currency with the Judgment Currency. If the amount
of the Agreement Currency so purchased is less than the amount
originally to be paid to such Holder or the Trustee, as the case
may be, in the Agreement Currency, the Company agrees, as a
separate obligation and notwithstanding such judgment, to pay to
such Holder or the Trustee, as the case may be, the difference,
and if the amount of the Agreement Currency so purchased exceeds
the amount originally to be paid to such Holder or the Trustee,
as the case may be, such Holder or the Trustee, as the case may
be, shall pay to or for the account of the Company such excess,
provided that such Holder or the Trustee, as the case may be,
shall not have any obligation to pay any such excess as long as a
Default has occurred and is continuing, in which case such excess
may be applied by such Holder or the Trustee, as the case may be,
to such obligations.
ARTICLE 5
SUCCESSORS
Section 5.01. Merger, Consolidation or Sale of Assets.
The Company shall not consolidate or merge with or into
(whether or not the Company is the surviving corporation), or
sell, assign, transfer, lease, convey or otherwise dispose of all
or substantially all of its properties or assets in one or more
related transactions to, another Person unless (a) the Company is
the surviving corporation or the Person formed by or surviving
any such consolidation or merger (if other than the Company) or
to which such sale, assignment, transfer, lease, conveyance or
other disposition shall have been made is a corporation organized
or existing under the laws of the United States, any state
thereof or the District of Columbia or Canada or any province
thereof, (b) 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, lease, conveyance or
other disposition shall have been made assumes all the
obligations of the Company under the Notes and this Indenture
pursuant to a supplemental indenture in a form reasonably
satisfactory to the Trustee, (c) immediately after such
transaction no Default or Event of Default exists and (d) except
in the case of a merger of the Company with or into a Wholly
Owned Restricted Subsidiary of the Company, 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, lease, conveyance or other disposition shall have been
made (A) will have Consolidated Net Worth immediately after the
transaction equal to or greater than the Consolidated Net Worth
of the Company immediately preceding the transaction and (B)
will, at the time of such transaction and after giving pro forma
effect thereto as if such transaction 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
Consolidated Interest Coverage Ratio test set forth in the first
paragraph of Section 4.09 hereof.
In connection with any consolidation, merger or disposition
contemplated by this provision, the Company shall deliver, or
cause to be delivered, to the Trustee, in form and substance
reasonably satisfactory to the Trustee, (i) an Officers'
Certificate stating that such consolidation, merger or
disposition and any supplemental indenture in respect thereto
comply with this provision and that all conditions precedent in
the Indenture provided for relating to such transaction or
transactions have been complied with and (ii) an Opinion of
Counsel stating that the requirements of Section 5.01(a) and (b)
have been satisfied.
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 properties or assets of the Company in
accordance with 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, assignment, transfer, 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 corporation had been named as the
Company herein; provided, however, that the predecessor Company
shall not be relieved from its obligations under this Indenture
or the Notes in the case of any such lease.
ARTICLE 6
DEFAULTS AND REMEDIES
Section 6.01. Events of Default.
An "Event of Default" occurs if:
(a) the Company defaults in the payment when due of
interest on, or Liquidated Damages, if any, with respect to,
the Notes, and such default continues for a period of 30
days;
(b) the Company defaults in the payment when due of
principal of or premium, if any, on the Notes;
(c) the Company fails to comply with any of the
provisions of Section 4.10, 4.15 or 5.01 hereof;
(d) the Company fails to observe or perform any other
covenant or other agreement in this Indenture or the Notes
for 60 days after notice to the Company by the Trustee or
the Holders of at least 25% in principal amount of the Notes
then outstanding of such failure;
(e) 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 Restricted
Subsidiaries (or the payment of which is guaranteed by the
Company or any of its Restricted Subsidiaries), whether such
Indebtedness or guarantee now exists, or is created after
the date of this Indenture, which default (i) is caused by a
failure to pay principal of or premium or interest on such
Indebtedness prior to the expiration of any grace period
provided in such Indebtedness, including any extension
thereof (a "Payment Default") or (ii) 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 in excess of $5.0 million (or the equivalent
thereof in any other currency or currency unit); and
provided, further, that if such default is cured or waived
or any such acceleration rescinded, or such Indebtedness is
repaid, within a period of 10 days from the continuation of
such default beyond the applicable grace period or the
occurrence of such acceleration, as the case may be, an
Event of Default and any consequential acceleration of the
Notes shall be automatically rescinded, so long as such
rescission does not conflict with any judgment or decree;
(f) a final judgment or final 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 and such judgment or judgments are
not paid or discharged for a period (during which execution
shall not be effectively stayed) of 60 days, provided that
the aggregate of all such undischarged judgments exceeds
$5.0 million (or the equivalent thereof in any other
currency or currency unit);
(g) the failure of any Guarantor to perform any
covenant set forth in its Subsidiary Guarantee or the
repudiation by any Guarantor of its obligations under its
Subsidiary Guarantee or the unenforceability of any
Subsidiary Guarantee for any reason;
(h) the Company or any Significant Subsidiary pursuant
to or within the meaning of Bankruptcy Law:
(i) commences a voluntary case,
(ii) consents to the entry of an order for relief
against it in an involuntary case,
(iii) consents to the appointment of a
Custodian of it or for all or substantially all of its
property,
(iv) makes a general assignment for the benefit of
its creditors, or
(v) generally is not paying its debts as they
become due; or
(i) a court of competent jurisdiction enters an order
or decree under any Bankruptcy Law that:
(i) is for relief against the Company or any
Significant Subsidiary in an involuntary case;
(ii) appoints a Custodian of the Company or
any Significant Subsidiary or for all or
substantially all of the property of the Company
or any Significant Subsidiary; or
(iii) orders the liquidation of the
Company or any Significant Subsidiary;
and the order or decree remains unstayed and in effect for
60 consecutive days.
Section 6.02. Acceleration.
If any Event of Default occurs and is continuing, the
Trustee may, by notice to the Company, or the Holders of at least
25% in principal amount of the then outstanding Notes may, by
notice to the Company and the Trustee, and the Trustee shall,
upon the request of such Holders, 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 (h) or (i)
of Section 6.01 hereof occurs with respect to the Company or any
Significant Subsidiary, all outstanding Notes shall be due and
payable immediately without further action or notice. The
Holders of a majority in 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 of Default (except nonpayment of principal,
interest, premium or Liquidated Damages, if any, that have become
due solely because of the acceleration) have been cured or
waived.
If an Event of Default occurs by reason of any willful
action (or inaction) taken (or not taken) by or on behalf of the
Company with the intention of avoiding payment of the premium
that the Company would have had to pay if the Company then had
elected to redeem the Notes pursuant to Section 3.07 hereof,
then, upon acceleration of the Notes, an equivalent premium shall
also become and be immediately due and payable, to the extent
permitted by law, anything in this Indenture or in the Notes to
the contrary notwithstanding.
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 of and premium, interest and Liquidated Damages, if
any, 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 a majority in principal amount of the then
outstanding Notes by notice to the Trustee may on behalf of the
Holders of all of the Notes waive any 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 or
premium, interest or Liquidated Damages, if any, on the Notes
(including in connection with an offer to purchase). 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 or 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:
(a) the Holder of a Note gives to the Trustee written
notice of a continuing Event of Default;
(b) 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;
(c) 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;
(d) 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
(e) 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 of
and premium, interest and Liquidated Damages, if any, 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.
Section 6.08. Collection Suit by Trustee.
If an Event of Default specified in Section 6.01(a) or (b)
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, interest and Liquidated Damages, if any, remaining
unpaid on the Notes and interest on overdue principal and, to the
extent lawful, interest and Liquidated Damages, if any, 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.
Section 6.10. Priorities.
If the Trustee collects any money pursuant to this Article,
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 Trustee's costs and
expenses of collection;
Second: to Holders of Notes for amounts due and unpaid
on the Notes for principal, premium, interest and Liquidated
Damages, if any, ratably, without preference or priority of
any kind, according to the amounts due and payable on the
Notes for principal, premium, interest and Liquidated
Damages, if any, 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, 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 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 shall 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 man would exercise or use
under the circumstances in the conduct of his own affairs.
(b) Except during the continuance of an Event of Default:
(i) the duties of the Trustee shall 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
(ii) in the absence of bad faith on its part, the
Trustee may conclusively rely, as to the truth of the state-
ments and the correctness of the opinions expressed therein,
upon certificates or opinions furnished to the Trustee and
conforming to the requirements of this Indenture. However,
the Trustee shall examine the certificates and opinions to
determine whether or not they conform to the requirements of
this Indenture.
(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:
(i) this paragraph does not limit the effect of
paragraph (b) of this Section 7.01;
(ii) the Trustee shall 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
(iii) the Trustee shall 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 shall require the
Trustee to expend or risk its own funds or incur any liability.
The Trustee shall be under no obligation to exercise any of its
rights and powers under this Indenture at the request of any
Holders, unless such Holder shall have offered to the Trustee
security and indemnity satisfactory to it against any loss,
liability or expense.
(f) The Trustee shall 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 shall 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 and the written advice of such counsel or any Opinion of
Counsel shall 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 shall not be responsible for the misconduct or negligence of
any agent appointed with due care.
(d) The Trustee shall 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 shall be sufficient if signed by an Officer of the
Company.
(f) The Trustee shall be under no obligation to exercise
any of the rights or powers vested in it by this Indenture at the
request or direction of any of the Holders unless such Holders
shall have offered to the Trustee reasonable security or
indemnity against the costs, expenses and liabilities that might
be incurred by it in compliance with such request or direction.
(g) The Trustee shall have no duty to inquire as to the
performance of the Company's covenants in Article 4 hereof. In
addition, the Trustee shall not be deemed to have knowledge of
any Default or Event of Default except: (1) any Event of Default
occurring pursuant to Section 6.01(a) or 6.01(b) hereof; or (2)
any Default or Event of Default of which is Responsible Officer
shall have received written notification or obtained actual
knowledge.
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, any Guarantor 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 shall 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 shall not be responsible for the use or application
of any money received by any Paying Agent other than the Trustee,
and it shall 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 shall 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 or premium, if
any, or interest on any Note, the Trustee may withhold the notice
if and so long as 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.
Within 60 days after each May 15 beginning with the May 15
following the date of this Indenture, and for so long as Notes
remain outstanding, the Trustee shall mail to the Holders of the
Notes a brief report dated as of such reporting date that
complies with TIA <section sign> 313(a) (but if no event
described in TIA <section sign> 313(a) has occurred within the
twelve months preceding the reporting date, no report need be
transmitted). The Trustee also shall comply with TIA <section
sign> 313(b)(2) and <section sign> 313(b)(1). The Trustee shall
also transmit by mail all reports as required by TIA <section
sign> 313(c).
A copy of each report at the time of its mailing to the
Holders of Notes shall be mailed to the Company and filed with
the SEC and each stock exchange on which the Notes are listed in
accordance with TIA <section sign> 313(d). The Company shall
promptly notify the Trustee when the Notes are listed on any
stock exchange.
Section 7.07. Compensation and Indemnity.
The Company shall pay to the Trustee from time to time
reasonable compensation for its acceptance of this Indenture and
services hereunder. The Trustee's compensation shall not be
limited by any law on compensation of a trustee of an express
trust. The Company shall 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 shall include the reasonable
compensation, disbursements and expenses of the Trustee's agents
and counsel.
The Company and the Guarantors shall indemnify the 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 the
costs and expenses of enforcing this Indenture against the
Company (including this Section 7.07) and defending itself
against any claim (whether asserted by the Company, any Guarantor
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, bad faith or
willful misconduct. The Trustee shall notify the Company
promptly of any claim for which it may seek indemnity. Failure
by the Trustee to so notify the Company shall not relieve the
Company or the Guarantors of their obligations hereunder. The
Company shall defend the claim and the Trustee shall cooperate in
the defense. The Trustee may have separate counsel and the
Company shall pay the reasonable fees and expenses of such
counsel. The Company need not pay for any settlement made
without its consent, which consent shall not be unreasonably
withheld.
The obligations of the Company and the Guarantors under this
Section 7.07 shall survive the satisfaction and discharge of this
Indenture.
To secure the Company's payment obligations in this Section
7.07, the Trustee shall 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 shall survive the satisfaction and discharge of this
Indenture.
When the Trustee incurs expenses or renders services after
an Event of Default specified in Section 6.01(h) or (i) 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.
The Trustee shall comply with the provisions of TIA <section
sign> 313(b)(2) to the extent applicable.
Section 7.08. Replacement of Trustee.
A resignation or removal of the Trustee and appointment of a
successor Trustee shall become effective only upon the successor
Trustee's acceptance of appointment as provided in this Section.
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 Notes 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:
(a) the Trustee fails to comply with Section 7.10
hereof;
(b) 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;
(c) a Custodian or public officer takes charge of the
Trustee or its property; or
(d) the Trustee becomes incapable of acting.
If the Trustee resigns or is removed or if a vacancy exists
in the office of Trustee for any reason, the Company shall
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.
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 Notes of at least 10% in
principal amount of the then outstanding Notes may petition any
court of competent jurisdiction for the appointment of a
successor Trustee.
If the Trustee, after written request by any Holder of a
Note who has been a Holder of a Note for at least six months,
fails to comply with Section 7.10 hereof, such Holder of a Note
may petition any court of competent jurisdiction for the removal
of the Trustee and the appointment of a successor Trustee.
A successor Trustee shall deliver a written acceptance of
its appointment to the retiring Trustee and to the Company.
Thereupon, the resignation or removal of the retiring Trustee
shall become effective, and the successor Trustee shall have all
the rights, powers and duties of the Trustee under this
Indenture. The successor Trustee shall mail a notice of its
succession to Holders of the Notes. The retiring Trustee shall
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 shall continue for the benefit of the
retiring Trustee.
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 shall be the successor Trustee. As soon
as practicable, the successor Trustee shall mail a notice of its
succession to the Company and the Holders of the Notes.
Section 7.10. Eligibility; Disqualification.
There shall 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 shall always have a Trustee who satisfies the
requirements of TIA <section sign> 310(a)(1), (2) and (5). The
Trustee is subject to TIA <section sign> 310(b).
Section 7.11. Preferential Collection of Claims Against Company.
The Trustee is subject to TIA <section sign> 311(a),
excluding any creditor relationship listed in TIA <section
sign> 311(b). A Trustee who has resigned or been removed shall
be subject to TIA <section sign> 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, exercise its rights under either Section 8.02 or
8.03 hereof with respect 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 shall,
subject to the satisfaction of the conditions set forth in
Section 8.04 hereof, be deemed to have discharged its obligations
with respect to all outstanding Notes, and each Guarantor shall
be deemed to have discharged its obligations with respect to its
Subsidiary Guarantee, on the date the conditions set forth in
Section 8.04 below are satisfied (hereinafter, "Legal
Defeasance"). For this purpose, Legal Defeasance means that the
Company shall be deemed to have paid and discharged the entire
Indebtedness represented by the outstanding Notes, and each
Guarantor shall be deemed to have paid and discharged its
Subsidiary Guarantee (which in each case shall 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
(a) and (b) below) and to have satisfied all its other
obligations under such Notes or Subsidiary Guarantee 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 shall survive
until otherwise terminated or discharged hereunder: (a) the
rights of Holders of outstanding Notes to receive solely from the
trust fund described in Section 8.04 hereof, and as more fully
set forth in such Section, payments in respect of the principal
of and premium, if any, interest and Liquidated Damages, if any,
on such Notes when such payments are due, (b) the Company's
obligations with respect to such Notes under Sections 2.03, 2.04,
2.07, 2.10 and 4.02 hereof and the last paragraph of Section 4.19
hereof, (c) the rights, powers, trusts, duties and immunities of
the Trustee hereunder and the Company's obligations in connection
therewith and (d) 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 each
Guarantor shall, subject to the satisfaction of the conditions
set forth in Section 8.04 hereof, be released from its
obligations under the covenants contained in Article 4 (other
than those in Sections 4.01, 4.02, 4.06, 4.14 and 4.19) and in
clause (c) of Section 5.01 hereof on and after the date the
conditions set forth below are satisfied (hereinafter, "Covenant
Defeasance"), and the Notes shall 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 shall continue to
be deemed "outstanding" for all other purposes hereunder (it
being understood that such Notes shall not be deemed outstanding
for accounting purposes). For this purpose, Covenant Defeasance
means that, with respect to the outstanding Notes, the Company
and any Guarantor may omit to comply with and shall 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 shall 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 shall 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(e) through 6.01(g) hereof
shall not constitute Events of Default.
Section 8.04. Conditions to Legal or Covenant Defeasance.
In order to exercise either Legal Defeasance or Covenant
Defeasance:
(a) 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 such amounts as will be
sufficient, in the opinion of a nationally recognized firm
of independent public accountants, to pay the principal of
and premium, interest and Liquidated Damages, if any, on the
outstanding Notes on the stated maturity thereof 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;
(b) in the case of an election under Section 8.02
hereof, the Company shall have delivered to the Trustee an
Opinion of Counsel in the United States reasonably
acceptable to the Trustee confirming that (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;
(c) in the case of an election under Section 8.03
hereof, the Company shall have delivered 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;
(d) 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 incurrence of
Indebtedness or the grant of Liens securing such
Indebtedness, all or a portion of the proceeds of which will
be used to defease the Notes pursuant to this Article 8
concurrently with such incurrence or within 30 days
thereof);
(e) such Legal Defeasance or Covenant Defeasance shall
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
Restricted Subsidiaries is a party or by which the Company
or any of its Restricted Subsidiaries is bound;
(f) the Company shall have delivered to the Trustee an
Opinion of Counsel (which may be based on such solvency
certificates or solvency opinions as counsel deems necessary
or appropriate) to the effect that the trust funds will not
be subject to the effect of any applicable bankruptcy,
insolvency, reorganization or similar laws affecting
creditors' rights generally;
(g) the Company shall have delivered to the Trustee an
Officers' Certificate stating that the deposit was not made
by the Company with the intent of preferring the Holders
over any other creditors of the Company or with the intent
of defeating, hindering, delaying or defrauding creditors of
the Company or others; and
(h) the Company shall have delivered to the Trustee an
Officers' Certificate and an Opinion of Counsel, 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 pursuant to Section 8.04 hereof in respect of
the outstanding Notes shall 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,
if any, and interest, but such money need not be segregated from
other funds except to the extent required by law.
The Company shall pay and indemnify the Trustee against any
tax, fee or other charge imposed on or assessed against the 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.
Anything in this Article 8 to the contrary notwithstanding,
the Trustee shall deliver or pay to the Company from time to time
upon the 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(a) 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.
Subject to applicable escheat and abandoned property laws,
any money deposited with the Trustee or any Paying Agent, or then
held by the Company, in trust for the payment of the principal of
or premium or Liquidated Damages, if any, or interest on any Note
and remaining unclaimed for two years after such principal, and
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) shall be discharged from such trust;
and the Holder of such Note shall thereafter, as a secured
creditor, look only to the Company for payment thereof, and all
liability of the Trustee or such Paying Agent with respect to
such trust money, and all liability of the Company as trustee
thereof, shall thereupon cease; provided, however, that the
Trustee or such Paying Agent, before being required to make any
such repayment, may at the expense of the Company cause to be
published once, in 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 shall 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.
Nothing contained in this Section 8.06 shall be deemed to
affect any obligation of the Trustee or any Paying Agent to
search for lost Holders pursuant to Rule 17Ad-17 under the
Exchange Act.
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 8.05 hereof, by reason of any order or
judgment of any court or governmental authority enjoining,
restraining or otherwise prohibiting such application, then the
Company's obligations under this Indenture and the Notes shall be
revived and reinstated as though no deposit had occurred pursuant
to Section 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 8.05 hereof; provided, however, that, if the Company
makes any payment of principal of or premium, if any, or interest
on any Note following 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 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 or the Notes without the consent of any Holder of a
Note:
(a) to cure any ambiguity, defect or inconsistency;
(b) to provide for uncertificated Notes in addition to
or in place of certificated Notes;
(c) to provide for the assumption of the Company's
obligations to the Holders of the Notes pursuant to Article
5 hereof;
(d) to secure the Notes pursuant to the requirements
of Section 4.12 or otherwise;
(e) to make any change that would provide any
additional rights or benefits to the Holders of the Notes or
that does not materially adversely affect the legal rights
hereunder of any Holder of the Note;
(f) to comply with Article 10 hereof; or
(g) to comply with requirements of the SEC in order to
effect or maintain the qualification of this Indenture under
the TIA.
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 shall 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 shall 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,
the Guarantors and the Trustee may amend or supplement this
Indenture and the Notes may be amended or supplemented with the
consent of the Holders of at least a majority in principal amount
of the Notes then outstanding (including, without limitation,
consents obtained in connection with a purchase of, or tender
offer or exchange offer for the Notes), and, subject to Sections
6.04 and 6.07 hereof, any existing Default or Event of Default or
compliance with any provision of this Indenture or the Notes may
be waived with the consent of the Holders of a majority in
principal amount of the then outstanding Notes (including
consents obtained in connection with a tender offer or exchange
offer for the Notes).
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 9.06 hereof, the
Trustee shall join with the Company and the Guarantors in the
execution of such amended or supplemental indenture unless such
amended or supplemental indenture affects the Trustee's own
rights, duties or immunities under this Indenture or otherwise,
in which case the Trustee may in its discretion, but shall not be
obligated to, enter into such amended or supplemental indenture.
It shall 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, supplement or waiver, but it shall be
sufficient if such consent approves the substance thereof.
After an amendment, supplement or waiver under this Section
becomes effective, the Company shall 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, shall 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 principal amount of the Notes then
outstanding 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, supplement or waiver may not (with respect to any
Notes held by a non-consenting Holder):
(a) reduce the principal amount of Notes whose Holders
must consent to an amendment, supplement or waiver;
(b) reduce the principal of or change the fixed
maturity of any Note or alter any of the provisions with
respect to the redemption or purchase of the Notes by the
Company (except as provided in Sections 3.09, 4.10 and 4.15
hereof);
(c) reduce the rate of or change the time for payment
of interest on any Note;
(d) waive a Default or Event of Default in the payment
of principal of or premium, interest 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 principal
amount of the Notes and a waiver of the payment default that
resulted from such acceleration);
(e) make any Note payable in money other than that
stated in the Notes;
(f) make any change in the provisions of this
Indenture relating to waivers of past Defaults or Events of
Default or the rights of Holders of Notes to receive
payments of principal of or premium, interest or Liquidated
Damages, if any, on the Notes (except as permitted in clause
(g) below);
(g) waive a redemption payment with respect to any
Note (other than a payment required by Sections 4.10 and
4.15 hereof);
(h) make any change in the ranking of the Notes
relative to other Indebtedness of the Company or in the
Subsidiary Guarantees relative to other Indebtedness of the
Guarantors, in either case in a manner adverse to the
Holders of Notes; or
(i) make any change in the foregoing amendment,
supplement and waiver provisions.
Section 9.03. Compliance with Trust Indenture Act.
Every amendment or supplement to this Indenture or the Notes
shall 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 authenticate new Notes that reflect the
amendment, supplement or waiver.
Failure to make the appropriate notation or issue a new Note
shall not affect the validity and effect of such amendment,
supplement or waiver.
Section 9.06. Trustee to Sign Amendments, etc.
The Trustee shall 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 be entitled to receive and (subject
to Section 7.01) shall be fully protected in relying upon, 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.
ARTICLE 10
GUARANTEES OF NOTES
Section 10.01. Subsidiary Guarantees.
Subject to Section 10.06 hereof, the Guarantors hereby,
jointly and severally, unconditionally guarantee 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 held
thereby and the Obligations of the Company hereunder and
thereunder, that: (a) the principal of and premium, interest and
Liquidated Damages, if any, on the Notes will be promptly paid in
full when due, subject to any applicable grace period, whether at
maturity, by acceleration, redemption or otherwise, and interest
on the overdue principal of and premium, (to the extent permitted
by law) interest and Liquidated Damages, if any, on the Notes,
and all other payment Obligations of the Company to the Holders
or the Trustee hereunder or thereunder will be promptly paid in
full and performed, all in accordance with the terms hereof and
thereof; and (b) in case of any extension of time of payment or
renewal of any Notes or any of such other Obligations, the same
will be promptly paid in full when due or performed in accordance
with the terms of the extension or renewal, subject to any
applicable grace period, whether at stated maturity, by
acceleration, redemption or otherwise. Failing payment when so
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. An Event of Default under
this Indenture or the Notes shall constitute an event of default
under the Subsidiary Guarantees, and shall entitle the Holders to
accelerate the obligations of the Guarantors hereunder in the
same manner and to the same extent as the Obligations of the
Company. The Guarantors hereby agree that their obligations
hereunder shall be 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 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 (other than complete
performance) which might otherwise constitute a legal or
equitable discharge or defense of a Guarantor. Each Guarantor
further, to the extent permitted by law, 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 covenants that its
Subsidiary Guarantee will not be discharged except by complete
performance of the Obligations contained in the Notes and this
Indenture. If any Holder or the Trustee is required by any court
or otherwise to return to the Company, the Guarantors, or any
Custodian, Trustee or other similar official acting in relation
to either the Company or the Guarantors, any amount paid by the
Company or any Guarantor to the Trustee or such Holder, the
Subsidiary Guarantees, to the extent theretofore discharged,
shall be reinstated in full force and effect. Each Guarantor
agrees that it shall not be entitled to, and hereby waives, any
right of subrogation in relation to the Holders in respect of any
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, (a) the maturity of the
Obligations guaranteed hereby may be accelerated as provided in
Article 6 hereof for the purposes of its Subsidiary Guarantee,
notwithstanding any stay, injunction or other prohibition
preventing such acceleration in respect of the Obligations
guaranteed thereby, and (b) 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) shall forthwith
become due and payable by the Guarantor for the purpose of its
Subsidiary Guarantee. 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 Guarantees.
Section 10.02. Execution and Delivery of Subsidiary Guarantee.
To evidence its Subsidiary Guarantee set forth in Section
10.01 hereof, each Guarantor hereby agrees that a notation of
such Subsidiary Guarantee substantially in the form of Exhibit D
hereto shall be endorsed by manual or facsimile signature by an
Officer of such Guarantor on each Note authenticated and
delivered by the Trustee and that this Indenture shall be
executed on behalf of such Guarantor by an Officer of such
Guarantor.
To the extent required by the provisions of Section 4.13
hereof, the Company shall cause each of its Restricted
Subsidiaries to execute a Subsidiary Guarantee substantially in
the form of Exhibit D. Such Subsidiary Guarantee shall be
accompanied by a supplemental indenture substantially in the form
of Exhibit E, along with the Opinion of Counsel and Officers'
Certificate required under Section 9.06 of this Indenture;
provided, however, that any Subsidiary that has been properly
designated as an Unrestricted Subsidiary in accordance with this
Indenture need not execute a Subsidiary Guarantee for so long as
it continues to constitute an Unrestricted Subsidiary.
Each Guarantor hereby agrees that its Subsidiary Guarantee
shall 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 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 shall be valid nevertheless.
The delivery of any Note by the Trustee, after the
authentication thereof hereunder, shall constitute due delivery
of the Subsidiary Guarantees on behalf of the Guarantors.
Section 10.03. Guarantors May Consolidate, etc., on Certain
Terms.
(a) Except as set forth in Articles 4 and 5 hereof, nothing
contained in this Indenture shall prohibit a merger between a
Guarantor and another Guarantor or a merger between a Guarantor
and the Company.
(b) No Guarantor shall 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),
whether or not affiliated with such Guarantor, unless,
(i) subject to the provisions of Section 10.04 hereof, the Person
formed by or surviving any such consolidation or merger (if other
than such Guarantor) assumes all the obligations of such
Guarantor pursuant to a supplemental indenture, substantially in
the form of Exhibit E hereto, under the Notes and this Indenture;
(ii) immediately after giving effect to such transaction, no
Default or Event of Default exists; (iii) such Guarantor, or any
Person formed by or surviving any such consolidation or merger,
would have Consolidated Net Worth (immediately after giving
effect to such transaction), equal to or greater than the
Consolidated Net Worth of such Guarantor immediately preceding
the transaction; and (iv) the Company, at the time of such
transaction and after giving pro forma effect thereto as if such
transaction had occurred at the beginning of the applicable four-
quarter period, would be permitted to incur at least $1.00 of
additional Indebtedness pursuant to the Consolidated Interest
Coverage Ratio test set forth in the first paragraph of Section
4.09 hereof.
(c) In the case of any such consolidation or merger and
upon the assumption by the successor Person, by supplemental
indenture, executed and delivered to the Trustee and
substantially in the form of Exhibit E hereto, of the Subsidiary
Guarantee and the due and punctual performance of all of the
covenants of this 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; provided, however, that, solely for purposes of
computing Consolidated Net Income for purposes of clause (c) of
the first paragraph of Section 4.07 hereof, the Consolidated Net
Income of any Person other than the Company and its Restricted
Subsidiaries shall only be included for periods subsequent to the
effective time of such merger or consolidation. Such successor
Person thereupon may cause to be signed any or all of the
notations of 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 of the
Subsidiary Guarantees so issued shall 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.
Section 10.04. Releases Following Sale of Assets.
In the event of a sale or other disposition of all or
substantially all of the properties or assets or all of the
Capital Stock of any Guarantor, by way of merger, consolidation
or otherwise, then such Guarantor (in the event of a sale or
other disposition, by way of such a merger, consolidation or
otherwise, of all of the Capital Stock of such Guarantor) or the
Person acquiring the assets (in the event of a sale or other
disposition of all or substantially all of the properties or
assets of such Guarantor) shall be released and relieved of any
obligations under its Subsidiary Guarantee; provided, however,
that (i) in the event such transaction constitutes an Asset Sale,
the Net Proceeds from such sale or other disposition are treated
in accordance with the provisions of Section 4.10 hereof and (ii)
the Company is in compliance with all other provisions of this
Indenture applicable to such disposition. Upon delivery by the
Company to the Trustee of an Officers' Certificate to the effect
of the foregoing, the Trustee shall execute any documents
reasonably required in order to evidence the release of any
Guarantor from its obligations under its Subsidiary Guarantee.
Any Guarantor not released from its obligations under its
Subsidiary Guarantee shall remain liable for the full amount of
principal of and premium, interest and Liquidated Damages, if
any, on the Notes and for the other Obligations of such Guarantor
under this Indenture as provided in this Article 10.
Section 10.05. Releases Following Designation as an Unrestricted
Subsidiary.
In the event that the Company designates a Guarantor to be
an Unrestricted Subsidiary, then such Guarantor shall be released
and relieved of any obligations under its Subsidiary Guarantee;
provided, however, that such designation is conducted in
accordance with this Indenture.
Section 10.06. Limitation on Guarantor Liability.
For purposes hereof, each Guarantor's liability under its
Subsidiary Guarantee shall be limited to the lesser of (a) the
aggregate amount of the Obligations of the Company under the
Notes and this Indenture and (b) the amount, if any, which would
not have (i) rendered such Guarantor "insolvent" (as such term is
defined in the Bankruptcy Law and in the Debtor and Creditor Law
of the State of New York) or (ii) left such Guarantor with
unreasonably small capital at the time its Subsidiary Guarantee
of the Notes was entered into; provided, however, that, it will
be a presumption in any lawsuit or other proceeding in which a
Guarantor is a party that the amount guaranteed pursuant to the
Subsidiary Guarantee is the amount set forth in clause (a) above
unless any creditor, or representative of creditors of such
Guarantor, or debtor in possession or trustee in bankruptcy of
the Guarantor, otherwise proves in such a lawsuit that the
aggregate liability of the Guarantor is the amount set forth in
clause (b) above. In making any determination as to solvency or
sufficiency of capital of a Guarantor in accordance with the
previous sentence, the right of such Guarantor to contribution
from other Guarantors, and any other rights such Guarantor may
have, contractual or otherwise, shall be taken into account.
Section 10.07. "Trustee" to Include Paying Agent.
In case at any time any Paying Agent other than the Trustee
shall have been appointed by the Company and be then acting
hereunder, the term "Trustee" as used in this Article 10 shall in
each case (unless the context shall otherwise require) be
construed as extending to and including such Paying Agent within
its meaning as fully and for all intents and purposes as if such
Paying Agent were named in this Article 10 in place of the
Trustee.
ARTICLE 11
MISCELLANEOUS
Section 11.01. Trust Indenture Act Controls.
If any provision of this Indenture limits, qualifies or
conflicts with the duties imposed by TIA <section sign>318(c),
the imposed duties shall control.
Section 11.02. Notices.
Any notice or communication by the Company, any Guarantor or
the Trustee to the others is duly given if in writing (in the
English language) 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 or the Guarantors:
American Eco Corporation
11011 Jones Road
Houston, Texas 77070
Attention: Chief Administrative Officer
Telecopier No.: (281) 774-7006
If to the Trustee:
State Street Bank and Trust Company
Goodwin Square
225 Asylum Street
Hartford, Connecticut 06103
Telecopier No.: (860) 244-1889
Attention: Corporate Trust Administration
Ref: American Eco Corporation
The Company, any of the Guarantors 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) shall 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 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 shall 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 shall also be so mailed
to any Person described in TIA <section sign> 313(c), to the
extent required by the TIA. Failure to mail a notice or
communication to a Holder or any defect in it shall 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 shall mail a copy to the Trustee and each Agent at the same
time.
Section 11.03. Communication by Holders of Notes with Other
Holders of Notes.
Holders may communicate pursuant to TIA <section
sign> 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 sign> 312(c).
Section 11.04. 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, the Company
shall furnish to the Trustee:
(a) an Officers' Certificate in form and substance
reasonably satisfactory to the Trustee (which shall include
the statements set forth in Section 11.05 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
(b) an Opinion of Counsel in form and substance
reasonably satisfactory to the Trustee (which shall include
the statements set forth in Section 11.05 hereof) stating
that, in the opinion of such counsel, all such conditions
precedent and covenants have been satisfied.
Section 11.05. 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
sign> 314(a)(4)) shall comply with the provisions of TIA <section
sign> 314(e) and shall include:
(a) a statement that the Person making such certi-
ficate or opinion has read such covenant or condition;
(b) 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;
(c) 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
(d) a statement as to whether or not, in the opinion
of such Person, such condition or covenant has been
satisfied.
Section 11.06. 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 11.07. No Personal Liability of Directors, Officers,
Employees and Shareholders.
No past, present or future director, officer, employee,
incorporator, member, partner or shareholder or other owner of
Capital Stock of the Company or any Guarantor, as such, shall
have any liability for any obligations of the Company or any
Guarantor under the Notes, the Subsidiary Guarantees, this
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 issuance of the Notes.
Section 11.08. Governing Law.
THE LAW OF THE STATE OF NEW YORK SHALL GOVERN AND BE USED TO
CONSTRUE AND ENFORCE THIS INDENTURE, THE NOTES AND THE SUBSIDIARY
GUARANTEES.
Section 11.09. 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
Restricted Subsidiaries or of any other Person. Any such
indenture, loan or debt agreement may not be used to interpret
this Indenture.
Section 11.10. Successors.
All agreements of the Company and the Guarantors in this
Indenture and the Notes shall bind their successors. All
agreements of the Trustee in this Indenture shall bind its
successors.
Section 11.11. Severability.
In case any provision in this Indenture or in the Notes
shall be invalid, illegal or unenforceable, the validity,
legality and enforceability of the remaining provisions shall not
in any way be affected or impaired thereby.
Section 11.12. Counterpart Originals.
The parties may sign any number of copies of this
Indenture. Each signed copy shall be an original, but all of
them together represent the same agreement.
Section 11.13. 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 shall in no way modify or restrict any
of the terms or provisions hereof.
Section 11.14. Consent to Jurisdiction.
Each of the Company and the Guarantors irrevocably submits
to the non-exclusive jurisdiction of any New York state court
located in the Borough of Manhattan in the City and State of New
York over any suit, action or proceeding arising out of or
relating to this Indenture or any Guarantee or Note. Each of the
Company and the Guarantors irrevocably waives, to the fullest
extent permitted by law, any objection which it may have to the
laying of the venue of any such suit, action or proceeding
brought in such a court and any claim that any such suit, action
or proceeding brought in such a court has been brought in any
inconvenient forum.
Nothing in this Section shall limit the right of the Trustee
or any Holder to bring proceedings against the Company or any
Guarantor in the courts of any other jurisdiction.
[Signatures on following page]
SIGNATURES
AMERICAN ECO CORPORATION
By /s/ David L. Norris
--------------------------------
David L. Norris
Senior Vice President and Chief
Administrative Officer
Chempower, Inc.
Specialty Management Group, Inc.
C.A. Turner Construction Company
Action Contract Services, Inc.
Cambridge Construction Service Corp.
Lake Charles Construction Corporation
United Eco Systems, Inc.
Separation and Recovery Systems, Inc.
Industra Service Corp.
MM Industra Limited
The Turner Group, Inc.
C.A. Turner Maintenance, Inc.
H.E. Co. Services, Inc.
Eco Systems, Inc.
Industra Service Corporation
Industra Engineers & Consultants, Inc.
Industra Thermal Service Corporation
NUS, Inc.
Industra, Inc.
Industra Thermal Service Corp.
Global Power Company
Brookfield Corporation
Southwick Corporation
Controlled Power Limited Partnership
Separation and Recovery Systems
Limited
By /s/ David L. Norris
--------------------------------
David L. Norris
Vice President
State Street Bank and Trust
Company, as Trustee
By /s/ Susan Merker
--------------------------------
Susan Merker
Assistant Vice President
EXHIBIT A-1
(Face of Note)
9 5/8% [SERIES A] [SERIES B] SENIOR NOTES DUE 2008
No. $
---------------
CUSIP NO.
AMERICAN ECO CORPORATION
promises to pay to or registered assigns, the
----------
principal sum of Dollars on May 15, 2008.
-----------
Interest Payment Dates: May 15 and November 15
Record Dates: May 1 and November 1
AMERICAN ECO CORPORATION
By
---------------------------
Name:
Title:
Trustee's Certificate of Authentication:
This is one of the Notes referred
to in the within-mentioned Indenture.
State Street Bank
and Trust Company, as Trustee
By
--------------------------------
Authorized Signatory
Dated:
----------------------
(Back of Note)
9 5/8% [SERIES A][SERIES B] SENIOR NOTES DUE 2008
[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 Depository to a nominee of the Depository or by
a nominee of the Depository to the Depository or another nominee
of the Depository or by the Depository or any such nominee to a
successor Depository or a nominee of such successor Depository.
Unless this certificate is presented by an authorized
representative of The Depository Trust Company (55 Water Street,
New York, New York) ("DTC"), to the issuer 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 in as much
as the registered owner hereof, Cede & Co., has an interest
herein.]<footnote1>
[THE SECURITY (OR ITS PREDECESSOR) EVIDENCED HEREBY WAS
ORIGINALLY ISSUED IN A TRANSACTION EXEMPT FROM REGISTRATION
UNDER SECTION 5 OF THE UNITED STATES SECURITIES ACT OF
1933, AS AMENDED (THE "SECURITIES ACT"), AND THE SECURITY
EVIDENCED HEREBY MAY NOT BE OFFERED, SOLD OR OTHERWISE
TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR AN
APPLICABLE EXEMPTION THEREFROM. EACH PURCHASER OF THE
SECURITY EVIDENCED HEREBY IS HEREBY NOTIFIED THAT THE
SELLER MAY BE RELYING ON THE EXEMPTION FROM THE PROVISIONS
OF SECTION 5 OF THE SECURITIES ACT PROVIDED BY RULE 144A
THEREUNDER. THE HOLDER OF THE SECURITY EVIDENCED HEREBY
AGREES FOR THE BENEFIT OF THE COMPANY THAT (A) SUCH
SECURITY MAY BE RESOLD, PLEDGED OR OTHERWISE TRANSFERRED,
ONLY (1) (a) TO A PERSON WHO 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, (b) IN A TRANSACTION MEETING THE
REQUIREMENTS OF RULE 144 UNDER THE SECURITIES ACT, (c)
OUTSIDE THE UNITED STATES TO A NON-U.S. PERSON IN A
TRANSACTION MEETING THE REQUIREMENTS OF RULE 904 OF THE
SECURITIES ACT OR (d) IN ACCORDANCE WITH ANOTHER EXEMPTION
FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT
(AND BASED UPON AN OPINION OF COUNSEL IF THE COMPANY SO
REQUESTS), (2) TO THE COMPANY OR (3) PURSUANT TO AN
EFFECTIVE REGISTRATION STATEMENT AND, IN EACH CASE, IN
ACCORDANCE WITH ANY APPLICABLE SECURITIES LAWS OF ANY STATE
OF THE UNITED STATES OR ANY OTHER APPLICABLE JURISDICTION
AND (B) THE HOLDER WILL, AND EACH SUBSEQUENT HOLDER IS
REQUIRED TO, NOTIFY ANY PURCHASER FROM IT OF THE SECURITY
EVIDENCED HEREBY OF THE RESALE RESTRICTIONS SET FORTH IN
(A) ABOVE.]<footnote2>
1. This paragraph should be included only if the Note is issued
in global form.
2. This paragraph should be removed upon the exchange of Series A
Notes for Series B Notes in an Exchange Offer or upon the
transfer of the Series A Notes that have been sold pursuant to
the terms of the shelf registration contemplated by the
Registration Rights Agreement.
1. Interest. American Eco Corporation, an Ontario, Canada
corporation (the "Company"), promises to pay interest on the
principal amount of this Note at 9 5/8% per annum from ,
--- ----
until maturity and shall pay the Liquidated Damages payable
pursuant to Section 5 of the Registration Rights Agreement
referred to below. The Company will pay interest and Liquidated
Damages, if any, semi-annually in arrears on May 15 and
November 15 of each year, commencing , , 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 original
issuance; provided that if there is no existing Default or Event
of 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,
except in the case of the original issuance of Notes, in which
case interest shall accrue from the date of authentication. The
Company shall 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
the rate then in effect; it shall 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 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 to the
Persons who are registered Holders of Notes at the close of
business on the May 1 or November 1 next preceding the Interest
Payment Date, even if such Notes are cancelled 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 the
City and State of New York, or, at the option of the Company,
payment of interest and Liquidated Damages may be made by check
mailed to the Holders at their addresses set forth in the
register of Holders, and provided that payment by wire transfer
of immediately available funds will be required with respect to
principal of and interest, premium and Liquidated Damages on all
Global Notes and all other Notes the Holders of which shall have
provided wire transfer instructions to the Company or the Paying
Agent. Such payment shall 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, State Street Bank
and Trust Company, 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 May 21, 1998 ("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 <section sign><section sign> 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. The Notes
are general unsecured obligations of the Company limited to
$120,000,000 aggregate principal amount in the case of Notes
issued on the Issue Date (as defined in the Indenture).
5. Optional Redemption.
(a) Except as set forth in subparagraph (b) or (c) of this
Paragraph 5, the Company shall not have the option to redeem the
Notes prior to May 15, 2003. Thereafter, the Company shall have
the option to redeem the Notes, in whole or in part, 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
thereon to the applicable redemption date, if redeemed during the
twelve-month period beginning on May 15 of the years indicated
below:
YEAR PERCENTAGE
---- ----------
2003 . . . . . . . . . . . . . . . . . 104.813%
2004 . . . . . . . . . . . . . . . . . 103.208%
2005 . . . . . . . . . . . . . . . . . 101.604%
2006 and thereafter . . . . . . . . . . 100.000%
(b) Notwithstanding the provisions of subparagraph (a) of
this Paragraph 5, at any time prior to May 15, 2001, the Company
may redeem up to 35% of the aggregate principal amount of Notes
originally issued at a redemption price of 109.625% of the
principal amount thereof, plus accrued and unpaid interest and
Liquidated Damages, if any, thereon to the redemption date, with
the net cash proceeds of one or more Qualified Equity Offerings;
provided that (a) at least 65% of the aggregate principal amount
of Notes originally issued remains outstanding immediately after
the occurrence of each such redemption and (b) each such
redemption shall occur within 60 days of the date of the closing
of each such Qualified Equity Offering.
(c) The Company may at any time redeem, in whole but not in
part, the Notes at a redemption price of 100% of the principal
amount thereof plus accrued and unpaid interest and Liquidated
Damages, if any, thereon to the date of redemption if it has
become or would become obligated to pay any Additional Amounts in
respect of the Notes as a result of (a)(i) any change in or
amendment to the laws (or regulations promulgated thereunder) of
Canada (or any political subdivision or taxing authority thereof
or therein) or (ii) any change in or amendment to any official
position regarding the application or interpretation of such laws
or regulations, which change or amendment is announced or is
effective on or after the date of the Indenture and (b) such
obligation cannot be avoided by the Company taking reasonable
measures available to it.
6. Mandatory Redemption.
Except as set forth in paragraph 7 below, the Company shall
not be required to make mandatory redemption or sinking fund
payments with respect to the Notes.
7. Put Option of Holder.
(a) If there is a Change of Control, the Company shall be
required to make an offer (a "Change of Control Offer") to
purchase all or any portion (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 to the date of purchase (the "Change of Control
Payment"). Within 30 days following any Change of Control, the
Company shall mail a notice to each Holder describing the
transaction that constitutes the Change of Control and setting
forth the procedures governing the Change of Control Offer as
required by the Indenture.
(b) If the Company or a Restricted Subsidiary consummates
any Asset Sales, within 30 days of each date on which the
aggregate amount of Excess Proceeds exceeds $5.0 million, the
Company shall commence an offer to all Holders of Notes (an
"Asset Sale Offer") pursuant to Section 3.09 of the Indenture to
purchase the maximum principal amount of Notes 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, if any,
thereon to the date of purchase, in accordance with the
procedures set forth in the Indenture; provided, however, that,
if the Company is required to apply such Excess Proceeds to
purchase, or to offer to purchase, any Pari Passu Indebtedness,
the Company shall only be required to offer to purchase the
maximum principal amount of Notes that may be purchased out of
the amount of such Excess Proceeds multiplied by a fraction, the
numerator of which is the aggregate principal amount of Notes
outstanding and the denominator of which is the aggregate
principal amount of Notes outstanding plus the aggregate
principal amount of Pari Passu Indebtedness outstanding. To the
extent that the aggregate principal amount of Notes tendered
pursuant to an Asset Sale Offer is less than the Excess Proceeds,
the Company (or such Subsidiary) may use such deficiency for
general corporate purposes in any manner not prohibited by the
Indenture. If the aggregate principal amount of Notes surrendered
by Holders thereof exceeds the amount of Excess Proceeds, the
Trustee shall select the Notes to be purchased on a pro rata
basis (with such adjustments as may be deemed appropriate by the
Trustee so that only Notes in denominations of $1,000, or
integral multiples thereof, shall be purchased). 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, it 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 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
any existing default or compliance with any provision of the
Indenture or the Notes may be waived with the consent of the
Holders of a majority in principal amount of the then outstanding
Notes. Without the consent of any Holder of a Note, the
Indenture 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, to
provide for the assumption of the Company's obligations to
Holders of the Notes in case of a merger or consolidation, to
make any change that would provide any additional rights or
benefits to the Holders of the Notes or that does not materially
adversely affect the legal rights under the Indenture of any such
Holder, to add any additional Guarantor or to release any
Guarantor from its Subsidiary Guarantee, in each case as provided
in the Indenture, or to comply with the requirements of the
Commission in order to effect or maintain the qualification of
the Indenture under the Trust Indenture Act.
12. Defaults and Remedies. Events of Default include: (i)
default for 30 days in the payment when due of interest or
Liquidated Damages on the Notes; (ii) default in payment when due
of the principal of or premium, if any, on the Notes; (iii)
failure by the Company to comply with Section 4.10, 4.15 or 5.01
of the Indenture; (iv) failure by the Company for 60 days after
notice to comply with any of its other agreements in the
Indenture or the Notes; (v) default under any mortgage, indenture
or instrument under which there may be issued or by which there
may be secured or evidenced any Indebtedness for money borrowed
by the Company or any of its Restricted Subsidiaries (or the
payment of which is guaranteed by the Company or any of its
Restricted Subsidiaries), whether such Indebtedness or guarantee
now exists or is created after the date of the Indenture, which
default (a) is caused by a failure to pay principal of or premium
or interest on such Indebtedness prior to the expiration of any
grace period provided in such Indebtedness, including any
extension thereof (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 in excess of $5.0
million (or the equivalent thereof in any other currency or
currency unit), and provided, further, that if such default is
cured or waived or any such acceleration rescinded, or such
Indebtedness is repaid within a period of 10 days from the
continuation of such default beyond the applicable grace period
or the occurrence of such acceleration, as the case may be, an
Event of Default and any consequential acceleration of the Notes
shall be automatically rescinded, so long as said rescission does
not conflict with any judgment or decree; (vi) failure by the
Company or any of its Restricted Subsidiaries to pay final
judgments aggregating in excess of $5.0 million (or the
equivalent thereof in any other currency or currency unit), which
judgments are not paid, discharged or stayed for a period of 60
days; (vii) failure by any Guarantor to perform any covenant set
forth in its Subsidiary Guarantee, or the repudiation by any
Guarantor of its obligations under its Subsidiary Guarantee or
the unenforceability of any Subsidiary Guarantee against a
Guarantor for any reason; and (viii) certain events of bankruptcy
or insolvency with respect to the Company or any Significant
Subsidiary. If any 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, by notice, declare all the Notes
to be due and payable. Notwithstanding the foregoing, in the case
of an Event of Default arising from certain events of bankruptcy
or insolvency, all outstanding Notes will become due and payable
without further action or notice. Holders may not enforce the
Indenture or the Notes except as provided in the Indenture.
Subject to certain limitations, Holders of a majority in
principal amount of the then outstanding Notes may direct the
Trustee in its exercise of any trust or power. The Trustee may
withhold from Holders of the Notes notice of any continuing
Default or Event of Default (except a Default or Event of Default
relating to the payment of principal or interest) if it
determines that withholding notice is in their interest. The
Holders of a majority in aggregate principal amount of the Notes
then outstanding by notice to the Trustee may on behalf of the
Holders of all of the Notes waive any existing Default or Event
of Default and its consequences under the Indenture except a
continuing Default or Event of Default in the payment of the
principal of or premium, interest or Liquidated Damages, if any,
on the Notes. The Company is required to deliver to the Trustee
annually a statement regarding compliance with the Indenture, and
the Company is required upon becoming aware of any Default or
Event of Default, to deliver to the Trustee a statement
specifying such Default or Event of Default.
13. Defeasance. The Notes are subject to defeasance upon
the terms and conditions specified in the Indenture.
14. 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.
15. No Recourse Against Others. A director, officer,
employee, incorporator, member, partner or shareholder or other
owner of capital stock of the Company or any Guarantor, as such,
shall not have any liability for any obligations of the Company
or any 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 shall not be valid until
authenticated by the manual signature of an authorized signatory
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 Transfer Restricted
Securities. In addition to the rights provided to Holders of
Notes under the Indenture, Holders of Transfer Restricted
Securities shall have all the rights set forth in the
Registration Rights Agreement dated as of even date with the
Indenture, among the Company, the Guarantors and the Initial
Purchasers named on the signature page 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.
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:
American Eco Corporation
11011 Jones Road
Houston, Texas 77070
Attention: Chief Administrative Officer
ASSIGNMENT FORM
To assign this Note, fill in the form below: (I) or (we)
assign and transfer this Note to
-----------------------------------------------------------------
(Insert assignee's soc. sec. or tax I.D. no.)
-----------------------------------------------------------------
-----------------------------------------------------------------
-----------------------------------------------------------------
-----------------------------------------------------------------
(Print or type assignee's name, address and zip code)
and irrevocably appoint
------------------------------------------
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:
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 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 Note)
Soc. sec. or
Tax Identification No.:
--------------
Signature Guarantee:
SCHEDULE OF EXCHANGES OF NOTES<footnote3>
THE FOLLOWING EXCHANGES OF A PART OF THIS GLOBAL NOTE FOR OTHER
NOTES HAVE BEEN MADE:
Principal
Amount of
this Global Signature
Amount of Amount of Note of
decrease in increase in following authorized
Principal Principal such officer of
Amount of Amount of decrease Trustee or
Date of this Global this Global (or Note
Exchange Note Note increase) Custodian
--------- ----------- --------- ----------- ----------
3. This should be included only if the Note is issued in global
form.
EXHIBIT A-2
(Face of Regulation S Temporary Global Note)
9 5/8% [SERIES A][SERIES B] SENIOR NOTES DUE 2008
No. $
---------------
CUSIP NO.
AMERICAN ECO CORPORATION
promises to pay to Cede & Co. or registered assigns, the
principal sum of Dollars on May 15, 2008.
------
Interest Payment Dates: May 15 and November 15
Record Dates: May 1 and November 1
AMERICAN ECO CORPORATION
By
----------------------------------
Name:
Title:
Trustee's Certificate of Authentication:
This is one of the Notes referred
to in the within-mentioned Indenture.
State Street Bank
and Trust Company, as Trustee
By:
--------------------------------
Authorized Signatory
Dated:
---------------------
(Back of Regulation S Temporary Global Note)
9 5/8% [SERIES A][SERIES B] SENIOR NOTE DUE 2008
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 DEPOSITORY TO A NOMINEE OF THE DEPOSITORY OR BY
A NOMINEE OF THE DEPOSITORY TO THE DEPOSITORY OR ANOTHER NOMINEE
OF THE DEPOSITORY OR BY THE DEPOSITORY OR ANY SUCH NOMINEE TO A
SUCCESSOR DEPOSITORY OR A NOMINEE OF SUCH SUCCESSOR DEPOSITORY.
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY (55 WATER STREET,
NEW YORK, NEW YORK) ("DTC"),TO THE ISSUER 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.
THE SECURITY (OR ITS PREDECESSOR) EVIDENCED HEREBY WAS
ORIGINALLY ISSUED IN A TRANSACTION EXEMPT FROM REGISTRATION UNDER
SECTION 5 OF THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED
(THE "SECURITIES ACT"), AND THE SECURITY EVIDENCED HEREBY MAY NOT
BE OFFERED, SOLD OR OTHERWISE TRANSFERRED IN THE ABSENCE OF SUCH
REGISTRATION OR AN APPLICABLE EXEMPTION THEREFROM. EACH
PURCHASER OF THE SECURITY EVIDENCED HEREBY IS HEREBY NOTIFIED
THAT THE SELLER MAY BE RELYING ON THE EXEMPTION FROM THE
PROVISIONS OF SECTION 5 OF THE SECURITIES ACT PROVIDED BY RULE
144A THEREUNDER. THE HOLDER OF THE SECURITY EVIDENCED HEREBY
AGREES FOR THE BENEFIT OF THE COMPANY THAT (A) SUCH SECURITY MAY
BE RESOLD, PLEDGED OR OTHERWISE TRANSFERRED, ONLY (1) (a) TO A
PERSON WHO 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,
(b) IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 144 UNDER
THE SECURITIES ACT, (c) OUTSIDE THE UNITED STATES TO A NON-U.S.
PERSON IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 904 OF
THE SECURITIES ACT OR (d) IN ACCORDANCE WITH ANOTHER EXEMPTION
FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT (AND
BASED UPON AN OPINION OF COUNSEL IF THE COMPANY SO REQUESTS),
(2) TO THE COMPANY OR (3) PURSUANT TO AN EFFECTIVE REGISTRATION
STATEMENT AND, IN EACH CASE, IN ACCORDANCE WITH ANY APPLICABLE
SECURITIES LAWS OF ANY STATE OF THE UNITED STATES OR ANY OTHER
APPLICABLE JURISDICTION AND (B) THE HOLDER WILL, AND EACH
SUBSEQUENT HOLDER IS REQUIRED TO, NOTIFY ANY PURCHASER FROM IT OF
THE SECURITY EVIDENCED HEREBY OF THE RESALE RESTRICTIONS SET
FORTH IN (A) ABOVE.
THE RIGHTS ATTACHING TO THIS REGULATION S TEMPORARY GLOBAL
NOTE, AND THE CONDITIONS AND PROCEDURES GOVERNING ITS EXCHANGE
FOR DEFINITIVE 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 OR LIQUIDATED DAMAGES PRIOR TO THE
EXCHANGE OF THIS NOTE FOR A REGULATION S PERMANENT GLOBAL NOTE AS
CONTEMPLATED BY THE INDENTURE.
American Eco Corporation, an Ontario, Canada corporation
(the "Company"), promises to pay interest on the principal amount
of this Note at the rate of 9 5/8% per annum from
-------------
until maturity and shall pay the Liquidated Damages payable
pursuant to Section 5 of the Registration Rights Agreement
referred to in the Indenture. The Company will pay interest and
Liquidated Damages, if any, in United States dollars semi-
annually in arrears on May 15 and November 15, commencing on
, 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 shall accrue from the most recent date to
which interest has been paid or, if no interest has been paid,
from the date of original issuance; provided that if there is no
existing Default or Event of 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, except in the case of the original issuance of
Notes, in which case interest shall accrue from the date of
authentication. The Company shall 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 equal to the then applicable interest rate on the
Notes; it shall 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) from time to time on demand at the same
rate to the extent lawful. Interest shall be computed on the
basis of a 360-day year comprised of twelve 30-day months.
This Regulation S Temporary Global Note is issued in respect
of an issue of 9 5/8% [Series A] [Series B] Senior Notes due 2008
(the "Notes") of the Company, limited to, in the case of Notes
issued on the Issue Date (as defined in the Indenture),
$120,000,000 in aggregate principal amount, plus amounts, if any,
sufficient to pay premium, if any, interest or Liquidated
Damages, if any on outstanding Notes. The Company has issued the
Notes under an Indenture (the "Indenture") dated as of May 21,
1998, among the Company, the Guarantors and the Trustee. This
Regulation S Temporary Global Note is governed by the terms and
conditions of the Indenture governing the Notes, which terms and
conditions are incorporated herein by reference and, except as
otherwise provided herein, shall be binding on the Company and
the Holder hereof as if fully set forth herein. Unless the
context otherwise requires, the terms used herein shall have the
meanings specified in the Indenture.
Until this Regulation S Temporary Global Note is exchanged
for Regulation S Permanent Global Notes, the Holder hereof shall
not be entitled to receive payments of interest or Liquidated
Damages, if any, hereon although interest and Liquidated Damages,
if any, will continue to accrue; until so exchanged in full, this
Regulation S Temporary Global Note shall in all other respects be
entitled to the same benefits as other Notes under the Indenture.
This Regulation S Temporary Global Note is exchangeable in
whole or in part for one or more Regulation S Permanent 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 required by Article 2 of the
Indenture. Upon exchange of this Regulation S Temporary Global
Note for one or more Regulation S Permanent Global Notes, the
Trustee shall cancel this Regulation S Temporary Global Note.
This Regulation S Temporary Global Note shall not become
valid or obligatory until the certificate of authentication
hereon shall have been duly manually signed by an authorized
signatory the Trustee in accordance with the Indenture. This
Regulation S Temporary Global Note shall be governed by and
construed in accordance with the laws of the State of the New
York. All references to "$," "Dollars," "dollars" or "U.S. $"
are to such coin or currency of the United States of America as
at the time shall be legal tender for the payment of public and
private debts therein.
SCHEDULE OF EXCHANGES FOR GLOBAL NOTES
The following exchanges of a part of this Regulation S
Temporary Global Note for other Global Notes have been made:
Principal
Amount of
this Global
Amount of Amount of Note Signature of
decrease in increase in following authorized
Principal Principal such officer of
Amount Amount decrease Trustee or
Date of of this of this (or Note
Exchange Global Note Global Note increase) Custodian
--------- ----------- ----------- ----------- ----------
EXHIBIT B-1
FORM OF CERTIFICATE FOR EXCHANGE OR REGISTRATION OF TRANSFER
FROM 144A GLOBAL NOTE TO REGULATION S GLOBAL NOTE
(Pursuant to Section 2.06(a)(i) of the Indenture)
State Street Bank and Trust Company,
as Trustee and Registrar
Re: 9 5/8% Senior Notes due 2008 of American Eco
--------------------------------------------
Corporation
-----------
Reference is hereby made to the Indenture, dated as of
May 21, 1998 (the "Indenture"), among American Eco Corporation
(the "Company"), the Guarantors named therein (the "Guarantors")
and State Street Bank and Trust Company, as trustee (the
"Trustee"). Capitalized terms used but not defined herein shall
have the meanings given to them in the Indenture.
This letter relates to $ principal amount of
---------------
Notes which are evidenced by one or more 144A Global Notes and
held with the Depository in the name of (the
-------------
"Transferor"). The Transferor has requested a transfer of such
beneficial interest in the Notes to a Person who will take
delivery thereof in the form of an equal principal amount of
Notes evidenced by one or more Regulation S Global Notes, which
amount, immediately after such transfer, is to be held with the
Depository through Euroclear or Cedel or both.
In connection with such request and in respect of such
Notes, the Transferor hereby certifies that such transfer has
been effected in compliance with the transfer restrictions
applicable to the Global Notes and pursuant to and in accordance
with Rule 903 or Rule 904 under the United States Securities Act
of 1933, as amended (the "Securities Act"), and accordingly the
Transferor hereby further certifies that:
(1) The offer of the Notes was not made to a person in
the United States;
(2) either:
(a) at the time the buy order was originated, the
transferee was outside the United States or the
Transferor and any person acting on its behalf
reasonably believed and believes that the transferee
was outside the United States; or
(b) the transaction was executed in, on or
through the facilities of a designated offshore
securities market and neither the Transferor nor any
person acting on its behalf knows that the transaction
was prearranged with a buyer in the United States;
(3) no directed selling efforts have been made in
contravention of the requirements of Rule 904(b) of
Regulation S;
(4) the transaction is not part of a plan or scheme to
evade the registration provisions of the Securities Act; and
(5) upon completion of the transaction, the beneficial
interest being transferred as described above is to be held
with the Depository through Euroclear or Cedel or both.
Upon giving effect to this request to exchange a beneficial
interest in a 144A Global Note for a beneficial interest in a
Regulation S Global Note, the resulting beneficial interest shall
be subject to the restrictions on transfer applicable to
Regulation S Global Notes pursuant to the Indenture and the
Securities Act and, if such transfer occurs prior to the end of
the 40-day restricted period associated with the initial offering
of Notes, the additional restrictions applicable to transfers of
interests in the Regulation S Temporary Global Note.
This certificate and the statements contained herein are
made for your benefit and the benefit of the Company and the
Guarantors. Terms used in this certificate and not otherwise
defined in the Indenture have the meanings set forth in
Regulation S under the Securities Act.
[Insert Name of Transferor]
By
----------------------------
Name:
Title:
Dated:
cc: American Eco Corporation
EXHIBIT B-2
FORM OF CERTIFICATE FOR EXCHANGE OR REGISTRATION OF TRANSFER
FROM REGULATION S GLOBAL NOTE TO 144A GLOBAL NOTE
(Pursuant to Section 2.06(a)(ii) of the Indenture)
State Street Bank and Trust Company,
as Trustee and Registrar
Re: 9 5/8% Senior Notes due 2008 of American Eco
--------------------------------------------
Corporation
-----------
Reference is hereby made to the Indenture dated as of
May 21, 1998 (the "Indenture"), among American Eco Corporation
(the "Company"), the guarantors named therein (the "Guarantors")
and State Street Bank and Trust Company, as trustee (the
"Trustee"). Capitalized terms used but not defined herein shall
have the meanings given to them in the Indenture.
This letter relates to $ principal amount of Notes
---------
which are evidenced by one or more Regulation S Global Notes and
held with the Depository through Euroclear or Cedel in the name
of (the "Transferor"). The Transferor has requested a
--------
transfer of such beneficial interest in the Notes to a Person who
will take delivery thereof in the form of an equal principal
amount of Notes evidenced by one or more 144A Global Notes, to be
held with the Depository.
In connection with such request and in respect of such
Notes, the Transferor hereby certifies that:
[CHECK ONE]
[ ] such transfer is being effected pursuant to and in
accordance with Rule 144A under the United States
Securities Act of 1933, as amended (the "Securities Act"),
and, accordingly, the Transferor hereby further certifies
that the Notes are being transferred to a Person that the
Transferor reasonably believes is purchasing the Notes for
its own account, or for one or more accounts with respect
to which such Person exercises sole investment discretion,
and such Person and each such account is a "qualified
institutional buyer" within the meaning of Rule 144A in a
transaction meeting the requirements of Rule 144A;
or
[ ] such transfer is being effected pursuant to and in
accordance with Rule 144 under the Securities Act;
or
[ ] such transfer is being effected pursuant to an exemption
from the registration requirements of the Securities Act
other than one described above, and the Transferor hereby
further certifies that the Notes are being transferred in
compliance with the transfer restrictions applicable to
the Global Notes and in accordance with the requirements
of the exemption claimed, which certification is supported
by an Opinion of Counsel, provided by the transferor or
the transferee (a copy of which the Transferor has
attached to this certification) in form reasonably
acceptable to the Company and to the Registrar, to the
effect that such transfer is in compliance with the
Securities Act and any applicable blue sky laws of any
state of the United States;
or
[ ] such transfer is being effected pursuant to an effective
registration statement under the Securities Act;
and such Notes are being transferred in compliance with any
applicable blue sky securities laws of any state of the United
States or any other applicable jurisdiction.
Upon giving effect to this request to exchange a beneficial
interest in Regulation S Global Notes for a beneficial interest
in 144A Global Notes, the resulting beneficial interest shall be
subject to the restrictions on transfer applicable to 144A Global
Notes pursuant to the Indenture and the Securities Act.
This certificate and the statements contained herein are
made for your benefit and the benefit of the Company and the
Guarantors.
[Insert Name of Transferor]
By
---------------------------------
Name:
Title:
Dated:
cc: American Eco Corporation
EXHIBIT B-3
FORM OF CERTIFICATE FOR EXCHANGE OR REGISTRATION OF TRANSFER
OF DEFINITIVE NOTES
(Pursuant to Section 2.06(b) of the Indenture)
State Street Bank and Trust Company,
as Trustee and Registrar
Re: 9 5/8% Senior Notes due 2008 of American Eco
--------------------------------------------
Corporation
-----------
Reference is hereby made to the Indenture dated as of
May 21, 1998 (the "Indenture"), among American Eco Corporation
(the "Company"), the guarantors named therein (the "Guarantors")
and State Street Bank and Trust Company, as trustee (the
"Trustee"). Capitalized terms used but not defined herein shall
have the meanings given to them in the Indenture.
This relates to $ principal amount of Notes
-----------
which are evidenced by one or more Definitive Notes in the name
of (the "Transferor"). The Transferor has
------------------
requested an exchange or transfer of such Definitive Note(s) in
the form of an equal principal amount of Notes evidenced by one
or more Definitive Notes, to be delivered to the Transferor or,
in the case of a transfer of such Notes, to such Person as the
Transferor instructs the Trustee.
In connection with such request and in respect of the Notes
surrendered to the Trustee herewith (the "Surrendered Notes"),
the Holder of such Surrendered Notes hereby certifies that:
[CHECK ONE]
[ ] the Surrendered Notes are being acquired for the
Transferor's own account, without transfer;
or
[ ] the Surrendered Notes are being transferred to the Company
or one of its Subsidiaries;
or
[ ] the Surrendered Notes are being transferred pursuant to and
in accordance with Rule 144A under the United States
Securities Act of 1933, as amended (the "Securities Act"),
and, accordingly, the Transferor hereby further certifies
that the Surrendered Notes are being transferred to a Person
that the Transferor reasonably believes is purchasing the
Surrendered Notes for its own account, or for one or more
accounts with respect to which such Person exercises sole
investment discretion, and such Person and each such account
is a "qualified institutional buyer" within the meaning of
Rule 144A, in each case in a transaction meeting the
requirements of Rule 144A;
or
[ ] the Surrendered Notes are being transferred in a transaction
permitted by Rule 144 under the Securities Act;
or
[ ] the Surrendered Notes are being transferred pursuant to an
exemption under the Securities Act other than Rule 144A,
Rule 144 or Rule 904 to Person who is an Institutional
Accredited Investor and the Transferor further certifies
that the transfer complies with the transfer restrictions
applicable to Definitive Notes bearing the legend set forth
in Section 2.06(f) of the Indenture and the requirements of
the exemption claimed, which certification is supported by
(a) if such transfer is in respect of a principal amount of
Notes at the time of transfer of $100,000 or more, a
certificate executed by the transferee in the form of
Exhibit C to the Indenture, or (b) if such transfer is in
respect of a principal amount of Notes at the time of
transfer of less than $100,000, (i) a certificate executed
in the form of Exhibit C to the Indenture and (ii) 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 (1) such transfer is
in compliance with the Securities Act and (2) such transfer
complies with any applicable blue sky securities laws of any
state of the United States;
or
[ ] the Surrendered Notes are being transferred pursuant to an
effective registration statement under the Securities Act;
and the Surrendered Notes are being transferred in compliance
with any applicable blue sky securities laws of any state of the
United States or any other applicable jurisdiction.
This certificate and the statements contained herein are
made for your benefit and the benefit of the Company and the
Guarantors.
[Insert Name of Transferor]
By
----------------------------
Name:
Title:
Dated:
cc: American Eco Corporation
EXHIBIT B-4
FORM OF CERTIFICATE FOR EXCHANGE OR REGISTRATION OF TRANSFER
FROM 144A GLOBAL NOTE OR REGULATION S
PERMANENT GLOBAL NOTE
TO DEFINITIVE NOTE
(Pursuant to Section 2.06(c) of the Indenture)
State Street Bank and Trust Company,
as Trustee and Registrar
Re: 9 5/8% Senior Notes due 2008 of American Eco
--------------------------------------------
Corporation
-----------
Reference is hereby made to the Indenture dated as of
May 21, 1998 (the "Indenture"), among American Eco Corporation
(the "Company"), the guarantors named therein (the "Guarantors")
and State Street Bank and Trust Company, as trustee (the
"Trustee"). Capitalized terms used but not defined herein shall
have the meanings given to them in the Indenture.
This letter relates to $ principal amount of Notes
----------
which are evidenced by a beneficial interest in one or more 144A
Global Notes or Regulation S Permanent Global Notes in the name
of (the "Transferor"). The Transferor has
--------------------
requested an exchange or transfer of such beneficial interest in
the form of an equal principal amount of Notes evidenced by one
or more Definitive Notes, to be delivered to the Transferor or,
in the case of a transfer of such Notes, to such Person as the
Transferor instructs the Trustee.
In connection with such request and in respect of the Notes
surrendered to the Trustee herewith (the "Surrendered Notes"),
the Holder of such Surrendered Notes hereby certifies that:
[CHECK ONE]
[ ] the Surrendered Notes are being transferred to the
beneficial owner of such Notes;
or
[ ] the Surrendered Notes are being transferred to the Company
or one of its Subsidiaries;
or
[ ] the Surrendered Notes are being transferred pursuant to and
in accordance with Rule 144A under the United States
Securities Act of 1933, as amended (the "Securities Act"),
and, accordingly, the Transferor hereby further certifies
that the Surrendered Notes are being transferred to a Person
that the Transferor reasonably believes is purchasing the
Surrendered Notes for its own account, or for one or more
accounts with respect to which such Person exercises sole
investment discretion, and such Person and each such account
is a "qualified institutional buyer" within the meaning of
Rule 144A, in each case in a transaction meeting they
requirements of Rule 144A;
or
[ ] the Surrendered Notes are being transferred in a transaction
permitted by Rule 144 under the Securities Act;
or
[ ] the Surrendered Notes are being transferred pursuant to an
effective registration statement under the Securities Act;
or
[ ] the Surrendered Notes are being transferred pursuant to an
exemption under the Securities Act other than Rule 144A,
Rule 144 or Rule 904 to a Person who is an Institutional
Accredited Investor and the Transferor further certifies
that the transfer complies with the transfer restrictions
applicable to beneficial interests in Global Notes bearing
the legend set forth in Section 2.06(f) of the Indenture and
the requirements of the exemption claimed, which
certification is supported by (a) if such transfer is in
respect of a principal amount of Notes at the time of
transfer of $100,000 or more, a certificate executed by the
transferee in the form of Exhibit C to the Indenture, or (b)
if such transfer is in respect of a principal amount of
Notes at the time of transfer of less than $100,000, (i) a
certificate executed in the form of Exhibit C to the
Indenture and (ii) 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 (1)
such transfer is in compliance with the Securities Act and
(2) such transfer complies with any applicable blue sky
securities laws of any state of the United States;
and the Surrendered Notes are being transferred in compliance
with any applicable blue sky securities laws of any state of the
United States or any other applicable jurisdiction.
This certificate and the statements contained herein are
made for your benefit and the benefit of the Company and the
Guarantors.
[Insert Name of Transferor]
By
----------------------------------
Name:
Title:
Dated:
cc: American Eco Corporation
EXHIBIT C
FORM OF CERTIFICATE TO BE DELIVERED BY
INSTITUTIONAL ACCREDITED INVESTORS
,
--------------- -----
State Street Bank and Trust Company,
as Trustee and Registrar
Ladies and Gentlemen:
We are delivering this letter in connection with an offering
of 9 5/8% Senior Notes due 2008 (the "Notes") of American Eco
Corporation, an Ontario, Canada corporation (the "Company"), all
as described in the Offering Memorandum dated May 14, 1998 (the
"Offering Memorandum") relating to the offering of the Notes. We
hereby confirm that:
(i) we are an "accredited investor" within the meaning
of Rule 501(a)(1), (2), (3) or (7) under the Securities Act
of 1933, as amended (the "Securities Act"), or an entity in
which all of the equity owners are accredited investors
within the meaning of Rule 501(a)(1), (2), (3) or (7) under
the Securities Act (an "Institutional Accredited Investor");
(ii) any purchase of Notes by us will be for our own
account or, if we are buying for one or more institutional
accounts for which we are acting as fiduciary or agent and
we are not a bank (as defined in Section 3(a)(2) of the
Securities Act) or a savings and loan association or other
institution (as defined in Section 3(a)(5)(A) of the
Securities Act), each such account is an Institutional
Accredited Investor;
(iii) in the event that we purchase any Notes, we
will acquire Notes having a minimum purchase price of at
least $100,000 for our own account and for each separate
account for which we are acting;
(iv) we have such knowledge and experience in financial
and business matters that we are capable of evaluating the
merits and risks of purchasing Notes and we, and any
accounts for which we are acting, are able to bear the
economic risks of its or their investment;
(v) we are not acquiring Notes with a view to any
distribution thereof in a transaction that would violate the
Securities Act or the securities laws of any State of the
United States or any other applicable jurisdiction;
provided, however, that the disposition of our property and
the property of any accounts for which we are acting as
fiduciary shall remain at all times within our control; and
(vi) we have received a copy of the Offering Memorandum
and acknowledge that we have had access to such financial
and other information, and have been afforded the
opportunity to ask such questions of representatives of the
Company and receive answers thereto, as we deem necessary in
connection with our decision to purchase Notes.
We understand that the Notes were offered in a transaction
not involving any public offering within the meaning of the
Securities Act and that the Notes have not been registered under
the Securities Act, and we agree, on our own behalf and on behalf
of each account for which we acquire any Notes, that such Notes
may be offered, resold, pledged or otherwise transferred only (i)
to a person whom we reasonably believe to be a qualified
institutional buyer (as defined in Rule 144A under the Securities
Act) in a transaction meeting the requirements of Rule 144A under
the Securities Act, in a transaction meeting the requirements of
Rule 144 under the Securities Act, outside the United States in a
transaction meeting the requirements of Rule 904 under the
Securities Act, or in accordance with another exemption from the
registration requirements of the Securities Act (and based upon
an opinion of counsel if the Company so requests), (ii) to the
Company or (iii) pursuant to an effective registration statement,
and, in each case, in accordance with any applicable securities
laws of any State of the United States or any other applicable
jurisdiction, and we will, and each subsequent holder of the
Notes is required to, notify any subsequent purchaser from us or
it of the resale restrictions set forth in clause (i) above. We
acknowledge that the Notes will bear legends substantially to the
effect set forth in the Offering Memorandum under the "Notice to
Investors." We understand that the registrar will not be
required to accept for registration of transfer any Notes, except
upon presentation of evidence satisfactory to the Company that
the foregoing restrictions on transfer have been complied with.
We acknowledge that you and the Company will rely upon our
confirmations, acknowledgments and agreements set forth herein,
and we agree to notify you promptly in writing if any of our
representations or warranties herein ceases to be accurate and
complete.
THIS LETTER SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.
------------------------------------
[Name of Purchaser]
By
----------------------------------
Name:
Title:
Address:
EXHIBIT D
SUBSIDIARY GUARANTEE
Subject to Section 10.06 of the Indenture, each Guarantor
has jointly and severally, unconditionally guaranteed 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 the Indenture, the Notes and
the Obligations of the Company under the Notes or under the
Indenture, that: (a) the principal of and premium, if any,
interest and Liquidated Damages, if any, on the Notes will be
promptly paid in full when due, subject to any applicable grace
period, whether at maturity, by acceleration, redemption or
otherwise, and interest on overdue principal of and premium, if
any, (to the extent permitted by law) interest and Liquidated
Damages, if any, on the Notes and all other payment Obligations
of the Company to the Holders or the Trustee under the Indenture
or under the Notes will be promptly paid in full and performed,
all in accordance with the terms thereof; and (b) in case of any
extension of time of payment or renewal of any Notes or any of
such other payment Obligations, the same will be promptly paid in
full when due or performed in accordance with the terms of the
extension or renewal, subject to any applicable grace period,
whether at stated maturity, by acceleration, redemption or
otherwise. Failing payment when so 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. An Event of Default under the Indenture or the
Notes shall constitute an event of default under the Subsidiary
Guarantees, and shall entitle the Holders to accelerate the
obligations of the Guarantors under the Indenture in the same
manner and to the same extent as the Obligations of the Company.
The Guarantors have agreed that their Obligations under the
Indenture 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 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 further, to the extent permitted by
law, has 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 and
covenants that its Subsidiary Guarantee will not be discharged
except by complete performance of the Obligations contained in
the Notes and the Indenture. If any Holder or the Trustee is
required by any court or otherwise to return to the Company, the
Guarantors, or any Note Custodian, Trustee, liquidator or other
similar official acting in relation to either the Company or the
Guarantors, any amount paid by the Company or any Guarantor to
the Trustee or such Holder, the Subsidiary Guarantees, to the
extent theretofore discharged, shall be reinstated in full force
and effect. Each Guarantor has agreed that it shall not be
entitled to, and hereby has waived, any right of subrogation in
relation to the Holders in respect of any Obligations guaranteed
under the Indenture. Each Guarantor further has agreed that, as
between the Guarantors, on the one hand, and the Holders and the
Trustee, on the other hand, (a) the maturity of the Obligations
guaranteed under the Indenture may be accelerated as provided in
Article 6 of the Indenture for the purposes of its Subsidiary
Guarantee, notwithstanding any stay, injunction or other
prohibition preventing such acceleration in respect of the
Obligations guaranteed thereby, and (b) 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
Guarantor for the purpose of its Subsidiary Guarantee. 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 Guarantees.
The obligations of the Guarantors to the Holders and to the
Trustee pursuant to the Subsidiary Guarantees and the Indenture
are expressly set forth in Article 10 of the Indenture, and
reference is hereby made to such Indenture for the precise terms
of the Subsidiary Guarantees. The terms of Article 10 of the
Indenture are incorporated herein by reference. The Subsidiary
Guarantees are subject to release as and to the extent provided
in Sections 10.04 and 10.05 of the Indenture.
Each Subsidiary Guarantee is a continuing guarantee and
shall remain in full force and effect and shall be binding upon
each Guarantor and its respective successors and assigns to the
extent set forth in the Indenture until full and final payment of
all of the Company's Obligations under the Notes and the
Indenture and shall inure to the benefit of the successors and
assigns of the Trustee and the Holders and, in the event of any
transfer or assignment of rights by any Holder or the Trustee,
the rights and privileges conferred in the Indenture upon that
party shall automatically extend to and be vested in such
transferee or assignee, all subject to the terms and conditions
hereof. Each Subsidiary Guarantee is a guarantee of payment and
not a guarantee of collection.
The Subsidiary Guarantees shall not be valid or obligatory
for any purpose until the certificate of authentication on the
Note upon which this notation of Subsidiary Guarantee is endorsed
shall have been executed by the Trustee or an authenticating
agent under the Indenture by the manual signature of one of its
authorized signatories.
For purposes hereof, each Guarantor's liability under its
Subsidiary Guarantee shall be limited to the lesser of (i) the
aggregate amount of the Obligations of the Company under the
Notes and the Indenture and (ii) the amount, if any, which would
not have (A) rendered such Guarantor "insolvent" (as such term is
defined in the Bankruptcy Law and in the Debtor and Creditor Law
of the State of New York) or (B) left such Guarantor with
unreasonably small capital at the time its Subsidiary Guarantee
of the Notes was entered into; provided, however, that, it will
be a presumption in any lawsuit or other proceeding in which a
Guarantor is a party that the amount guaranteed pursuant to the
Subsidiary Guarantee is the amount set forth in clause (i) above
unless any creditor, or representative of creditors of such
Guarantor, or debtor in possession or trustee in bankruptcy of
such Guarantor, otherwise proves in such a lawsuit that the
aggregate liability of the Guarantor is limited to the amount set
forth in clause (ii) above. The Indenture provides that, in
making any determination as to the solvency or sufficiency of
capital of a Guarantor in accordance with the previous sentence,
the right of such Guarantors to contribution from other
Guarantors and any other rights such Guarantors may have,
contractual or otherwise, shall be taken into account.
Capitalized terms used herein have the same meanings given
in the Indenture unless otherwise indicated.
[GUARANTORS]
By
----------------------------------
Name:
Title:
EXHIBIT E
=================================================================
AMERICAN ECO CORPORATION
and
the Guarantors named herein
----------------------------------------
SERIES A AND SERIES B
9 5/8% SENIOR NOTES DUE 2008
----------------------------------------
-------------------
FORM OF SUPPLEMENTAL INDENTURE
AND AMENDMENT -- SUBSIDIARY GUARANTEE
DATED AS OF ,
-------- --- ----
-------------------
STATE STREET BANK AND TRUST COMPANY
Trustee
-------------------
=================================================================
This SUPPLEMENTAL INDENTURE, dated as of ,
---------- ---
, is among American Eco Corporation, an Ontario, Canada
----
corporation (the "Company"), each of the parties identified under
the caption "Guarantors" on the signature page hereto (the
"Guarantors") and State Street Bank and Trust Company, as
Trustee.
RECITALS
WHEREAS, the Company, the Guarantors and the Trustee entered
into an Indenture, dated as of May 21, 1998 (the "Indenture"),
pursuant to which the Company has originally issued
$ in principal amount of 9 5/8% Senior Notes due
--------------
2008 (the "Notes"); and
WHEREAS, Section 9.01(f) of the Indenture provides that the
Company and the Trustee may amend or supplement the Indenture in
order to execute and deliver a guarantee (a "Subsidiary
Guarantee") to comply with Section 10.02 thereof without the
consent of the Holders of the Notes; and
WHEREAS, all acts and things prescribed by the Indenture, by
law and by the charter and the bylaws (or comparable constituent
documents) of the Company, of the Guarantors and of the Trustee
necessary to make this Supplemental Indenture a valid instrument
legally binding on the Company, the Guarantors and the Trustee,
in accordance with its terms, have been duly done and performed;
NOW, THEREFORE, to comply with the provisions of the
Indenture and in consideration of the above premises, the
Company, the Guarantors and the Trustee covenant and agree for
the equal and proportionate benefit of the respective Holders of
the Notes as follows:
ARTICLE 1
Section 1.01. This Supplemental Indenture is supplemental
to the Indenture and does and shall be deemed to form a part of,
and shall be construed in connection with and as part of, the
Indenture for any and all purposes.
Section 1.02. This Supplemental Indenture shall become
effective immediately upon its execution and delivery by each of
the Company, the Guarantors and the Trustee.
ARTICLE 2
From this date, in accordance with Section 10.02 and by
executing this Supplemental Indenture and the accompanying
notation of Subsidiary Guarantee (a copy of which is attached
hereto), the Guarantors whose signatures appear below are subject
to the provisions of the Indenture to the extent provided for in
Article 10 thereunder.
ARTICLE 3
Section 3.01. Except as specifically modified herein, the
Indenture and the Notes are in all respects ratified and
confirmed (mutatis mutandis) and shall remain in full force and
effect in accordance with their terms with all capitalized terms
used herein without definition having the same respective
meanings ascribed to them as in the Indenture.
Section 3.02. Except as otherwise expressly provided
herein, no duties, responsibilities or liabilities are assumed,
or shall be construed to be assumed, by the Trustee by reason of
this Supplemental Indenture. This Supplemental Indenture is
executed and accepted by the Trustee subject to all the terms and
conditions set forth in the Indenture with the same force and
effect as if those terms and conditions were repeated at length
herein and made applicable to the Trustee with respect hereto.
Section 3.03. THE LAW OF THE STATE OF NEW YORK SHALL GOVERN
AND BE USED TO CONSTRUE AND ENFORCE THIS SUPPLEMENTAL INDENTURE.
Section 3.04. The parties may sign any number of copies of
this Supplemental Indenture. Each signed copy shall be an
original, but all of such executed copies together shall
represent the same agreement.
[NEXT PAGE IS SIGNATURE PAGE]
IN WITNESS WHEREOF, the parties hereto have caused this
Supplemental Indenture to be duly executed, all as of the date
first written above.
AMERICAN ECO CORPORATION
By
----------------------------------
Name:
Title:
GUARANTORS
[ ]
-----------------------------
By
----------------------------------
Name:
Title:
STATE STREET BANK AND TRUST
COMPANY, as Trustee
By
----------------------------------
Name:
Title:
=================================================================
AMERICAN ECO CORPORATION
AND
THE GUARANTORS NAMED ON THE SIGNATURE PAGE HERETO
$120,000,000
9 5/8% SERIES A SENIOR NOTES DUE 2008
PURCHASE AGREEMENT
May 14, 1998
JEFFERIES & COMPANY, INC.
NESBITT BURNS SECURITIES INC.
=================================================================
<PAGE>
AMERICAN ECO CORPORATION
$120,000,000
9 5/8% SERIES A SENIOR NOTES DUE 2008
PURCHASE AGREEMENT
May 14, 1998
New York, New York
JEFFERIES & COMPANY, INC.
NESBITT BURNS SECURITIES INC.
c/o Jefferies & Company, Inc.
2 Houston Center
909 Fannin Street, Suite 3100
Houston, Texas 77010
Ladies & Gentlemen:
American Eco Corporation, an Ontario, Canada corporation
(the "Company"), proposes to issue and sell to Jefferies &
-------
Company, Inc. and Nesbitt Burns Securities Inc. (collectively,
the "Initial Purchasers") $120,000,000 aggregate principal amount
------------------
of its 9 5/8% Series A Senior Notes due 2008 (the "Series A
--------
Notes"), subject to the terms and conditions set forth herein.
-----
The Notes (as defined below) will be issued pursuant to an
indenture (the "Indenture"), to be dated the Closing Date (as
---------
defined below), among the Company, the Guarantors (as defined
below) and State Street Bank and Trust Company, as trustee (the
"Trustee"). The Notes will be fully and unconditionally
-------
guaranteed (the "Guarantees"), upon the terms and subject to the
----------
conditions of the Indenture, as to payment of principal,
interest, liquidated damages and premium, if any, jointly and
severally, by each of the subsidiaries listed on Exhibit A hereto
(each a "Guarantor" and collectively, the "Guarantors").
--------- ----------
Capitalized terms used herein and not otherwise defined shall
have the meanings assigned to such terms in the Indenture.
1. ISSUANCE OF SECURITIES. The Company proposes, upon the
----------------------
terms and subject to the conditions set forth herein, to issue
and sell to the Initial Purchasers an aggregate of $120,000,000
principal amount of Series A Notes. The Series A Notes and the
Series B Notes (as defined below) issuable in exchange therefor
are collectively referred to herein as the "Notes."
-----
Upon original issuance thereof, and until such time as the
same is no longer required under the applicable requirements of
the Securities Act of 1933, as amended (the "Act"), the Series A
---
Notes (and all securities issued in exchange therefor or in
substitution thereof) shall bear the following legend:
"THE SECURITY (OR ITS PREDECESSOR) EVIDENCED HEREBY WAS
ORIGINALLY ISSUED IN A TRANSACTION EXEMPT FROM
REGISTRATION UNDER SECTION 5 OF THE UNITED STATES
SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES
ACT"), AND THE SECURITY EVIDENCED HEREBY MAY NOT BE
OFFERED, SOLD OR OTHERWISE TRANSFERRED IN THE ABSENCE
OF SUCH REGISTRATION OR AN APPLICABLE EXEMPTION
THEREFROM. EACH PURCHASER OF THE SECURITY EVIDENCED
HEREBY IS HEREBY NOTIFIED THAT THE SELLER MAY BE
RELYING ON THE EXEMPTION FROM THE PROVISIONS OF SECTION
5 OF THE SECURITIES ACT PROVIDED BY RULE 144A
THEREUNDER. THE HOLDER OF THE SECURITY EVIDENCED
HEREBY AGREES FOR THE BENEFIT OF THE COMPANY THAT (A)
SUCH SECURITY MAY BE RESOLD, PLEDGED OR OTHERWISE
TRANSFERRED, ONLY (1)(a) TO A PERSON WHO 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,
(b) IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE
144 UNDER THE SECURITIES ACT, (c) OUTSIDE THE UNITED
STATES TO A NON-U.S. PERSON IN A TRANSACTION MEETING
THE REQUIREMENTS OF RULE 904 UNDER THE SECURITIES ACT
OR (d) IN ACCORDANCE WITH ANOTHER EXEMPTION FROM THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT (AND
BASED UPON AN OPINION OF COUNSEL IF THE COMPANY SO
REQUESTS), (2) TO THE COMPANY OR (3) PURSUANT TO AN
EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES
ACT AND, IN EACH CASE, IN ACCORDANCE WITH ANY
APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED
STATES OR ANY OTHER APPLICABLE JURISDICTION AND (B) THE
HOLDER WILL, AND EACH SUBSEQUENT HOLDER IS REQUIRED TO,
NOTIFY ANY PURCHASER FROM IT OF THE SECURITY EVIDENCED
HEREBY OF THE RESALE RESTRICTIONS SET FORTH IN (A)
ABOVE."
2. OFFERING. The Series A Notes will be offered and sold
--------
to the Initial Purchasers pursuant to an exemption from the
registration requirements under the Act. The Company has
prepared a preliminary offering memorandum, dated April 30, 1998
(the "Preliminary Offering Memorandum"), and a final offering
-------------------------------
memorandum, dated the date hereof (the "Offering Memorandum"),
-------------------
relating to the Company, the Guarantors and the Series A Notes.
The Initial Purchasers have advised the Company that the
Initial Purchasers will make offers (the "Exempt Resales") of the
--------------
Series A Notes only upon the terms set forth in this Agreement
and the Offering Memorandum, as amended or supplemented, and
solely to (i) persons whom the Initial Purchasers reasonably
believe to be "qualified institutional buyers," as defined in
Rule 144A under the Act ("QIBs"), (ii) a limited number of
---
persons who have represented to the Company and the Initial
Purchasers that they are institutional "Accredited Investors"
referred to in Rule 501(a)(1), (2), (3) or (7) under the Act
(each, an "Accredited Investor"), or (iii) to non-U.S. persons
-------------------
(as defined in Rule 902 under the Securities Act) upon the terms
and conditions set forth in Annex I hereof (such persons
specified in clauses (i), (ii) and (iii) being referred to herein
as the "Eligible Purchasers"). The Initial Purchasers will offer
-------------------
the Series A Notes to such Eligible Purchasers initially at a
price equal to 97.0% of the principal amount thereof. Such price
may be changed at any time without notice.
Holders (including subsequent transferees) of the Series A
Notes will have the registration rights set forth in the
registration rights agreement relating thereto (the "Registration
------------
Rights Agreement"), to be dated the Closing Date, for so long as
----------------
such Series A Notes constitute "Transfer Restricted Securities"
------------------------------
(as defined in the Registration Rights Agreement). Pursuant to
the Registration Rights Agreement, the Company and the Guarantors
will agree to file with the Securities and Exchange Commission
(the "Commission"), under the circumstances set forth therein,
----------
(i) a registration statement under the Act (the "Exchange Offer
--------------
Registration Statement") relating to the 9 5/8% Series B Senior
----------------------
Notes due 2008 (the "Series B Notes") to be offered in exchange
--------------
for the Series A Notes (the "Exchange Offer") and (ii) under
--------------
certain circumstances, a shelf registration statement pursuant to
Rule 415 under the Act (the "Shelf Registration Statement")
----------------------------
relating to the resale by certain holders of the Series A Notes,
and to use their best efforts to cause such Registration
Statements to be declared effective and to consummate the
Exchange Offer. This Agreement, the Notes, the Indenture, the
Registration Rights Agreement and the Guarantees are hereinafter
sometimes referred to collectively as the "Operative Documents."
-------------------
3. PURCHASE, SALE AND DELIVERY. (a) On the basis of the
---------------------------
representations, warranties and covenants contained in this
Agreement, and subject to its terms and conditions, the Company
agrees to issue and sell to the Initial Purchasers, and the
Initial Purchasers agree to purchase from the Company,
$120,000,000 aggregate principal amount of Series A Notes. The
purchase price for the Series A Notes will be $970 per $1,000
principal amount of Series A Notes.
(b) Closing of the purchase, sale and delivery of the
Series A Notes shall take place at the offices of Vinson & Elkins
L.L.P., 1001 Fannin, Houston, Texas 77002, or such other location
as may be mutually acceptable. Such delivery and payment shall
be made at 10:00 a.m., New York City time, on May 21, 1998 or at
such other time as shall be agreed upon by the Initial Purchasers
and the Company. The time and date of such delivery and payment
are herein called the "Closing Date."
------------
(c) Except as set forth in the next paragraph, one Series A
Note in definitive global form, registered in the name of Cede &
Co., as nominee of The Depository Trust Company ("DTC") (the
---
"Global Note"), shall be delivered by the Company to the Initial
-----------
Purchasers, against payment by the Initial Purchasers of the
purchase price therefor, by wire transfer, in same-day funds, to
the Company's account, by causing DTC to credit the principal
amount of the Global Note to the account of Jefferies & Company,
Inc. at DTC.
Such Series A Notes, if any, as Jefferies & Company, Inc.
may request upon at least 48 hours' prior notice to the Company
(such request to include the authorized denominations and the
names in which they are to be registered), shall be delivered in
definitive certificated form, by or on behalf of the Company to
Jefferies & Company, Inc. against payment by the Initial
Purchasers for the purchase price therefor, by wire transfer in
same-day funds to the Company's account. The Company will cause
the certificates representing such definitive certificated
Series A Notes to be made available to the Initial Purchasers, at
Jefferies & Company, Inc.'s offices at 650 5th Avenue, New York,
New York 10019, at least 24 hours preceding the Closing Date.
4. AGREEMENTS OF THE COMPANY AND THE GUARANTORS. The
--------------------------------------------
Company and the Guarantors, jointly and severally, covenant and
agree with the Initial Purchasers as follows:
(a) To advise the Initial Purchasers promptly and, if
requested by the Initial Purchasers, confirm such advice in
writing, (i) of the issuance by any state securities
commission of any stop order suspending the qualification or
exemption from qualification of any Notes for offering or
sale in any jurisdiction, or the initiation of any
proceeding for such purpose by any state securities
commission or other regulatory authority or (ii) of the
happening of any event that makes any statement of a
material fact made in the Offering Memorandum untrue or that
requires the making of any additions to or changes in the
Offering Memorandum in order to make the statements therein,
in the light of the circumstances under which they are made,
not misleading. The Company and the Guarantors shall use
their reasonable best efforts to prevent the issuance of any
stop order or order suspending the qualification or exemp-
tion of any Notes under any state securities or Blue Sky
laws and, if at any time any state securities commission or
other regulatory authority shall issue an order suspending
the qualification or exemption of any Notes under any state
securities or Blue Sky laws, the Company and the Guarantors
shall use their reasonable best efforts to obtain the
withdrawal or lifting of such order at the earliest possible
time.
(b) To furnish the Initial Purchasers and those
persons identified by the Initial Purchasers, without
charge, as many copies of the Preliminary Offering
Memorandum and the Offering Memorandum, and any amendments
or supplements thereto, as the Initial Purchasers may
reasonably request. The Company and the Guarantors consent
to the use of the Preliminary Offering Memorandum and the
Offering Memorandum, and any amendments and supplements
thereto, by the Initial Purchasers in connection with Exempt
Resales.
(c) Not to amend or supplement the Preliminary
Offering Memorandum or the Offering Memorandum prior to the
Closing Date unless the Initial Purchasers shall previously
have been advised thereof and shall not have objected
thereto within a reasonable time after being furnished a
copy thereof.
(d) Not to file any document pursuant to the
Securities Exchange Act of 1934, as amended (the "Exchange
--------
Act"), prior to the termination of the offering of the Notes
---
if such document would be incorporated by reference in the
Offering Memorandum unless a copy thereof shall have been
provided to the Initial Purchasers and counsel for the
Initial Purchasers within a reasonable period of time prior
to the filing thereof and the Initial Purchasers shall not
have objected thereto in good faith.
(e) If, after the date hereof and prior to
consummation of any Exempt Resale, any event shall occur as
a result of which, in the judgment of the Company and the
Guarantors, it becomes necessary or advisable to amend or
supplement the Preliminary Offering Memorandum or Offering
Memorandum in order to make the statements therein, in the
light of the circumstances when such Offering Memorandum is
delivered to an Eligible Purchaser, not misleading, or if it
is necessary or advisable to amend or supplement the
Preliminary Offering Memorandum or Offering Memorandum to
comply with applicable law, (i) to notify the Initial
Purchasers and (ii) promptly to prepare, at the Company's
expense, an appropriate amendment or supplement to such
Preliminary Offering Memorandum or Offering Memorandum so
that the statements therein as so amended or supplemented
will not, in the light of the circumstances when it is so
delivered, be misleading, or so that such Preliminary
Offering Memorandum or Offering Memorandum will comply with
applicable law.
(f) To cooperate with the Initial Purchasers and
counsel for the Initial Purchasers in connection with the
qualification or registration of the Series A Notes under
the securities or Blue Sky laws of such jurisdictions of the
United States as the Initial Purchasers may reasonably
request and to continue such qualification in effect so long
as required for the Exempt Resales; provided, however, that
neither the Company nor any Guarantor shall be required in
connection therewith to register or qualify as a foreign
corporation where it is not now so qualified or to take any
action that would subject it to service of process in suits
or taxation in each case, other than as to matters and
transactions relating to Exempt Resales, in any jurisdiction
where it is not now so subject.
(g) Whether or not the transactions contemplated by
this Agreement are consummated or this Agreement becomes
effective or is terminated, to pay all costs, expenses, fees
and taxes incident to the performance of the obligations of
the Company and the Guarantors hereunder, including in
connection with: (i) the preparation, printing, filing and
distribution of the Preliminary Offering Memorandum and the
Offering Memorandum and all amendments and supplements
thereto required pursuant hereto and delivery of all other
agreements, memoranda, correspondence and all other
documents prepared and delivered in connection herewith and
with the Exempt Resales, (ii) the issuance, transfer and
delivery by the Company of the Notes and the Guarantors of
the Guarantees to the Initial Purchasers, (iii) the
qualification or registration of the Notes for offer and
sale under the securities or Blue Sky laws of the several
states (including, without limitation, Blue Sky filing fees,
the cost of printing and mailing a preliminary and final
Blue Sky Memorandum and the reasonable fees and
disbursements of counsel for the Initial Purchasers relating
thereto), (iv) furnishing such copies of the Preliminary
Offering Memorandum and the Offering Memorandum, and all
amendments and supplements thereto, as may be requested for
use in connection with Exempt Resales, (v) the preparation
of certificates for the Notes (including, without
limitation, printing and engraving thereof), (vi) the fees,
disbursements and expenses of the Company's and the
Guarantors' counsel and accountants, (vii) all expenses and
listing fees in connection with the application for
quotation of the Notes in the National Association of
Securities Dealers, Inc. ("NASD") Private Offering, Resales
----
and Trading through Automated Linkages ("PORTAL") market,
------
(viii) all fees and expenses (including fees and expenses of
counsel) of the Company and the Guarantors in connection
with the approval of the Notes by DTC for "book-entry"
transfer, (ix) rating the Notes by rating agencies, (x) the
reasonable fees and expenses of the Trustee and its counsel,
(xi) the performance by the Company and the Guarantors of
their other obligations under this Agreement and the other
Operative Documents and (xii) "roadshow" travel and other
expenses incurred by the Company in connection with the
marketing and sale of the Notes.
(h) To use the proceeds from the sale of the Series A
Notes in the manner described in the Offering Memorandum
under the caption "Use of Proceeds."
(i) Not to voluntarily claim, and to resist actively
any attempts to claim, the benefit of any usury laws against
the holders of any Notes.
(j) Not to sell, offer for sale or solicit offers to
buy or otherwise negotiate in respect of any security (as
defined in the Act) that would be integrated with the sale
of the Series A Notes in a manner that would require the
registration under the Act of the sale to the Initial
Purchasers or the Eligible Purchasers of the Series A Notes
or to take any other action that would result in the Exempt
Resales not being exempt from registration under the Act.
(k) For so long as any of the Notes remain outstanding
and during any period in which neither the Company nor any
Guarantor is subject to Section 13 or 15(d) of the Exchange
Act to make available upon request to any holder or
beneficial owner of Series A Notes in connection with any
sale thereof and any prospective Purchasers of such Series A
Notes from such holder or beneficial owner, the information
required by Rule 144A(d)(4) under the Act.
(l) [Intentionally omitted.]
(m) To comply with all of their respective agreements
set forth in this Agreement, the Indenture, the other
Operative Documents to which any of them is a party and all
agreements set forth in the representation letters of the
Company to DTC relating to the approval of the Series A
Notes by DTC for "book-entry" transfer.
(n) To cooperate with the Initial Purchasers to effect
the inclusion of the Notes in PORTAL and to obtain approval
of the Series A Notes by DTC for "book-entry" transfer.
(o) For so long as any of the Notes remain
outstanding, to deliver without charge to the Initial
Purchasers, as they may reasonably request, promptly upon
their becoming available, copies of (i) all reports or other
information that the Company or any Guarantor shall mail or
otherwise make available to its security holders and (ii)
all reports, financial statements and proxy or information
statements filed by the Company or any Guarantor with the
Commission or any national securities exchange.
(p) Not to take, directly or indirectly, any action
designed to, or that might reasonably be expected to, cause
or result in stabilization or manipulation of the price of
any security of the Company or any Guarantor to facilitate
the sale or resale of the Notes. Except as permitted by the
Act, neither the Company nor any Guarantor shall distribute
any (i) preliminary offering memorandum, including, without
limitation, the Preliminary Offering Memorandum, (ii)
offering memorandum, including, without limitation, the
Offering Memorandum or (iii) other offering material in
connection with the offering and sale of the Notes.
(q) Prior to the Closing Date, not to permit any
material change in the capital stock of the Company or in
the consolidated short-term debt or long-term debt of the
Company and its subsidiaries otherwise than as set forth or
contemplated in the Offering Memorandum.
(r) Not to, nor to cause or permit any of its
affiliates (as defined in Rule 501(b) under the Act) to,
solicit any offer to buy or offer or sell the Series A Notes
or the Series B Notes by means of any form of general
solicitation or general advertising (as such terms are used
in Regulation D under the Act), or in any manner involving a
public offering within the meaning of Section 4(2) of the
Act prior to the effectiveness of a registration statement
with respect to the Series A Notes or the Series B Notes, as
applicable.
5. REPRESENTATIONS AND WARRANTIES. (a) The Company and
------------------------------
the Guarantors, jointly and severally, represent and warrant to
the Initial Purchasers that:
(i) The Preliminary Offering Memorandum and the
Offering Memorandum have been prepared in connection with
the Exempt Resales. The Preliminary Offering Memorandum and
the Offering Memorandum do not, and any supplement or
amendment to them will not, contain any untrue statement of
a material fact or omit to state any material fact required
to be stated therein or necessary in order to make the
statements therein, in the light of the circumstances under
which they were made, not misleading, except that the
representations and warranties contained in this paragraph
shall not apply to statements in or omissions from the
Preliminary Offering Memorandum and the Offering Memorandum
(or any supplement or amendment thereto) made in reliance
upon and in conformity with information relating to the
Initial Purchasers furnished to the Company in writing by
the Initial Purchasers expressly for use therein.
(ii) The Company and each Guarantor (A) has been
duly organized and is validly existing as a corporation in
good standing under the laws of its jurisdiction of
incorporation or organization, (B) has all requisite
corporate power and authority to carry on its business as it
is currently being conducted and as described in the
Offering Memorandum and to own, lease and operate its
properties, and (C) is duly qualified and in good standing
as a foreign corporation, authorized to do business in each
jurisdiction in which the nature of its business or its
ownership or leasing of property requires such
qualification, except where the failure to be so qualified
could not reasonably be expected to (x) result, individually
or in the aggregate, in a material adverse effect on the
properties, business, prospects, results of operations or
condition (financial or otherwise) of the Company and its
subsidiaries, taken as a whole, (y) interfere with or
adversely affect the issuance of the Notes pursuant hereto
or (z) in any manner draw into question the validity of this
Agreement or any other Operative Document or the
transactions described in the Offering Memorandum under the
caption "Use of Proceeds" (any of the events set forth in
clauses (x), (y) or (z), a "Material Adverse Effect").
-----------------------
(iii) The Company is not a "foreign private issuer"
as that term is defined in Rule 405 of the Act.
(iv) The Company has an authorized capitalization
as set forth under "Capitalization" in the Offering
Memorandum, and all of the issued shares of capital stock of
the Company have been duly and validly authorized and issued
and are fully paid and non-assessable; all of the issued
shares of capital stock of each Guarantor have been duly and
validly authorized and issued, are fully paid and
non-assessable and are owned directly or indirectly by the
Company, free and clear of all liens, encumbrances, equities
or claims other than those arising under the Credit
Facilities (as defined in the Offering Memorandum).
(v) Except as disclosed in the Offering Memorandum,
there are not currently any outstanding subscriptions,
rights, warrants, calls, commitments of sale or options to
acquire, or instruments convertible into or exchangeable
for, any capital stock or other equity interest of the
Company or any of the Guarantors.
(vi) When the Series A Notes and the Guarantees
are issued and delivered pursuant to this Agreement, neither
the Series A Notes nor the Guarantees will be of the same
class (within the meaning of Rule 144A under the Act) as
securities of the Company or any Guarantor that are listed
on a national securities exchange registered under Section 6
of the Exchange Act or that are quoted in a United States
automated inter-dealer quotation system.
(vii) Each of the Company and the Guarantors has
all requisite corporate power and authority to execute,
deliver and perform its obligations under this Agreement and
each of the other Operative Documents to which it is a party
and to consummate the transactions contemplated hereby and
thereby, including, without limitation, the corporate power
and authority to issue, sell and deliver the Notes and to
issue and deliver the Guarantees as provided herein and
therein.
(viii) This Agreement has been duly and validly
authorized, executed and delivered by each of the Company
and the Guarantors.
(ix) The Indenture has been duly and validly
authorized by each of the Company and the Guarantors and,
when duly executed and delivered by each of the Company and
the Guarantors, will be the legal, valid and binding
obligation of each of the Company and the Guarantors,
enforceable against each of them in accordance with its
terms, subject to applicable bankruptcy, insolvency,
fraudulent conveyance, reorganization or similar laws
affecting the rights of creditors generally and subject to
general principles of equity. The Indenture conforms in all
material respects to the description thereof in the Offering
Memorandum.
(x) The Registration Rights Agreement has been duly
and validly authorized by each of the Company and the
Guarantors and, when duly executed and delivered by each of
the Company and the Guarantors, will be the legal, valid and
binding obligation of each of the Company and the
Guarantors, enforceable against each of them in accordance
with its terms, subject to applicable bankruptcy,
insolvency, fraudulent conveyance, reorganization or similar
laws affecting the rights of creditors generally and subject
to general principles of equity and provided that rights to
indemnification and contribution thereunder may be limited
by federal or state securities laws or public policy
relating thereto. The Registration Rights Agreement
conforms in all material respects to the description thereof
in the Offering Memorandum.
(xi) The Series A Notes have been duly and validly
authorized by the Company for issuance and sale to the
Initial Purchasers pursuant to this Agreement and, when
issued and authenticated in accordance with the terms of the
Indenture and delivered against payment therefor in
accordance with the terms hereof and thereof, will be the
legal, valid and binding obligations of the Company,
enforceable against it in accordance with their terms and
entitled to the benefits of the Indenture, subject to
applicable bankruptcy, insolvency, fraudulent conveyance,
reorganization or similar laws affecting the rights of
creditors generally and subject to general principles of
equity. The Series A Notes conform in all material respects
to the description thereof in the Offering Memorandum.
(xii) The Guarantees of the Series A Notes have
been duly and validly authorized by each of the Guarantors
and, when executed and delivered in accordance with the
terms of the Indenture and when the Series A Notes have been
issued and authenticated in accordance with the terms of the
Indenture and delivered against payment therefor in
accordance with the terms hereof and thereof, will be the
legal, valid and binding obligations of each of the
Guarantors, enforceable against each of them in accordance
with their terms and entitled to the benefits of the
Indenture, subject to applicable bankruptcy, insolvency,
fraudulent conveyance, reorganization or similar laws
affecting the rights of creditors generally and subject to
general principles of equity. The Guarantees of the Series
A Notes conform in all material respects to the description
thereof in the Offering Memorandum.
(xiii) Neither the Company nor any of the Guarantors
is (A) in violation of its charter or bylaws, (B) in default
in the performance of any bond, debenture, note, indenture,
mortgage, deed of trust or other agreement or instrument to
which it is a party or by which it is bound or to which any
of its properties is subject, or (C) in violation of any
local, state, federal or foreign law, statute, ordinance,
rule, regulation, requirement, judgment or court decree
(including, without limitation, environmental laws,
statutes, ordinances, rules, regulations, judgments or court
decrees) applicable to it or any of its assets or properties
(whether owned or leased), except, in the case of clause (B)
or (C), where such event could not reasonably be expected to
have a Material Adverse Effect. To the best knowledge of
the Company and the Guarantors, there exists no condition
that, with notice, the passage of time or otherwise, would
constitute a default under any such document or instrument,
which default could reasonably be expected to have a
Material Adverse Effect.
(xiv) None of (A) the execution, delivery or
performance by the Company or any of the Guarantors of this
Agreement or any of the other Operative Documents to which
it is a party, (B) the issuance and sale of the Notes or the
Guarantees or (C) consummation of the transactions described
in the Offering Memorandum under the caption "Use of
Proceeds," violates, conflicts with or constitutes a breach
of any of the terms or provisions of, or a default under (or
an event that with notice or the lapse of time, or both,
would constitute a default), or result in the imposition of
a lien or encumbrance on any properties of the Company or
any of the Guarantors, or an acceleration of any
indebtedness of the Company or any of the Guarantors
pursuant to, (1) the charter or bylaws (or comparable
constituent documents) of the Company or any of the
Guarantors, (2) any bond, debenture, note, indenture,
mortgage, deed of trust or other agreement or instrument to
which the Company or any of the Guarantors is a party or by
which any of them or their property is or may be bound, (3)
any statute, rule or regulation (excluding any securities
law statute, rule or regulation) applicable to the Company
or any of the Guarantors or any of their assets or
properties or (4) any judgment, order or decree of any court
or governmental agency or authority having jurisdiction over
the Company or any of the Guarantors or any of their assets
or properties, except, in the case of clause (2), (3) or
(4), where such event could not reasonably be expected to
have a Material Adverse Effect. No consent, approval,
authorization or order of, or filing, registration,
qualification, license or permit of or with, (A) any court
or governmental agency, body or administrative agency or (B)
any other person is required for (1) the execution, delivery
and performance by the Company or any of the Guarantors of
this Agreement or any of the other Operative Documents to
which it is a party, (2) the issuance and sale of the Notes
or the Guarantees or (3) consummation of the transactions
described in the Offering Memorandum under the caption "Use
of Proceeds," except such as have been obtained and made
(or, in the case of the Registration Rights Agreement, will
be obtained and made) under the Act, the Trust Indenture Act
of 1939, as amended (the "Trust Indenture Act"), and state
-------------------
securities or Blue Sky laws and regulations, or such as may
be required by the NASD.
(xv) Other than as set forth in the Offering
Memorandum, there are no legal or governmental proceedings
pending to which the Company or any of its subsidiaries is a
party or of which any property of the Company or any of its
subsidiaries is the subject which, if determined adversely
to the Company or any of its subsidiaries, would
individually or in the aggregate have a Material Adverse
Effect; and, to the best of the Company's and the
Guarantors' knowledge, no such proceedings are threatened or
contemplated by governmental authorities or threatened by
others.
(xvi) Each of the Company and its subsidiaries
owns, possesses or has obtained all governmental licenses,
permits, certificates, consents, orders, approvals and other
authorizations (the "Governmental Authorizations") necessary
---------------------------
to own or lease, as the case may be, and to operate its
properties and to carry on its business as presently
conducted, except where the failure to own, possess or
obtain such Government Authorizations would not, in the
aggregate, have a Material Adverse Effect, and, except as
disclosed in the Offering Memorandum, neither the Company
nor any subsidiary has received any notice of proceedings
relating to revocation or modification of any such licenses,
permits, certificates, consents, orders, approvals or
authorizations which, singly or in the aggregate, if the
subject of an unfavorable decision, ruling or finding, would
have a Material Adverse Effect.
(xvii) Each of the Company and its subsidiaries
(i) is in compliance with any and all applicable foreign,
federal, state and local laws and regulations relating to
the protection of human health and safety, the environment
or hazardous or toxic substances or waste, pollutants or
contaminants ("Environmental Laws"), (ii) has received all
------------------
permits, licenses or other approvals required of it under
applicable Environmental Laws to conduct its business and
(iii) is in compliance with all terms and conditions of any
such permit, license or approval, except for such
noncompliance with Environmental Laws, failure to receive
required permits, licenses or other approvals or failure to
comply with the terms and conditions of such permits,
licenses or approvals that would not, singly or in the
aggregate, have a Material Adverse Effect.
(xviii) Neither the Company nor any of the Guarantors
is a party to any union or collective bargaining agreement,
and there is no significant strike, labor dispute, slowdown
or stoppage pending against the Company or any of the
Guarantors nor, to the knowledge of the Company and the
Guarantors, threatened against the Company or any of the
Guarantors, except, in each case, as is disclosed in the
Offering Memorandum or as could not reasonably be expected
to have a Material Adverse Effect.
(xix) The Company and each of the Guarantors has
(i) good and indefeasible title to all real property owned
by it to the extent necessary to carry on its business and
(ii) good and valid title to all personal property owned by
it, in each case free and clear of all liens, encumbrances
and defects except such as are described in the Offering
Memorandum or such as do not materially affect the value of
such property and do not interfere with the use made and
proposed to be made of such property by the Company and the
Guarantors, considered as one enterprise; the Company and
each of the Guarantors enjoys peaceful and undisturbed
possession under all leases of real estate and personal
property used in the conduct of their business.
(xx) The Company and each of the Guarantors have
(i) filed all federal, state and local and foreign tax
returns which are required to be filed through the date
hereof, and all such tax returns are true, complete and
accurate in all material respects, or (ii) received valid
extensions thereof and have paid all taxes shown on such
returns and all assessments received by them except where,
in the case of state and local and foreign tax returns, the
failure to file in clause (i), or extend the due date of or
pay the same in clause (ii), in the aggregate, could not
reasonably be expected to have a Material Adverse Effect;
and the Company has no knowledge of any tax deficiency which
has been or might be asserted against the Company or any of
its subsidiaries which could reasonably be expected to have
a Material Adverse Effect.
(xxi) None of the Company, the Guarantors or any of
the Company's other subsidiaries is (i) an "investment
company" or (ii) a company "controlled" by an "investment
company" within the meaning of the Investment Company Act of
1940, as amended (the "Investment Company Act").
----------------------
(xxii) The Company and each of the Guarantors
maintains a system of internal accounting controls
sufficient to provide reasonable assurance that:
(A) transactions are executed in accordance with
management's general or specific authorizations;
(B) transactions are recorded as necessary to permit
preparation of financial statements in conformity with
generally accepted accounting principles and to maintain
accountability for assets; (C) access to assets is permitted
only in accordance with management's general or specific
authorization; and (D) the recorded accountability for
assets is compared with the existing assets at reasonable
intervals and appropriate action is taken with respect to
any material discrepancies.
(xxiii) None of the Company, the Guarantors or any of
the Company's other subsidiaries has (A) taken, directly or
indirectly, any action designed to, or that might reasonably
be expected to, cause or result in stabilization or
manipulation of the price of any security of the Company to
facilitate the sale or resale of the Notes or (B) since the
date of the Preliminary Offering Memorandum (1) sold, bid
for, purchased or paid any person any compensation for
soliciting purchases of, the Notes or (2) paid or agreed to
pay to any person any compensation for soliciting another to
purchase any other securities of the Company, any of the
Guarantors or any of the Company's other subsidiaries.
(xxiv) Subject to compliance by the Initial Purchasers
with the representations and warranties set forth in Section
5(b)(ii) and the procedures set forth in Annex I hereof, it
is not necessary in connection with the offer, sale and
delivery of the Series A Notes to the Initial Purchasers and
to each Eligible Purchaser, in the manner contemplated by
this Agreement and the Offering Memorandum, to register the
Series A Notes under the Act or the Trust Indenture Act. No
securities of the same class as the Notes or the Guarantees
have been issued and sold by the Company, any of the
Guarantors or any of the Company's other subsidiaries within
the six-month period immediately prior to the date hereof.
(xxv) Neither the Company, any of the Guarantors,
nor any person acting on their behalf (other than the
Initial Purchasers, as to whom the Company and the
Guarantors make no representation or warranty) has offered
or sold the Series A Notes by means of any general
solicitation or general advertising within the meaning of
Rule 502(c) under the Act or, with respect to Series A Notes
sold outside the United States to non-U.S. persons, by means
of any directed selling efforts within the meaning of
Rule 902 under the Act and the Company, its affiliates and
any person acting on their behalf (other than the Initial
Purchasers, as to whom the Company and the Guarantors make
no representation or warranty) have complied with and will
implement the "offering restrictions" within the meaning of
such Rule 902.
(xxvi) Each of the Preliminary Offering Memorandum, as
of its date, and the Offering Memorandum, as of its date and
as of the Closing Date, and each amendment or supplement
thereto, as of its date and as of the Closing Date, contains
the information specified in, and meets the requirements of,
Rule 144A(d)(4) under the Act.
(xxvii) None of the execution, delivery and performance
of this Agreement, the issuance and sale of the Notes and
the Guarantees, the application of the proceeds from the
issuance and sale of the Notes and the consummation of the
transactions contemplated by the Company or the Guarantors
as set forth in the Offering Memorandum, will violate
Regulations G, T, U or X promulgated by the Board of
Governors of the Federal Reserve System or analogous foreign
laws and regulations.
(xxviii) The accountants who have certified the
financial statements included as part of the Offering
Memorandum are independent accountants. The historical
consolidated financial statements, together with related
schedules and notes thereto, of the Company comply as to
form in all material respects with the requirements
applicable to registration statements on Form S-1 under the
Act and present fairly in all material respects the
consolidated financial position, results of operations and
changes in stockholders' investment and cash flows of the
Company at the respective dates or for the periods
indicated. Such financial statements have been prepared in
accordance with generally accepted accounting principles
applied on a consistent basis throughout the periods
presented unless otherwise stated therein. The other
financial and statistical information and data included in
the Offering Memorandum, historical and pro forma, fairly
present in all material respects the information they
purport to present and are prepared on a basis consistent
with the financial statements included in the Offering
Memorandum and the books and records of the Company, the
Guarantors and the Company's other subsidiaries, as
applicable. The "as adjusted" financial information
included in the Offering Memorandum that gives effect to the
issuance of the Notes, the application of the net proceeds
therefrom and the other transactions and events specified
therein has been properly compiled on the basis of the
assumptions set forth with respect thereto.
(xxix) There are no contracts, indentures, mortgages,
loan agreements, notes, leases or other agreements or
instruments or other documents (collectively, "Documents")
---------
required to be described or referred to in a Registration
Statement on Form S-1 other than those described or referred
to in the Offering Memorandum; all descriptions of Documents
in the Offering Memorandum are accurate in all material
respects and present fairly the information described
therein.
(xxx) Neither the Company nor any of the Guarantors
intends to, nor does it believe that it will, incur debts
beyond its ability to pay such debts as they mature. The
present fair saleable value of the assets of each of the
Company and the Guarantors exceeds the amount that will be
required to be paid on or in respect of its existing debts
and other liabilities (including contingent liabilities) as
they become absolute and matured. The assets of each of the
Company and the Guarantors do not constitute unreasonably
small capital to carry out its business as conducted or as
proposed to be conducted. Upon the issuance of the Notes
and the Guarantees, the present fair saleable value of the
assets of each of the Company and the Guarantors will exceed
the amount that will be required to be paid on or in respect
of its existing debts and other liabilities (including
contingent liabilities) as they become absolute and matured.
Upon the issuance of the Notes and the Guarantees, the
assets of each of the Company and the Guarantors will not
constitute unreasonably small capital to carry out its
businesses as now conducted, including its capital needs,
taking into account the projected capital requirements and
capital availability.
The Company and the Guarantors each acknowledge that the
Initial Purchasers and, for purposes of the opinions to be
delivered to the Initial Purchasers pursuant to Section 8 hereof,
counsel for the Company and the Guarantors and counsel for the
Initial Purchasers, will rely upon the accuracy and truth of the
foregoing representations and hereby consent to such reliance.
(b) Each Initial Purchaser represents, warrants and
covenants to the Company and the Guarantors and agrees that:
(i) Such Initial Purchaser is a QIB, with such
knowledge and experience in financial and business matters
as are necessary in order to evaluate the merits and risks
of an investment in the Series A Notes.
(ii) Such Initial Purchaser (A) is not acquiring the
Series A Notes with a view to any distribution thereof that
would violate the Act or the securities laws of any state of
the United States or any other applicable jurisdiction and
(B) will be reoffering and reselling the Series A Notes only
to (1) persons that it reasonably believes are QIBs in
reliance on the exemption from the registration requirements
of the Act provided by Rule 144A, (2) institutions that it
reasonably believes are Accredited Investors in a private
placement exempt from the registration requirements of the
Act, or (3) non-U.S. persons outside the United States in
reliance upon Regulation S under the Act.
(iii) No form of general solicitation or general
advertising (as such terms are defined in Rule 502(c) under
the Act) has been or will be used by such Initial Purchaser
or any of its representatives in connection with the offer
and sale of any of the Series A Notes, including, but not
limited to, articles, notices or other communications
published in any newspaper, magazine, or similar medium or
broadcast over television or radio, or any seminar or
meeting whose attendees have been invited by any general
solicitation or general advertising.
(iv) Neither the Initial Purchasers, nor any person
acting on their behalf, has offered or sold the Series A
Notes by means of any general solicitation or general
advertising within the meaning of Rule 502(c) under the Act
or, with respect to Series A Notes sold outside the United
States to non-U.S. persons, by means of any directed selling
efforts within the meaning of Rule 902 under the Act and the
Initial Purchasers and any person acting on their behalf
have complied with and will implement the "offering
restrictions" within the meaning of such Rule 902.
(v) In connection with the Exempt Resales, it will
offer to sell the Series A Notes only to, and will solicit
offers to buy the Series A Notes only from, persons who in
purchasing such Series A Notes will be deemed to have
represented and agreed (1) if such person is a QIB, that it
is purchasing the Series A Notes for its own account or an
account with respect to which it exercises sole investment
discretion and that its or such accounts are QIBs, (2) if
such person is an Accredited Investor, that such person has
made the representations contained in, and executed and
returned to such Initial Purchaser a certificate in the form
of, Annex A attached to the Offering Memorandum, (3) that
such Series A Notes will not have been registered under the
Act and may be resold, pledged or otherwise transferred only
(A) (I) to a person who the seller reasonably believes is a
QIB, (II) in a transaction meeting the requirements of Rule
144 under the Act, (III) outside the United States to a
foreign person in a transaction meeting the requirements of
Rule 904 under the Act or (IV) in accordance with another
exemption from the registration requirements of the Act (and
based upon an opinion of counsel if the Company so
requests), (B) to the Company or (C) pursuant to an
effective registration statement under the Act, in each
case, in accordance with any applicable securities laws of
any State of the United States or any other applicable
jurisdiction, and (4) that the holder will, and each
subsequent holder is required to, notify any purchasers from
it of the security evidenced thereby of the resale
restrictions set forth in (3) above.
Each Initial Purchaser acknowledges that the Company and the
Guarantors and, for purposes of the opinions to be delivered to
such Initial Purchaser pursuant to Section 8 hereof, counsel for
the Company and the Guarantors and counsel for the Initial
Purchasers, will rely upon the accuracy and truth of the
foregoing representations and hereby consents to such reliance.
6. INDEMNIFICATION. (a) The Company and the Guarantors,
---------------
jointly and severally, agree to indemnify and hold harmless (i)
the Initial Purchasers, (ii) each person, if any, who controls
the Initial Purchasers within the meaning of Section 15 of the
Act or Section 20(a) of the Exchange Act and (iii) the respective
officers, directors, partners, employees, representatives and
agents of the Initial Purchasers or any controlling person to the
fullest extent lawful, from and against any and all losses,
liabilities, claims, damages and expenses whatsoever (including
but not limited to reasonable attorneys' fees and any and all
expenses whatsoever reasonably incurred in investigating,
preparing or defending against any investigation or litigation,
commenced or threatened, or any claim whatsoever, and any and all
amounts paid in settlement of any claim or litigation), joint or
several, to which they or any of them may become subject under
the Act, the Exchange Act or otherwise, insofar as such losses,
liabilities, claims, damages or expenses (or actions in respect
thereof) arise out of or are based upon any untrue statement or
alleged untrue statement of a material fact contained in the
Preliminary Offering Memorandum or the Offering Memorandum, or in
any supplement thereto or amendment thereof, or arise out of or
are based upon the omission or alleged omission to state therein
a material fact required to be stated therein or necessary to
make the statements therein, in the light of the circumstances
under which they were made, not misleading; provided, however,
that the Company and the Guarantors will not be liable in any
such case to the extent, but only to the extent, that any such
loss, liability, claim, damage or expense arises out of or is
based upon any such untrue statement or alleged untrue statement
or omission or alleged omission made therein in reliance upon and
in conformity with written information furnished to the Company
by the Initial Purchasers expressly for use therein. This
indemnity agreement will be in addition to any liability which
the Company and the Guarantors may otherwise have, including
under this Agreement.
(b) Each Initial Purchaser agrees to indemnify and hold
harmless (i) the Company and each of the Guarantors, (ii) each
person, if any, who controls the Company or any Guarantor within
the meaning of Section 15 of the Act or Section 20(a) of the
Exchange Act and (iii) the respective officers, directors,
partners, employees, representatives and agents of the Company,
the Guarantors or any controlling person to the fullest extent
lawful, from and against any losses, liabilities, claims, damages
and expenses whatsoever (including but not limited to attorneys'
fees and any and all expenses whatsoever incurred in
investigating, preparing or defending against any investigation
or litigation, commenced or threatened, or any claim whatsoever
and any and all amounts paid in settlement of any claim or
litigation), joint or several, to which they or any of them may
become subject under the Act, the Exchange Act or otherwise,
insofar as such losses, liabilities, claims, damages or expenses
(or actions in respect thereof) arise out of or are based upon
any untrue statement or alleged untrue statement of a material
fact contained in the Preliminary Offering Memorandum or the
Offering Memorandum, or in any amendment thereof or supplement
thereto, or arise out of or are based upon the omission or
alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein, in
the light of the circumstances under which they were made, not
misleading, in each case to the extent, but only to the extent,
that any such loss, liability, claim, damage or expense arises
out of or is based upon any untrue statement or alleged untrue
statement or omission or alleged omission made therein in
reliance upon and in conformity with written information
furnished to the Company by such Initial Purchasers expressly for
use therein; provided, however, that in no case shall either
Initial Purchaser be liable or responsible for any amount in
excess of the discounts received by such Initial Purchaser, as
set forth on the cover page of the Offering Memorandum. This
indemnity will be in addition to any liability which each Initial
Purchaser may otherwise have, including under this Agreement.
(c) Promptly after receipt by an indemnified party under
subsection (a) or (b) above of notice of the commencement of any
action, such indemnified party shall, if a claim in respect
thereof is to be made against the indemnifying party under such
subsection, notify each party against whom indemnification is to
be sought in writing of the commencement thereof (but the failure
so to notify an indemnifying party shall not relieve it from any
liability which it may have under this Section 6 or otherwise
except to the extent that it has been prejudiced in any material
respect by such failure). In case any such action is brought
against any indemnified party, and it notifies an indemnifying
party of the commencement thereof, the indemnifying party will be
entitled to participate therein, and to the extent it may elect
by written notice delivered to the indemnified party promptly
after receiving the aforesaid notice from such indemnified party,
to assume and control the defense thereof with counsel reasonably
satisfactory to such indemnified party. Notwithstanding the
foregoing, the indemnified party or parties shall have the right
to employ its or their own counsel in any such case, but the fees
and expenses of such counsel shall be at the expense of such
indemnified party or parties unless (i) the employment of such
counsel shall have been authorized in writing by the indemnifying
parties in connection with the defense of such action, (ii) the
indemnifying parties shall not have employed counsel to take
charge of the defense of such action within a reasonable time
after notice of commencement of the action, or (iii) such
indemnified party or parties shall have reasonably concluded that
there may be defenses available to it which are different from or
additional to those available to one or all of the indemnifying
parties (in which case the indemnifying party shall not have the
right to direct the defense of such action on behalf of the
indemnified party or parties), in any of which events such fees
and expenses of counsel shall be borne by the indemnifying
parties; provided, however, that the indemnifying party under
subsection (a) or (b) above shall only be liable for the legal
expenses of one counsel (in addition to any local counsel) for
all indemnified parties. Anything in this subsection to the
contrary notwithstanding, an indemnifying party shall not be
liable for any settlement of any claim or action effected without
its prior written consent, provided that such consent was not
unreasonably withheld.
7. CONTRIBUTION. In order to provide for contribution in
------------
circumstances in which the indemnification provided for in
Section 6 is for any reason held to be unavailable or is
insufficient to hold harmless a party indemnified thereunder, the
Company and the Guarantors, on the one hand, and each Initial
Purchaser, on the other hand, shall contribute to the aggregate
losses, claims, damages, liabilities and expenses of the nature
contemplated by such indemnification provision (including any
investigation, legal and other expenses incurred in connection
with, and any amount paid in settlement of, any action, suit or
proceeding or any claims asserted, but after deducting in the
case of losses, claims, damages, liabilities and expenses
suffered by the Company and the Guarantors, any contribution
received by the Company and the Guarantors from persons, other
than the Initial Purchasers, who may also be liable for
contribution, including persons who control the Company and the
Guarantors within the meaning of Section 15 of the Act or Section
20(a) of the Exchange Act) to which the Company, the Guarantors
and each Initial Purchaser may be subject, in such proportion as
is appropriate to reflect the relative benefits received by the
Company and the Guarantors, on one hand, and each Initial
Purchaser, on the other hand, from the offering of the Series A
Notes or, if such allocation is not permitted by applicable law
or indemnification is not available as a result of the
indemnifying party not having received notice as provided in
Section 6, in such proportion as is appropriate to reflect not
only the relative benefits referred to above but also the
relative fault of the Company and the Guarantors, on one hand,
and each Initial Purchaser, on the other hand, in connection with
the statements or omissions which resulted in such losses,
claims, damages, liabilities or expenses, as well as any other
relevant equitable considerations. The relative benefits
received by the Company and the Guarantors, on one hand, and each
Initial Purchaser, on the other hand, shall be deemed to be in
the same proportion as (i) the total proceeds from the offering
of Series A Notes (net of discounts but before deducting
expenses) received by the Company and the Guarantors and (ii) the
discounts received by each Initial Purchaser, respectively, in
each case as set forth in the table on the cover page of the
Offering Memorandum. The relative fault of the Company and the
Guarantors, on one hand, and of each Initial Purchaser, on the
other hand, shall be determined by reference to, among other
things, whether the untrue or alleged untrue statement of a
material fact or the omission or alleged omission to state a
material fact relates to information supplied by the Company, the
Guarantors or each Initial Purchaser and the parties' relative
intent, knowledge, access to information and opportunity to
correct or prevent such statement or omission. The Company, the
Guarantors and each Initial Purchaser agrees that it would not be
just and equitable if contribution pursuant to this Section 7
were determined by pro rata allocation or by any other method of
allocation which does not take into account the equitable
considerations referred to above. Notwithstanding the provisions
of this Section 7, (i) in no case shall an Initial Purchaser be
required to contribute any amount in excess of the amount by
which the discounts applicable to the Series A Notes purchased by
such Initial Purchaser pursuant to this Agreement exceeds the
amount of any damages which such Initial Purchaser has otherwise
been required to pay by reason of any untrue or alleged untrue
statement or omission or alleged omission and (ii) no person
guilty of fraudulent misrepresentation (within the meaning of
Section 11(f) of the Act) shall be entitled to contribution from
any person who was not guilty of such fraudulent
misrepresentation. For purposes of this Section 7, (A) each
person, if any, who controls each Initial Purchaser within the
meaning of Section 15 of the Act or Section 20(a) of the Exchange
Act and (B) the respective officers, directors, partners,
employees, representatives and agents of each Initial Purchaser
or any controlling person shall have the same rights to
contribution as the Initial Purchaser with which they are
associated, and each person, if any, who controls the Company and
the Guarantors within the meaning of Section 15 of the Act or
Section 20(a) of the Exchange Act shall have the same rights to
contribution as the Company and the Guarantors, subject in each
case to clauses (i) and (ii) in the preceding sentence of this
Section 7. Any party entitled to contribution will, promptly
after receipt of notice of commencement of any action, suit or
proceeding against such party in respect of which a claim for
contribution may be made against another party or parties under
this Section 7, notify such party or parties from whom
contribution may be sought, but the failure to so notify such
party or parties shall not relieve the party or parties from whom
contribution may be sought from any obligation it or they may
have under this Section 7 or otherwise, except to the extent it
has been prejudiced in any material respect by such failure. No
party shall be liable for contribution with respect to any action
or claim settled without its prior written consent, provided that
such written consent was not unreasonably withheld.
8. CONDITIONS OF INITIAL PURCHASERS' OBLIGATIONS. The
---------------------------------------------
obligation of the Initial Purchasers to purchase and pay for the
Series A Notes, as provided herein, shall be subject to the
satisfaction of the following conditions:
(a) All of the representations and warranties of the
Company and the Guarantors contained in this Agreement shall
be true and correct on the date hereof and on the Closing
Date with the same force and effect as if made on and as of
the date hereof and the Closing Date, respectively. Each of
the Company and the Guarantors shall have performed or
complied with all of the agreements herein contained and
required to be performed or complied with by it at or prior
to the Closing Date.
(b) The Offering Memorandum shall have been printed
and copies distributed to the Initial Purchasers not later
than 10:00 a.m., New York City time, on the day following
the date of this Agreement or at such later date and time as
to which the Initial Purchasers may agree, and no stop order
suspending the qualification or exemption from qualification
of the Series A Notes in any jurisdiction referred to in
Section 4(f) shall have been issued and no proceeding for
that purpose shall have been commenced or shall be pending
or threatened.
(c) No action shall have been taken and no statute,
rule, regulation or order shall have been enacted, adopted
or issued by any governmental agency which would, as of the
Closing Date, prevent the issuance of the Series A Notes; no
action, suit or proceeding shall have been commenced and be
pending against or affecting or, to the best knowledge of
the Company and the Guarantors, threatened against, the
Company, any of the Guarantors or any of the Company's other
subsidiaries before any court or arbitrator or any
governmental body, agency or official that, if adversely
determined, could reasonably be expected to result in a
Material Adverse Effect; and no stop order shall have been
issued preventing the use of the Offering Memorandum, or any
amendment or supplement thereto, or which could reasonably
be expected to have a Material Adverse Effect.
(d) Since the dates as of which information is given
in the Offering Memorandum, (i) there shall not have been
any material change, or any development that is reasonably
likely to result in a material adverse change, in the
capital stock or the long-term debt, or material increase in
the short-term debt, of the Company, any of the Guarantors
or any of the Company's other subsidiaries from that set
forth in the Offering Memorandum, (ii) no dividend or
distribution of any kind shall have been declared, paid or
made by the Company on any class of its capital stock and
(iii) other than pursuant to this Agreement, none of the
Company, the Guarantors or any of the Company's other
subsidiaries shall have incurred any liabilities or
obligations, direct or contingent, that are or will be
material, individually or in the aggregate, to the Company,
the Guarantors and the Company's other subsidiaries, taken
as a whole, and that are required to be disclosed on a
balance sheet or notes thereto in accordance with generally
accepted accounting principles and are not disclosed on the
latest balance sheet or notes thereto included in the
Offering Memorandum. Since the date hereof and since the
dates as of which information is given in the Offering
Memorandum, there shall not have occurred any material
adverse change in the business, financial condition or
results of operation of the Company, the Guarantors and
their subsidiaries, taken as a whole.
(e) The Initial Purchasers shall have received a
certificate, dated the Closing Date, signed on behalf of
each of the Company and the Guarantors by two senior
officers, one of whom must be its Chief Financial Officer,
in form and substance satisfactory to the Initial
Purchasers, confirming, as of the Closing Date, the matters
set forth in paragraphs (a), (b), (c) and (d) of this
Section 8.
(f) Reid & Priest LLP, U.S. counsel for the Company,
shall have furnished to the Initial Purchasers their written
opinion, dated the Closing Date, in form and substance
satisfactory to the Initial Purchasers, to the effect that:
(i) This Agreement and the Registration Rights
Agreement have been duly authorized, executed and
delivered by the Company and the Guarantors;
(ii) The Series A Notes have been duly authorized,
executed, authenticated, issued and delivered and
constitute valid and legally binding obligations of the
Company entitled to the benefits provided by the
Indenture; the Series B Notes have been duly authorized
for issuance by the Company and, when duly executed,
authenticated, issued and delivered in exchange for the
Series A Notes in accordance with the terms of the
Indenture, will constitute valid and legally binding
obligations of the Company entitled to the benefits
provided by the Indenture; and the Indenture, the
Guarantees and the Notes conform, as to legal matters,
in all material respects to the descriptions thereof in
the Offering Memorandum;
(iii) The Indenture has been duly authorized,
executed and delivered by the Company and the
Guarantors and, assuming it has been duly authorized,
executed and delivered by the Trustee, constitutes a
valid and legally binding instrument, enforceable in
accordance with its terms, subject, as to enforcement,
to bankruptcy, insolvency, reorganization and other
laws of general applicability relating to or affecting
creditors' rights and to general equity principles
(regardless of whether such enforcement is considered
in a proceeding in equity or at law);
(iv) No consent, approval, authorization, order,
registration or qualification of or with any court or
governmental agency or body is required for the issue
and sale of the Notes or Guarantees or the consummation
by the Company of the transactions contemplated by this
Agreement or the Indenture, except such as may be
required under the Act in connection with the
transactions contemplated by the Registration Rights
Agreement and such consents, approvals, authorizations,
registrations or qualifications as may be required
under state securities or Blue Sky laws in connection
with the purchase and distribution of the Series A
Notes and Guarantees by the Initial Purchasers;
(v) The statements in the Offering Memorandum
under the caption "Description of the Notes," insofar
as they purport to summarize the terms of the Notes and
the Guarantees, are accurate in all material respects,
and the statements of law contained in the Offering
Memorandum under the caption "Certain Tax Consequences-
-United States Considerations" are accurate in all
material respects;
(vi) No registration of the Series A Notes or
Guarantees under the Act, and no qualification of an
indenture under the Trust Indenture Act of 1939, as
amended, with respect thereto, is required for the
initial offer and sale by the Company, or the resale by
the Initial Purchasers, of the Series A Notes and
Guarantees in the manner contemplated by this Agreement
and the Offering Memorandum;
(vii) The issue and sale of the Series A Notes
and Guarantees and the compliance by the Company and
the Guarantors with all of the provisions of the Series
A Notes, Guarantees, the Indenture, the Registration
Rights Agreement and this Agreement and the
consummation of the transactions therein and herein
contemplated will not result in a breach or violation
of any of the terms or provisions of, or constitute a
default under the Credit Facility (as defined in the
Preliminary Offering Memorandum) or any other agreement
for borrowed money filed as an exhibit to the Company's
Annual Report on Form 10-K for its fiscal year ended
November 30, 1997;
(viii) The Company is duly qualified as a
foreign corporation for the transaction of business and
is in good standing under the laws of the State of
Texas; and
(ix) Each Guarantor incorporated or organized in
the State of Delaware (each a "Delaware Guarantor" and
------------------
collectively, the "Delaware Guarantors") has been duly
-------------------
incorporated or organized and is validly existing as a
corporation in good standing under the laws of the
State of Delaware; all of the issued shares of capital
stock of each Delaware Guarantor have been duly and
validly authorized and issued and are fully paid and
nonassessable; to such counsel's knowledge, all of the
issued shares of capital stock of each Delaware
Guarantor are owned directly or indirectly by the
Company, free and clear of all liens, encumbrances,
equities or claims.
In addition, such opinion shall also contain a
statement that such counsel has participated in conferences
with certain officers and representatives of the Company,
counsel to the Initial Purchasers, representatives of the
independent public accountants of the Company, and
representatives of the Initial Purchasers at which the
contents of the Offering Memorandum and related matters were
discussed and, although such counsel is not passing upon and
does not assume any responsibility for the accuracy,
completeness or fairness of the statements contained in the
Offering Memorandum (except as stated in clause (vii)
above), on the basis of the foregoing (relying as to
materiality upon the officers and other representatives of
the Company), no information has come to the attention of
such counsel that have caused it to believe that the
Offering Memorandum, as of its date, contained any untrue
statement of a material fact or omitted to state a material
fact necessary to make the statements therein, in the light
of the circumstances under which they were made, not
misleading; it being understood that such counsel need make
no comment as to the financial statements and other
financial or statistical data included in the Offering
Memorandum; in rendering such opinion, such counsel may (i)
rely in respect to matters of fact upon certificates of
officers of the Company and its subsidiaries and upon
information obtained from public officials, (ii) assume that
all documents submitted to such counsel as originals are
authentic, that all copies submitted to such counsel conform
to the originals thereof, and that the signatures on all
documents examined by such counsel are genuine, (iii) rely
as to all matters of Canadian law upon the opinion of
Cassels Brock & Blackwell, Canadian counsel to the Company,
referred to in paragraph (j) below, (iv) state that such
counsel's opinion is limited to, except in reliance upon the
opinion of Canadian counsel as aforesaid, (a) federal law
and the laws of the State of New York and the General
Corporation Law of the State of Delaware, (v) assume the due
authorization, execution and delivery by the Company of this
Agreement, the Registration Rights Agreement, the Indenture
and the Series A Notes, and the due authorization by the
Company of the Series B Notes, (vi) assume, with respect to
the due authorization, execution and delivery of this
Agreement, the Registration Rights Agreement and the
Indenture by all Guarantors not incorporated in the State of
Delaware, that the laws of each such Guarantor's
jurisdiction of incorporation are similar to the laws of the
State of New York, and (vii) may make such other assumptions
and qualifications as may be reasonably acceptable to the
Initial Purchasers.
(g) At the time this Agreement is executed and at the
Closing Date, the Initial Purchasers shall have received
from Coopers & Lybrand, L.L.P. and Karlins Fuller Arnold &
Klodosky P.C., independent accountants, dated as of the date
of this Agreement and as of the Closing Date, customary
comfort letters addressed to the Initial Purchasers and in
form and substance reasonably satisfactory to the Initial
Purchasers and counsel for the Initial Purchasers with
respect to the financial statements and certain financial
information of the Company and its subsidiaries contained in
the Offering Memorandum.
(h) The Initial Purchasers shall have received an
opinion, dated the Closing Date, in form and substance
reasonably satisfactory to the Initial Purchasers, of
Vinson & Elkins L.L.P., counsel for the Initial Purchasers,
covering such matters as are customarily covered in such
opinions. In rendering such opinion, such counsel may rely
as to all matters of Canadian law upon the opinion of
Cassels Brock & Blackwell referred to in paragraph (j)
below.
(i) Vinson & Elkins L.L.P. shall have been furnished
with such documents, in addition to those set forth above,
as they may reasonably require for the purpose of enabling
them to review or pass upon the matters referred to in this
Section 8 and in order to evidence the accuracy,
completeness or satisfaction in all material respects of any
of the representations, warranties or conditions herein
contained.
(j) Further, Cassels Brock & Blackwell, Canadian
counsel to the Company, shall have furnished to the Initial
Purchasers their written opinion, dated the Closing Date, in
form and substance satisfactory to the Initial Purchasers,
to the effect that:
(i) The statements of law contained in "Certain
Tax Considerations--Canadian Taxation" and the second
paragraph of "Description of the Notes--Enforceability
of Judgments; Indemnification for Foreign Currency
Judgments" in the Offering Memorandum are accepted in
all material respects;
(ii) The Company has been duly incorporated and is
validly existing as a corporation in good standing
under the laws of the Ontario, Canada, with corporate
power and authority to own its properties and conduct
its business as described in the Offering Memorandum;
(iii) The Company has an authorized
capitalization as set forth under the caption
"Capitalization" in the Offering Memorandum, and all of
the issued shares of capital stock of the Company have
been duly and validly authorized and issued and are
fully paid and non-assessable;
(iv) This Agreement and the Registration Rights
Agreement have been duly authorized, executed and
delivered by the Company;
(v) The Series A Notes have been duly authorized,
executed, authenticated, issued and delivered and
constitute valid and legally binding obligations of the
Company entitled to the benefits provided by the
Indenture; the Series B Notes have been duly authorized
for issuance by the Company; and, to the extent
Canadian law applies, when duly executed,
authenticated, issued and delivered in exchange for the
Series A Notes in accordance with the terms of the
Indenture, the Series B Notes will constitute valid and
legally binding obligations of the Company entitled to
the benefits provided by the Indenture;
(vi) The Indenture has been duly authorized,
executed and delivered by the Company, to the extent
Canadian law applies and assuming it has been duly
authorized, executed and delivered by the Trustee, the
Indenture constitutes a valid and legally binding
instrument, enforceable in accordance with its terms,
subject, as to enforcement, to bankruptcy, insolvency,
reorganization and other laws of general applicability
relating to or affecting creditors' rights and to
general equity principles (regardless of whether such
enforcement is considered in a proceeding in equity or
at law); and
(vii) The issue and sale of the Series A Notes
and Guarantees and the compliance by the Company with
all of the provisions of the Series A Notes,
Guarantees, the Indenture, the Registration Rights
Agreement and this Agreement and the consummation of
the transactions therein and herein contemplated will
not result in a violation of the provisions of the
Certificate of Incorporation or By-Laws of the Company;
(k) Prior to the Closing Date, the Company and the
Guarantors shall have furnished to the Initial Purchasers
such further information, certificates and documents as the
Initial Purchasers may reasonably request.
(l) The Company, the Guarantors and the Trustee shall
have entered into the Indenture.
(m) The Company and the Guarantors shall have entered
into the Registration Rights Agreement with the Initial
Purchasers.
All opinions, certificates, letters and other documents
required by this Section 8 to be delivered by the Company and the
Guarantors will be in compliance with the provisions hereof only
if they are reasonably satisfactory in form and substance to the
Initial Purchasers. The Company and the Guarantors will furnish
the Initial Purchasers with such conformed copies of such
opinions, certificates, letters and other documents as they shall
reasonably request.
9. INITIAL PURCHASERS' INFORMATION. The Company, the
-------------------------------
Guarantors and the Initial Purchasers acknowledge that the
statements with respect to the offering of the Series A Notes set
forth in the last paragraph of the cover page and the third,
fifth and sixth paragraphs, the fourth sentence of the seventh
paragraph and the eight paragraph under the caption "Plan of
Distribution" in the Offering Memorandum constitute the only
information furnished in writing by the Initial Purchasers
expressly for use in the Offering Memorandum.
10. SURVIVAL OF REPRESENTATIONS AND AGREEMENTS. All
------------------------------------------
representations and warranties, covenants and agreements of the
Initial Purchasers, the Company and the Guarantors contained in
this Agreement, including the agreements contained in Sections
4(g) and 11(d), the indemnity agreements contained in Section 6
and the contribution agreements contained in Section 7, shall
remain operative and in full force and effect regardless of any
investigation made by or on behalf of the Initial Purchasers, any
controlling person thereof, or by or on behalf of the Company,
the Guarantors or any controlling person thereof, and shall
survive delivery of and payment for the Series A Notes to and by
the Initial Purchasers. The representations contained in
Section 5 and the agreements contained in Sections 4(g), 6, 7 and
11(d) shall survive the termination of this Agreement, including
any termination pursuant to Section 11.
11. EFFECTIVE DATE OF AGREEMENT; TERMINATION. (a) This
----------------------------------------
Agreement shall become effective upon execution and delivery of a
counterpart hereof by each of the parties hereto.
(b) The Initial Purchasers shall have the right to
terminate this Agreement at any time prior to the Closing Date by
notice to the Company from the Initial Purchasers, without
liability (other than with respect to Sections 6 and 7) on the
Initial Purchasers' part to the Company or any of the Guarantors
if, on or prior to such date, (i) the Company or any of the
Guarantors shall have failed, refused or been unable to perform
any agreement on its part to be performed hereunder, (ii) any
other condition to the obligations of the Initial Purchasers
hereunder as provided in Section 8 is not fulfilled when and as
required or (iii)(A) any domestic or international event or act
or occurrence has materially disrupted, or in the reasonable
opinion of the Initial Purchasers will in the immediate future
materially disrupt the market for the Company's securities or for
securities in general, (B) trading in securities generally on the
New York Stock Exchange shall have been suspended or materially
limited, or minimum or maximum prices for trading shall have been
established, or maximum ranges for prices for securities shall
have been required, on such exchange, or by such exchange or
other regulatory body or governmental authority having
jurisdiction, (C) a banking moratorium shall have been declared
by federal or New York State authorities, or a moratorium in
foreign exchange trading by major international banks or persons
shall have been declared, (D) there is an outbreak or escalation
of armed hostilities involving the United States on or after the
date hereof, or if there has been a declaration by the United
States of a national emergency or war, the effect of which shall
be, in the Initial Purchasers' judgment, to make it inadvisable
or impracticable to proceed with the offering or delivery of the
Series A Notes on the terms and in the manner contemplated in the
Offering Memorandum, or (E) there shall have been such a material
adverse change in general economic, political or financial
conditions or if the effect of international conditions on the
financial markets in the United States shall be such as, in the
Initial Purchasers' judgment, to make it inadvisable or
impracticable to proceed with the delivery of the Series A Notes
as contemplated hereby.
(c) Any notice of termination pursuant to this Section 11
shall be by telephone, telephonic facsimile, or telegraph,
confirmed in writing by letter.
(d) If this Agreement shall be terminated pursuant to any
of the provisions hereof, or if the sale of the Series A Notes
provided for herein is not consummated because any condition to
the obligations of the Initial Purchasers set forth herein is not
satisfied or because of any refusal, inability or failure on the
part of the Company or any of the Guarantors to perform any
agreement herein or comply with any provision hereof, the Company
and the Guarantors will reimburse the Initial Purchasers for all
reasonable out-of-pocket expenses (including the reasonable fees
and expenses of Initial Purchasers' counsel), incurred by the
Initial Purchasers in connection herewith.
12. NOTICE. All communications hereunder, except as may be
------
otherwise specifically provided herein, shall be in writing and,
if sent to the Initial Purchasers, shall be mailed, delivered, or
telecopied and confirmed in writing to Jefferies & Company, Inc.,
2 Houston Center, 909 Fannin Street, Suite 3100, Houston, Texas
77010, Attention: Corporate Finance Department, telecopy number
(713) 650-8730, with a copy to Vinson & Elkins L.L.P., 2300 First
City Tower, 1001 Fannin Street, Houston, Texas 77002, Attention:
T. Mark Kelly, telecopy number (713) 615-5531; and if sent to the
Company, shall be mailed, delivered or telecopied and confirmed
in writing to it at 11011 Jones Road, Houston, Texas 77070,
Attention: Chief Administrative Officer, telecopy number (281)
774-7006, with a copy to Reid & Priest LLP, 40 West 57th Street,
New York, New York 10019, Attention: Bruce A. Rich, telecopy
number (212)603-2001.
13. PARTIES. This Agreement shall inure solely to the
-------
benefit of, and shall be binding upon, the Initial Purchasers,
the Company, the Guarantors and the controlling persons and
agents referred to in Sections 6 and 7, and their respective
successors and assigns, and no other person shall have or be
construed to have any legal or equitable right, remedy or claim
under or in respect of or by virtue of this Agreement or any
provision herein contained. The term "successors and assigns"
----------------------
shall not include a purchaser, in its capacity as such, of Notes
from the Initial Purchasers.
14. CONSTRUCTION. This Agreement shall be construed in
------------
accordance with the internal laws of the State of New York.
15. CAPTIONS. The captions included in this Agreement are
--------
included solely for convenience of reference and are not to be
considered a part of this Agreement.
16. COUNTERPARTS. This Agreement may be executed in
------------
various counterparts which together shall constitute one and the
same instrument.
17. PARTIAL INVALIDITY. In case any provision of this
------------------
Agreement shall be invalid, illegal or unenforceable, the
validity, legality and enforceability of the remaining provisions
shall not in any way be affected or impaired thereby.
[Signature page to follow]
<PAGE>
If the foregoing correctly sets forth the understanding
among the Initial Purchasers, the Company and the Guarantors
please so indicate in the space provided below for that purpose,
whereupon this letter shall constitute a binding agreement among
us.
Very truly yours,
American Eco Corporation
By /s/ David L. Norris
----------------------------------
David L. Norris
Senior Vice President and
Chief Administrative Officer
The Turner Group, Inc.
C.A. Turner Construction Company
Action Contract Services, Inc.
C.A. Turner Maintenance, Inc.
H.E. Co. Services, Inc.
Cambridge Construction Service Corp.
Lake Charles Construction Corporation
United Eco Systems, Inc.
Eco Systems, Inc.
MM Industra Limited
Separation and Recovery Systems, Inc.
Industra Service Corporation
Industra Engineers & Consultants, Inc.
Industra Thermal Service Corporation
NUS, Inc.
Industra Service Corp.
Industra, Inc.
Industra Thermal Service Corp.
Chempower, Inc.
Global Power Company
Brookfield Corporation
Southwick Corporation
Controlled Power Limitd Partnership
Specialty Management Group, Inc.
Separation and Recovery Systems, Ltd.
By: /s/ David L. Norris
----------------------------------
David L. Norris
Vice President
Accepted and agreed to as of
the date first above written:
Jefferies & Company, Inc.
By /s/ Joe Maly
----------------------------
Name: Joe Maly
Title: Managing Director
Nesbitt Burns Securities Inc.
By /s/ William J. Moser, Jr.
----------------------------
Name: William J. Moser, Jr.
Title: Director
<PAGE>
ANNEX I
(1) The Series A Notes have not been and will not be
registered under the Securities Act and may not be offered or
sold within the United States or to, or for the account or
benefit of, U.S. persons except in accordance with Regulation S
under the Securities Act or pursuant to an exemption from the
registration requirements of the Securities Act. Each Initial
Purchaser represents that it has offered and sold the Series A
Nots, and will offer and sell the Series A Notes upon the
conversion thereof (i) as part of their distribution at any time
and (ii) otherwise until 40 days after the later of the
commencement of the offering and the Closing Date, only in
accordance with Rule 903 of Regulation S or Rule 144A under the
Securities Act or pursuant to Paragraph 2 of this Annex I.
Accordingly, each Initial Purchaser agrees that neither it, its
affiliates nor any persons acting on its or their behalf has
engaged or will engage in any directed selling efforts with
respect to the Series A Notes, and it and they have complied and
will comply with the offering restrictions requirement of
Regulation S. Each Initial Purchaser agrees that, at or prior to
confirmation of sale of Securities (other than a sale pursuant to
Rule 144A or pursuant to Paragraph 2 of this Annex I), it will
have sent to each distributor, dealer or person receiving a
selling concession, fee or other remuneration that purchases
Series A Notes from it during the Restricted Period (as defined
in the Offering Memorandum) a confirmation or notice to
substantially the following effect:
"The Series A Notes have not been registered under
the United States Securities Act of 1933, as amended
(the "Securities Act"), and may not be offered and sold
within the United States or to, or for the account or
benefit of, U.S. persons (i) as part of their
distribution at any time or (ii) otherwise until 40
days after the later of the commencement of the
offering and the closing date, except in either case in
accordance with Regulation S (or Rule 144A if
available) under the Securities Act. Terms used above
have the meaning given to them by Regulation S under
the Securities Act."
Terms used in this paragraph have the meanings given to them by
Regulation S.
Each Initial Purchaser further agrees that it has not
entered and will not enter into any contractual arrangement with
respect to the distribution or delivery of the Securities, except
with its affiliates or with the prior written consent of the
Company.
(2) Notwithstanding the foregoing, Series A Notes in
registered form may be offered, sold and delivered by the
Purchasers in the United States and to U.S. persons pursuant to
Section 3(a)(i) or (ii) of this Agreement without delivery of the
written statement required by paragraph (1) above.
(3) Each Initial Purchaser further represents and agrees
that (i) it has not offered or sold or invited any person to
offer to purchase and, prior to the date six months after the
date the Series A Notes are purchased by such Initial Purchaser,
will not offer or sell any Series A Notes to persons or invite
any person to offer to purchase any Series A Notes in the United
Kingdom except to persons whose ordinary activities involve them
in acquiring, holding, managing or disposing of investments (as
principal or agent) for the purposes of their businesses or
otherwise in circumstances which have not resulted and will not
result in an offer to the public in the United Kingdom within the
meaning of the Public Offers of Securities Regulations 1995,
(ii) it has complied, and will comply, with all applicable
provisions of the Financial Services Act 1986 of Great Britain
with respect to anything done by it in relation to the Series A
Notes in, from or otherwise involving the United Kingdom, and
(iii) it has only issued or passed on, and will only issue or
pass on, in the United Kingdom, any document received by it in
connection with the issuance of the Series A Notes to a person
who is of a kind described in Article 11(3) of the Financial
Services Act 1986 (Investment Advertisements) (Exemptions) Order
1995 of Great Britain or is a person to whom the document may
otherwise lawfully be issued or passed on.
(4) Each Initial Purchaser agrees that it will not offer,
sell or deliver any of the Series A Notes in any jurisdiction
outside the United States except under circumstances that will
result in compliance with the applicable laws thereof, and that
it will take at its own expense whatever action is required to
permit its purchase and resale of the Series A Notes in such
jurisdictions. Each Initial Purchaser understands that no action
has been taken to permit a public offering in any jurisdiction
outside the United States where action would be required for such
purpose. Each Initial Purchaser agrees not to cause any
advertisement of the Series A Notes to be published in any
newspaper or periodical or posted in any public place and not to
issue any circular relating to the Series A Notes, except in any
such case with the express written consent of Jefferies &
Company, Inc. and then only at its own risk and expense.
<PAGE>
EXHIBIT A
American Eco Corporation
The Turner Group, Inc. (DE)
C.A. Turner Construction Company (DE)
Action Contract Services, Inc. (DE)
C.A. Turner Maintenance, Inc. (DE)
H.E. Co. Services, Inc. (TX)
Cambridge Construction Service Corp. (NV)
Lake Charles Construction Corporation (LA)
United Eco Systems, Inc. (DE)
Eco Systems, Inc. (DE)
MM Industra Limited (NS)
Separation and Recovery Systems, Inc. (NV)
Industra Service Corporation (BC)
Industra Engineers & Consultants, Inc. (BC)
Industra Thermal Service Corporation (AB)
NUS, Inc. (WA)
Industra Service Corp. (WA)
Industra, Inc. (WA)
Industra Thermal Service Corp. (WA)
Chempower, Inc. (OH)
Global Power Company (OH)
Brookfield Corporation (OH)
Southwick Corporation (OH)
Controlled Power Limitd Partnership (IL)
Specialty Management Group, Inc. (TX)
Separation and Recovery Systems, Ltd. (UK)
=================================================================
AMERICAN ECO CORPORATION
AND
THE GUARANTORS NAMED ON THE SIGNATURE PAGE HERETO
$120,000,000
9 5/8% SERIES A SENIOR NOTES DUE 2008
REGISTRATION RIGHTS AGREEMENT
DATED AS OF MAY 21, 1998
JEFFERIES & COMPANY, INC.
NESBITT BURNS SECURITIES INC.
=================================================================
<PAGE>
This Registration Rights Agreement (this "Agreement") is
---------
made and entered into as of May 21, 1998 by and among American
Eco Corporation, an Ontario, Canada corporation (the "Company"),
-------
each of the subsidiary guarantors listed on the signature page
hereto (each a "Guarantor" and, collectively, the "Guarantors"),
--------- ----------
and Jefferies & Company, Inc. and Nesbitt Burns Securities Inc.
(each an "Initial Purchaser" and, collectively, the "Initial
----------------- -------
Purchasers"), who have agreed to purchase $120,000,000 aggregate
-----------
principal amount of the Company's 9 5/8% Series A Senior Notes
due 2008 (the "Series A Notes") pursuant to the Purchase
--------------
Agreement (as defined below).
This Agreement is made pursuant to the Purchase Agreement,
dated May 14, 1998 (the "Purchase Agreement"), by and among the
------------------
Company, the Guarantors and the Initial Purchasers. In order to
induce the Initial Purchasers to purchase the Series A Notes, the
Company has agreed to provide the registration rights set forth
in this Agreement. The execution and delivery of this Agreement
is a condition to the obligations of the Initial Purchasers set
forth in Section 3 of the Purchase Agreement.
The parties hereby agree as follows:
SECTION 1. DEFINITIONS
As used in this Agreement, the following capitalized terms
shall have the following meanings:
Act: The Securities Act of 1933, as amended.
---
Advice: As defined in Section 6.
------
Broker-Dealer: Any broker or dealer registered under
-------------
the Exchange Act.
Closing Date: The date on which the Series A Notes are
------------
originally issued under the Indenture.
Commission: The Securities and Exchange Commission.
----------
Consummate: The Exchange Offer shall be deemed
----------
"Consummated" for purposes of this Agreement upon the
occurrence of (i) the filing and effectiveness under the Act
of the Exchange Offer Registration Statement relating to the
Series B Notes to be issued in the Exchange Offer, (ii) the
maintenance of such Registration Statement continuously
effective and the keeping of the Exchange Offer open for a
period not less than the minimum period required pursuant to
Section 3(b) hereof, and (iii) the delivery by the Company
to the Registrar under the Indenture of Series B Notes in
the same aggregate principal amount as the aggregate
principal amount of Series A Notes that were tendered by
Holders thereof pursuant to the Exchange Offer.
Damages Payment Date: With respect to the Series A
--------------------
Notes, each Interest Payment Date.
Effectiveness Target Date: As defined in Section 5.
-------------------------
Exchange Act: The Securities Exchange Act of 1934, as
------------
amended.
Exchange Offer: The registration by the Company under
--------------
the Act of the Series B Notes pursuant to a Registration
Statement pursuant to which the Company offers the Holders
of all outstanding Transfer Restricted Securities the
opportunity to exchange all such outstanding Transfer
Restricted Securities held by such Holders for Series B
Notes in an aggregate principal amount equal to the
aggregate principal amount of the Transfer Restricted
Securities tendered in such exchange offer by such Holders.
Exchange Offer Registration Statement: The
-------------------------------------
Registration Statement relating to the Exchange Offer,
including the related Prospectus.
Exempt Resales: The transactions in which the Initial
--------------
Purchasers propose to sell the Series A Notes (i) to certain
"qualified institutional buyers," as such term is defined in
Rule 144A under the Act, (ii) to certain institutional
"accredited investors," as such term is defined in Rule
501(a)(1), (2), (3) and (7) of Regulation D under the Act
("Accredited Institutions") and (iii) outside the United
-----------------------
States to certain non-U.S. Persons meeting the requirements
of Rule 904 under the Act.
Holders: As defined in Section 2(b) hereof.
-------
Indemnified Holder: As defined in Section 8(a) hereof.
------------------
Indenture: The Indenture, dated as of even date
---------
herewith, among the Company, State Street Bank and Trust
Company, as trustee (the "Trustee"), and the Guarantors,
-------
pursuant to which the Notes are to be issued, as such
Indenture is amended or supplemented from time to time in
accordance with the terms thereof.
Initial Purchaser and Initial Purchasers: As defined
----------------- ------------------
in the preamble hereto.
Interest Payment Date: As defined in the Indenture and
---------------------
the Notes.
NASD: National Association of Securities Dealers, Inc.
----
Notes: The Series A Notes and the Series B Notes.
-----
Person: An individual, partnership, corporation,
------
trust, limited liability company or unincorporated
organization, or a government or agency or political
subdivision thereof.
Prospectus: The prospectus included in a Registration
----------
Statement, as amended or supplemented by any prospectus
supplement and by all other amendments thereto, including
post-effective amendments, and all material incorporated by
reference into such Prospectus.
Record Holder: With respect to any Damages Payment
-------------
Date relating to Notes, each Person who is a Holder of Notes
on the record date with respect to the Interest Payment Date
on which such Damages Payment Date shall occur.
Registration Default: As defined in Section 5 hereof.
--------------------
Registration Statement: Any registration statement of
----------------------
the Company relating to (a) an offering of Series B Notes
and the Subsidiary Guarantees pursuant to an Exchange Offer
or (b) the registration for resale of Transfer Restricted
Securities pursuant to the Shelf Registration Statement
which is filed pursuant to the provisions of this Agreement,
in each case, including the Prospectus.
Series A Notes: As defined in the Preamble hereof.
--------------
Series B Notes: The Company's 9 5/8% Series B Senior
--------------
Notes due 2008 to be issued pursuant to the Indenture and
the Exchange Offer.
Shelf Filing Deadline: As defined in Section 4 hereof.
---------------------
Shelf Registration Statement: As defined in Section 4
----------------------------
hereof.
Subsidiary Guarantees: The joint and several
---------------------
guarantees of the Company's payment obligations under the
Notes by the Guarantors.
TIA: The Trust Indenture Act of 1939 (15 U.S.C. Section
---
77aaa-77bbbb) as in effect on the date of the Indenture.
Transfer Restricted Securities: Each Series A Note
------------------------------
until (i) the date on which such Series A Note has been
exchanged by a Person other than a Broker-Dealer for a
Series B Note in the Exchange Offer, (ii) following the
exchange by a Broker-Dealer in the Exchange Offer of a
Series A Note for a Series B Note, the date on which such
Series B Note is sold to a purchaser who receives from such
Broker-Dealer on or prior to the date of such sale a copy of
the Prospectus contained in the Exchange Offer Registration
Statement, (iii) the date on which such Series A Note has
been effectively registered under the Act and disposed of in
accordance with the Shelf Registration Statement or (iv) the
date on which such Series A Note is distributed to the
public pursuant to Rule 144 under the Act or may be
distributed to the public pursuant to Rule 144(k) under the
Act.
Underwritten Registration or Underwritten Offering: A
------------------------- ---------------------
registration in which securities of the Company are sold to
an underwriter for reoffering to the public.
SECTION 2. SECURITIES SUBJECT TO THIS AGREEMENT
(a) Transfer Restricted Securities. The securities
------------------------------
entitled to the benefits of this Agreement are the Transfer
Restricted Securities.
(b) Holders of Transfer Restricted Securities. A Person is
-----------------------------------------
deemed to be a holder of Transfer Restricted Securities (each, a
"Holder") whenever such Person owns Transfer Restricted
------
Securities of record.
SECTION 3. REGISTERED EXCHANGE OFFER
(a) Unless the Exchange Offer shall not be permissible
under applicable law or Commission policy (after the procedures
set forth in Section 6(a) below have been complied with), the
Company and the Guarantors shall (i) cause to be filed with the
Commission on or before the 60th day after the Closing Date, a
Registration Statement under the Act relating to the Series B
Notes, the Subsidiary Guarantees and the Exchange Offer, (ii) use
their reasonable best efforts to cause such Registration
Statement to become effective on or before the 135th day after
the Closing Date, (iii) in connection with the foregoing, file
(A) all pre-effective amendments to such Registration Statement
as may be necessary in order to cause such Registration Statement
to become effective, (B) if applicable, a post-effective
amendment to such Registration Statement pursuant to Rule 430A
under the Act and (C) cause all necessary filings in connection
with the registration and qualification of the Series B Notes and
the Subsidiary Guarantees to be made under the Blue Sky laws of
such jurisdictions as are necessary to permit the Exchange Offer
to be Consummated, and (iv) upon the effectiveness of such
Registration Statement, commence the Exchange Offer. The
Exchange Offer Registration Statement shall be on the appropriate
form under the Act permitting registration of the Series B Notes
to be offered in exchange for the Transfer Restricted Securities
and to permit resales of the Series B Notes held by Broker-
Dealers as contemplated by Section 3(c) below.
(b) The Company and the Guarantors shall cause the Exchange
Offer Registration Statement to be effective continuously and
shall keep the Exchange Offer open for a period of not less than
the minimum period required under applicable federal and state
securities laws to Consummate the Exchange Offer; provided,
however, that in no event shall such period be less than 20
business days. The Company and the Guarantors shall cause the
Exchange Offer to comply with all applicable federal and state
securities laws. No securities other than the Series B Notes and
the Subsidiary Guarantees shall be included in the Exchange Offer
Registration Statement. The Company and the Guarantors shall use
their reasonable best efforts to cause the Exchange Offer to be
Consummated on the earliest practicable date after the Exchange
Offer Registration Statement has become effective, but in any
event on or prior to the 180th day after the Closing Date.
(c) The Company and the Guarantors shall indicate in a
"Plan of Distribution" section contained in the Exchange Offer
Registration Statement that any Broker-Dealer who holds Notes
that are Transfer Restricted Securities and that were acquired
for its own account as a result of market-making activities or
other trading activities (other than Transfer Restricted
Securities acquired directly from the Company) may exchange such
Series A Notes pursuant to the Exchange Offer; however, such
Broker-Dealer may be deemed to be an "underwriter" within the
meaning of the Act and must, therefore, deliver a prospectus
meeting the requirements of the Act in connection with any
resales of the Series B Notes received by such Broker-Dealer in
the Exchange Offer, which prospectus delivery requirement may be
satisfied by the delivery by such Broker-Dealer of the Prospectus
contained in the Exchange Offer Registration Statement. Such
"Plan of Distribution" section shall also contain all other
information with respect to such resales by Broker-Dealers that
the Commission may require in order to permit such resales
pursuant thereto, but such "Plan of Distribution" shall not name
any such Broker-Dealer or disclose the amount of Notes held by
any such Broker-Dealer except to the extent required by the
Commission as a result of a change in policy after the date of
this Agreement.
The Company and the Guarantors shall use their
reasonable best efforts to keep the Exchange Offer Registration
Statement continuously effective, supplemented and amended as
required by the provisions of Section 6(c) below to the extent
necessary to ensure that it is available for resales of Notes
acquired by Broker-Dealers for their own accounts as a result of
market-making activities or other trading activities, and to
ensure that it conforms with the requirements of this Agreement,
the Act and the policies, rules and regulations of the Commission
as announced from time to time, for a period of one year from the
date on which the Exchange Offer Registration Statement is
declared effective.
The Company and the Guarantors shall provide sufficient
copies of the latest version of such Prospectus to Broker-Dealers
promptly upon request at any time during such one-year period in
order to facilitate such resales.
SECTION 4. SHELF REGISTRATION
(a) Shelf Registration. If (i) the Company and the
------------------
Guarantors are not required to file an Exchange Offer
Registration Statement or permitted to Consummate the Exchange
Offer because the Exchange Offer is not permitted by applicable
law or Commission policy (after the procedures set forth in
Section 6(a) below have been complied with) or (ii) any Holder of
Transfer Restricted Securities notifies the Company prior to the
20th day following the Consummation of the Exchange Offer (A)
that such Holder is prohibited by applicable law or Commission
policy from participating in the Exchange Offer, or (B) that such
Holder may not resell the Series B Notes acquired by it in the
Exchange Offer to the public without delivering a prospectus and
that the Prospectus contained in the Exchange Offer Registration
Statement is not available for such resales by such Holder, then
the Company and the Guarantors shall use their reasonable best
efforts to:
(x) cause to be filed a shelf registration statement
pursuant to Rule 415 under the Act, which may be an
amendment to the Exchange Offer Registration Statement (in
either event, the "Shelf Registration Statement") on or
----------------------------
prior to the earliest to occur of (1) the 60th day after the
date on which the Company determines that it is not required
to file the Exchange Offer Registration Statement and (2)
the 60th day after the date on which the Company receives
notice from a Holder of Transfer Restricted Securities as
contemplated by clause (ii) above (such earliest date being
the "Shelf Filing Deadline"), which Shelf Registration
---------------------
Statement shall provide for resales of all Transfer
Restricted Securities the Holders of which shall have
provided the information required pursuant to Section 4(b)
hereof; and
(y) cause such Shelf Registration Statement to be
declared effective by the Commission on or before the 120th
day after the Shelf Filing Deadline.
The Company and the Guarantors shall use their reasonable best
efforts to keep such Shelf Registration Statement continuously
effective, supplemented and amended as required by the provisions
of Sections 6(b) and (c) hereof to the extent necessary to ensure
that it is available for resales of Notes by the Holders of
Transfer Restricted Securities entitled to the benefit of this
Section 4(a), and to ensure that it conforms with the
requirements of this Agreement, the Act and the policies, rules
and regulations of the Commission as announced from time to time,
for a period of at least two years following the Closing Date or,
if earlier, until the Shelf Registration Statement terminates
when all Transfer Restricted Securities covered by such Shelf
Registration Statement have been sold.
(b) Provision by Holders of Certain Information in
----------------------------------------------
Connection with the Shelf Registration Statement. No Holder of
------------------------------------------------
Transfer Restricted Securities may include any of its Transfer
Restricted Securities in any Shelf Registration Statement
pursuant to this Agreement unless and until such Holder furnishes
to the Company in writing, within 20 business days after receipt
of a request therefor, such information as the Company may
reasonably request for use in connection with any Shelf
Registration Statement or Prospectus or preliminary Prospectus
included therein. No Holder of Transfer Restricted Securities
shall be entitled to Liquidated Damages pursuant to Section 5
hereof if such Holder shall have failed to provide all such
reasonably requested information within such 20-day period. Each
Holder as to which any Shelf Registration Statement is being
effected agrees to furnish promptly to the Company all
information required to be disclosed in order to make the
information previously furnished to the Company by such Holder
not materially misleading.
SECTION 5. LIQUIDATED DAMAGES
If (i) any of the Registration Statements required by this
Agreement to be filed is not filed with the Commission on or
prior to the date specified for such filing in this Agreement,
(ii) any of such Registration Statements has not been declared
effective by the Commission on or prior to the date specified for
such effectiveness in this Agreement (the "Effectiveness Target
--------------------
Date"), whether or not the Company and the Guarantors have
-----
breached any obligations to use their reasonable best efforts to
cause any such Registration Statement to be declared effective,
(iii) the Exchange Offer has not been Consummated within 180 days
of the Closing Date with respect to the Exchange Offer
Registration Statement or (iv) any Registration Statement
required by this Agreement is filed and declared effective but
shall thereafter cease to be effective or fail to be usable for
its intended purpose without being succeeded immediately by a
post-effective amendment to such Registration Statement that
cures such failure and that is itself declared effective on or
prior to the Effectiveness Target Date (each such event referred
to in clauses (i) through (iv), a "Registration Default"), the
--------------------
Company and the Guarantors hereby jointly and severally agree to
pay liquidated damages to each Holder of Transfer Restricted
Securities with respect to the first 90-day period immediately
following the occurrence of such Registration Default in an
amount equal to $.05 per week per $1,000 principal amount of
Transfer Restricted Securities held by such Holder for each week
or portion thereof that the Registration Default continues. The
amount of the liquidated damages shall increase by an additional
$.05 per week per $1,000 in principal amount of Transfer
Restricted Securities with respect to each subsequent 90-day
period until all Registration Defaults have been cured, up to a
maximum amount of liquidated damages of $.20 per week per $1,000
principal amount of Transfer Restricted Securities. All accrued
liquidated damages shall be paid to Record Holders by the Company
on each Damages Payment Date following the accrual thereof, in
the same manner as provided in the Indenture and the Notes for
the payment of interest on the Notes. Following the cure of all
Registration Defaults relating to any particular Transfer
Restricted Securities, the accrual of liquidated damages with
respect to such Transfer Restricted Securities will cease.
All obligations of the Company and the Guarantors set forth
in the preceding paragraph that are outstanding with respect to
any Transfer Restricted Security at the time such security ceases
to be a Transfer Restricted Security shall survive until such
time as all such obligations with respect to such security shall
have been satisfied in full.
SECTION 6. REGISTRATION PROCEDURES
(a) Exchange Offer Registration Statement. In connection
-------------------------------------
with the Exchange Offer, the Company and the Guarantors shall
comply with all of the provisions of Section 6(c) below, shall
use their reasonable best efforts to effect such exchange to
permit the sale of Transfer Restricted Securities being sold in
accordance with the intended method or methods of distribution
thereof, and shall comply with all of the following provisions:
(i) If in the reasonable opinion of counsel to the
Company there is a question as to whether the Exchange Offer
is permitted by applicable law, the Company and the
Guarantors hereby agree to seek a no-action letter or other
favorable decision from the Commission allowing the Company
and the Guarantors to Consummate the Exchange Offer. The
Company and the Guarantors hereby agree to pursue the
issuance of such a decision to the Commission staff level
but shall not be required to take commercially unreasonable
action to effect a change of Commission policy. The Company
and the Guarantors hereby agree, however, to (A) participate
in telephonic conferences with the Commission staff, (B)
deliver to the Commission staff an analysis prepared by
counsel to the Company setting forth the legal bases, if
any, upon which such counsel has concluded that the Exchange
Offer should be permitted and (C) diligently pursue a
resolution (which need not be favorable) by the Commission
staff of such submission.
(ii) Each Initial Purchaser, for itself and on behalf
of the Holders, hereby acknowledges and agrees, and each
Holder by its purchase of Transfer Restricted Securities
shall be deemed to have acknowledged and agreed, that any
Broker-Dealer and any such Holder using the Exchange Offer
to participate in a distribution of the securities to be
acquired in the Exchange Offer (1) could not under
Commission policy as in effect on the date of this Agreement
rely on the position of the Commission enunciated in Morgan
Stanley and Co., Inc. (available June 5, 1991) and Exxon
Capital Holdings Corporation (available May 13, 1988), as
interpreted in the Commission's letter to Shearman &
Sterling dated July 2, 1993, and similar no-action letters
(including any no-action letter obtained pursuant to clause
(i) above), and (2) must comply with the registration and
prospectus delivery requirements of the Act in connection
with a secondary resale transaction and that such a
secondary resale transaction should be covered by an
effective registration statement containing the selling
security holder information required by Item 507 or 508, as
applicable, of Regulation S-K if the resales are of Series B
Notes obtained by such Holder in exchange for Series A Notes
acquired by such Holder directly from the Company.
(iii) Prior to effectiveness of the Exchange Offer
Registration Statement, the Company and the Guarantors shall
provide a supplemental letter to the Commission (A) stating
that the Company and the Guarantors are registering the
Exchange Offer in reliance on the position of the Commission
enunciated in Exxon Capital Holdings Corporation (available
May 13, 1988), Morgan Stanley and Co., Inc. (available
June 5, 1991) and, if applicable, any no-action letter
obtained pursuant to clause (i) above and (B) including a
representation that neither the Company nor any Guarantor
has entered into any arrangement or understanding with any
Person to distribute the Series B Notes to be received in
the Exchange Offer and that, to the best of the Company's
information and belief, each Holder participating in the
Exchange Offer is acquiring the Series B Notes in its
ordinary course of business and has no arrangement or
understanding with any Person to participate in the
distribution of the Series B Notes received in the Exchange
Offer.
(b) Shelf Registration Statement. In connection with the
----------------------------
Shelf Registration Statement, if required, the Company and the
Guarantors shall comply with all the provisions of Section 6(c)
below and shall use their reasonable best efforts to effect such
registration to permit the sale of the Transfer Restricted
Securities being sold in accordance with the intended method or
methods of distribution thereof and, pursuant thereto, the
Company and the Guarantors will prepare and file with the
Commission in accordance with Section 4(a) hereof a Shelf
Registration Statement relating to the registration on any
appropriate form under the Act, which form shall be available for
the sale of the Transfer Restricted Securities in accordance with
the intended method or methods of distribution thereof.
(c) General Provisions. In connection with any
------------------
Registration Statement and any Prospectus required by this
Agreement to permit the sale or resale of Transfer Restricted
Securities (including, without limitation, any Registration
Statement and the related Prospectus required to permit resales
of Notes by Broker-Dealers), the Company and the Guarantors
shall:
(i) use their reasonable best efforts to keep such
Registration Statement continuously effective and provide
all requisite financial statements (including, if required
by the Act or any regulation thereunder, financial
statements of the Guarantors) for the period specified in
Section 3 or 4 of this Agreement, as applicable; upon the
occurrence of any event that would cause any such
Registration Statement or the Prospectus contained therein
(A) to contain a material misstatement or omission or (B)
not to be effective and usable for the resale of Transfer
Restricted Securities during the period required by this
Agreement, the Company and the Guarantors shall file
promptly an appropriate amendment to such Registration
Statement, in the case of clause (A), correcting any such
misstatement or omission, and, in the case of either clause
(A) or (B), use their reasonable best efforts to cause such
amendment to be declared effective and such Registration
Statement and the related Prospectus to become usable for
their intended purpose(s) as soon as practicable thereafter;
(ii) prepare and file with the Commission such
amendments and post-effective amendments to the Registration
Statement as may be necessary to keep the Registration
Statement effective for the applicable period set forth in
Section 3 or 4 hereof, as applicable, or such shorter period
as will terminate when all Transfer Restricted Securities
covered by such Registration Statement have been sold; cause
the Prospectus to be supplemented by any required Prospectus
supplement, and as so supplemented to be filed pursuant to
Rule 424 under the Act, and to comply fully with the
applicable provisions of Rules 424 and 430A under the Act in
a timely manner; and comply with the provisions of the Act
with respect to the disposition of all securities covered by
such Registration Statement during the applicable period in
accordance with the intended method or methods of
distribution by the sellers thereof set forth in such
Registration Statement or supplement to the Prospectus;
(iii) advise the underwriter(s), if any, and
selling Holders promptly and, if requested by any such
Person, to confirm such advice in writing, (A) when the
Prospectus or any Prospectus supplement or post-effective
amendment has been filed, and, with respect to any
Registration Statement or any post-effective amendment
thereto, when the same has become effective, (B) of any
request by the Commission for amendments to the Registration
Statement or amendments or supplements to the Prospectus or
for additional information relating thereto, (C) of the
issuance by the Commission of any stop order suspending the
effectiveness of the Registration Statement under the Act or
of the suspension by any state securities commission of the
qualification of the Transfer Restricted Securities for
offering or sale in any jurisdiction, or the initiation of
any proceeding for any of the preceding purposes, (D) of the
existence of any fact or the happening of any event that
makes any statement of a material fact made in the
Registration Statement, the Prospectus, any amendment or
supplement thereto, or any document incorporated by
reference therein untrue, or that requires the making of any
additions to or changes in the Registration Statement or the
Prospectus in order to make the statements therein not
misleading. If at any time the Commission shall issue any
stop order suspending the effectiveness of the Registration
Statement, or any state securities commission or other
regulatory authority shall issue an order suspending the
qualification or exemption from qualification of the
Transfer Restricted Securities under state securities or
Blue Sky laws, the Company and the Guarantors shall use
their reasonable best efforts to obtain the withdrawal or
lifting of such order at the earliest possible time;
(iv) furnish to each of the selling Holders and each of
the underwriter(s), if any, before filing with the
Commission, copies of any Registration Statement or any
Prospectus included therein or any amendments or supplements
to any such Registration Statement or Prospectus (but
excluding any documents incorporated by reference as a
result of the Company's periodic reporting requirements
under the Exchange Act), and neither the Company nor any
Guarantors shall file any such Registration Statement or
Prospectus or any amendment or supplement to any such
Registration Statement or Prospectus (excluding all such
documents incorporated by reference as a result of the
Company's periodic reporting requirements under the Exchange
Act) to which a selling Holder of Transfer Restricted
Securities covered by such Registration Statement or the
underwriter(s), if any, shall reasonably object within five
business days after the receipt thereof. A selling Holder
or underwriter, if any, shall be deemed to have reasonably
objected to such filing if such Registration Statement,
amendment, Prospectus or supplement, as applicable, as
proposed to be filed, contains a material misstatement or
omission;
(v) promptly following the filing of any document that
is to be incorporated by reference into a Registration
Statement or Prospectus, provide copies of such document to
the selling Holders and to the underwriter(s), if any, make
the Company's representatives available for discussion of
such document and other customary due diligence matters, and
include such information in such document prior to the
filing thereof as such selling Holders or underwriter(s), if
any, reasonably may request;
(vi) make available at reasonable times for inspection
by the selling Holders, any underwriter participating in any
disposition pursuant to such Registration Statement, and any
attorney or accountant retained by such selling Holders or
any of the underwriter(s), all relevant financial and other
records, pertinent corporate documents and properties of the
Company and the Guarantors and cause the Company's and the
Guarantors' officers, directors and employees to supply all
information reasonably requested by any such Holder,
underwriter, attorney or accountant in connection with such
Registration Statement subsequent to the filing thereof and
prior to its effectiveness; provided, however, that the
foregoing inspection and information gathering (i) shall be
coordinated on behalf of the selling Holders, underwriters,
or any representative thereof, by one counsel, who shall be
Vinson & Elkins L.L.P. or such other counsel as may be
chosen by the Holders of a majority in principal amount of
Transfer Restricted Securities, and (ii) shall not be
available for any such Holder who does not agree in writing
to hold such information in confidence.
(vii) if requested by any selling Holders or the
underwriter(s), if any, promptly incorporate in any
Registration Statement or Prospectus, pursuant to a
supplement or post-effective amendment if necessary, such
information as such selling Holders and underwriter(s), if
any, may reasonably request to have included therein,
including, without limitation, information relating to the
"Plan of Distribution" of the Transfer Restricted
Securities, information with respect to the principal amount
of Transfer Restricted Securities being sold to such
underwriter(s), the purchase price being paid therefor and
any other terms of the offering of the Transfer Restricted
Securities to be sold in such offering; and make all
required filings of such Prospectus supplement or
post-effective amendment as soon as practicable after the
Company is notified of the matters to be incorporated in
such Prospectus supplement or post-effective amendment;
(viii) furnish to each selling Holder and each of
the underwriter(s), if any, without charge, at least one
copy of the Registration Statement, as first filed with the
Commission, and of each amendment thereto, including all
documents incorporated by reference therein and all exhibits
(including exhibits incorporated therein by reference);
(ix) deliver to each selling Holder and each of the
underwriter(s), if any, without charge, as many copies of
the Prospectus (including each preliminary prospectus) and
any amendment or supplement thereto as such Persons
reasonably may request; the Company and the Guarantors
hereby consent to the use of the Prospectus and any
amendment or supplement thereto by each of the selling
Holders and each of the underwriter(s), if any, in
connection with the offering and the sale of the Transfer
Restricted Securities covered by the Prospectus or any
amendment or supplement thereto; provided that such use of
the Prospectus and any amendment or supplement thereto and
such offering and sale conforms to the Plan of Distribution
set forth in the Prospectus and complies with the terms of
this Agreement and all applicable laws and regulations
thereunder;
(x) in the event of an Underwritten Registration,
enter into such customary agreements (including an
underwriting agreement), make such customary representations
and warranties, deliver such customary documents and
certificates, and take all such other customary actions in
connection therewith in order to expedite or facilitate the
disposition of the Transfer Restricted Securities pursuant
to any Shelf Registration Statement contemplated by this
Agreement, all to such extent as may be reasonably requested
by any Holder of Transfer Restricted Securities or
underwriter in connection with any sale or resale pursuant
to any Shelf Registration Statement contemplated by this
Agreement; and, without limiting the generality of the
foregoing, the Company and the Guarantors shall:
(A) furnish to each underwriter upon the
effectiveness of the Shelf Registration Statement:
(1) a certificate, dated the date of
effectiveness of the Shelf Registration Statement,
signed on behalf of the Company by two senior
officers, one of whom must be its Chief Financial
Officer, confirming, as of such date, the matters
set forth in paragraphs (a), (c) and (d) of
Section 8 of the Purchase Agreement with respect
to the transactions contemplated by the Shelf
Registration Statement;
(2) an opinion, dated the date of
effectiveness of the Shelf Registration Statement,
of counsel for the Company and the Guarantors,
covering the matters set forth in Section 8(f) of
the Purchase Agreement with respect to the
transactions contemplated by the Shelf
Registration Statement, and in any event including
a statement to the effect that such counsel has
participated in conferences with officers and
other representatives of the Company and the
Guarantors, representatives of the independent
accountants of the Company and the Guarantors and
representatives of the Initial Purchaser at which
the contents of the Registration Statement and
related matters were discussed and, although it
does not assume any responsibility for the
accuracy, completeness or fairness of the
statements contained in the Registration Statement
during the course of such participation, no facts
came to its attention that caused such counsel to
believe that the Registration Statement, at the
time such Registration Statement or any
post-effective amendment thereto became effective,
contained any untrue statement of a material fact
or omitted to state any fact required to be stated
therein or necessary to make the statements
therein not misleading, or that the Prospectus
contained in such Registration Statement as of its
date contained an untrue statement of a material
fact or omitted to state a material fact necessary
in order to make the statements therein, in the
light of the circumstances under which they were
made, not misleading (except as to financial
statements and related notes, the financial
statement schedules and other financial and
statistical data included therein); and
(3) a customary comfort letter, dated as of
the date of effectiveness of the Shelf
Registration Statement, from the Company's
independent accountants if such comfort letter
shall be issuable to the underwriters in
accordance with the relevant accounting industry
pronouncements, in the customary form and covering
matters of the type customarily covered in comfort
letters by underwriters in connection with primary
underwritten offerings, and affirming the matters
set forth in the comfort letters delivered
pursuant to Section 8(g) of the Purchase
Agreement, without exception; and
(B) deliver such other documents and certificates
as may be reasonably requested by such parties to
evidence compliance with clause (A) above.
If at any time the representations and warranties of the
Company and the Guarantors contemplated in clause (A)(1)
above cease to be true and correct, the Company shall so
advise the Initial Purchasers and the underwriter(s), if
any, and each selling Holder promptly and, if requested by
any such Person, shall confirm such advice in writing;
(xi) prior to any public offering of Transfer
Restricted Securities, cooperate with the selling Holders,
the underwriter(s), if any, and their respective counsel in
connection with the registration and qualification of the
Transfer Restricted Securities under the securities or Blue
Sky laws of such jurisdictions as the selling Holders or
underwriter(s) may request and do any and all other acts or
things reasonably necessary or advisable to enable the
disposition in such jurisdictions of the Transfer Restricted
Securities covered by the Shelf Registration Statement;
provided, however, that neither the Company nor the
Guarantors shall be required to register or qualify as a
foreign corporation where it is not now so qualified or to
take any action that would subject it to the service of
process in suits or to taxation, other than as to matters
and transactions relating to the Registration Statement, in
any jurisdiction where it is not now so subject;
(xii) issue, upon the request of any Holder of
Series A Notes covered by the Shelf Registration Statement,
Series B Notes, having an aggregate principal amount equal
to the aggregate principal amount of Series A Notes being
sold by such Holder; such Series B Notes to be registered in
the name of the purchaser(s) of such Notes, as the case may
be; in return, the Series A Notes held by such Holder shall
be surrendered to the Company for cancellation;
(xiii) cooperate with the selling Holders and the
underwriter(s), if any, to facilitate the timely preparation
and delivery of certificates representing Transfer
Restricted Securities to be sold and not bearing any
restrictive legends; and enable such Transfer Restricted
Securities to be in such authorized denominations and
registered in such names as the Holders or the
underwriter(s), if any, may reasonably request at least two
business days prior to any sale of Transfer Restricted
Securities made by such underwriter(s);
(xiv) if any fact or event contemplated by clause
(c)(iii)(D) above shall exist or have occurred, prepare a
supplement or post-effective amendment to the Registration
Statement or related Prospectus or any document incorporated
therein by reference or file any other required document so
that, as thereafter delivered to the purchasers of Transfer
Restricted Securities, the Prospectus will not contain any
untrue statement of a material fact or omit to state any
material fact necessary to make the statements therein not
misleading;
(xv) provide a CUSIP number for all Series B Notes not
later than the effective date of the Registration Statement
and provide the Trustee under the Indenture with one or more
global certificates for the Series B Notes that are in a
form eligible for deposit with The Depository Trust Company;
(xvi) cooperate and assist in any filings required
to be made with the NASD and in the performance of any due
diligence investigation by any underwriter (including any
"qualified independent underwriter") that is required to be
retained in accordance with the rules and regulations of the
NASD;
(xvii) otherwise use their reasonable best efforts
to comply with all applicable rules and regulations of the
Commission, and make generally available to its security
holders, as soon as practicable, a consolidated earnings
statement meeting the requirements of Rule 158 (which need
not be audited) for the twelve-month period (A) commencing
at the end of any fiscal quarter in which Transfer
Restricted Securities are sold to underwriters in a firm or
best efforts Underwritten Offering or (B) if not sold to
underwriters in such an offering, beginning with the first
month of the Company's first fiscal quarter commencing after
the effective date of the Registration Statement;
(xviii) cause the Indenture to be qualified under the
TIA not later than the effective date of the first
Registration Statement required by this Agreement, and, in
connection therewith, cooperate with the Trustee and the
Holders of Notes to effect such changes to the Indenture as
may be required for such Indenture to be so qualified in
accordance with the terms of the TIA; and execute and use
their reasonable best efforts to cause the Trustee to
execute, all documents that may be required to effect such
changes and all other forms and documents required to be
filed with the Commission to enable such Indenture to be so
qualified in a timely manner; and
(xix) provide promptly to each Holder upon request
each document filed with the Commission pursuant to the
requirements of Section 13 or Section 15 of the Exchange
Act.
Each Holder agrees by acquisition of a Transfer
Restricted Security that, upon receipt of any notice from the
Company of the existence of any fact of the kind described in
Section 6(c)(iii)(D) hereof, such Holder will keep such notice
confidential and forthwith discontinue disposition of Transfer
Restricted Securities pursuant to the applicable Registration
Statement until such Holder's receipt of the copies of the
supplemented or amended Prospectus contemplated by Section
6(c)(xiv) hereof, or until it is advised in writing (the
"Advice") by the Company that the use of the Prospectus may be
------
resumed, and has received copies of any additional or
supplemental filings that are incorporated by reference in the
Prospectus. If so directed by the Company, each Holder will
deliver to the Company (at the Company's expense) all copies,
other than permanent file copies then in such Holder's
possession, of the Prospectus covering such Transfer Restricted
Securities that was current at the time of receipt of such
notice. In the event the Company shall give any such notice, the
time period regarding the effectiveness of such Registration
Statement set forth in Section 3 or 4 hereof, as applicable,
shall be extended by the number of days during the period from
and including the date of the giving of such notice pursuant to
Section 6(c)(iii)(D) hereof to and including the date when each
selling Holder covered by such Registration Statement shall have
received the copies of the supplemented or amended Prospectus
contemplated by Section 6(c)(xiv) hereof or shall have received
the Advice.
SECTION 7. REGISTRATION EXPENSES
(a) All expenses incident to the Company's or the
Guarantors' performance of or compliance with this Agreement will
be borne by the Company and the Guarantors, regardless of whether
a Registration Statement becomes effective, including without
limitation: (i) all registration and filing fees and expenses
(including filings made by the Initial Purchasers or Holders with
the NASD (and, if applicable, the fees and expenses of any
"qualified independent underwriter" and its counsel that may be
required by the rules and regulations of the NASD)); (ii) all
fees and expenses of compliance with federal securities and state
Blue Sky or securities laws; (iii) all expenses of printing
(including printing of Prospectuses), messenger and delivery
services and telephone; (iv) all fees and disbursements of
counsel for the Company and the Guarantors and, subject to
Section 7(b) below, counsel for the Holders of Transfer
Restricted Securities; (v) all application and filing fees in
connection with listing Notes on a national securities exchange
or automated quotation system, if any; and (vi) all fees and
disbursements of independent public accountants of the Company
and the Guarantors (including the expenses of any special audit
and comfort letters required by or incident to such performance).
The Company and the Guarantors will, in any event, bear
their internal expenses (including, without limitation, all
salaries and expenses of its officers and employees performing
legal or accounting duties), the expenses of any annual audit and
the fees and expenses of any Person, including special experts,
retained by the Company or any Guarantor. The Company shall not
be responsible for any other expenses or costs, including but not
limited to commissions, fees and discounts of underwriters,
brokers, dealers and agents.
(b) In connection with any Registration Statement required
by this Agreement (excluding the Exchange Offer Registration
Statement), the Company and the Guarantors will reimburse the
Initial Purchasers and the Holders of Transfer Restricted
Securities being tendered in the Exchange Offer and/or resold
pursuant to the "Plan of Distribution" contained in the Exchange
Offer Registration Statement or registered pursuant to the Shelf
Registration Statement, as applicable, for the reasonable fees
and disbursements of not more than one counsel, who shall be
Vinson & Elkins L.L.P. or such other counsel as may be chosen by
the Holders of a majority in principal amount of the Transfer
Restricted Securities for whose benefit such Registration
Statement is being prepared.
SECTION 8. INDEMNIFICATION
(a) The Company and the Guarantors, jointly and severally,
agree to indemnify and hold harmless (i) each Holder, (ii) each
Initial Purchaser, (iii) each person, if any, who controls any
Holder or an Initial Purchaser within the meaning of Section 15
of the Act or Section 20(a) of the Exchange Act and (iii) the
respective officers, directors, partners, employees,
representatives and agents of any Holder or Initial Purchaser or
any controlling person (any person referred to in clauses (i),
(ii) or (iii) may hereinafter be referred to as an "Indemnified
-----------
Holder"), to the fullest extent lawful, from and against any and
------
all losses, liabilities, claims, damages and expenses whatsoever
(including but not limited to reasonable attorneys' fees and any
and all reasonable expenses whatsoever incurred in investigating,
preparing or defending against any investigation or litigation,
commenced or threatened, or any claim whatsoever, and any and all
amounts paid in settlement of any claim or litigation), joint or
several, to which they or any of them may become subject under
the Act, the Exchange Act or otherwise, insofar as such losses,
liabilities, claims, damages or expenses (or actions in respect
thereof) arise out of or are based upon any untrue statement or
alleged untrue statement of a material fact contained in any
Registration Statement or Prospectus, or in any supplement
thereto or amendment thereof, or arise out of or are based upon
the omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements
therein, in the light of the circumstances under which they were
made, not misleading; provided, however, that the Company and the
Guarantors will not be liable in any such case to the extent, but
only to the extent, that any such loss, liability, claim, damage
or expense arises out of or is based upon any such untrue
statement or alleged untrue statement or omission or alleged
omission made therein in reliance upon and in conformity with
written information furnished to the Company by or on behalf of
the any of the Holders expressly for use therein. This indemnity
agreement will be in addition to any liability that the Company
and the Guarantors may otherwise have, including under this
Agreement.
(b) Each Holder of Transfer Restricted Securities agrees,
severally and not jointly, to indemnify and hold harmless the
Company, each of the Guarantors and each person, if any, who
controls the Company or any Guarantor within the meaning of
Section 15 of the Act or Section 20(a) of the Exchange Act and
each of their respective officers, directors, employers,
partners, representatives and agents to the same extent as the
foregoing indemnity from the Company and the Guarantors to each
of the Indemnified Holders, but only with respect to information
relating to such Holder furnished in writing by such Holder for
use in any Registration Statement, or in any amendment thereof or
supplement thereto; provided, however, that in no case shall any
selling Holder be liable or responsible for any amount in excess
of proceeds received by such Holder upon the sale of the Notes
giving rise to such indemnification obligation. This indemnity
will be in addition to any liability that the Holders may
otherwise have, including under this Agreement.
(c) Promptly after receipt by an indemnified party under
subsection (a) or (b) above of notice of the commencement of any
action, such indemnified party shall, if a claim in respect
thereof is to be made against the indemnifying party under such
subsection, notify each party against whom indemnification is to
be sought in writing of the commencement thereof (but the failure
so to notify an indemnifying party shall not relieve it from any
liability that it may have under this Section 8 or otherwise
except to the extent that it has been prejudiced in any material
respect by such failure). In case any such action is brought
against any indemnified party, and it notifies an indemnifying
party of the commencement thereof, the indemnifying party will be
entitled to participate therein, and to the extent it may elect
by written notice delivered to the indemnified party promptly
after receiving the aforesaid notice from such indemnified party,
to assume and control the defense thereof with counsel reasonably
satisfactory to such indemnified party. Notwithstanding the
foregoing, the indemnified party or parties shall have the right
to employ its or their own counsel in any such case, but the fees
and expenses of such counsel shall be at the expense of such
indemnified party or parties unless (i) the employment of such
counsel shall have been authorized in writing by the indemnifying
parties in connection with the defense of such action, (ii) the
indemnifying parties shall not have employed counsel to take
charge of the defense of such action within a reasonable time
after notice of commencement of the action, or (iii) such
indemnified party or parties shall have reasonably concluded that
there may be defenses available to it that are different from or
additional to those available to one or all of the indemnifying
parties (in which case the indemnifying party shall not have the
right to direct the defense of such action on behalf of the
indemnified party or parties), in any of which events such fees
and expenses of counsel shall be borne by the indemnifying
parties; provided, however, that the indemnifying party under
subsection (a) or (b) above shall only be liable for the legal
expenses of one counsel (in addition to any local counsel) for
all indemnified parties. Anything in this subsection to the
contrary notwithstanding, an indemnifying party shall not be
liable for any settlement of any claim or action effected without
its prior written consent; provided that such consent was not
unreasonably withheld.
SECTION 9. CONTRIBUTION
In order to provide for contribution in circumstances in
which the indemnification provided for in Section 8 is for any
reason held to be unavailable or is insufficient to hold harmless
a party indemnified thereunder, the Company and the Guarantors,
on the one hand, and the Holders on the other hand, shall
contribute to the aggregate losses, claims, damages, liabilities
and expenses of the nature contemplated by such indemnification
provision (including any investigation, legal and other expenses
incurred in connection with, and any amount paid in settlement
of, any action, suit or proceeding or any claims asserted, but
after deducting in the case of losses, claims, damages,
liabilities and expenses suffered by the Company and the
Guarantors, any contribution received by the Company and the
Guarantors from Persons, other than a Holder, who may also be
liable for contribution, including persons who control the
Company and the Guarantors within the meaning of Section 15 of
the Act or Section 20(a) of the Exchange Act) to which the
Company, the Guarantors or any Holder may be subject, (i) in such
proportion as is appropriate to reflect the relative fault of the
Company and the Guarantors, on one hand, and each Holder, on the
other hand, in connection with the statements or omissions that
resulted in such losses, claims, damages, liabilities or
expenses, or (ii) if the allocation provided by clause (i) is not
permitted by applicable law, in such proportion as is appropriate
to reflect not only the relative fault referred to in clause (i)
above but also other relevant equitable considerations. The
relative fault of the Company and the Guarantors, on one hand,
and of each Holder, on the other hand, shall be determined by
reference to, among other things, whether the untrue or alleged
untrue statement of a material fact or the omission or alleged
omission to state a material fact relates to information supplied
by the Company, the Guarantors or such Holder and the parties'
relative intent, knowledge, access to information and opportunity
to correct or prevent such statement or omission. The Company,
the Guarantors and each Holder of Transfer Restricted Securities
agree that it would not be just and equitable if contribution
pursuant to this Section 9 were determined by pro rata allocation
or by any other method of allocation that does not take into
account the equitable considerations referred to above.
Notwithstanding the provisions of this Section 9, (i) in no case
shall any Holder be required to contribute any amount in excess
of the amount by which the proceeds received by such Holder upon
the sale of the Transfer Restricted Securities giving rise to
such obligation exceeds the amount of any damages that such
Holder has otherwise been required to pay by reason of any untrue
or alleged untrue statement or omission or alleged omission and
(ii) no person guilty of fraudulent misrepresentation (within the
meaning of Section 11(f) of the Act) shall be entitled to
contribution from any Person who was not guilty of such
fraudulent misrepresentation. For purposes of this Section 9,
(A) each Person, if any, who controls any of the Holders within
the meaning of Section 15 of the Act or Section 20(a) of the
Exchange Act and (B) the respective officers, directors,
partners, employees, representatives and agents of such Holder or
any controlling Person shall have the same rights to contribution
as the Holders, and each Person, if any, who controls the Company
or any Guarantor within the meaning of Section 15 of the Act or
Section 20(a) of the Exchange Act shall have the same rights to
contribution as the Company and the Guarantors, subject in each
case to clauses (i) and (ii) of this Section 9. Any party
entitled to contribution will, promptly after receipt of notice
of commencement of any action, suit or proceeding against such
party in respect of which a claim for contribution may be made
against another party or parties under this Section 9, notify
such party or parties from whom contribution may be sought, but
the failure to so notify such party or parties shall not relieve
the party or parties from whom contribution may be sought from
any obligation it or they may have under this Section 9 or
otherwise, except to the extent it or they have been prejudiced
in any material respect by such failure. No party shall be
liable for contribution with respect to any action or claim
settled without its prior written consent; provided that such
written consent was not unreasonably withheld.
SECTION 10. RULE 144A
The Company and the Guarantors hereby agree with each
Holder, for so long as any Transfer Restricted Securities remain
outstanding, to make available to any Holder or beneficial owner
of Transfer Restricted Securities in connection with any sale
thereof and any prospective purchaser of such Transfer Restricted
Securities from such Holder or beneficial owner, the information
required by Rule 144A(d)(4) under the Act in order to permit
resales of such Transfer Restricted Securities pursuant to Rule
144A.
SECTION 11. PARTICIPATION IN UNDERWRITTEN REGISTRATIONS
No Holder may participate in any Underwritten Registration
hereunder unless such Holder (a) agrees to sell such Holder's
Transfer Restricted Securities on the basis provided in any
underwriting arrangements approved by the Persons entitled
hereunder to approve such arrangements and (b) completes and
executes all reasonable questionnaires, powers of attorney,
indemnities, underwriting agreements, lock-up letters and other
documents required under the terms of such underwriting
arrangements.
SECTION 12. SELECTION OF UNDERWRITERS
The Holders of Transfer Restricted Securities covered by the
Shelf Registration Statement who desire to do so may sell such
Transfer Restricted Securities in an Underwritten Offering. In
any such Underwritten Offering, the investment banker or
investment bankers and manager or managers that will administer
the offering will be selected by the Holders of a majority in
aggregate principal amount of the Transfer Restricted Securities
included in such offering; provided, however, that such
investment bankers and managers must be reasonably satisfactory
to the Company.
SECTION 13. MISCELLANEOUS
(a) [Intentionally omitted.]
(b) No Inconsistent Agreements. The Company and the
--------------------------
Guarantors shall not, on or after the date of this Agreement,
enter into any agreement with respect to its securities that is
inconsistent with the rights granted to the Holders in this
Agreement or otherwise conflicts with the provisions hereof. The
rights granted to the Holders hereunder do not in any way
conflict with and are not inconsistent with the rights granted to
the holders of the Company's or any Guarantor's securities under
any agreement in effect on the date hereof.
(c) Adjustments Affecting the Notes. The Company and the
-------------------------------
Guarantors shall not take any action with respect to the Notes
that would materially and adversely affect the ability of the
Holders to Consummate the Exchange Offer.
(d) Amendments and Waivers. The provisions of this
----------------------
Agreement may not be amended, modified or supplemented, and
waivers or consents to or departures from the provisions hereof
may not be given unless the Company has obtained the written
consent of Holders of a majority of the outstanding principal
amount of Transfer Restricted Securities. Notwithstanding the
foregoing, a waiver or consent to departure from the provisions
hereof that relates exclusively to the rights of Holders whose
securities are being tendered pursuant to the Exchange Offer and
that does not affect directly or indirectly the rights of other
Holders whose securities are not being tendered pursuant to such
Exchange Offer may be given by the Holders of a majority of the
outstanding principal amount of Transfer Restricted Securities
being tendered.
(e) Notices. All notices and other communications provided
-------
for or permitted hereunder shall be made in writing by hand-
delivery, first-class mail (registered or certified, return
receipt requested), telecopier, or air courier guaranteeing
overnight delivery:
(i) if to a Holder, at the address set forth on the
records of the Registrar under the Indenture, with a copy to
the Registrar under the Indenture; and
(ii) if to the Company or any Guarantor:
American Eco Corporation
11011 Jones Road
Houston, Texas 77070
Telecopier No.: (281) 774-7006
Attention: Chief Administrative Officer
with a copy to:
Reid & Priest LLP
40 West 57th Street
New York, New York 10019
Telecopier No.: (212) 603-2001
Attention: Bruce A. Rich
All such notices and communications shall 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 on the next business day, if timely delivered to
an air courier guaranteeing overnight delivery.
Copies of all such notices, demands or other communications
shall be concurrently delivered by the Person giving the same to
the Trustee at the address specified in the Indenture.
(f) Successors and Assigns. This Agreement shall inure to
----------------------
the benefit of and be binding upon the successors and assigns of
each of the parties, including without limitation and without the
need for an express assignment, the successors and assigns of
subsequent Holders of Transfer Restricted Securities; provided,
however, that this Agreement shall not inure to the benefit of or
be binding upon a successor or assign of a Holder unless and to
the extent such successor or assign acquired Transfer Restricted
Securities from such Holder.
(g) Counterparts. This Agreement may be executed in any
------------
number of counterparts and by the parties hereto in separate
counterparts, each of which when so executed shall be deemed to
be an original and all of which taken together shall constitute
one and the same agreement.
(h) Headings. The headings in this Agreement are for
--------
convenience of reference only and shall not limit or otherwise
affect the meaning hereof.
(i) Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY AND
-------------
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.
(j) Severability. In the event that any one or more of the
------------
provisions contained herein, or the application thereof in any
circumstance, is held invalid, illegal or unenforceable, the
validity, legality and enforceability of any such provision in
every other respect and of the remaining provisions contained
herein shall not be affected or impaired thereby.
[Signature page to follow]
<PAGE>
IN WITNESS WHEREOF, the parties have executed this Agreement
as of the date first written above.
American Eco Corporation
By /s/ David L. Norris
-------------------------------------
David L. Norris
Senior Vice President and
Chief Administrative Officer
The Turner Group, Inc.
C.A. Turner Construction Company
Action Contract Services, Inc.
C.A. Turner Maintenance, Inc.
H.E. Co. Services, Inc.
Cambridge Construction Service Corp.
Lake Charles Construction Corporation
United Eco Systems, Inc.
Eco Systems, Inc.
MM Industra Limited
Separation and Recovery Systems, Inc.
Industra Service Corporation
Industra Engineers & Consultants, Inc.
Industra Thermal Service Corporation
NUS, Inc.
Industra Service Corp.
Industra, Inc.
Industra Thermal Service Corp.
Chempower, Inc.
Global Power Company
Brookfield Corporation
Southwick Corporation
Controlled Power Limitd Partnership
Specialty Management Group, Inc.
Separation and Recovery Systems Limited
By: /s/ David L. Norris
------------------------------------
David L. Norris
Vice President
Accepted and agreed to as of
the date first above written:
Jefferies & Company, Inc.
By /s/ Joe Maly
---------------------------
Name: Joe Maly
Title: Managing Director
Nesbitt Burns Securities Inc.
By /s/ William J. Moser, Jr.
---------------------------
Name: William J. Moser, Jr.
Title: Director
NEWS RELEASE
American Eco Corporation Suite 200, 154 University Avenue, Toronto,
Ontario, Canada M5H 3Y9
[NASDAQ SYMBOL: ECGOF / TSE SYMBOL: ECX / CBOE SYMBOL: EOQ]
For Immediate Release
---------------------
AMERICAN ECO PLACES
$120.0 MILLION IN SENIOR NOTES
TORONTO, Ontario, Canada, Thursday, May 21, 1998 - MICHAEL E. MCGINNIS,
CHAIRMAN, PRESIDENT & CEO of AMERICAN ECO CORPORATION announced completion
of a placement of US$120.0 million 9.625% Senior Notes that will be due in
2008. American Eco intends to use the proceeds from the sale of the Notes
for repayment of US$71.2 million of debt, with the remainder of the net
proceeds to be used for potential acquisitions and working capital
requirements.
STANDARD & POOR'S REPORTED last week that they have assigned a "BB-" rating
to American Eco's Senior Notes above, as well as a corporate credit rating
of "BB-." Standard & Poor's News Release stated that the ratings outlook
for American Eco is positive. MOODY'S INVESTORS SERVICES, INC. has
assigned a B1 credit rating to the issue.
THE NOTES WERE PLACED UNDER A RULE 144A PRIVATE PLACEMENT offering to
institutional investors. This News Release shall not constitute an offer
to sell or the solicitation of an offer to buy the Notes. The Notes,
issuable upon the sale thereof, have not been registered under the
Securities Act of 1933 nor under any state securities laws, and may not be
offered or sold in the United States absent registration or qualification
or an applicable exemption from registration or qualification requirements.
AMERICAN ECO is a leading North American provider of single-source
industrial support and specialty fabrication services in the energy, pulp &
paper, and power generating industries.
####
For additional information, contact:
Bruce Tobecksen Cindy Jackson Sylvia Dresner,
Senior Vice-President Director of Investor Senior Vice-President
& CFO Relations VMW Inc., New York,
Houston, Texas Houston, Texas New York
(888) 774-3246 (888) 774-3246 (212) 605-3140
www.americaneco.com [email protected]
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