As filed with the Securities and Exchange Commission on March 7, 2003
REGISTRATION NO. 333-_____
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UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM S-4
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
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NATIONAL-OILWELL, INC.
(Exact name of registrant as specified in its charter)
DELAWARE 5084 76-0475815
(State or other jurisdiction of (Primary Standard Industrial (I.R.S. Employer
incorporation or organization) Classification Code Number) Identification No.)
STEVEN W. KRABLIN
10000 RICHMOND AVENUE 10000 RICHMOND AVENUE
HOUSTON, TEXAS 77042-4200 HOUSTON, TEXAS 77042-4200
(713) 346-7500 (713) 346-7773
(Address, including zip code, and telephone number, including (Address, including zip code, and telephone number, including
area code, of registrant's principal executive offices) area code, of registrant's agent for service of process)
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With a copy to: With a copy to:
DWIGHT W. RETTIG MARGARET B. SYMONDS
NATIONAL-OILWELL, INC. BRACEWELL & PATTERSON, L.L.P.
10000 RICHMOND AVENUE 711 LOUISIANA STREET, SUITE 2900
HOUSTON, TEXAS 77042-4200 HOUSTON, TEXAS 77002-2781
PHONE: (713) 346-7550 PHONE: (713) 221-1368
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APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE OF THE SECURITIES TO
THE PUBLIC: As soon as practicable after this Registration Statement becomes
effective.
If the securities being registered on this Form are to be offered in
connection with the formation of a holding company or there is compliance with
General Instruction G, check the following box. [ ]
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, check the following box and
list the Securities Act registration statement number of the earlier effective
registration statement for the same offering.[ ]
If this Form is a post-effective amendment filed pursuant to Rule
462(d) under the Securities Act, check the following box and list the Securities
Act registration statement number of the earlier effective registration
statement for the same offering.[ ]
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The Registrant hereby amends this Registration Statement on such date
or dates as may be necessary to delay its effective date until the Registrant
shall file a further amendment which specifically states that this Registration
Statement shall thereafter become effective in accordance with Section 8(a) of
the Securities Act of 1933 or until the Registration Statement shall become
effective on such date as the Commission, acting pursuant to said Section 8(a),
may determine.
CALCULATION OF REGISTRATION FEE
=================================================================================================================================
PROPOSED
TITLE OF EACH MAXIMUM AGGREGATE PROPOSED
CLASS OF SECURITIES AMOUNT TO OFFERING PRICE MAXIMUM AGGREGATE AMOUNT OF
TO BE REGISTERED BE REGISTERED (1) PER UNIT (1) OFFERING PRICE (1) REGISTRATION FEE
5.65% Senior Notes due 2012 $200,000,000 100% $200,000,000 $16,180.00
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(1) Estimated solely for the purpose of calculating the registration fee
pursuant to Rule 457(o).
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INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A
REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT BE SOLD NOR MAY
OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION STATEMENT BECOMES
EFFECTIVE. THIS PROSPECTUS SHALL NOT CONSTITUTE AN OFFER TO SELL OR THE
SOLICITATION OF AN OFFER TO BUY NOR SHALL THERE BE ANY SALE OF THESE SECURITIES
IN ANY STATE IN WHICH SUCH OFFER, SOLICITATION OR SALE WOULD BE UNLAWFUL PRIOR
TO REGISTRATION OR QUALIFICATION UNDER THE SECURITIES LAWS OF ANY SUCH STATE.
SUBJECT TO COMPLETION, DATED MARCH 7, 2003
$200,000,000
NATIONAL-OILWELL, INC.
OFFER TO EXCHANGE
5.65% EXCHANGE SENIOR NOTES DUE 2012
FOR ANY AND ALL OUTSTANDING 5.65% SENIOR NOTES DUE 2012
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This prospectus, and accompanying letter of transmittal, relate to our
proposed exchange offer. We are offering to exchange up to $200,000,000
aggregate principal amount of new 5.65% senior notes due 2012, Series B, which
we call the exchange notes, which will be freely transferable, for any and all
outstanding 5.65% senior notes due 2012, which we call the original notes,
previously issued in a private offering on November 22, 2002 and which have
certain transfer restrictions.
In this prospectus we sometimes refer to the exchange notes and the
original notes collectively as the notes.
o The exchange offer expires at 5:00 p.m., New York City time,
on _______, 2003, unless we extend it.
o The terms of the exchange notes are substantially identical to
the terms of the original notes, except that the exchange
notes will be freely transferable and issued free of any
covenants regarding exchange and registration rights.
o All original notes that are validly tendered and not validly
withdrawn will be exchanged.
o Tenders of original notes may be withdrawn at any time prior
to expiration of the exchange offer. o We will not receive any
proceeds from the exchange offer.
o The exchange of original notes for exchange notes will not be
a taxable event for United States federal income tax purposes.
o Holders of original notes do not have any appraisal or
dissenters' rights in connection with the exchange offer.
o Original notes not exchanged in the exchange offer will remain
outstanding and be entitled to the benefits of the indenture,
but except under limited circumstances, will have no further
exchange or registration rights under the registration rights
agreement discussed in this prospectus.
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PLEASE SEE "RISK FACTORS" BEGINNING ON PAGE 10 FOR A DISCUSSION OF
FACTORS YOU SHOULD CONSIDER IN CONNECTION WITH THE EXCHANGE OFFER.
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Neither the Securities and Exchange Commission nor any state securities
commission has approved or disapproved of the exchange notes or determined if
this prospectus is truthful or complete. Any representation to the contrary is a
criminal offense.
We may amend or supplement this prospectus from time to time by filing
amendments or supplements as required. You should read this entire prospectus,
the accompanying letter of transmittal and related documents and any amendments
or supplements to this prospectus carefully before making your investment
decision.
The date of this prospectus is _________, 2003.
TABLE OF CONTENTS
PAGE
SUMMARY ......................................................... 3
RISK FACTORS .................................................... 10
THE EXCHANGE OFFER .............................................. 13
USE OF PROCEEDS ................................................. 26
DESCRIPTION OF NOTES ............................................ 27
MATERIAL UNITED STATES FEDERAL INCOME TAX CONSIDERATIONS ........ 39
VALIDITY OF THE EXCHANGE NOTES .................................. 40
EXPERTS ......................................................... 40
WHERE YOU CAN FIND MORE INFORMATION ............................. 41
INFORMATION REGARDING FORWARD-LOOKING STATEMENTS ................ 42
ANNEX A - LETTER OF TRANSMITTAL ................................. A-1
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YOU SHOULD RELY ONLY ON THE INFORMATION CONTAINED IN THIS PROSPECTUS OR
TO WHICH WE HAVE REFERRED YOU. WE HAVE NOT AUTHORIZED ANYONE TO PROVIDE YOU WITH
DIFFERENT INFORMATION. THIS PROSPECTUS MAY ONLY BE USED WHERE IT IS LEGAL TO
SELL THE NOTES. YOU SHOULD NOT ASSUME THAT THE INFORMATION IN OR INCORPORATED BY
REFERENCE IN THIS PROSPECTUS IS ACCURATE AS OF ANY DATE OTHER THAN THE DATE ON
THE FRONT COVER OF THOSE DOCUMENTS. OUR BUSINESS, FINANCIAL CONDITION, RESULTS
OF OPERATIONS AND PROSPECTS MAY HAVE CHANGED SINCE THOSE DATES.
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THIS PROSPECTUS INCORPORATES IMPORTANT BUSINESS AND FINANCIAL
INFORMATION ABOUT NATIONAL OILWELL THAT IS NOT INCLUDED IN OR DELIVERED WITH
THIS PROSPECTUS. INFORMATION THAT WE HAVE INCORPORATED BY REFERENCE IS
AVAILABLE, WITHOUT CHARGE, UPON WRITTEN OR ORAL REQUEST.
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FOR INFORMATION REGARDING WHO TO CONTACT FOR INFORMATION WHICH WE HAVE
INCORPORATED BY REFERENCE, SEE "WHERE YOU CAN FIND MORE INFORMATION. "IN ORDER
TO OBTAIN TIMELY DELIVERY OF THIS INFORMATION, YOU MUST REQUEST THIS INFORMATION
NO LATER THAN FIVE BUSINESS DAYS PRIOR TO THE EXPIRATION DATE OF THE EXCHANGE
OFFER.
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SUMMARY
The following is a summary of more detailed information contained
elsewhere in this prospectus. It may not contain all of the information that is
important to you. This prospectus includes or incorporates by reference
information about this offering, our business and our financial and operating
data. Before making an investment decision, we encourage you to read the entire
prospectus carefully, including the "Risk Factors" and "Information Regarding
Forward-Looking Statements" sections and the financial statements and the
footnotes to those statements, which are incorporated by reference in this
prospectus.
NATIONAL-OILWELL, INC.
We are a worldwide leader in the design, manufacture and sale of
comprehensive systems, components and products used in oil and gas drilling and
production, as well as in distributing products and providing supply chain
integration services to the upstream oil and gas industry.
Our principal executive offices are located at 10000 Richmond Avenue,
Houston, Texas 77042 and our telephone number at that address is 713-346-7500.
PRODUCTS AND TECHNOLOGY
National Oilwell designs, manufactures and sells drilling systems and
components for both land and offshore drilling rigs as well as complete land
drilling and well servicing rigs. Mechanical components include drawworks, mud
pumps, top drives, solids control equipment, travelling equipment and rotary
tables. These components are essential to pump fluids and hoist, support and
rotate the drill string. Many of these components are designed specifically for
applications in offshore, extended reach and deep land drilling. This equipment
is installed on new rigs and often replaced during the upgrade and refurbishment
of existing rigs.
We design and manufacture masts, derricks and substructures for use on
land rigs and on fixed and mobile offshore platforms suitable for drilling
applications to depths of up to 30,000 feet or more. Other products include
cranes, jacking systems, mooring systems, reciprocating and centrifugal pumps
and fluid end expendables for all major manufacturer's pumps. Our business
includes the sale of replacement parts for our own manufactured machinery and
equipment.
We also design and manufacture electrical systems and control data
acquisition systems for drilling related operations and automated and remotely
controlled machinery for drilling rigs. Our control systems can control and
monitor many simultaneous operations on a drilling rig and often form the basis
for our state-of-the-art driller's cabin. Our automated pipe handling system
provides an efficient and cost effective method of joining lengths of drill pipe
or casing as does our iron roughneck. These and similar technologically advanced
products can greatly improve the safety on rigs, often by reducing the number of
persons working on the drilling floor.
While offering a complete line of conventional rigs, National Oilwell
has extensive experience in providing rig designs to satisfy requirements for
harsh or specialized environments. Such products include drilling and well
servicing rigs designed for the Arctic, highly mobile drilling and well
servicing rigs for jungle and desert use, modular well servicing rigs for
offshore platforms and modular drilling facilities for North Sea platforms. We
also design and produce fully integrated drilling solutions for offshore rigs.
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National Oilwell designs and manufactures drilling motors, drilling
jars and specialized drilling tools for rent and sale. We also design and
manufacture a complete line of fishing tools used to remove objects stuck in the
wellbore.
DISTRIBUTION SERVICES
National Oilwell provides distribution services through its network of
approximately 150 distribution service centers. These distribution service
centers stock and sell a variety of expendable items for oilfield applications
and spare parts for our proprietary equipment. As oil and gas companies and
drilling contractors have refocused on their core competencies and emphasized
efficiency initiatives to reduce costs and capital requirements, our
distribution services have expanded to offer outsourcing and alliance
arrangements that include comprehensive procurement, inventory management and
logistics support. In addition, we believe we have a competitive advantage in
the distribution services business by distributing market-leading products
manufactured by us and from the association of this business with our Products
and Technology segment.
The supplies and equipment stocked by our distribution service centers
vary by location. Each distribution point generally offers a large line of
oilfield products including valves, fittings, flanges, spare parts for oilfield
equipment and miscellaneous expendable items.
Most drilling contractors and oil and gas companies typically buy
supplies and equipment pursuant to non-exclusive contracts, which normally
specify a discount from list price for each product or product category. Our
goal is to create strategic alliances with our customers whereby we become the
customer's primary supplier of those items. In certain cases, we assume
responsibility for procurement, inventory management and product delivery for
the customer, occasionally by working directly out of the customer's facilities.
We believe e-commerce brings a significant advantage to larger
companies that are technologically proficient. During the last few years, we
have invested over $20 million to improve our information technology systems.
Our e-commerce system can interface directly with customers' systems to maximize
efficiencies for us and for our customers. We believe we have an advantage in
this effort due to our investment in technology, geographic size, knowledge of
the industry and customers, existing relationships with vendors and existing
means of product delivery.
BUSINESS STRATEGY
National Oilwell's business strategy is to enhance its market positions
and operating performance in the upstream oil and gas business by:
Leveraging our Capital Equipment Installed Base. We believe our market
position and comprehensive product offering present substantial opportunities to
capture a significant portion of expenditures for the construction of new
drilling rigs and equipment as well as the upgrade and refurbishment of existing
drilling rigs and equipment. Over the next few years, the advanced age of the
existing fleet of drilling rigs, coupled with drilling activity involving
greater depths and extended reach, is expected to generate demand for new
equipment. National Oilwell's automation and control systems offer the potential
to improve the performance of new and existing drilling rigs. The large
installed base of our equipment also provides recurring demand for spare parts
and expendable products necessary for proper and efficient operation.
Expanding our Non-Capital Products Business. Our non-capital equipment
revenues continue to represent over half of our products and technology
business. We are a leader in the rental and sale of
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high-performance drilling motors and downhole tools and in the manufacture of
certain expendable products and spare parts needed in the drilling and
production process. We believe additional expansion in the non-capital upstream
oil and gas industry would be beneficial to our business and our customers.
Furthering our Information Technology and Process Improvement Strategy.
National Oilwell has developed an integrated information technology and process
improvement strategy to enhance procurement, inventory management and logistics
activities. As a result of the need to improve industry efficiency, oil and gas
companies and drilling contractors are frequently seeking alliances with
suppliers, manufacturers and service providers to achieve cost and capital
improvements. We believe we are well positioned to provide these services as a
result of our:
o large and geographically diverse network of distribution
service centers in major oil and gas producing areas;
o strong relationship with a large community of industry
suppliers;
o knowledge of customers' procurement processes, suppliers'
capabilities and products' performance; and
o information systems that offer customers and suppliers
enhanced e-commerce capabilities.
In addition, the integration of our distribution expertise, extensive
network and growing base of customer alliances provides an increased opportunity
for cost-effective marketing of our manufactured parts and equipment.
Continuing our Acquisitions Strategy. We believe the oilfield service
and equipment industry will continue to experience consolidation as businesses
seek to align themselves with other market participants in order to gain access
to broader markets and integrated product offerings. From 1997 through January
2003, National Oilwell has made a total of thirty-two acquisitions and plans to
continue to participate in this trend.
RISK FACTORS
o We are dependent on the oil and gas industry.
o Oil and gas prices are volatile and cause shifts in the
expenditure levels of our customers who purchase the products
and services we offer.
o The oilfield products and services industry is highly
competitive.
o Some of our products are used in potentially hazardous
applications which could cause us to face product liability
and warranty claims.
o Unstable foreign markets can have a negative impact on our
revenues.
o Changes in foreign currency exchange rates could have a
negative impact on our revenues.
o Our rapid growth may cause difficulties integrating new
operations.
o Our debt securities may limit our financial flexibility.
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THE EXCHANGE OFFER
Registration Rights
Agreement ....................... When we sold $200 million in aggregate principal amount of original notes
to qualified institutional buyers as defined in Rule 144A under the
Securities Act through Merril Lynch, Pierce, Fenner & Smith,
Incorporated, as initial purchaser, we entered into a registration rights
agreement dated as of November 22, 2002 with the initial purchaser which
granted the holders of the original notes certain exchange and
registration rights. The exchange offer made hereby is intended to
satisfy such exchange rights.
The Exchange Offer .............. $1,000 principal amount of exchange notes in exchange for each $1,000
principal amount of original notes. As of the date hereof, $200 million
aggregate principal amount of the original notes are outstanding.
Although the exchange notes are titled 5.65% Senior Notes due 2012,
Series B, the indenture provides that the original notes and the exchange
notes are treated as a single series of notes under the indenture. We
will issue exchange notes to holders on the earliest practicable date
following the Expiration Date.
Resales of the Exchange Notes.... Based on an interpretation of the Securities Act of 1933 by the staff of
the Securities and Exchange Commission set forth in several no-action
letters issued to third parties, and except as described below, we
believe that the exchange notes issued pursuant to the exchange offer may
be offered for resale, resold and otherwise transferred by holders
thereof without further compliance with the registration and prospectus
delivery provisions of the Securities Act. However, any purchaser of
notes who is an "affiliate" of ours within the meaning of Rule 405 under
the Securities Act, or who intends to participate in the exchange offer
for the purpose of distributing the exchange notes, or any broker-dealer
who purchased the notes to resell pursuant to Rule 144A or any other
available exemption under the Securities Act, (i) will not be able to
rely on the interpretation by the staff of the Securities and Exchange
Commission set forth in the above referenced no-action letters, (ii) will
not be able to tender the notes in the exchange offer and (iii) must
comply with the registration and prospectus delivery requirements of the
Securities Act in connection with any sale or transfer of the notes,
unless such sale or transfer is made pursuant to an exemption from such
requirements. We do not intend to seek our own no-action letter, and
there is no assurance that the Securities and Exchange Commission would
make a similar determination with respect to the exchange notes as it has
in such no-action letters to other persons.
Each broker-dealer that receives exchange notes pursuant to the exchange
offer in exchange for original notes that such broker-dealer acquired for
its own account as a result of market-making activities or other trading
activities, other than original notes acquired directly from us or our
affiliates, must acknowledge that it will deliver a prospectus in
connection with any resale of such exchange notes. The letter of
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transmittal states that by so acknowledging and by delivering a
prospectus, a broker-dealer will not be deemed to admit that it is an
"underwriter" within the meaning of the Securities Act.
If we receive certain notices in the letter of transmittal, this
prospectus, as it may be amended or supplemented from time to time, may
be used for the appropriate time period by a broker-dealer in connection
with resales of exchange notes received in exchange for original notes
where such original notes were acquired by such broker-dealer as a result
of market-making activities or other trading activities and not acquired
directly from us. We have agreed that, if we receive certain notices in
the letter of transmittal, we will make this prospectus available to any
such broker-dealer for use in connection with any such resale.
The letter of transmittal requires broker-dealers tendering original
notes in the exchange offer to indicate whether such broker-dealer
acquired the original notes for its own account as a result of
market-making activities or other trading activities, other than original
notes acquired directly from us or any of our affiliates. If no
broker-dealer indicates that the original notes were so acquired, we have
no obligation under the registration rights agreement to maintain the
effectiveness of the registration statement past the consummation of the
exchange offer or to allow the use of this prospectus for such
resales. See "The Exchange Offer--Registration Rights" and "--Resale of
the Exchange Notes; Plan of Distribution."
Expiration Date ................. The exchange offer expires at 5:00 p.m., New York City time, on
_________, 2003, unless we extend the exchange offer in our sole
discretion, in which case the term "Expiration Date" means the latest
date and time to which the exchange offer is extended.
Conditions to the Exchange
Offer ........................... The exchange offer is subject to certain conditions, which we may waive.
See "The Exchange Offer--Conditions to the Exchange Offer."
Procedures for Tendering
the Original Notes .............. Each holder of original notes wishing to accept the exchange offer must
complete, sign and date the accompanying letter of transmittal in
accordance with the instructions contained herein and therein, and mail
or otherwise deliver such letter of transmittal together with the
original notes and any other required documentation to the exchange agent
identified below under "Exchange Agent" at the address set forth herein.
See "The Exchange Offer--Registration Rights" and "--Procedures for
Tendering Original Notes."
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Special Procedures for
Beneficial Owners ............... Any beneficial owner whose original notes are registered in the name of a
broker, dealer, commercial bank, trust company or other nominee and who
wishes to tender should contact the registered holder promptly and
instruct the registered holder to tender on such beneficial owner's
behalf. See "The Exchange Offer --Procedures for Tendering Original
Notes."
Guaranteed Delivery
Procedures ...................... Holders of original notes who wish to tender their original notes when
those securities are not immediately available or who cannot deliver
their original notes, the letter of transmittal or any other documents
required by the letter of transmittal to the exchange agent prior to the
Expiration Date must tender their original notes according to the
guaranteed delivery procedures set forth in "The Exchange Offer --
Procedures for Tendering Original Notes - Guaranteed Delivery."
Withdrawal Rights ............... Tenders of original notes pursuant to the exchange offer may be withdrawn
at any time prior to the Expiration Date.
Acceptance of Original
Notes and Delivery of
Exchange Notes .................. We will accept for exchange any and all original notes that are properly
tendered in the exchange offer, and not withdrawn, prior to the exchange
offer's Expiration Date. The exchange notes issued pursuant to the
exchange offer will be issued on the earliest practicable date following
our acceptance for exchange of original notes. See "The Exchange
Offer--Terms of the Exchange Offer."
Exchange Agent .................. The Bank of New York is serving as the exchange agent in connection with
the exchange offer.
Federal Income Tax
Considerations .................. The exchange of original notes for exchange notes pursuant to the
exchange offer will not be treated as a taxable exchange for federal
income tax purposes. See "Material United States Federal Income Tax
Considerations."
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SUMMARY FINANCIAL DATA
Data for periods prior to 2002 shown below is restated to combine IRI
International Corporation and Dupre' results pursuant to pooling-of-interests
accounting. The following should be read in conjunction with Management's
Discussion and Analysis of Financial Condition and Results of Operations and the
financial statements and the related notes thereto incorporated by reference in
this prospectus.
YEAR ENDED DECEMBER 31,
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2002 2001 2000 1999 1998
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(IN THOUSANDS OF U.S. DOLLARS, EXCEPT PER SHARE AMOUNTS AND RATIOS)
OPERATING DATA:
Revenues ............................................. $ 1,521,946 $ 1,747,455 $ 1,149,920 $ 839,648 $ 1,449,248
Operating income (1) ................................. 134,323 189,277 48,456 1,325 139,815
Income (loss) before taxes ........................... 112,465 168,017 27,037 (14,859) 125,021
Net income (loss) (2) ................................ 73,069 104,063 13,136 (9,385) 81,336
Net income (loss) per share
Basic (2) ........................................... 0.90 1.29 0.17 (0.13) 1.19
Diluted (2) ......................................... 0.89 1.27 0.16 (0.13) 1.19
OTHER DATA:
Depreciation and amortization ........................ 25,048 38,873 35,034 25,541 20,518
Capital expenditure .................................. 24,805 27,358 24,561 17,547 39,246
BALANCE SHEET DATA:
Working capital ...................................... 768,852 631,257 480,321 452,015 529,937
Total assets ......................................... 1,968,662 1,471,696 1,278,894 1,005,715 1,091,028
Long-term debt, less current maturities .............. 594,637 300,000 222,477 196,053 222,209
Stockholders' equity ................................. 933,364 867,540 767,206 596,375 603,568
RATIOS:
Consolidated Ratios of Earnings to Fixed Charges (3).. 5.0 7.4 2.3 0.1 9.4
(1) In connection with the IRI International Corporation merger in 2000, we
recorded charges of $14.1 million related to direct merger costs, personnel
reductions, and facility closures and inventory write-offs of $15.7 million
due to product line rationalization. In 1998, a $17.0 million charge was
recorded related to personnel reductions and facility closures and a $5.6
million charge related to the write-down of certain tubular inventories.
(2) We adopted Statement of Financial Accounting Standards No. 142,
"Goodwill and Other Intangible Assets" (SFAS 142), effective January 1,
2002. The effects of not amortizing goodwill and other intangible assets in
periods prior to the adoption of SFAS 142 would have resulted in net income
(loss) of $115.0 million, $23.1 million, $(4.0) million and $84.8 million
for the years ended December 31, 2001, 2000, 1999,and 1998, respectively;
basic earnings per common share of $1.42, $0.29, $(0.06) and $1.24 for the
years ending December 31, 2001, 2000, 1999 and 1998, respectively; and
diluted earnings per common share of $1.41, $0.29, $(0.06) and $1.24 for
the years ending December 31, 2001, 2000, 1999 and 1998, respectively.
(3) In all cases, (i) earnings represent: income before income taxes, excluding
extraordinary gains or losses; plus fixed charges, excluding capitalized
interest and (ii) fixed charges include interest, whether expensed or
capitalized, plus amortization of debt issuance costs, plus the portion of
rental expense which is deemed representative of interest.
-9-
RISK FACTORS
You should carefully consider the risks described below, in addition to
other information contained or incorporated by reference herein. Realization of
any of the following risks could have a material adverse effect on our business,
financial condition, cash flows and results of operations.
NATIONAL OILWELL DEPENDS ON THE OIL AND GAS INDUSTRY
National Oilwell is dependent upon the oil and gas industry and its
willingness to explore for and produce oil and gas. The industry's willingness
to explore and produce depends upon the prevailing view of future product
prices. Many factors affect the supply and demand for oil and gas and therefore
influence product prices, including:
o level of production from known reserves;
o cost of producing oil and gas;
o level of drilling activity;
o worldwide economic activity;
o national government political requirements;
o development of alternate energy sources; and
o environmental regulations.
If there is a significant reduction in demand for drilling services, in
cash flows of drilling contractors or production companies or in drilling or
well servicing rig utilization rates, then demand for our products will decline.
OIL AND GAS PRICES ARE VOLATILE
Oil and gas prices have been volatile since 1990, ranging from $10 -
$40 per barrel. Over the last three years, oil prices have generally ranged
within $20-$30 per barrel. Spot gas prices have also been volatile since 1990,
ranging from less than $1.00 per mmbtu of gas to above $10.00. Gas prices were
moderate in 1998 and 1999, generally ranging from $1.80 - $2.50 per mmbtu. Gas
prices in 2000 generally ranged from $4-$8 per mmbtu. In the second quarter of
2001, gas prices came under pressure, generally ranging between $2.20 to $3.00
per mmbtu through the first quarter of 2002. Gas prices have generally ranged
between $3.00 - $5.00 per mmbtu since that time.
Expectations for future oil and gas prices cause many shifts in the
strategies and expenditure levels of oil and gas companies and drilling
contractors, particularly with respect to decisions to purchase major capital
equipment of the type we manufacture. Industry activity and our revenues have
not responded to the higher commodity prices that have existed since the second
quarter of 2002, presumably due to concerns that these prices will not continue
in the current range. We cannot predict future oil and gas prices or the effect
prices will have on exploration and production levels.
NATIONAL OILWELL'S INDUSTRY IS HIGHLY COMPETITIVE
The oilfield products and services industry is highly competitive. The
following competitive actions can each affect our revenues and earnings:
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o price changes;
o new product and technology introductions; and
o improvements in availability and delivery.
We compete with many companies and there are low barriers to entry in
many of our business segments.
NATIONAL OILWELL FACES POTENTIAL PRODUCT LIABILITY AND WARRANTY CLAIMS
Customers use some of our products in potentially hazardous drilling,
completion and production applications that can cause:
o injury or loss of life;
o damage to property, equipment or the environment; and
o suspension of operations.
We maintain amounts and types of insurance coverage that we believe are
consistent with normal industry practice. We cannot guarantee that insurance
will be adequate to cover all liabilities we may incur. We also may not be able
to maintain insurance in the future at levels we believe are necessary and at
rates we consider reasonable.
National Oilwell may be named as a defendant in product liability or
other lawsuits asserting potentially large claims if an accident occurs at a
location where our equipment and services have been used. We are currently party
to various legal and administrative proceedings. We cannot predict the outcome
of these proceedings, nor can we guarantee any negative outcomes will not be
significant to us.
INSTABILITY OF FOREIGN MARKETS COULD HAVE A NEGATIVE IMPACT ON OUR REVENUES AND
OPERATING RESULTS
Some of our revenues depend upon customers in the Middle East, Africa,
Southeast Asia, South America and other international markets. These revenues
are subject to risks of instability of foreign economies and governments. Laws
and regulations limiting exports to particular countries can affect our sales,
and sometimes export laws and regulations of one jurisdiction contradict those
of another.
CHANGES IN FOREIGN CURRENCY EXCHANGE RATES COULD HAVE A NEGATIVE IMPACT ON OUR
REVENUES AND OPERATING RESULTS
National Oilwell is exposed to the risks of changes in exchange rates
between the U.S. dollar and foreign currencies. Our Norwegian companies enter
into foreign exchange forward contracts, primarily between the Norwegian kroner
and the US dollar, to hedge cash flows on certain significant contracts. Our
decisions regarding the need for hedging foreign currencies in Norway and other
countries can adversely affect our operating results.
NATIONAL OILWELL MAY NOT BE ABLE TO SUCCESSFULLY MANAGE ITS GROWTH
National Oilwell has acquired 32 companies since April 1997, including
nine in 2001 and four in 2002. In addition, we acquired two other companies in
January 2003. We cannot predict whether suitable acquisition candidates will be
available on reasonable terms or if we will have access to adequate funds to
complete any desired acquisition. Once acquired, we cannot guarantee that we
will successfully integrate
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the operations of the acquired companies. Combining organizations could
interrupt the activities of some or all of our businesses and have a negative
impact on operations.
NATIONAL OILWELL HAS DEBT
In 1998, National Oilwell issued $150 million of 6 7/8% unsecured
senior notes due July 1, 2005. In 2001, we issued an additional $150 million of
6 1/2% unsecured senior notes due March 15, 2011. In 2002, we issued $200
million of 5.65% unsecured senior notes due November 15, 2012. We also have a
$175 million revolving line of credit and approximately $200 million in
availability under various borrowing arrangements of our wholly-owned foreign
subsidiaries. Our leverage requires us to use some of our cash flow from
operations for payment of interest on our debt. Our leverage may also make it
more difficult to obtain additional financing in the future. Further, our
leverage could make us more vulnerable to economic downturns and competitive
pressures.
NO PUBLIC MARKET FOR THE NOTES EXISTS
The original notes have not been registered under the Securities Act
and may not be resold by purchasers thereof unless the original notes are
subsequently registered or an exemption from the registration requirements of
the Securities Act is available. There can be no assurance, even following
registration or exchange of the original notes for exchange notes, that an
active trading market for the original notes or the exchange notes will exist.
At the time of the private placement of the original notes, the initial
purchaser was not obligated to make a market in the original notes and, if
issued, the exchange notes, and any such market-making activity that commenced
or is commenced may be terminated at any time without notice. In addition, any
market-making activity will be subject to restrictions imposed by the Securities
Act and the Exchange Act. No assurance can be given as to the liquidity of or
trading market for the original notes or the exchange notes.
The liquidity of any market for the notes will depend upon the number
of holders of the notes, our performance, the market for similar securities, the
interest of securities dealers in making a market in the notes, prevailing
interest rates and other factors.
CONSEQUENCES OF FAILING TO EXCHANGE OR PROPERLY TENDER
Consequences of Failure to Exchange. To the extent that original notes
are tendered and accepted for exchange pursuant to the exchange offer, the
trading market for original notes that remain outstanding may be significantly
more limited, which might adversely affect the liquidity of the original notes
not tendered for exchange. The extent of the market and the availability of
price quotations for original notes would depend upon a number of factors,
including the number of holders of original notes remaining at such time and the
interest in maintaining a market in such original notes on the part of
securities firms. An issue of securities with a smaller outstanding market value
available for trading (the "float") may command a lower price than would a
comparable issue of securities with a greater float. Therefore, the market price
for original notes that are not exchanged in the exchange offer may be affected
adversely to the extent that the amount of original notes exchanged pursuant to
the exchange offer reduces the float. The reduced float also may tend to make
the trading price of the original notes that are not exchanged more volatile.
Consequences of Failure to Properly Tender. Issuance of the exchange
notes in exchange for the original notes pursuant to the exchange offer will be
made following the prior satisfaction, or waiver, of the conditions set forth in
"The Exchange Offer--Conditions to the Exchange Offer" and only after timely
receipt by the exchange agent of such original notes, a properly completed and
duly executed letter of transmittal and all other required documents. Therefore,
holders of original notes desiring to tender such original notes in exchange for
exchange notes should allow sufficient time to ensure timely delivery of all
required documentation. Neither we, the exchange agent nor any other person is
under any duty to
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give notification of defects or irregularities with respect to the tenders of
original notes for exchange. Original notes that may be tendered in the exchange
offer but which are not validly tendered will, following the consummation of the
exchange offer, remain outstanding and will continue to be subject to the same
transfer restrictions currently applicable to such original notes.
HOLDERS OF BOOK-ENTRY INTERESTS WILL NEED TO ACT THROUGH DEPOSITARIES
The original notes are represented, and the exchange notes will be
represented, by one or more global notes in definitive fully registered form
without coupons and will be deposited upon issuance with, or on behalf of, The
Depository Trust Company, which we call DTC. DTC (or its nominee) will be the
sole holder of the global notes representing the notes and owners of book-entry
interests will not be considered owners or holders of the notes. After payment
to DTC, we will have no responsibility or liability for any aspect of the
payments made on account of book-entry interests. Accordingly, holders of
book-entry interests must rely on the procedures of DTC or, if such holder is
not a participant in DTC, on the procedures of the participant through which the
interest is owned, to exercise any rights and obligations of a holder under the
indenture governing the notes.
Owners of book-entry interests will not have the direct right to act
upon our solicitations for consents or requests for waivers or other actions
from holders of the notes. Instead, owners of book-entry interests will be
permitted to act only to the extent they have received appropriate proxies to do
so from DTC. There can be no assurance that procedures implemented for the
granting of such proxies will be sufficient to enable owners of book-entry
interests to vote on any requested actions on a timely basis.
Similarly, upon the occurrence of an event of default under the
indenture governing the notes, unless and until definitive registered notes are
issued in respect of all book-entry interests, owners of book-entry interests
will be restricted to acting through DTC. There can be no assurance that the
procedures to be implemented through DTC will be adequate to ensure the timely
exercise of remedies under the notes.
THE EXCHANGE OFFER
REGISTRATION RIGHTS
At the closing of the sale of the original notes, we entered into a
registration rights agreement with the initial purchaser pursuant to which we
agreed, for the benefit of the holders of the original notes, at our cost,
o to file, no later than March 7, 2003, an exchange offer
registration statement with the Securities and Exchange
Commission with respect to the exchange offer for the exchange
notes;
o to use our reasonable best efforts to cause the exchange offer
registration statement to be declared effective under the
Securities Act no later than April 21, 2003;
o to use our reasonable best efforts to keep the registration
statement for the exchange notes effective until the closing
of the exchange offer; and
o to use our reasonable best efforts to cause the exchange offer
to be completed no later than May 21, 2003.
Upon the exchange offer registration statement being declared
effective, we agreed to offer the exchange notes in exchange for surrender of
the original notes and to keep the exchange offer open for not less than 30 days
thereafter. For each original note surrendered to us pursuant to the exchange
offer,
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the holder of that original note will receive an exchange note having a
principal amount equal to that of the surrendered original note. Interest on
each exchange note will accrue from the last interest payment date on which
interest was paid on the original note tendered in exchange therefor or, if no
interest has been paid on the original note, from the date of its initial
issuance. The registration rights agreement also provides an agreement to
include in the prospectus for the exchange offer certain information necessary
to allow a broker-dealer who holds original notes that were acquired for its own
account as a result of market-making activities or other ordinary course trading
activities (other than original notes acquired directly from us or one of our
affiliates) to exchange such original notes pursuant to the exchange offer and
to satisfy the prospectus delivery requirements in connection with resales of
exchange notes received by such broker-dealer in the exchange offer.
The preceding agreement is needed because any broker-dealer who
acquires original notes for its own account as a result of market-making
activities or other trading activities is required to deliver a prospectus
meeting the requirements of the Securities Act. This prospectus covers our offer
and sale of the exchange notes pursuant to the exchange offer. It also covers
the resale of exchange notes received in the exchange offer by any broker-dealer
who held original notes acquired for its own account as a result of
market-making activities or other trading activities other than original notes
acquired directly from us or one of our affiliates.
Under existing interpretations of the staff of the Securities and
Exchange Commission contained in several no-action letters to third parties, the
exchange notes would in general be freely tradeable after the exchange offer
without further registration under the Securities Act. However, any purchaser of
original notes who is an "affiliate" of ours as defined in Rule 405 of the
Securities Act or who intends to participate in the exchange offer for the
purpose of distributing the related exchange notes
o will not be able to rely on the interpretation of the staff of
the Securities and Exchange Commission;
o will not be able to tender its original notes in the exchange
offer; and
o must comply with the registration and prospectus delivery
requirements of the Securities Act in connection with any sale
or transfer of the original notes unless such sale or transfer
is made pursuant to an exemption from such requirements.
Each holder of the original notes who wishes to exchange original notes
for exchange notes in the exchange offer will be required to make certain
representations, including that (1) any exchange notes to be received by it will
be acquired in the ordinary course of its business, (2) at the time of
commencement of the exchange offer, it has no arrangement with any person to
participate in the distribution of the original notes or the exchange notes
(within the meaning of the Securities Act) and (3) it is not an affiliate of
ours or, if it is an affiliate, it will comply with the registration and
prospectus delivery requirements of the Securities Act to the extent applicable.
If the holder is not a broker-dealer, it will be required to represent
that it is not engaged in, and does not intend to engage in, the distribution of
the exchange notes. If the holder is a broker-dealer that will receive exchange
notes for its own account in exchange for original notes that were acquired as a
result of market-making activities or other trading activities, it will be
required to acknowledge that it will deliver a prospectus in connection with any
resale of the exchange notes.
If:
o we determine that the exchange offer registration statement is
not available or the exchange offer may not be consummated
because it would violate applicable law or Securities and
Exchange Commission interpretations;
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o the exchange offer registration statement is not declared
effective on or before April 21, 2003 or the exchange offer
has not been completed on or before May 21, 2003;
o the exchange offer is not available to any holder of original
notes based on an opinion of counsel; or
o the initial purchaser of the original notes (but only with
respect to original notes acquired directly from us) so
requests;
we will, as promptly as practicable, use our reasonable efforts to file a shelf
registration statement for resale of the original notes. We will use our
reasonable best efforts to cause the shelf registration statement to become
effective as promptly as practicable but no later than June 20, 2003, and to
keep the registration statement effective for a period ending on the earlier of:
o the second anniversary of the effective date of the shelf
registration statement; or
o until all of the original notes that are covered by the shelf
registration statement cease to be outstanding or have been
sold to the public under Rule 144 under the Securities Act or
are eligible to be sold to the public under Rule 144(k) under
the Securities Act.
We will provide to the holders of the original notes copies of the
prospectus that is part of the shelf registration statement, notify such holders
when the resale registration for the original notes has become effective and
take other actions as are required to permit unrestricted sales of such notes. A
holder of the original notes that offers or sells such notes pursuant to the
shelf registration generally would be required to be named as a selling
securityholder in the related prospectus and to deliver a prospectus to the
purchaser, will be subject to certain of the civil liability provisions of the
Securities Act in connection with such sales and will be bound by the provisions
of the registration rights agreement applicable to that holder, including
indemnification obligations.
We will pay additional interest on the original notes if:
o the exchange offer registration statement is not filed with
the Securities and Exchange Commission on or before March 7,
2003;
o the exchange offer registration statement or the shelf
registration statement, as the case may be, is not declared
effective on or before the date on which such registration
statement is required to become or be declared effective;
o the exchange offer is not consummated on or before May 21,
2003 (if the exchange offer is then required to be made); or
o the shelf registration is filed and declared effective but
thereafter becomes unusable by the holders of notes covered by
the registration statement for more than 45 days in any
12-month period,
in which case, we will be obligated to pay additional interest on the original
notes over and above the applicable interest rate at a rate of 0.25% per year,
which interest shall be further increased by 0.25% for each 90-day period that
we are required to pay additional interest up to a maximum additional interest
rate of 0.50% per year, until the exchange offer registration statement is
filed, the applicable registration statement is declared effective, the exchange
offer is consummated, or the shelf registration statement becomes usable, as the
case may be. Any additional interest will cease to accrue when all of the events
described above have been cured.
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We are required to deposit, in immediately available funds, the amount
of any additional interest payable to holders of the notes with the trustee on
or before the semiannual interest payment date.
This summary of the material provisions of the registration rights
agreement does not purport to be complete and is subject to, and is qualified in
its entirety by reference to, all the provisions of the registration rights
agreement, a copy of which is filed as an exhibit to the registration statement
of which this prospectus is a part.
Except as set forth above, after consummation of the exchange offer,
holders of original notes which are the subject of the exchange offer will have
no registration or exchange rights under the registration rights agreement.
These consequences are more fully described under "--Consequences of Failure to
Exchange" and "--Resale of the Exchange Notes; Plan of Distribution."
CONSEQUENCES OF FAILURE TO EXCHANGE
The original notes which are not exchanged for exchange notes pursuant
to the exchange offer and are not included in a resale prospectus which, if
required, will be filed as part of an amendment to the registration statement of
which this prospectus is a part, will remain restricted securities and subject
to restrictions on transfer. Accordingly, original notes that are not exchanged
may only be resold:
o to us, upon redemption or otherwise;
o so long as the original notes are eligible for resale pursuant
to Rule 144A under the Securities Act, to a person whom the
seller reasonably believes is a qualified institutional buyer
within the meaning of Rule 144A, purchasing for its own
account or for the account of a qualified institutional buyer
to whom notice is given that the resale, pledge or other
transfer is being made in reliance on Rule 144A;
o in an offshore transaction in accordance with Regulation S
under the Securities Act;
o pursuant to an exemption from registration in accordance with
Rule 144, if available, under the Securities Act;
o in reliance on another exemption from the registration
requirements of the Securities Act; or
o pursuant to an effective registration statement under the
Securities Act.
In all of the situations discussed above, the resale must be in
accordance with any applicable securities laws of any state of the United
States.
To the extent original notes are tendered and accepted in the exchange
offer, the principal amount of outstanding original notes will decrease with a
resulting decrease in the liquidity in the market therefor. Accordingly, the
liquidity of the market of the original notes could be adversely affected. The
risks of failing to exchange original notes are more fully described in "Risk
Factors--Consequences of Failing to Exchange or Properly Tender."
TERMS OF THE EXCHANGE OFFER
Upon the terms and subject to the conditions set forth in this
prospectus and in the letter of transmittal, a copy of which is attached to this
prospectus as Annex A, we will accept any and all original notes validly
tendered and not withdrawn prior to the Expiration Date. We will issue $1,000
principal amount of exchange notes in exchange for each $1,000 principal amount
of original notes accepted in the
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exchange offer. Holders may tender some or all of their original notes pursuant
to the exchange offer. However, original notes may be tendered only in integral
multiples of $1,000 principal amount.
The form and terms of the exchange notes are the same as the form and
terms of the original notes, except that:
o the exchange notes will have been registered under the
Securities Act and will not bear legends restricting their
transfer pursuant to the Securities Act;
o holders of the exchange notes will not be entitled to the
rights of holders of original notes under the registration
rights agreement; and
o provisions for additional interest in the event of breach of
certain registration covenants relating to the original notes
will not apply to the exchange notes.
The exchange notes will evidence the same debt as the original notes
that they replace, and will be issued under, and be entitled to the benefits of,
the indenture which governs all of the notes.
Solely for reasons of administration and for no other purpose, we have
fixed the close of business on _____, 2003 as the date for purposes of
determining the persons to whom this prospectus and the letter of transmittal
will be mailed initially. Only a registered holder of original notes or such
holder's legal representative or attorney-in-fact as reflected on the records of
the trustee under the indenture may participate in the exchange offer. There
will be no fixed record date for determining registered holders of the original
notes entitled to participate in the exchange offer.
Holders of the original notes do not have any appraisal or dissenters'
rights under Delaware law or the indenture in connection with the exchange
offer. We intend to conduct the exchange offer in accordance with the applicable
requirements of the Exchange Act and the rules and regulations of the Securities
and Exchange Commission thereunder.
We shall be deemed to have accepted validly tendered original notes
when, as and if we have given oral or written notice of our acceptance to the
exchange agent. The exchange agent will act as agent for the tendering holders
of the original notes for the purposes of receiving the exchange notes. The
exchange notes delivered pursuant to the exchange offer will be issued on the
earliest practicable date following our acceptance for exchange of original
notes.
If any tendered original notes are not accepted for exchange because of
an invalid tender, the occurrence of certain other events described herein or
otherwise, certificates for any such unaccepted original notes will be returned,
without expense, to the tendering holder thereof as promptly as practicable
after the Expiration Date.
Holders who tender original notes in the exchange offer will not be
required to pay brokerage commissions or fees or, subject to the instructions in
the letter of transmittal, transfer taxes with respect to the exchange of the
original notes pursuant to the exchange offer. We will pay all charges and
expenses, other than certain applicable taxes, in connection with the exchange
offer. See "--Fees and Expenses."
EXPIRATION DATE; EXTENSIONS; AMENDMENTS
The term "Expiration Date" with respect to the exchange offer, shall
mean 5:00 p.m., New York City time, on ___________, 2003, unless we, in our sole
discretion, extend the exchange offer, in which case "Expiration Date" shall
mean the latest date and time to which the exchange offer is extended.
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In order to extend the exchange offer, we will notify the exchange
agent of any extension by oral or written notice and will make a public
announcement thereof, each prior to 9:00 a.m., New York City time, on the next
business day after the previously scheduled Expiration Date of the exchange
offer.
We reserve the right, in our sole discretion,
o to delay accepting any original notes;
o to extend the exchange offer;
o if any of the conditions set forth below under "--Conditions
to the Exchange Offer" have not been satisfied, to terminate
the exchange offer; or
o to amend the terms of the exchange offer in any manner.
We may effect any such delay, extension or termination by giving oral
or written notice thereof to the exchange agent.
Except as specified in the second paragraph under this heading, any
such delay in acceptance, extension, termination or amendment will be followed
as promptly as practicable by a public announcement thereof. If the exchange
offer is amended in a manner determined by us to constitute a material change,
we will promptly disclose any amendment by means of a prospectus supplement that
will be distributed to the registered holders of the original notes. The
exchange offer will then be extended for a period of five to ten business days,
as required by law, depending upon the significance of the amendment and the
manner of disclosure to the registered holders, if the exchange offer would
otherwise expire during such five to ten business day period.
Without limiting the manner in which we may choose to make a public
announcement of any delay, extension, termination or amendment of the exchange
offer, we shall not have an obligation to publish, advertise, or otherwise
communicate any such public announcement, other than by making a timely release
thereof to the Dow Jones News Service.
PROCEDURES FOR TENDERING ORIGINAL NOTES
Tenders of Original Notes. The tender by a holder of original notes
pursuant to any of the procedures set forth below will constitute the tendering
holder's acceptance of the terms and conditions of the exchange offer. Our
acceptance for exchange of original notes tendered pursuant to any of the
procedures described below will constitute a binding agreement between such
tendering holder and us in accordance with the terms and subject to the
conditions of the exchange offer. Only holders of record are authorized to
tender their original notes. The procedures by which original notes may be
tendered by beneficial owners that are not holders of record will depend upon
the manner in which the original notes are held.
DTC has authorized DTC participants that are beneficial owners of
original notes through DTC to tender their original notes as if they were
holders. To effect a tender, DTC participants should either (1) complete and
sign the letter of transmittal or a facsimile thereof, have the signature
thereon guaranteed if required by Instruction 1 of the letter of transmittal and
mail or deliver the letter of transmittal or such facsimile pursuant to the
procedures for book-entry transfer set forth below under "-- Book-Entry Delivery
Procedures," or (2) transmit their acceptance to DTC through the DTC Automated
Tender Offer Program (which we call "ATOP"), for which the transaction will be
eligible, and follow the procedures for book-entry transfer set forth below
under "-- Book-Entry Delivery Procedures."
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Tender of Original Notes Held in Physical Form. To tender effectively
original notes held in physical form pursuant to the exchange offer,
o a properly completed letter of transmittal applicable to such
notes (or a facsimile thereof) duly executed by the holder
thereof, and any other documents required by the letter of
transmittal, must be received by the exchange agent at one of
its addresses set forth below, and tendered original notes
must be received by the exchange agent at such address (or
delivery effected through the deposit of original notes into
the exchange agent's account with DTC and making book-entry
delivery as set forth below) on or prior to the Expiration
Date of the exchange offer; or
o the tendering holder must comply with the guaranteed delivery
procedures set forth below.
LETTERS OF TRANSMITTAL AND ORIGINAL NOTES SHOULD BE SENT ONLY TO THE
EXCHANGE AGENT AND SHOULD NOT BE SENT TO US.
Tender of Original Notes Held Through a Custodian. To effectively
tender original notes that are held of record by a custodian bank, depository,
broker, trust company or other nominee, the beneficial owner thereof must
instruct such holder to tender the original notes on the beneficial owner's
behalf. A letter of instructions from the record owner to the beneficial owner
may be included in the materials provided along with this prospectus which may
be used by the beneficial owner in this process to instruct the registered
holder of such owner's original notes to effect the tender.
Tender of Original Notes Held Through DTC. To effectively tender
original notes that are held through DTC, DTC participants should either
o properly complete and duly execute the letter of transmittal
(or a facsimile thereof), and any other documents required by
the letter of transmittal, and mail or deliver the letter of
transmittal or such facsimile pursuant to the procedures for
book-entry transfer set forth below; or
o transmit their acceptance through ATOP, for which the
transaction will be eligible, and DTC will then edit and
verify the acceptance and send an Agent's Message to the
exchange agent for its acceptance.
Delivery of tendering original notes held through DTC must be made to
the exchange agent pursuant to the book-entry delivery procedures set forth
below or the tendering DTC participant must comply with the guaranteed delivery
procedures set forth below.
THE METHOD OF DELIVERY OF ORIGINAL NOTES AND LETTERS OF TRANSMITTAL,
ANY REQUIRED SIGNATURE GUARANTEES AND ALL OTHER REQUIRED DOCUMENTS, INCLUDING
DELIVERY THROUGH DTC AND ANY ACCEPTANCE OR AGENT'S MESSAGE TRANSMITTED THROUGH
ATOP, IS AT THE ELECTION AND RISK OF THE PERSON TENDERING ORIGINAL NOTES AND
DELIVERING LETTERS OF TRANSMITTAL. EXCEPT AS OTHERWISE PROVIDED IN THE LETTER OF
TRANSMITTAL, DELIVERY WILL BE DEEMED MADE ONLY WHEN ACTUALLY RECEIVED BY THE
EXCHANGE AGENT. IF DELIVERY IS BY MAIL, IT IS SUGGESTED THAT THE HOLDER USE
PROPERLY INSURED, REGISTERED MAIL WITH RETURN RECEIPT REQUESTED, AND THAT THE
MAILING BE MADE SUFFICIENTLY IN ADVANCE OF THE EXPIRATION DATE TO PERMIT
DELIVERY TO THE EXCHANGE AGENT PRIOR TO SUCH DATE.
Except as provided below, unless the original notes being tendered are
deposited with the exchange agent on or prior to the Expiration Date
(accompanied by a properly completed and duly executed letter of transmittal or
a properly transmitted Agent's Message), we may, at our option, reject
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such tender. Exchange of exchange notes for original notes will be made only
against deposit of the tendered original notes and delivery of all other
required documents.
Book-Entry Delivery Procedures. The exchange agent will establish an
account with respect to the original notes at DTC for purposes of the exchange
offer within two business days after the date of this prospectus, and any
financial institution that is a participant in DTC may make book-entry delivery
of the original notes by causing DTC to transfer such original notes into the
exchange agent's account in accordance with DTC's procedures for such transfer.
However, although delivery of original notes may be effected through book-entry
at DTC, the letter of transmittal (or facsimile thereof), with any required
signature guarantees or an Agent's Message in connection with a book-entry
transfer, and any other required documents, must, in any case, be transmitted to
and received by the exchange agent at one or more of its addresses set forth in
this prospectus on or prior to the Expiration Date, or compliance must be made
with the guaranteed delivery procedures described below. Delivery of documents
to DTC does not constitute delivery to the exchange agent. The confirmation of a
book-entry transfer into the exchange agent's account at DTC as described above
is referred to herein as a "Book-Entry Confirmation."
The term "Agent's Message" means a message transmitted by DTC to, and
received by, the exchange agent and forming a part of the Book-Entry
Confirmation, which states that DTC has received an express acknowledgment from
a participant in DTC tendering original notes and that such participant has
received the letter of transmittal and agrees to be bound by the terms of the
letter of transmittal and we may enforce such agreement against such
participant.
Signature Guarantees. Signatures on all letters of transmittal must be
guaranteed by a recognized member of the Medallion Signature Guarantee Program
or by any other "eligible guarantor institution," as such term is defined in
Rule 17Ad-15 promulgated under the Exchange Act (each of these being an
"eligible institution"), unless the original notes tendered thereby are tendered
(1) by a registered holder of original notes (or by a participant in DTC whose
name appears on a DTC security position listing as the owner of such original
notes) who has not completed either the box entitled "Special Issuance
Instructions" or "Special Delivery Instructions" on the letter of transmittal or
(2) for the account of an eligible institution. For additional information on
signature guarantees, see Instruction 1 of the letter of transmittal. If the
original notes are registered in the name of a person other than the signer of
the letter of transmittal or if original notes not accepted for exchange or not
tendered are to be returned to a person other than the registered holder, then
the signatures on the letter of transmittal accompanying the tendered original
notes must be guaranteed by an eligible institution as described above.
Additional information on signature guarantees and instruments of transfer is
included in Instructions 1 and 5 of the letter of transmittal.
Guaranteed Delivery. If a holder desires to tender original notes
pursuant to the exchange offer and time will not permit the letter of
transmittal, certificates representing the original notes and all other required
documents to reach the exchange agent, or the procedures for book-entry transfer
cannot be completed, on or prior to the Expiration Date of the exchange offer,
such original notes may nevertheless be tendered if all of the following
conditions are satisfied:
o the tender is made by or through an eligible institution;
o a properly completed and duly executed Notice of Guaranteed
Delivery, substantially in the form provided by us herewith,
or an Agent's Message with respect to guaranteed delivery that
is accepted by us, is received by the exchange agent on or
prior to the Expiration Date, as provided below; and
o the certificates for the tendered original notes, in proper
form for transfer (or a Book-Entry Confirmation of the
transfer of such original notes into the exchange agent's
account at DTC as described above), together with the letter
of transmittal (or facsimile
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thereof), properly completed and duly executed, with any
required signature guarantees and any other documents required
by the letter of transmittal or a properly transmitted Agent's
Message, are received by the exchange agent within two
business days after the date of execution of the Notice of
Guaranteed Delivery.
The Notice of Guaranteed Delivery may be sent by hand delivery,
telegram, facsimile transmission or mail to the exchange agent and must include
a guarantee by an eligible institution in the form set forth in the Notice of
Guaranteed Delivery.
Notwithstanding any other provision hereof, delivery of exchange notes
by the exchange agent for original notes tendered and accepted for exchange
pursuant to the exchange offer will, in all cases, be made only after timely
receipt by the exchange agent of such original notes (or Book-Entry Confirmation
of the transfer of such original notes into the exchange agent's account at DTC
as described above), and the letter of transmittal (or facsimile thereof) with
respect to such original notes, properly completed and duly executed, with any
required signature guarantees and any other documents required by the letter of
transmittal, or a properly transmitted Agent's Message.
Determination of Validity. All questions as to the validity, form,
eligibility (including time of receipt), acceptance and withdrawal of tendered
original notes will be determined by us in our sole discretion, which
determination will be final and binding. We reserve the absolute right to reject
any and all original notes not properly tendered or any original notes our
acceptance of which, in the opinion of our counsel, would be unlawful.
We also reserve the right to waive any defects, irregularities or
conditions of tender as to particular original notes. The interpretation of the
terms and conditions of our exchange offer (including the instructions in the
letter of transmittal) by us will be final and binding on all parties. Unless
waived, any defects or irregularities in connection with tenders of original
notes must be cured within such time as we shall determine.
Although we intend to notify holders of defects or irregularities with
respect to tenders of original notes through the exchange agent, neither we, the
exchange agent nor any other person is under any duty to give such notice, nor
shall we or they incur any liability for failure to give such notification.
Tenders of original notes will not be deemed to have been made until such
defects or irregularities have been cured or waived.
Any original notes received by the exchange agent that are not validly
tendered and as to which the defects or irregularities have not been cured or
waived, or if original notes are submitted in a principal amount greater than
the principal amount of original notes being tendered by such tendering holder,
such unaccepted or non-exchanged original notes will either be
o returned by the exchange agent to the tendering holders as
promptly as practicable; or
o in the case of original notes tendered by book-entry transfer
into the exchange agent's account at the Book-Entry Transfer
Facility pursuant to the book-entry transfer procedures
described above, credited to an account maintained with such
Book-Entry Transfer Facility.
By tendering, each registered holder will represent to us that,
o the exchange notes to be acquired by the holder and any
beneficial owner(s) of the original notes in connection with
the exchange offer are being acquired by the holder and any
beneficial owner(s) in the ordinary course of business of the
holder and any beneficial owner(s);
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o the holder and each beneficial owner are not participating, do
not intend to participate and have no arrangement or
understanding with any person to participate, in a
distribution of the exchange notes;
o the holder and each beneficial owner acknowledge and agree
that if the offeree is a broker-dealer holding original notes
acquired for its own account as a result of market making
activities or other trading activities, it will deliver a
prospectus meeting the requirements of the Securities Act in
connection with any resale of exchange notes received in
respect of original notes pursuant to the exchange offer, but
by so acknowledging, the holder shall not be deemed to admit
that, by delivering a prospectus, it is an "underwriter"
within the meaning of the Securities Act;
o neither the holder nor any beneficial owner is an "affiliate,"
as defined under Rule 405 of the Securities Act, of ours
except as otherwise disclosed to us in writing; and
o each holder and each beneficial owner acknowledges and agrees
that any person participating in the exchange offer for the
purpose of distributing the exchange notes cannot rely on the
position of the Staff of the Securities and Exchange
Commission set forth in no-action letters that are discussed
herein under "--Resale of the Exchange Notes; Plan of
Distribution" and that such person must comply with the
registration and prospectus delivery requirements for any
secondary resale transaction with respect to exchange notes
acquired by such person and that such a transaction should be
covered by an effective registration statement containing the
selling security holder information required by Item 507 of
Regulation S-K of the Securities and Exchange Commission.
Each broker-dealer that receives exchange notes for its own account in
exchange for original notes, where such original notes were acquired by such
broker-dealer as a result of market-making activities or other trading
activities, must acknowledge that it will deliver a prospectus in connection
with any resale of such exchange notes. For additional information, see
"--Resale of the Exchange Notes; Plan of Distribution."
WITHDRAWAL OF TENDERS
Except as otherwise provided in this prospectus and the letter of
transmittal, tenders of original notes pursuant to the exchange offer may be
withdrawn, unless earlier accepted for exchange as provided in the exchange
offer, at any time prior to the Expiration Date of the exchange offer.
To be effective, a written or facsimile transmission notice of
withdrawal must be received by the exchange agent at its address set forth
herein prior to the Expiration Date of the exchange offer. Any such notice of
withdrawal must
o specify the name of the person having deposited the original
notes to be withdrawn;
o identify the original notes to be withdrawn, including the
certificate number or numbers of the particular certificates
evidencing the original notes (unless such original notes were
tendered by book-entry transfer), and aggregate principal
amount of such original notes; and
o be signed by the holder in the same manner as the original
signature on the letter of transmittal (including any required
signature guarantees) or be accompanied by documents of
transfer sufficient to have the trustee under the indenture
register the transfer of the original notes into the name of
the person withdrawing such original notes.
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If original notes have been delivered pursuant to the procedures for
book-entry transfer described in "--Procedures for Tendering Original
Notes--Book-Entry Delivery Procedures," any notice of withdrawal must specify
the name and number of the account at the appropriate book-entry transfer
facility to be credited with such withdrawn original notes and must otherwise
comply with such book-entry transfer facility's procedures.
If the original notes to be withdrawn have been delivered or otherwise
identified to the exchange agent, a signed notice of withdrawal meeting the
requirements discussed above is effective immediately upon written or facsimile
notice of withdrawal even if physical release is not yet effected. A withdrawal
of original notes can only be accomplished in accordance with these procedures.
All questions as to the validity, form and eligibility (including time
of receipt) of such notices will be determined by us in our sole discretion,
which determination shall be final and binding on all parties. No withdrawal of
original notes will be deemed to have been properly made until all defects or
irregularities have been cured or expressly waived. Neither we, the exchange
agent nor any other person will be under any duty to give notification of any
defects or irregularities in any notice of withdrawal or revocation, nor shall
we or they incur any liability for failure to give any such notification. Any
original notes so withdrawn will be deemed not to have been validly tendered for
purposes of the exchange offer and no exchange notes will be issued with respect
thereto unless the original notes so withdrawn are retendered. Properly
withdrawn original notes may be retendered by following one of the procedures
described above under "--Procedures for Tendering Original Notes" at any time
prior to the Expiration Date of the exchange offer.
Any original notes which have been tendered but which are not accepted
for exchange due to the rejection of the tender due to uncured defects or the
prior termination of the exchange offer, or which have been validly withdrawn,
will be returned to the holder thereof unless otherwise provided in the letter
of transmittal, as soon as practicable following the Expiration Date of the
exchange offer or, if so requested in the notice of withdrawal, promptly after
receipt by us of notice of withdrawal without cost to such holder.
CONDITIONS TO THE EXCHANGE OFFER
The exchange offer shall not be subject to any conditions, other than
that:
o the Securities and Exchange Commission has issued an order or
orders declaring the indenture governing the notes qualified
under the Trust Indenture Act of 1939;
o the exchange offer, or the making of any exchange by a holder,
does not violate applicable law or any applicable
interpretation of the staff of the Securities and Exchange
Commission;
o no action or proceeding shall have been instituted or
threatened in any court or by or before any governmental
agency with respect to the exchange offer;
o there shall not have been declared by United States federal or
New York state authorities a banking moratorium or trading on
the New York Stock Exchange or generally in the United States
over-the-counter market shall not have been suspended by order
of the Securities and Exchange Commission or any other
governmental authority; and
o there shall not have been adopted or enacted any law, statute,
rule or regulation prohibiting the exchange offer.
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If we determine in our sole discretion that any of the conditions to
the exchange offer are not satisfied, we may:
o refuse to accept any original notes and return all tendered
original notes to the tendering holders;
o extend the exchange offer and retain all original notes
tendered prior to the Expiration Date applicable to the
exchange offer, subject, however, to the rights of holders to
withdraw such original notes (see "-- Withdrawal of Tenders");
or
o waive any unsatisfied conditions with respect to the exchange
offer and accept all validly tendered original notes which
have not been withdrawn.
If any waiver constitutes a material change to the exchange offer, we
will promptly disclose such waiver by means of a prospectus supplement that will
be distributed to the registered holders and will extend the exchange offer for
a period of five to ten business days, depending upon the significance of the
waiver and the manner of disclosure to the registered holders, if the exchange
offer would otherwise expire during such five to ten business day period.
EXCHANGE AGENT
The Bank of New York, the trustee under the indenture governing the
notes, has been appointed as exchange agent for the exchange offer. Questions
and requests for assistance, requests for additional copies of this prospectus
or of the letter of transmittal and requests for Notices of Guaranteed Delivery
and other documents should be directed to the exchange agent addressed as
follows:
By Registered or Certified Mail:
The Bank of New York
Corporate Trust Operations
Reorganization Unit
101 Barclay Street - 7 East
New York, New York 10286
By Facsimile: (Eligible Institutions Only):
(212) 298-1915
To Confirm by Telephone or for Information Call:
(212) 815-3738
By Hand or Overnight Delivery:
The Bank of New York
Corporate Trust Operations
Reorganization Unit
101 Barclay Street
Corporate Trust Services Window
FEES AND EXPENSES
We will bear the expenses of soliciting tenders of original notes. The
principal solicitation is being made by mail; however, additional solicitation
may be made by telegraph, telecopy, telephone or in person by officers and
regular employees of National Oilwell and its affiliates.
No dealer-manager has been retained in connection with the exchange
offer and no payments will be made to brokers, dealers or others soliciting
acceptance of the exchange offer. However, reasonable
-24-
and customary fees will be paid to the exchange agent for its services and it
will be reimbursed for its reasonable out-of-pocket expenses in connection
therewith.
We estimate that our out of pocket expenses for the exchange offer will
be approximately $150,000. These expenses include fees and expenses of the
exchange agent and the trustee under the indenture, accounting and legal fees
and printing costs, among others.
We will pay all transfer taxes, if any, applicable to the exchange of
the original notes pursuant to the exchange offer. If, however, a transfer tax
is imposed for any reason other than the exchange of the original notes pursuant
to the exchange offer, then the amount of any such transfer taxes (whether
imposed on the registered holder or any other persons) will be payable by the
tendering holder. If satisfactory evidence of payment of such taxes or exemption
therefrom is not submitted with the letter of transmittal, the amount of such
transfer taxes will be billed directly to such tendering holder.
ACCOUNTING TREATMENT
The exchange notes will be recorded in our books at the carrying value
of the original notes and we will not recognize gain or loss for accounting
purposes. The expenses of the exchange offer will be amortized over the term of
the exchange notes.
RESALE OF THE EXCHANGE NOTES; PLAN OF DISTRIBUTION
Based on interpretation of the Securities Act by the staff of the
Securities and Exchange Commission set forth in several no-action letters to
other persons, and subject to the immediately following sentence, we believe
that the exchange notes issued in the exchange offer may be offered for resale,
resold and otherwise transferred by holders thereof without further compliance
with the registration and prospectus delivery provisions of the Securities Act.
However, any purchaser of notes who is an "affiliate" of ours or who intends to
participate in the exchange offer for the purpose of distributing the exchange
notes, or any broker-dealer who purchased the notes from us to resell pursuant
to Rule 144A or any other available exemption under the Securities Act, (1) will
not be able to rely on the interpretation by the staff of the Securities and
Exchange Commission set forth in the above referenced no-action letters, (2)
will not be able to tender the notes in the exchange offer and (3) must comply
with the registration and prospectus delivery requirements of the Securities Act
in connection with any sale or transfer of the notes, unless such sale or
transfer is made pursuant to an exemption from such requirements. We do not
intend to seek our own no-action letter, and there is no assurance that the
staff of the Securities and Exchange Commission would make a similar
determination with respect to the exchange notes as it has in the no-action
letters to other persons.
Each holder of original notes who wishes to exchange the original notes
for the exchange notes in the exchange offer will be required to make
representations, including that (1) it is neither an affiliate of ours nor a
broker-dealer tendering notes acquired directly from us for its own account, (2)
any exchange notes to be received by it shall be acquired in the ordinary course
of its business and (3) at the time of commencement of the exchange offer, it
has no arrangement or understanding with any person to participate in the
distribution of the exchange notes (within the meaning of the Securities Act).
In addition, in connection with any resales of the exchange notes, any
participating broker-dealer must deliver a prospectus meeting the requirements
of the Securities Act. The staff of the Securities and Exchange Commission has
taken the position that participating broker-dealers may fulfill their
prospectus delivery requirements with respect to the exchange notes (other than
a resale of an unsold allotment from the original sale of the notes) with this
prospectus. Under the registration rights agreement, we are required to allow
participating broker-dealers to use this prospectus (as it may be amended or
supplemented from time to time) in connection with the resale of exchange notes
received in exchange for original notes acquired by such participating
broker-dealers for their own account as a result of market-making or other
trading activities.
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We will not receive any proceeds from any sale of exchange notes by
broker-dealers. Exchange notes received by broker-dealers for their own account
pursuant to the exchange offer may be sold from time to time in one or more
transactions
o in the over-the-counter market;
o in negotiated transactions;
o through the writing of options on the exchange notes or a
combination of such methods of resale;
o at market prices prevailing at the time of resale;
o at prices related to such prevailing market prices; or
o at negotiated prices.
Any such resale may be made directly to purchasers or to or through
brokers or dealers who may receive compensation in the form of commissions or
concessions from any such broker-dealer or the purchasers of any such exchange
notes.
Any broker-dealer that resells exchange notes that were received by it
for its own account pursuant to the exchange offer and any broker or dealer that
participates in a distribution of such exchange notes may be deemed to be an
"underwriter" within the meaning of the Securities Act and any profit on any
such resale of exchange notes and any commission on concessions received by any
such persons may be deemed to be underwriting compensation under the Securities
Act. The letter of transmittal states that, by acknowledging that it will
deliver a prospectus and by delivering a prospectus, a broker-dealer will not be
deemed to admit that it is an "underwriter" within the meaning of the Securities
Act.
We have agreed to pay all expenses incident to the exchange offer
(including in the case of the filing of a shelf registration statement the
expenses of one counsel for the holders of the original notes other than
commissions or concessions of any brokers or dealers and will indemnify the
holders of the original notes (including any broker-dealers) required to use
this prospectus in connection with their resale of exchange notes as described
above against certain liabilities, including liabilities under the Securities
Act.
USE OF PROCEEDS
The exchange offer is intended to satisfy our obligations under the
registration rights agreement. We will not receive any cash proceeds from the
issuance of the exchange notes offered by this prospectus. In consideration for
issuing the exchange notes as contemplated in this prospectus, we will receive
in exchange original notes in like principal amount, the form and terms of which
are the same as the form and terms of the exchange notes, except as otherwise
described in this prospectus under "The Exchange Offer -- Terms of the Exchange
Offer." The original notes surrendered in exchange for the exchange notes will
be retired and canceled and cannot be reissued. Accordingly, the issuance of the
exchange notes will not result in any increase in our indebtedness.
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DESCRIPTION OF NOTES
GENERAL
The original notes were issued, and the exchange notes are to be
issued, under an indenture dated as of November 22, 2002. The indenture is a
contract between us and The Bank of New York, which acts as trustee. The
indenture will not be qualified under the Trust Indenture Act of 1939, except
upon effectiveness of the registration statement for the exchange offer. By its
terms however, the indenture incorporates certain provisions of the Trust
Indenture Act and, upon consummation of the exchange offer, the indenture will
be subject to and governed by the Trust Indenture Act. The indenture and the
notes contain the full legal text of the matters described in this section. The
indenture and the notes are governed by New York law. We have filed a copy of
the indenture as an exhibit to the registration statement of which this
prospectus is a part.
The following is a description of the material provisions of the notes
and the indenture and is a summary only. Because this section is a summary, it
does not describe every aspect of those documents. This summary is subject to
and qualified in its entirety by reference to all the provisions of those
documents, including definitions of terms referenced in this prospectus.
References in this summary to the notes include the original notes and the
exchange notes unless the context otherwise requires.
The notes are direct, unsecured and senior obligations of National
Oilwell. The indenture does not limit our ability to incur additional
indebtedness.
PRINCIPAL AND MATURITY
The notes mature on November 15, 2012, unless sooner redeemed. Although
only $200,000,000 in aggregate principal amount of the original notes were
issued, we may, so long as no Event of Default under the indenture has occurred
and is continuing, issue and sell additional principal amounts of the notes in
the future without the consent of the holders of the notes. The original notes
and the exchange notes, together with any additional notes subsequently issued
under this indenture, will constitute a single series of notes under the
indenture.
The notes are not entitled to the benefits of a sinking fund.
All of the notes are held initially in the form of one or more global
notes. See "--Legal Ownership--Global Notes" for a general description of the
global notes.
INTEREST
The notes bear interest from November 22, 2002 at the annual rate set
forth on the cover page of this prospectus, payable semi-annually in arrears on
May 15 and November 15 of each year to noteholders in whose name the notes are
registered at the close of business on May 1 or November 1 (whether or not a
business day) preceding the applicable interest payment date. We refer to each
of those payment days as an interest payment date. If an interest payment date
or a redemption date occurs on a date which is not a business day, payment will
be made on the next business day and no additional interest will accrue.
Interest payments will commence on May 15, 2003.
Interest on the notes is computed on the basis of a 360-day year
comprised of twelve 30-day months.
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RANKING
The notes rank equally with all of our existing and future unsecured
senior indebtedness and senior to all of our existing and future subordinated
debt. The indenture does not limit our ability to incur additional indebtedness.
Because we are a holding company that conducts all of our operations through
subsidiaries, the notes will be effectively subordinated to all obligations of
our subsidiaries. Consequently, our right to receive assets of any subsidiary
(and thus the ability of noteholders to benefit indirectly from these assets) is
subject to the prior claims of creditors of that subsidiary. As of December 31,
2002, we have senior indebtedness of $500 million, none of which is secured. In
addition, Hydralift ASA, a subsidiary of National Oilwell, had unsecured
indebtedness of approximately $94 million at December 31, 2002.
The indenture governing the notes permits us to incur an unlimited
amount of indebtedness. Our subsidiaries may also incur an unlimited amount of
indebtedness. The notes are not guaranteed by any of our subsidiaries.
OPTIONAL REDEMPTION
The notes are redeemable, at our option, at any time in whole, or from
time to time in part, upon not less than 30 and not more than 60 days' notice
mailed to each holder of notes to be redeemed at the holder's address appearing
in the note register, at a price equal to 100% of the principal amount of the
notes plus accrued and unpaid interest, if any, to the redemption date and a
make-whole premium, if any. Holders of record on the relevant record date have
the right to receive interest due on an interest payment date that is on or
prior to the redemption date. The redemption price will never be less than 100%
of the principal amount of the notes plus accrued interest to the redemption
date.
The amount of the make-whole premium on any note, or portion of a note,
to be redeemed will be equal to the excess, if any, of:
(1) the sum of the present values, calculated as of the redemption
date, of:
o each interest payment that, but for the redemption,
would have been payable on the note, or portion of a
note, being redeemed on each interest payment date
occurring after the redemption date, excluding any
accrued interest for the period prior to the
redemption date; plus
o the principal amount that, but for the redemption,
would have been payable on the maturity date of the
note, or portion of a note, being redeemed;
over
(2) the principal amount of the note, or portion of a note, being
redeemed.
The present values of interest and principal payments referred to in
clause (1) above will be determined in accordance with generally accepted
principles of financial analysis. The present values will be calculated by
discounting the amount of each payment of interest or principal from the date
that each such payment would have been payable, but for the redemption, to the
redemption date at a discount rate equal to the Treasury Yield, as defined
below, plus 25 basis points.
We will appoint an independent investment banking institution of
national standing to calculate the make-whole premium; provided that if we fail
to appoint an institution at least 45 days prior to the date set for redemption
or if the institution that we appoint is unwilling or unable to make such
calculation, such calculation will be made by Merrill Lynch & Co. or if such
firm is unwilling or unable
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to make such calculation, by an independent investment banking institution of
national standing appointed by the trustee.
For purposes of determining the make-whole premium, "Treasury Yield"
refers to an annual rate of interest equal to the weekly average yield to
maturity of United States Treasury Notes that have a constant maturity that
corresponds to the remaining term to maturity of the notes, calculated to the
nearest 1/12th of a year, which we call the remaining term. The Treasury Yield
will be determined as of the third business day immediately preceding the
applicable redemption date.
The weekly average yields of United States Treasury Notes will be
determined by reference to the most recent statistical release published by the
Federal Reserve Bank of New York and designated "H.15(519) Selected Interest
Rates" or any successor release, which we call the H.15 Statistical Release. If
the H.15 Statistical Release sets forth a weekly average yield for United States
Treasury Notes having a constant maturity that is the same as the remaining
term, then the Treasury Yield will be equal to such weekly average yield. In all
other cases, the Treasury Yield will be calculated by interpolation, on a
straight-line basis, between the weekly average yields on the United States
Treasury Notes that have a constant maturity closest to and greater than the
remaining term and the United States Treasury Notes that have a constant
maturity closest to and less than the remaining term, in each case as set forth
in the H.15 Statistical Release. Any weekly average yields as calculated by
interpolation will be rounded to the nearest 0.01%, with any figure of 0.005% or
more being rounded upward. If weekly average yields for United States Treasury
Notes are not available in the H.15 Statistical Release or otherwise, then the
Treasury Yield will be calculated by interpolation of comparable rates selected
by the independent investment banking institution.
If less than all of the notes are to be redeemed, the trustee will
select the notes to be redeemed pro rata or by lot or by another method that the
trustee deems fair and appropriate not more than 60 days prior to the redemption
date. The trustee may select for redemption notes and portions of notes in
amounts equal to whole multiples of $1,000.
SAME DAY SETTLEMENT
The original notes trade in, and the exchange notes will trade in, The
Depository Trust Company's settlement system until maturity. As a result, The
Depository Trust Company will require secondary trading activity in the notes to
be settled in immediately available funds. So long as the notes continue to
trade in The Depository Trust Company's settlement system, all payments of
principal and interest on the global notes will be made by us in immediately
available funds.
IMPORTANT COVENANTS
Certain Definitions. The following definitions are applicable to the
discussion of the indenture covenants in this summary.
"Consolidated Net Tangible Assets" means the aggregate amount of assets
included on our consolidated balance sheet, less applicable reserves and other
properly deductible items and after deducting therefrom (a) all current
liabilities (other than liabilities that, by their terms, are extendable or
renewable at the option of the obligor to a date that is 12 months or more after
the date on which such current liabilities are determined) and (b) all goodwill,
trade names, trademarks, patents, copyrights, unamortized debt discount and
expense and other like intangibles, all in accordance with generally accepted
accounting principles consistently applied.
"Government Securities" means direct obligations of, or obligations
guaranteed by, the United States of America for the payment of which guarantees
or obligations the full faith and credit of the United States is pledged.
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"Lien" means, with respect to any property or asset, any mortgage,
pledge, lien, encumbrance, charge or security interest of any kind in respect of
such property or asset, whether or not filed, recorded or otherwise perfected
under applicable law, but excluding agreements to refrain from granting Liens.
"Permitted Liens" means:
o certain purchase money Liens;
o statutory liens or landlords', carriers', warehouseman's,
mechanics', suppliers', materialmen's, repairmen's or other
similar Liens arising in the ordinary course of business and
with respect to amounts not yet delinquent or being contested
in good faith by appropriate proceedings;
o Liens existing on property at the time we or a Restricted
Subsidiary acquire it;
o Liens existing on the property or on the outstanding shares or
indebtedness of any Person at the time it becomes a Restricted
Subsidiary;
o Liens on property of a Person existing at the time such Person
is merged into or consolidated with us or a Restricted
Subsidiary;
o Liens in favor of governmental bodies to secure certain
progress or advance payments;
o Liens existing on property we or any of our Subsidiaries own
on the date of the indenture or provided for pursuant to
agreements existing on the date of the indenture;
o Liens created pursuant to the creation of trusts or other
arrangements funded solely with cash, cash equivalents or
other marketable investments or securities of the type
customarily subject to such arrangements in customary
financial practice with respect to long-term or medium-term
indebtedness for borrowed money, the sole purpose of which is
to make provision for the retirement or defeasance, without
prepayment of indebtedness; or
o certain extensions, renewals or replacements in whole or in
part of a Lien enumerated in any of the foregoing.
"Person" means (a) any form of business entity, association, grouping,
trust or other form now or hereafter permitted by the laws of any state of the
United States of America or any foreign government or utilized by businesses in
the conduct of their activities and (b) a natural person, as the context may
require.
"Principal Property" means any real property, manufacturing plant,
office building, warehouse or other physical facility, or any other like
depreciable asset of us or any Restricted Subsidiary, whether owned at the date
of the indenture or thereafter acquired that in the opinion of our Board of
Directors is of material importance to the total business we and our Restricted
Subsidiaries conduct, as a whole; provided, however, that any such property
shall not be deemed a Principal Property if such property does not have a fair
value in excess of 5% of the total assets included on a consolidated balance
sheet of us and our Restricted Subsidiaries prepared in accordance with
generally accepted accounting principles consistently applied.
"Restricted Subsidiary" means (a) any currently existing Subsidiary
whose principle assets and business are located in the United States or Canada
and (b) any Subsidiary that we designate to be a Restricted Subsidiary.
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"Sale and Leaseback Transaction" means the sale or transfer by us or a
Restricted Subsidiary of any Principal Property owned by it or us with the
intention of taking back a lease on such property.
"Secured Debt" means indebtedness for money we or a Restricted
Subsidiary borrow, and any other indebtedness of us or a Restricted Subsidiary,
on which interest is paid or payable (other than indebtedness owed by a
Restricted Subsidiary to us, by a Restricted Subsidiary to another Restricted
Subsidiary or by us to a Restricted Subsidiary), that in any such case is
secured by (a) any Lien on any Principal Property of us or a Restricted
Subsidiary or (b) a Lien on any shares of stock or indebtedness of a Restricted
Subsidiary that owns a Principal Property. The amount of Secured Debt at any
time outstanding shall be the amount we or a Restricted Subsidiary then owe
thereon.
"Significant Subsidiary" means a subsidiary that would be a
"Significant Subsidiary" within the meaning of Rule 1-02 under Regulation S-X
promulgated by the Securities and Exchange Commission.
"Subsidiary" means, with respect to any Person, (a) any corporation of
which we, or we and one or more Subsidiaries, or any one or more Subsidiaries,
directly or indirectly own voting securities entitling any one or more of us and
our Subsidiaries to elect a majority of the directors, either at all times, or
so long as there is no default or contingency which permits the holders of any
other class or classes of securities to vote for the election of one or more
directors, (b) any partnership of which we, or we and one or more of our
Subsidiaries, or any one or more Subsidiaries, is, at the date of determination,
a general or limited partner of such partnership, but only if we and our
Subsidiaries are entitled to receive more than 50% of the assets of such
partnership upon dissolution or more than 50% of the profits of such
partnership, or (c) any other Person (other than a corporation or partnership)
in which we, or we and one or more Subsidiaries, or any one or more
Subsidiaries, directly or indirectly, at the date of determination thereof, has
(x) at least a majority ownership interest or (y) the power to elect or direct
the election of a majority of the directors or other governing body of such
Person.
Limitation on Liens. The indenture provides that we will not, nor will
we permit any Restricted Subsidiary to, create, incur, issue, assume or
guarantee any Secured Debt without making effective provision whereby the notes
then outstanding and any other indebtedness of or guaranteed by us or any of our
Restricted Subsidiaries then entitled thereto, subject to applicable priorities
of payment, shall be secured by a Lien equally and ratably with any and all
other obligations and indebtedness thereby secured, so long as any of the other
obligations and indebtedness shall be so secured; provided, that if any such
Lien securing such Secured Debt ceases to exist, such equal and ratable security
for the benefit of the noteholders shall automatically cease to exist without
any further action; provided, further, that if the Secured Debt is expressly
subordinated to the notes, the Lien securing such subordinated Secured Debt
shall be subordinate and junior to the Lien securing the notes with the same
relative priority as such Secured Debt shall have with respect to the notes.
These provisions do not apply to Secured Debt that is secured by Permitted
Liens.
Notwithstanding these restrictions, we and our Restricted Subsidiaries
may, without equally and ratably securing the notes, create, incur, issue,
assume or guarantee Secured Debt not otherwise permitted or excepted if the sum
of (a) the amount of such Secured Debt plus (b) the aggregate value of Sale and
Leaseback Transactions (excluding Sale and Leaseback Transactions described in
clauses (1) through (4) of "Limitation on Sale and Leaseback Transactions") does
not exceed 10% of Consolidated Net Tangible Assets (as shown in our quarterly
consolidated balance sheet most recently published prior to the date of the
creation, incurrence, issuance, assumption or guarantee).
Limitation on Sale and Leaseback Transactions. The indenture provides
that we will not, and we will not permit any of our Restricted Subsidiaries to,
engage in a Sale and Leaseback Transaction unless:
(1) the Sale and Leaseback Transaction occurs within one year from
the date of completion of the acquisition of the Principal
Property subject thereto or the date of the completion
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of construction, development or substantial repair or
improvement, or commencement of full operations, on such
Principal Property, whichever is later;
(2) the Sale and Leaseback Transaction involves a lease for a
period, including renewals, of not more than three years;
(3) we or a Restricted Subsidiary would be entitled to incur
Secured Debt secured by a Lien on the Principal Property
subject thereto in a principal amount equal to or exceeding
the net sale proceeds from such Sale and Leaseback Transaction
without equally and ratably securing the notes pursuant to the
covenant "Limitation on Liens" described above; or
(4) we or a Restricted Subsidiary, within a one-year period after
such Sale and Leaseback Transaction, apply or cause to be
applied an amount not less than the net sale proceeds from
such Sale and Leaseback Transaction to:
o the redemption of the notes or the prepayment,
repayment, reduction or retirement of any of our
indebtedness that ranks pari passu with the notes; or
o the expenditure or expenditures for Principal
Property used or to be used in the ordinary course of
our business or the business of any of our Restricted
Subsidiaries.
Notwithstanding the foregoing, our indenture provides that we may, and
may permit each of our Restricted Subsidiaries to, effect any Sale and Leaseback
Transaction that is not excepted by clauses (1) through (4) (inclusive) of the
above paragraph, provided that, after giving effect thereto and the application
of proceeds, if any, received by us or any Restricted Subsidiaries as a result
thereof, the net sale proceeds from such Sale and Leaseback Transaction,
together with the aggregate principal amount of all Secured Debt then
outstanding (other than the notes) secured by Liens upon Principal Property that
are not Permitted Liens would not exceed 10% of the Consolidated Net Tangible
Assets (as shown in our quarterly consolidated balance sheet most recently
published prior to the date such Sale and Leaseback Transaction is effected).
CONSOLIDATION, MERGER AND SALE OF ASSETS
The indenture provides that we may (a) consolidate with or merge into,
or (b) sell, convey, transfer, lease or otherwise dispose of our properties and
assets substantially as an entirety to, any Person, provided that (i) the Person
surviving such consolidation or merger (if we are not the continuing entity) or
to which the sale, conveyance, transfer, lease or other disposition will be made
is a Person organized and validly existing under the laws of the United States,
any political subdivision thereof or any State thereof and assumes by
supplemental indenture all of our obligations on the notes and under the
indenture and (ii) after giving effect to the transaction, no Event of Default,
and no event which, after notice or lapse of time or both, would become an Event
of Default, exists. Upon a disposition of assets as described in clause (b) of
the preceding sentence, we will be released from any further liability under the
notes and the indenture.
EVENTS OF DEFAULT
In the indenture with respect to the notes an Event of Default will
mean any of the following:
o failure to pay principal of, or any premium on, any note when
due;
o failure to pay any interest on any note when due, and the
continuance of that failure for 30 days;
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o failure to perform or observe any other covenant in the notes
or indenture, and the continuance of such default for 60 days
after written notice has been given by the trustee, or the
holders of at least 25% in principal amount of the notes, as
provided in the indenture;
o our indebtedness or the indebtedness of any Subsidiary is not
paid when due within the applicable grace period, if any, or
is accelerated by the holders thereof and, in either case, the
principal amount of the unpaid or accelerated indebtedness
exceeds $20 million; or
o the bankruptcy, insolvency or reorganization of us, a
Significant Subsidiary or a group of Subsidiaries that would
constitute a Significant Subsidiary.
If an Event of Default (other than an Event of Default, as a result of
the bankruptcy, insolvency or reorganization of us, a Significant Subsidiary or
a group of Subsidiaries that would constitute a Significant Subsidiary) occurs
and continues, either the trustee or the holders of at least 25% in aggregate
principal amount of the notes, by notice to us, may declare the principal amount
of all notes to be due and payable immediately. If an Event of Default occurs as
a result of the bankruptcy, insolvency or reorganization of us, a Significant
Subsidiary or a group of Subsidiaries that would constitute a Significant
Subsidiary, the principal amount of all the notes will automatically, and
without any action by the trustee or any holder, become immediately due and
payable. After any acceleration, but before a judgment or decree for the payment
of the money due has been obtained by the trustee, the holders of a majority in
aggregate principal amount of the notes, by written notice to the trustee, may
rescind and annul the acceleration and its consequences if all Events of
Default, other than the non-payment of accelerated principal, have been cured or
waived as provided in the indenture. For information as to waiver of defaults,
see "Modification and Waiver" below.
Other than its duties in case of a default that is continuing, the
trustee is under no obligation to exercise any of its rights or powers under the
indenture at the request of any holders, unless the holders offer the trustee
security or indemnity satisfactory to the trustee against any loss, liability or
expense. Subject to these provisions to indemnify the trustee, the holders of a
majority in aggregate principal amount of the notes have the right to direct the
time, method and place of conducting any proceeding for any remedy available to
the trustee, or exercising any trust or power conferred on the trustee, for the
notes.
No holder of any note has the right to institute any proceeding with
respect to the indenture, or for the appointment of a receiver or a trustee, or
for any other remedy thereunder, unless:
o the holder has previously given written notice of a continuing
Event of Default to the trustee;
o the holders of at least 25% in aggregate principal amount of
the notes have made written request, and have offered
indemnity satisfactory to the trustee against any loss,
liability or expense to be incurred in complying with such
request, to institute proceedings in respect of such Event of
Default; and
o the trustee has failed to institute such proceeding, and has
not received from the holders of a majority in aggregate
principal amount of the notes a direction inconsistent with
such request, within 60 days after notice, request and offer.
These limitations do not apply if a holder institutes a proceeding for
the enforcement or payment of the principal of, or the premium or interest on,
any note on or after the applicable due date specified in such note.
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We are required to furnish the trustee with an annual statement from
our officers as to whether or not, to our knowledge, a Default or an Event of
Default has occurred during the year, and, if so, specifying all such known
Defaults or Events of Default. We are also required to furnish the Trustee with
a statement from our officers, as soon as possible, but within 5 days after we
become aware that a Default or Event of Default has occurred specifying the
details of such Default of Event of Default and the action we propose to take
with respect thereto. If a Default or Event of Default occurs and is continuing
and if it is actually known to a responsible officer of the trustee, the trustee
must mail to the noteholders 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, interest or premium, if any, 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
noteholders.
MODIFICATION AND WAIVER
Under the indenture, generally we and the trustee may modify our rights
and obligations with the consent of the holders of a majority in principal
amount of the notes. We may not modify or amend the indenture, without the
consent of the holder of each note affected thereby, if the amendment or
modification would (with respect to any notes held by a nonconsenting holder):
o change the maturity date of the principal of, or any
installment of principal of or interest on, any note;
o reduce the principal amount of, or any interest on, any note;
o reduce the amount of principal of any note payable upon
acceleration of the maturity date;
o change the place or currency of payment of principal of, or
interest on, any note;
o impair the right to institute suit for the enforcement of any
payment on or with respect to any note;
o reduce the percentage in principal amount of the notes, the
consent of whose holders is required for modification or
amendment of the indenture;
o reduce the percentage in principal amount of the notes
necessary for waiver of compliance with certain provisions of
the indenture or for waiver of certain defaults;
o modify such provisions with respect to modification and
waiver;
o waive, reduce or modify a make-whole premium with respect to
any note called for redemption; or
o make changes to the amendment and waiver provisions of the
indenture, or to the provisions relating to waivers of past
defaults or institution of proceedings for payment of
principal, any premium or interest.
Without the consent of any noteholder, we and the trustee may amend the
indenture:
o to cure any ambiguity, defect or inconsistency;
o to provide for uncertificated notes in addition to or in place
of certificated notes or to alter the provisions relating to
the form, issuance, delivery, transfer, exchange, replacement
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and other limited matters with respect to the notes in a
manner that does not materially adversely affect any holder;
o to provide for the assumption of our obligations to
noteholders in the case of a merger, consolidation or sale of
all or substantially all of our assets;
o to make any change that would provide any additional rights or
benefits to the noteholders or that does not adversely affect
the legal rights of any noteholder in any material respect;
o to comply with requirements of the Securities and Exchange
Commission in order to effect or maintain the qualification of
the indenture under the Trust Indenture Act; or
o to allow any guarantor to guarantee the notes.
Holders of a majority in principal amount of the notes may waive our
compliance with certain restrictive provisions of the indenture or waive any
past default under the indenture, except a continuing default in the payment of
principal of, any premium or interest on the notes and covenants and provisions
of the indenture that require the consent of the holder of each note affected
thereby.
Except in certain limited circumstances, we are entitled to set any day
as a record date for the purpose of determining the noteholders entitled to give
or take any direction, notice, consent, waiver or other action under the
indenture, in the manner and subject to the limitations provided in the
indenture. In certain limited circumstances, the trustee may be entitled to set
a record date for noteholder action or for payments if there is a default. If a
record date is set for action to be taken by the noteholders, only persons who
are noteholders on the record date may take the action. To be effective, action
must be taken by holders of the requisite principal amount of the notes within a
specified period following the record date. For any particular record date, this
period will be 180 days or such shorter period as may be specified by us (or the
trustee, if it sets the record date), and may be shortened or lengthened (but
not beyond 180 days) from time to time.
DISCHARGING OUR OBLIGATIONS; DEFEASANCE
Satisfaction and Discharge. We may satisfy and discharge certain of our
obligations with respect to notes which have not already been delivered to the
trustee for cancellation and which have either become due and payable or are by
their terms due and payable within one year by:
o depositing or causing to be deposited with the trustee money
or Government Securities in an amount sufficient to pay and
discharge the principal and any premium and interest to the
date of such deposit (in case of the notes which have become
due and payable) or to the maturity date, as the case may be;
o paying or causing to be paid all other sums payable under the
indenture with respect to the notes; and
o delivering to the trustee an Officer's Certificate and opinion
of counsel relating to our satisfaction and discharge.
Defeasance and Discharge. We may discharge all of our indebtedness and
obligations with respect to the notes (except for obligations to exchange or
register the transfer of the notes, to replace stolen, lost or mutilated
outstanding notes, to maintain paying agencies and to hold moneys for payment in
trust) upon the deposit in trust for the benefit of the noteholders of money or
Government Securities, or both, which, through the payment of principal and
interest in respect thereof in accordance with their
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terms, will provide money in an amount sufficient to pay the principal of, any
premium and interest on the notes on the maturity date in accordance with the
terms of the indenture and the notes. Such defeasance or discharge may occur
only if, among other things, we have delivered to the trustee an opinion of
counsel to the effect that we have received from, or there has been published
by, the United States Internal Revenue Service a ruling, or there has been a
change in tax law, in either case to the effect that the noteholders will not
recognize gain or loss for federal income tax purposes as a result of such
deposit, defeasance and discharge and will be subject to federal income tax on
the same amount, in the same manner and at the same times as would have been the
case if such deposit, defeasance and discharge were not to occur.
Defeasance of Certain Covenants. The indenture provides that we may
omit to comply with certain restrictive covenants, including the covenants
described under "Limitation on Liens," "Limitation on Sale and Leaseback
Transactions" and "Consolidation, Merger and Sale of Assets," in which event
certain Events of Default, which are described above (with respect to such
respective covenants) under "Events of Default," will no longer constitute
Events of Default. In order to exercise such option to defease such covenants,
we will be required to deposit, in trust for the benefit of the noteholders,
money or Government Securities, or both, which, through the payment of principal
and interest in respect thereof in accordance with their terms, will provide
money in an amount sufficient to pay the principal of, any premium and interest
on the notes on the maturity date in accordance with the terms of the indenture
and the notes. We will also be required, among other things, to deliver to the
trustee an opinion of counsel to the effect that noteholders will not recognize
gain or loss for federal income tax purposes as a result of such deposit and
defeasance of certain obligations and will be subject to federal income tax on
the same amount, in the same manner and at the same times as would have been the
case if such deposit and defeasance were not to occur.
If subsequent to the completion of a defeasance of certain covenants as
described in the immediately preceding paragraph, the notes are declared due and
payable because of the occurrence of any remaining Event of Default, the amount
of money and Government Securities we deposit in trust may be sufficient to pay
amounts due on the notes on the maturity date but may not be sufficient to pay
amounts due on the notes upon any acceleration resulting from such Event of
Default. In such case, we would remain liable for such payments.
CONCERNING THE TRUSTEE
The Bank of New York is the trustee under the indenture.
LEGAL OWNERSHIP
Street Name and Other Indirect Holders. Investors who hold notes in
accounts at banks, brokers and other financial institutions will generally not
be recognized by us as legal holders of notes. This is called holding in street
name. These intermediary banks, brokers and other financial institutions pass
along principal, interest and other payments on the notes, either because they
agree to do so in their customer agreements or because they are legally required
to do so. If you hold notes in street name, you should check with your own
institution to find out:
o how it handles securities payments and notices;
o whether it imposes fees or charges;
o how it would handle voting, if required; and
o how it would pursue rights under the notes if there were a
default or other event triggering the need for holders to act
to protect their interests.
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Direct Holders. Our obligations, as well as the obligations of the
trustee and those of any third parties employed by us or the trustee, extend
only to persons who are registered as holders of notes. We do not have any
responsibility for any aspect of the records relating to or payments made on
account of beneficial ownership interest in a global note, for maintaining,
supervising or reviewing any records relating to such beneficial ownership
interests or for any action taken or omitted to be taken by DTC or any
participant because the notes are issued in the form of global notes as
described below. For example, once we make a payment to the registered holder,
we have no further responsibility for the payment, even if that holder is
legally required to pass the payment along to you as a street name customer but
does not do so.
Global Notes. A global note is a special type of indirectly held
note. Because we issued the original notes, and will issue the exchange notes
only in the form of global notes, the ultimate beneficial owners can only be
indirect holders. We do this by requiring that the global notes be registered in
the name of a financial institution we select and by requiring that the notes
included in the global notes not be transferred to the name of any other direct
holder unless the special circumstances described below occur. The financial
institution that acts as the sole direct holder of the global note is called the
depositary. Any person wishing to own a note must do so indirectly by virtue of
an account with a bank, broker or other financial institution that in turn has
an account with the depositary.
Special Investor Considerations for Global Notes. As an
indirect holder, an investor's rights relating to the global notes will
be governed by the account rules of the investor's bank, broker or
other financial institution and of the depositary, as well as general
laws relating to securities transfers. We do not recognize this type of
investor as a holder of notes and instead deal only with the depositary
that holds the global notes.
If you are an investor, you should be aware that:
o you cannot get notes registered in your own name, except in
limited circumstances described in the indenture;
o you cannot receive physical certificates for your interest in
the notes, except in limited circumstances described in the
indenture;
o you will be a street name holder and must look to your own
bank, broker or other financial institution for payments on
the notes and protection of your legal rights relating to the
notes; see "--Street Name and Other Indirect Holders;"
o you may not be able to sell or pledge your interest in the
notes to some insurance companies and other institutions that
are required by law to own their securities in the form of
physical certificates;
o the depositary's policies will govern payments, transfers,
exchange and other matters relating to your interest in the
global notes. We and the trustee have no responsibility for
any aspect of the depositary's actions or for its records of
ownership interest in the global notes. We and the trustee
also do not supervise the depositary in any way;
o so long as the depositary, or its nominee, is the registered
owner or holder of a global note, the depositary, or its
nominee, will be considered the sole owner or holder of the
notes represented by the global note for all purposes under
the indenture, the notes and applicable law, including having
the right to sue for nonpayment of principal and interest; and
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o as an indirect owner, you will not be able to transfer the
interest in the global note, except in accordance with the
depositary's applicable procedures (in addition to those under
the indenture referred to herein).
Special Situations When Global Notes Will Be Terminated. In a
few special situations described in the next paragraph, the global
notes will terminate and interests in them will be exchanged for
physical certificates representing the notes. After that exchange, the
choice of whether to hold notes directly or in street name will be up
to you. You must consult your own bank, broker or other financial
institution to find out how to have your interests in the notes
transferred to your own name, so that you will be a direct holder. The
rights of street name investors and direct holders in the notes have
been previously described in the subsections entitled "--Street Name
and Other Indirect Holders" and "--Direct Holders."
The special situations for termination of the global notes are:
o when the depositary notifies us that it is unwilling, unable
or no longer qualified to continue as depositary; and
o when we notify the trustee that we wish to terminate the
global notes.
ADDITIONAL MECHANICS
Global Notes. The original notes were issued in the form of one or more
registered notes in global form, without interest coupons, which we call the
Rule 144A Global Notes. The Rule 144A Global Notes were deposited on the date of
closing of the initial sale of the original notes with, or on behalf of, The
Depository Trust Company or will remain in the custody of the trustee pursuant
to the FAST Balance Certificate Agreement between The Depository Trust Company
and the trustee, and registered in the name of Cede & Co., as nominee of The
Depository Trust Company. Interests in the Rule 144A Global Notes are available
for purchase only by qualified institutional buyers.
The Depository Trust Company has advised us that it is a
limited-purpose trust company organized under the New York Banking Law, a
"banking organization" within the meaning of the New York Banking Law, a member
of the Federal Reserve System, a "clearing corporation" within the meaning of
the New York Uniform Commercial Code and a "clearing agency" registered pursuant
to Section 17A of the Securities Exchange Act of 1934 (the "Exchange Act"). The
Depository Trust Company was created to hold securities of persons who have
accounts with The Depository Trust Company, otherwise known as participants, and
to facilitate the clearance and settlement of securities transactions among its
participants in securities through electronic book-entry changes in accounts of
the participants, thereby eliminating the need for physical movement of
certificates. These participants include securities brokers and dealers, banks,
trust companies and other clearing corporations. Indirect access to The
Depository Trust Company's book-entry system also is available to others, such
as banks, brokers, dealers and trust companies that clear through or maintain a
custodial relationship with a participant, either directly or indirectly. The
Depository Trust Company is owned by a number of its direct participants and by
the New York Stock Exchange, Inc., the American Stock Exchange LLC and the
National Association of Securities Dealers, Inc. The rules applicable to The
Depository Trust Company and its direct and indirect participants are on file
with the Securities and Exchange Commission.
Form, Exchange and Transfer of Physical Notes. The following discussion
only applies if the global notes are terminated as described above under
"--Legal Ownership--Global Notes--Special Situations When Global Notes Will Be
Terminated" and the notes are issued in the form of physical certificates.
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The notes will be issued:
o only in registered form;
o without interest coupons; and
o in denominations that are even multiples of $1,000.
You may have your notes divided into more notes of smaller
denominations (but not less than $1,000) or combined into fewer notes of larger
denominations, as long as the total principal amount is not changed. This is
called an exchange.
You may exchange or transfer notes at the office of the trustee. The
trustee acts as our agent for registering notes in the names of holders and
transferring notes. We may change this appointment to another entity or perform
these functions ourselves. The entity performing the role of maintaining the
list of registered holders is called the security registrar. It will also
perform transfers. You will not be required to pay a service charge to transfer
or exchange the notes, but you may be required to pay for any tax or other
governmental charge associated with the transfer or exchange. The transfer or
exchange will only be made if the security registrar is satisfied with your
proof of ownership.
We may cancel the designation of any particular transfer agent. We may
also approve a change in the office through which any transfer agent acts.
MATERIAL UNITED STATES FEDERAL INCOME TAX CONSIDERATIONS
The following discussion summarizes the material United States federal
income tax consequences of the exchange of original notes for exchange
notes. This discussion is based upon the provisions of the Internal Revenue Code
of 1986, as amended, applicable Treasury Regulations promulgated and proposed
thereunder, judicial authority and administrative interpretations, as of the
date hereof, all of which are subject to change, possibly with retroactive
effect, or are subject to different interpretations. We cannot assure you that
the Internal Revenue Service will not challenge one or more of the tax
consequences described herein, and we have not obtained, nor do we intend to
obtain, a ruling from the IRS or an opinion of counsel with respect to the
United States federal tax consequences of the exchange of original notes for
exchange notes.
In this discussion, we do not purport to address all tax considerations
that may be important to a particular holder in light of the holder's
circumstances, or to certain categories of investors that may be subject to
special rules, such as financial institutions, insurance companies, regulated
investment companies, tax exempt organizations, dealers in securities or
currencies, persons whose functional currency is not the U.S. dollar, U.S.
expatriates, persons subject to the alternative minimum tax or persons who hold
the notes as part of a hedge, conversion transaction, straddle or other risk
reduction transaction. This discussion is limited to holders who purchased the
original notes for cash at the original offering price and who hold the notes as
capital assets within the meaning of section 1221 of the Internal Revenue Code.
If a partnership holds notes, the tax treatment of a partner generally will
depend upon the status of the partner and the activities of the partnership.
This discussion also does not address the tax considerations arising under the
laws of any foreign, state, local or other jurisdiction.
HOLDERS OF ORIGINAL NOTES SHOULD CONSULT THEIR OWN TAX ADVISORS
REGARDING THE APPLICATION OF THE U.S. FEDERAL INCOME TAX LAWS TO THEM OF THE
EXCHANGE OFFER AND THE APPLICABILITY AND EFFECT OF STATE, LOCAL OR FOREIGN TAX
LAWS AND TAX TREATIES.
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TREATMENT OF EXCHANGES UNDER THE EXCHANGE OFFER
The exchange of original notes for exchange notes under the terms of
the exchange offer will not constitute a taxable exchange. As a result,
o a holder will not recognize taxable gain or loss as a result
of exchanging original notes for exchange notes under the
terms of the exchange offer;
o the holding period of the exchange notes will include the
holding period of the original notes exchanged for the
exchange notes; and
o the adjusted tax basis for the exchange notes will be the same
as the adjusted tax basis, immediately before the exchange, of
the original notes exchanged for the exchange notes.
INFORMATION REPORTING AND BACKUP WITHHOLDING
We will, where required, report to the holders of the notes and the
Internal Revenue Service the amount of any interest paid on the notes in each
calendar year and the amounts of federal income tax withheld, if any, with
respect to payments. A noncorporate noteholder may be subject to information
reporting and to backup withholding with respect to payments of principal,
premium, if any, and interest made on the notes, or on proceeds of the
disposition of the notes before maturity, unless the noteholder provides a
correct taxpayer identification number or proof of an applicable exemption, and
otherwise complies with applicable requirements of the information and backup
withholding rules.
Backup withholding is not an additional tax. Any amount withheld under
the backup withholding rules will be refunded or credited against the
noteholder's federal income tax liability, provided that the required
information is furnished to the Internal Revenue Service.
VALIDITY OF THE EXCHANGE NOTES
The validity of the exchange notes being offered hereby will be passed
upon for us by Bracewell & Patterson, L.L.P., Houston, Texas.
EXPERTS
Ernst & Young LLP, independent auditors, have audited our consolidated
financial statements included in National Oilwell, Inc.'s Annual report on Form
10-K for the year ended December 31, 2002, as set forth in their report, which
is incorporated by reference in this Prospectus and elsewhere in the
registration statement. National Oilwell, Inc.'s financial statements are
incorporated by reference in reliance on Ernst & Young LLP's report, given on
their authority as experts in accounting and auditing.
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WHERE YOU CAN FIND MORE INFORMATION
We file annual, quarterly and special reports, proxy statements and
other information with the Securities and Exchange Commission.
The SEC allows us to "incorporate by reference" the information we
filed with it, which means that we can disclose important information to you by
referring you to those documents.
We incorporate by reference in this prospectus the following documents:
o Our Annual Report on Form 10-K for the fiscal year ended
December 31, 2002; and
o All documents filed with the Securities and Exchange
Commission under Sections 13(a), 13(c), 14 or 15(d) of the
Securities Exchange Act of 1934, as amended, between the date
of this prospectus and the completion of the exchange offer.
The information incorporated by reference is an important part of this
prospectus, and information that we file later with the Securities and Exchange
Commission will automatically update and supersede this information as well as
the information included in this prospectus.
You may read and copy any document we file with the Securities and
Exchange Commission at the Securities and Exchange Commission's public reference
room located at:
o 450 Fifth Street, N.W.
Washington, D.C. 20549
Additionally, you may obtain copies of our documents filed with the
Securities and Exchange Commission on our website at www.natoil.com.
Please call the Securities and Exchange Commission at 1-800-SEC-0330
for further information on the public reference room and its copy charges. Our
Securities and Exchange Commission filings are also available to the public on
the Securities and Exchange Commission's web site at http://www.sec.gov and
through the New York Stock Exchange, Inc., 20 Broad Street, New York, New York
10005, on which our shares of common stock are traded.
We have agreed that for so long as the notes remain outstanding, if we
are no longer subject to the informational requirements of Section 13 or 15(d)
of the Securities Exchange Act of 1934, we will furnish to holders and
beneficial owners of the notes and to prospective purchasers designated by such
holders the information required to be delivered pursuant to Rule 144A(d)(4)
under the Securities Act to permit compliance with Rule 144A in connection with
resales of the notes.
We will provide a copy of any document incorporated by reference in
this prospectus and any exhibit specifically incorporated by reference in those
documents at no cost by request directed to us at the following address and
telephone number:
o National-Oilwell, Inc.
10000 Richmond Avenue
Houston, Texas 77042
Attention: Investor Relations
713-346-7500
To obtain timely delivery of this information, you must
request this information no later than five business days prior to the
Expiration Date of the exchange offer.
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INFORMATION REGARDING FORWARD-LOOKING STATEMENTS
Some of the information in this prospectus contains, or has
incorporated by reference, forward-looking statements. Statements that are not
historical facts, including statements about our beliefs and expectations, are
forward-looking statements. Forward-looking statements typically are identified
by use of terms such as "may," "will," "expect," "anticipate," "estimate" and
similar words, although some forward-looking statements are expressed
differently. You should be aware that our actual results could differ materially
from those contained in the forward-looking statements due to a number of
factors, including changes in oil and gas prices, customer demand for our
products and worldwide economic activity. You should also consider carefully the
statements under "Risk Factors" which address additional factors that could
cause our actual results to differ from those set forth in the forward-looking
statements. Given these uncertainties, current or prospective investors are
cautioned not to place undue reliance on any such forward-looking statements. We
disclaim any obligation or intent to update any such factors or forward-looking
statements to reflect future events or developments.
-42-
NATIONAL-OILWELL, INC.
LETTER OF TRANSMITTAL
TO TENDER FOR EXCHANGE
5.65% SENIOR NOTES DUE 2012
OF
NATIONAL-OILWELL, INC.
PURSUANT TO THE PROSPECTUS DATED _________, 2003
THIS OFFER WILL EXPIRE AT 5:00 P.M., NEW YORK CITY TIME, ON _________,
________, 2003 UNLESS THE OFFER IS EXTENDED BY THE CORPORATION IN ITS SOLE
DISCRETION (THE "EXPIRATION DATE"). TENDERS OF NOTES MAY BE WITHDRAWN AT ANY
TIME PRIOR TO THE EXPIRATION DATE.
THE EXCHANGE AGENT FOR THE EXCHANGE OFFER IS:
THE BANK OF NEW YORK
BY REGISTERED OR CERTIFIED MAIL: BY FACSIMILE TRANSMISSION: BY HAND OR OVERNIGHT DELIVERY:
(ELIGIBLE INSTITUTIONS ONLY)
The Bank of New York The Bank of New York
Corporate Trust Operations (212) 298-1915 Corporate Trust Operations
Reorganization Unit Reorganization Unit
101 Barclay Street - 7 East To Confirm by Telephone or for 101 Barclay Street
New York, New York 10286 Information Call: Corporate Trust Services Window
(212) 815-3738
DELIVERY OF THIS LETTER OF TRANSMITTAL TO AN ADDRESS OTHER THAN AS SET
FORTH ABOVE OR TRANSMISSION OF THIS LETTER OF TRANSMITTAL VIA FACSIMILE TO A
NUMBER OTHER THAN AS LISTED ABOVE WILL NOT CONSTITUTE A VALID DELIVERY.
HOLDERS WHO WISH TO BE ELIGIBLE TO RECEIVE EXCHANGE NOTES PURSUANT TO
THE EXCHANGE OFFER MUST VALIDLY TENDER (AND NOT WITHDRAW) THEIR ORIGINAL NOTES
TO THE EXCHANGE AGENT ON OR PRIOR TO THE EXPIRATION DATE.
This Letter of Transmittal is to be used by holders ("Holders") of
5.65% Senior Notes due 2012 (the "Original Notes") of National-Oilwell, Inc.
(the "Corporation") to receive 5.65% Senior Notes due 2012, Series B (the
"Exchange Notes") if: (i) certificates representing Original Notes are to be
physically delivered to the Exchange Agent herewith by such Holders; (ii) tender
A-1
of Original Notes is to be made by book-entry transfer to the Exchange Agent's
account at The Depository Trust Company ("DTC") pursuant to the procedures set
forth under the caption "The Exchange Offer -- Procedures for Tendering Original
Notes -- Book-Entry Delivery Procedures" in the Prospectus dated ___________,
2003 (the "Prospectus"); or (iii) tender of Original Notes is to be made
according to the guaranteed delivery procedures set forth under the caption "The
Exchange Offer -- Procedures for Tendering Original Notes -- Guaranteed
Delivery" in the Prospectus, and, in each case, instructions are not being
transmitted through the DTC Automated Tender Offer Program ("ATOP"). The
undersigned hereby acknowledges receipt of the Prospectus. All capitalized terms
used herein and not defined shall have the meanings ascribed to them in the
Prospectus.
Holders of Original Notes that are tendering by book-entry transfer to
the Exchange Agent's account at DTC can execute the tender through ATOP, for
which the transaction will be eligible. DTC participants that are accepting the
exchange offer as set forth in the Prospectus and this Letter of Transmittal
(together, the "Exchange Offer") must transmit their acceptance to DTC which
will edit and verify the acceptance and execute a book-entry delivery to the
Exchange Agent's account at DTC. DTC will then send an Agent's Message to the
Exchange Agent for its acceptance. Delivery of the Agent's Message by DTC will
satisfy the terms of the Offer as to execution and delivery of a Letter of
Transmittal by the participant identified in the Agent's Message. DTC
participants may also accept the Exchange Offer by submitting a notice of
guaranteed delivery through ATOP.
DELIVERY OF DOCUMENTS TO DTC DOES NOT CONSTITUTE DELIVERY
TO THE EXCHANGE AGENT
If a Holder desires to tender Original Notes pursuant to the Exchange
Offer and time will not permit this Letter of Transmittal, certificates
representing such Original Notes and all other required documents to reach the
Exchange Agent, or the procedures for book-entry transfer cannot be completed,
on or prior to the Expiration Date, then such Holder must tender such Original
Notes according to the guaranteed delivery procedures set forth under the
caption "The Exchange Offer -- Procedures for Tendering Original Notes --
Guaranteed Delivery" in the Prospectus. See Instruction 2.
The undersigned should complete, execute and deliver this Letter of
Transmittal to indicate the action the undersigned desires to take with respect
to the Exchange Offer.
A-2
TENDER OF ORIGINAL NOTES
[ ] CHECK HERE IF TENDERED ORIGINAL NOTES ARE BEING DELIVERED BY BOOK-ENTRY
TRANSFER MADE TO THE ACCOUNT MAINTAINED BY THE EXCHANGE AGENT WITH DTC
AND COMPLETE THE FOLLOWING:
Name of Tendering Institution:
-----------------------------------------
Account Number:
--------------------------------------------------------
Transaction Code Number:
-----------------------------------------------
[ ] CHECK HERE IF TENDERED ORIGINAL NOTES ARE BEING DELIVERED PURSUANT TO A
NOTICE OF GUARANTEED DELIVERY PREVIOUSLY SENT TO THE EXCHANGE AGENT AND
COMPLETE THE FOLLOWING:
Name(s) of Registered Holder(s):
---------------------------------------
Window Ticker Number (if any):
-----------------------------------------
Date of Execution of Notice of Guaranteed Delivery:
--------------------
Name of Eligible Institution that Guaranteed Delivery:
-----------------
List below the Original Notes to which this Letter of Transmittal
relates. The name(s) and address(es) of the registered Holder(s) should be
printed, if not already printed below, exactly as they appear on the Original
Notes tendered hereby. The Original Notes and the principal amount of Original
Notes that the undersigned wishes to tender should be indicated in the
appropriate boxes. If the space provided is inadequate, list the certificate
number(s) and principal amount(s) on a separately executed schedule and affix
the schedule to this Letter of Transmittal.
DESCRIPTION OF ORIGINAL NOTES
Name(s) and Address(es)
of Registered Holder(s) Aggregate
(Please fill in if blank) See Certificate Principal Amount Principal Amount
Instruction 3. Number(s)* Represented** Tendered**
----------------------------- ----------- ---------------- ----------------
------------------ ---------------------------- -----------------
------------------ ---------------------------- -----------------
------------------ ---------------------------- -----------------
------------------ ---------------------------- -----------------
------------------ ---------------------------- -----------------
----------------------------- ------------------ ---------------------------- -----------------
Total Principal
Amount of Original
Notes
- ---------------------------------------------------------------------------------------------------------------
* Need not be completed by Holders tendering by book-entry transfer.
** Unless otherwise specified, the entire aggregate principal amount
represented by the Original Notes described above will be deemed to be
tendered. See Instruction 4.
A-3
NOTE: SIGNATURES MUST BE PROVIDED BELOW.
PLEASE READ THE ACCOMPANYING INSTRUCTIONS CAREFULLY.
Ladies and Gentlemen:
The undersigned hereby tenders to National-Oilwell, Inc. (the
"Corporation"), upon the terms and subject to the conditions set forth in its
Prospectus dated __________, 2003 (the "Prospectus"), receipt of which is hereby
acknowledged, and in accordance with this Letter of Transmittal (which, together
with the Prospectus, constitute the "Exchange Offer"), the principal amount of
Original Notes indicated in the foregoing table entitled "Description of
Original Notes" under the column heading "Principal Amount Tendered." The
undersigned represents that it is duly authorized to tender all of the Original
Notes tendered hereby which it holds for the account of beneficial owners of
such Original Notes ("Beneficial Owner(s)") and to make the representations and
statements set forth herein on behalf of such Beneficial Owner(s).
Subject to, and effective upon, the acceptance for purchase of the
principal amount of Original Notes tendered herewith in accordance with the
terms and subject to the conditions of the Exchange Offer, the undersigned
hereby exchanges, assigns and transfers to, or upon the order of, the
Corporation, all right, title and interest in and to all of the Original Notes
tendered hereby. The undersigned hereby irrevocably constitutes and appoints the
Exchange Agent its true and lawful agent and attorney-in-fact of the undersigned
(with full knowledge that the Exchange Agent also acts as the agent of the
Corporation in connection with the Exchange Offer) with respect to such Original
Notes, with full powers of substitution and resubstitution (such power of
attorney being deemed to be an irrevocable power coupled with an interest) and
full power and authority to (i) present such Original Notes and all evidences of
transfer and authenticity to, or transfer ownership of, such Original Notes on
the account books maintained by DTC to, or upon the order of, the Corporation,
(ii) present such Original Notes for transfer of ownership on the books of the
Corporation, and to transfer the Original Notes on the books and records of the
Corporation, and (iii) receive for the account of the Corporation all benefits
and otherwise exercise all rights of beneficial ownership of such Original
Notes, all in accordance with the terms and conditions of the Exchange Offer, as
described in the Prospectus.
By accepting the Exchange Offer, the undersigned hereby represents and
warrants that:
o the Exchange Notes to be acquired by the undersigned and any
Beneficial Owner(s) in connection with the Exchange Offer are
being acquired by the undersigned and any Beneficial Owner(s)
in the ordinary course of business of the undersigned and any
Beneficial Owner(s);
o the undersigned and each Beneficial Owner are not
participating, do not intend to participate and have no
arrangement or understanding with any person to participate,
in a distribution of the Exchange Notes;
o the undersigned and each Beneficial Owner acknowledge and
agree that (x) if the offeree is a broker-dealer holding
Original Notes acquired for its own account as a result of
market making activities or other trading activities, it will
deliver a prospectus meeting the requirements of the
Securities Act in connection with any
A-4
resale of Exchange Notes received in respect of Original Notes
pursuant to the Exchange Offer and (y) any person
participating in the Exchange Offer for the purpose of
distributing the Exchange Notes cannot rely on the position of
the Staff of the Securities and Exchange Commission set forth
in no-action letters that are discussed in the Prospectus and
that such person must comply with the registration and
prospectus delivery requirements for any secondary resale
transaction with respect to Exchange Notes acquired by such
person and that such a transaction should be covered by an
effective registration statement containing the selling
securityholder information required by Item 507 of Regulation
S-K of the Securities and Exchange Commission; and
o except as indicated below, neither the undersigned nor any
Beneficial Owner is an "affiliate," as defined in Rule 405
under the Securities Act of 1933, as amended (together with
the rules and regulations promulgated thereunder, the
"Securities Act"), of the Corporation.
If the undersigned is a broker-dealer that will receive Exchange Notes
for its own account in exchange for Original Notes that were acquired as the
result of market-making activities or other trading activities, it acknowledges
that it will deliver a prospectus in connection with any resale of such Exchange
Notes. By so acknowledging and by delivering a prospectus, a broker-dealer shall
not be deemed to admit that it is an "underwriter" within the meaning of the
Securities Act.
The undersigned understands that tenders of Original Notes may be
withdrawn by written notice of withdrawal received by the Exchange Agent at any
time prior to the Expiration Date in accordance with the Prospectus. In the
event of a termination of the Exchange Offer, the Original Notes tendered
pursuant to the Exchange Offer will be returned to the tendering Holders
promptly (or, in the case of Original Notes tendered by book-entry transfer,
such Original Notes will be credited to the account maintained at DTC from which
such Original Notes were delivered). If the Corporation makes a material change
in the terms of the Exchange Offer or the information concerning the Exchange
Offer or waives a material condition of such Exchange Offer, the Corporation
will disseminate additional Exchange Offer materials and extend such Exchange
Offer, if and to the extent required by law.
The undersigned understands that the tender of Original Notes pursuant
to any of the procedures set forth in the Prospectus and in the instructions
hereto will constitute the undersigned's acceptance of the terms and conditions
of the Exchange Offer. The Corporation's acceptance for exchange of Original
Notes tendered pursuant to any of the procedures described in the Prospectus
will constitute a binding agreement between the undersigned and the Corporation
in accordance with the terms and subject to the conditions of the Exchange
Offer. For purposes of the Exchange Offer, the undersigned understands that
validly tendered Original Notes (or defectively tendered Original Notes with
respect to which the Corporation has, or has caused to be, waived such defect)
will be deemed to have been accepted by the Corporation if, as and when the
Corporation gives oral or written notice thereof to the Exchange Agent.
If the undersigned is an affiliate, as defined in Rule 405 of the Act,
the undersigned acknowledges that neither it nor any other such person may offer
for resale, resell or otherwise
A-5
transfer Exchange Notes without registering them under the Act, or without an
exemption therefrom.
The undersigned hereby represents and warrants that the undersigned has
full power and authority to tender, exchange, sell, assign and transfer the
Original Notes tendered hereby, and that when such tendered Original Notes are
accepted for exchange by the Corporation, the Corporation will acquire good
title thereto, free and clear of all liens, restrictions, charges and
encumbrances and not subject to any adverse claim or right. The undersigned and
each Beneficial Owner will, upon request, execute and deliver any additional
documents deemed by the Exchange Agent or by the Corporation to be necessary or
desirable to complete the tender, exchange, sale, assignment and transfer of the
Original Notes tendered hereby.
All authority conferred or agreed to be conferred by this Letter of
Transmittal shall not be affected by, and shall survive the death or incapacity
of the undersigned and any Beneficial Owner(s), and any obligation of the
undersigned or any Beneficial Owner(s) hereunder shall be binding upon the
heirs, executors, administrators, trustees in bankruptcy, personal and legal
representatives, successors and assigns of the undersigned and such Beneficial
Owner(s).
The undersigned understands that the delivery and surrender of any
Original Notes is not effective, and the risk of loss of the Original Notes does
not pass to the Exchange Agent or the Corporation, until receipt by the Exchange
Agent of this Letter of Transmittal, or a manually signed facsimile hereof,
properly completed and duly executed, together with the Original Notes and all
accompanying evidences of authority and any other required documents in form
satisfactory to the Corporation. All questions as to form of all documents and
the validity (including time of receipt) and acceptance of tenders and
withdrawals of Original Notes will be determined by the Corporation, in its sole
discretion, which determination shall be final and binding.
Unless otherwise indicated herein under "Special Issuance
Instructions," the undersigned hereby requests that any Original Notes
representing principal amounts not tendered or not accepted for exchange be
issued in the name(s) of the undersigned (and in the case of Original Notes
tendered by book-entry transfer, by credit to the account of DTC), and Exchange
Notes issued in exchange for Original Notes pursuant to the Exchange Offer be
issued to the undersigned. Similarly, unless otherwise indicated herein under
"Special Delivery Instructions," the undersigned hereby requests that any
Original Notes representing principal amounts not tendered or not accepted for
exchange and Exchange Notes issued in exchange for Original Notes pursuant to
the Exchange Offer be delivered to the undersigned at the address shown below
the undersigned's signature(s). In the event that the "Special Issuance
Instructions" box or the "Special Delivery Instructions" box is, or both are,
completed, the undersigned hereby requests that any Original Notes representing
principal amounts not tendered or not accepted for exchange be issued in the
name(s) of, certificates for such Original Notes be delivered to, and Exchange
Notes issued in exchange for Original Notes pursuant to the Exchange Offer be
issued in the name(s) of, and be delivered to, the person(s) at the address(es)
so indicated, as applicable. The undersigned recognizes that the Corporation has
no obligation pursuant to the "Special Issuance Instructions" box or "Special
Delivery Instructions" box to transfer any Original Notes from the name of the
registered Holder(s) thereof if the Corporation does not accept for exchange any
of the principal amount of such Original Notes so tendered.
A-6
[ ] CHECK HERE IF YOU OR ANY BENEFICIAL OWNER FOR WHOM YOU HOLD ORIGINAL
NOTES IS AN AFFILIATE OF THE CORPORATION.
[ ] CHECK HERE IF YOU OR ANY BENEFICIAL OWNER FOR WHOM YOU HOLD ORIGINAL
NOTES TENDERED HEREBY IS A BROKER-DEALER WHO ACQUIRED SUCH NOTES
DIRECTLY FROM THE CORPORATION OR AN AFFILIATE OF THE CORPORATION.
[ ] CHECK HERE AND COMPLETE THE LINES BELOW IF YOU OR ANY BENEFICIAL OWNER
FOR WHOM YOU HOLD ORIGINAL NOTES TENDERED HEREBY IS A BROKER-DEALER WHO
ACQUIRED SUCH NOTES IN MARKET-MAKING OR OTHER TRADING ACTIVITIES. IF
THIS BOX IS CHECKED, THE CORPORATION WILL SEND 10 ADDITIONAL COPIES OF
THE PROSPECTUS AND 10 COPIES OF ANY AMENDMENTS OR SUPPLEMENTS THERETO
TO YOU OR SUCH BENEFICIAL OWNER AT THE ADDRESS SPECIFIED IN THE
FOLLOWING LINES.
Name:
---------------------------------------------------------------------------
Address:
------------------------------------------------------------------------
- --------------------------------------------------------------------------------
A-7
SPECIAL ISSUANCE INSTRUCTIONS
(SEE INSTRUCTIONS 1, 5, 6 AND 7)
To be completed ONLY if Original Notes in a principal amount not
tendered or not accepted for exchange are to be issued in the name of, or
Exchange Notes are to be issued in the name of, someone other than the person(s)
whose signature(s) appear(s) within this Letter of Transmittal.
Issue: [ ] Original Notes
[ ] Exchange Notes
(check as applicable)
Name
----------------------------------------------------------------------------
(Please Print)
Address
-------------------------------------------------------------------------
(Please Print)
- --------------------------------------------------------------------------------
(Zip Code)
- --------------------------------------------------------------------------------
(TAX IDENTIFICATION OR SOCIAL SECURITY NUMBER)
(SEE SUBSTITUTE FORM W-9 HEREIN)
SPECIAL DELIVERY INSTRUCTIONS
(SEE INSTRUCTIONS 1, 5, 6 AND 7)
To be completed ONLY if Original Notes in a principal amount not
tendered or not accepted for exchange or Exchange Notes are to be sent to
someone other than the person(s) whose signature(s) appear(s) within this Letter
of Transmittal or to the undersigned at an address different from that shown in
the box entitled "Description of Original Notes" within this Letter of
Transmittal.
Issue: [ ] Original Notes
[ ] Exchange Notes
(check as applicable)
Name
----------------------------------------------------------------------------
(Please Print)
Address
-------------------------------------------------------------------------
(Please Print)
- --------------------------------------------------------------------------------
(Zip Code)
- --------------------------------------------------------------------------------
(TAX IDENTIFICATION OR SOCIAL SECURITY NUMBER)
(SEE SUBSTITUTE FORM W-9 HEREIN)
A-8
PLEASE SIGN HERE
(TO BE COMPLETED BY ALL TENDERING HOLDERS OF ORIGINAL NOTES)
------------------------------------------------
------------------------------------------------
------------------------------------------------
Signature(s) of Registered Holder(s) or Authorized Signatory
(See guarantee requirement below)
This Letter of Transmittal must be signed by the registered Holder(s)
exactly as name(s) appear(s) on certificate(s) for Original Notes or, if
tendered by a participant in DTC, exactly as such participant's name appears on
a security position listing as owner of Original Notes or by the person(s)
authorized to become registered Holder(s) by endorsements and documents
transmitted herewith. If signature is by trustees, executors, administrators,
guardians, attorneys-in-fact, officers of corporations or others acting in a
fiduciary or representative capacity, please set forth full title and see
Instruction 5.
Dated:
--------------------------------------------------------------------------
Name(s):
------------------------------------------------------------------------
(Please Print)
Capacity (Full Title):
----------------------------------------------------------
Address:
------------------------------------------------------------------------
(Including Zip Code)
Area Code and Telephone Number:
-------------------------------------------------
Tax Identification or Social Security Number:
-----------------------------------
(Complete Accompanying Substitute Form W-9)
SIGNATURE GUARANTEE
(IF REQUIRED -- SEE INSTRUCTIONS 1 AND 5)
Authorized Signature
------------------------------------------------------------
Name of Firm
--------------------------------------------------------------------
Address (including Zip Code):
---------------------------------------------------
Telephone Number (with Area Code): ( )
----- -------------------------------------
Date:
---------------------------------------------------------------------------
[place seal here]
A-9
INSTRUCTIONS
FORMING PART OF THE TERMS AND CONDITIONS OF THE EXCHANGE OFFER
1. Signature Guarantees. Signatures of this Letter of Transmittal must
be guaranteed by a recognized member of the Medallion Signature Guarantee
Program or by any other "eligible guarantor institution," as such term is
defined in Rule 17Ad-15 promulgated under the Exchange Act (each of the
foregoing, an "Eligible Institution"), unless the Original Notes tendered hereby
are tendered (i) by a registered Holder of Original Notes (or by a participant
in DTC whose name appears on a security position listing as the owner of such
Original Notes) that has not completed either the box entitled "Special Issuance
Instructions" or the box entitled "Special Delivery Instructions" on this Letter
of Transmittal or (ii) for the account of an Eligible Institution. If the
Original Notes are registered in the name of a person other than the signer of
this Letter of Transmittal, if Original Notes not accepted for exchange or not
tendered are to be returned to a person other than the registered Holder or if
Exchange Notes are to be issued in the name of or sent to a person other than
the registered Holder, then the signatures on this Letter of Transmittal
accompanying the tendered Original Notes must be guaranteed by an Eligible
Institution as described above. See Instruction 5.
2. Delivery of Letter of Transmittal and Original Notes. This Letter of
Transmittal is to be completed by Holders if (i) certificates representing
Original Notes are to be physically delivered to the Exchange Agent herewith by
such Holders; (ii) tender of Original Notes is to be made by book-entry transfer
to the Exchange Agent's account at DTC pursuant to the procedures set forth
under the caption "The Exchange Offer -- Procedures for Tendering Original Notes
- -- Book-Entry Delivery Procedures" in the Prospectus; or (iii) tender of
Original Notes is to be made according to the guaranteed delivery procedures set
forth under the caption "The Exchange Offer -- Procedures for Tendering Original
Notes -- Guaranteed Delivery" in the Prospectus. All physically delivered
Original Notes, or a confirmation of a book-entry transfer into the Exchange
Agent's account at DTC of all Original Notes delivered electronically, as well
as a properly completed and duly executed Letter of Transmittal (or manually
signed facsimile thereof), any required signature guarantees and any other
documents required by this Letter of Transmittal, must be received by the
Exchange Agent at one of its addresses set forth on the cover page hereto on or
prior to the Expiration Date, or the tendering Holder must comply with the
guaranteed delivery procedures set forth below. DELIVERY OF DOCUMENTS TO DTC
DOES NOT CONSTITUTE DELIVERY TO THE EXCHANGE AGENT.
If a Holder desires to tender Original Notes pursuant to the Exchange
Offer and time will not permit this Letter of Transmittal, certificates
representing such Original Notes and all other required documents to reach the
Exchange Agent, or the procedures for book-entry transfer cannot be completed,
on or prior to the Expiration Date, such Holder must tender such Original Notes
pursuant to the guaranteed delivery procedures set forth under the caption "The
Exchange Offer -- Procedures for Tendering Original Notes -- Guaranteed
Delivery" in the Prospectus. Pursuant to such procedures, (i) such tender must
be made by or through an Eligible Institution; (ii) a properly completed and
duly executed Notice of Guaranteed Delivery, substantially in the form provided
by the Corporation, or an Agent's Message with respect to guaranteed delivery
that is accepted by the Corporation, must be received by the Exchange Agent,
either by hand
A-10
delivery, mail, telegram, or facsimile transmission, on or prior to the
Expiration Date; and (iii) the certificates for all tendered Original Notes, in
proper form for transfer (or confirmation of a book-entry transfer or all
Original Notes delivered electronically into the Exchange Agent's account at DTC
pursuant to the procedures for such transfer set forth in the Prospectus),
together with a properly completed and duly executed Letter of Transmittal (or
manually signed facsimile thereof) and any other documents required by this
Letter of Transmittal, or in the case of a book-entry transfer, a properly
transmitted Agent's Message, must be received by the Exchange Agent within two
business days after the date of the execution of the Notice of Guaranteed
Delivery.
THE METHOD OF DELIVERY OF THIS LETTER OF TRANSMITTAL AND ALL OTHER
REQUIRED DOCUMENTS, INCLUDING DELIVERY THROUGH DTC AND ANY ACCEPTANCE OR AGENT'S
MESSAGE DELIVERED THROUGH ATOP, IS AT THE ELECTION AND RISK OF THE TENDERING
HOLDER AND, EXCEPT AS OTHERWISE PROVIDED IN THIS INSTRUCTION 2, DELIVERY WILL BE
DEEMED MADE ONLY WHEN ACTUALLY RECEIVED BY THE EXCHANGE AGENT. IF DELIVERY IS BY
MAIL, IT IS SUGGESTED THAT THE HOLDER USE PROPERLY INSURED, REGISTERED MAIL WITH
RETURN RECEIPT REQUESTED, AND THAT THE MAILING BE MADE SUFFICIENTLY IN ADVANCE
OF THE EXPIRATION DATE TO PERMIT DELIVERY TO THE EXCHANGE AGENT PRIOR TO SUCH
DATE.
No alternative, conditional or contingent tenders will be accepted. All
tendering Holders, by execution of this Letter of Transmittal (or a facsimile
thereof), waive any right to receive any notice of the acceptance of their
Original Notes for exchange.
3. Inadequate Space. If the space provided herein is inadequate, the
certificate numbers and/or the principal amount represented by Original Notes
should be listed on a separate signed schedule attached hereto.
4. Partial Tenders. (Not applicable to Holders who tender by book-entry
transfer). If Holders wish to tender less than the entire principal amount
evidenced by an Original Note submitted, such Holders must fill in the principal
amount that is to be tendered in the column entitled "Principal Amount
Tendered." The minimum permitted tender is $1,000 in principal amount of
Original Notes. All other tenders must be in integral multiples of $1,000 in
principal amount. In the case of a partial tender of Original Notes, as soon as
practicable after the Expiration Date, new certificates for the remainder of the
Original Notes that were evidenced by such Holder's old certificates will be
sent to such Holder, unless otherwise provided in the appropriate box on this
Letter of Transmittal. The entire principal amount that is represented by
Original Notes delivered to the Exchange Agent will be deemed to have been
tendered, unless otherwise indicated.
5. Signatures on Letter of Transmittal, Instruments of Transfer and
Endorsements. If this Letter of Transmittal is signed by the registered
Holder(s) of the Original Notes tendered hereby, the signatures must correspond
with the name(s) as written on the face of the certificate(s) without
alteration, enlargement or any change whatsoever. If this Letter of Transmittal
is signed by a participant in DTC whose name is shown as the owner of the
Original Notes tendered hereby, the signature must correspond with the name
shown on the security position listing as the owner of the Original Notes.
A-11
If any of the Original Notes tendered hereby are registered in the name
of two or more Holders, all such Holders must sign this Letter of Transmittal.
If any of the Original Notes tendered hereby are registered in different names
on several certificates, it will be necessary to complete, sign and submit as
many separate Letters of Transmittal as there are different registrations of
certificates.
If this Letter of Transmittal or any Original Note or instrument of
transfer is signed by a trustee, executor, administrator, guardian,
attorney-in-fact, agent, officer of a corporation or other person acting in a
fiduciary or representative capacity, such person should so indicate when
signing, and proper evidence satisfactory to the Corporation of such person's
authority to so act must be submitted.
When this Letter of Transmittal is signed by the registered Holder(s)
of the Original Notes listed herein and transmitted hereby, no endorsements of
Original Notes or separate instruments of transfer are required unless Exchange
Notes are to be issued, or Original Notes not tendered or exchanged are to be
issued, to a person other than the registered Holder(s), in which case
signatures on such Original Notes or instruments of transfer must be guaranteed
by an Eligible Institution.
IF THIS LETTER OF TRANSMITTAL IS SIGNED OTHER THAN BY THE REGISTERED
HOLDER(S) OF THE ORIGINAL NOTES LISTED HEREIN, THE ORIGINAL NOTES MUST BE
ENDORSED OR ACCOMPANIED BY APPROPRIATE INSTRUMENTS OF TRANSFER, IN EITHER CASE
SIGNED EXACTLY AS THE NAME(S) OF THE REGISTERED HOLDER(S) APPEAR ON THE ORIGINAL
NOTES AND SIGNATURES ON SUCH ORIGINAL NOTES OR INSTRUMENTS OF TRANSFER ARE
REQUIRED AND MUST BE GUARANTEED BY AN ELIGIBLE INSTITUTION, UNLESS THE SIGNATURE
IS THAT OF AN ELIGIBLE INSTITUTION.
6. Special Issuance and Delivery Instructions. If certificates for
Exchange Notes or unexchanged or untendered Original Notes are to be issued in
the name of a person other than the signer of this Letter of Transmittal, or if
Exchange Notes or such Original Notes are to be sent to someone other than the
signer of this Letter of Transmittal or to an address other than that shown
herein, the appropriate boxes on this Letter of Transmittal should be completed.
All Original Notes tendered by book-entry transfer and not accepted for payment
will be returned by crediting the account at DTC designated herein as the
account for which such Original Notes were delivered.
7. Transfer Taxes. Except as set forth in this Instruction 7, the
Corporation will pay or cause to be paid any transfer taxes with respect to the
transfer and sale of Original Notes to it, or to its order, pursuant to the
Exchange Offer. If Exchange Notes, or Original Notes not tendered or exchanged
are to be registered in the name of any persons other than the registered
owners, or if tendered Original Notes are registered in the name of any persons
other than the persons signing this Letter of Transmittal, the amount of any
transfer taxes (whether imposed on the registered Holder or such other person)
payable on account of the transfer to such other person must be paid to the
Corporation or the Exchange Agent (unless satisfactory evidence of the payment
of such taxes or exemption therefrom is submitted) before the Exchange Notes
will be issued.
A-12
8. Waiver of Conditions. The conditions of the Exchange Offer may be
amended or waived by the Corporation, in whole or in part, at any time and from
time to time in the Corporation's sole discretion, in the case of any Original
Notes tendered.
9. Substitute Form W-9. Each tendering Holder of an Original Note who
is not exempt on the basis of foreign status (or other payee) is required to
provide the Exchange Agent with a correct taxpayer identification number
("TIN"), generally the owner's social security or federal employer
identification number, and with certain other information, on Substitute Form
W-9, which is provided hereafter under "Important Tax Information," and to
certify that the owner (or other payee) is not subject to backup withholding.
Failure to provide the information on the Substitute Form W-9 may subject the
tendering owner (or other payee) to a $50 penalty imposed by the Internal
Revenue Service and 30% federal income tax withholding. The box in Part 3 of the
Substitute Form W-9 may be checked if the tendering owner (or other payee) has
not been issued a TIN and has applied for a TIN or intends to apply for a TIN in
the near future. If the box in Part 3 is checked and the Exchange Agent is not
provided with a TIN within 60 days of the date on the Substitute Form W-9, the
Exchange Agent will withhold 30% of all payments made thereafter until a TIN is
provided to the Exchange Agent.
10. Broker-Dealers Participating in the Exchange Offer. If no
broker-dealer checks the last box on page __ of this Letter of Transmittal, the
Corporation has no obligation under the Registration Rights Agreement to allow
the use of the Prospectus for resales of the Exchange Notes by broker-dealers or
to maintain the effectiveness of the Registration Statement of which the
Prospectus is a part after the consummation of the Exchange Offer.
11. Requests for Assistance or Additional Copies. Any questions or
requests for assistance or additional copies of the Prospectus, this Letter of
Transmittal or the Notice of Guaranteed Delivery may be directed to the Exchange
Agent at the telephone numbers and location listed above. A Holder or owner may
also contact such Holder's or owner's broker, dealer, commercial bank or trust
company or nominee for assistance concerning the Exchange Offer.
IMPORTANT: THIS LETTER OF TRANSMITTAL (OR A FACSIMILE HEREOF), TOGETHER
WITH ALL OTHER REQUIRED DOCUMENTS OR THE NOTICE OF GUARANTEED DELIVERY, MUST BE
RECEIVED BY THE EXCHANGE AGENT ON OR PRIOR TO THE EXPIRATION DATE.
IMPORTANT TAX INFORMATION
Under federal income tax law, an owner of Original Notes whose tendered
Original Notes are accepted for exchange is required to provide the Exchange
Agent with such owner's current TIN on Substitute Form W-9 below. If such owner
is an individual, the TIN is his or her social security number. If the Exchange
Agent is not provided with the correct TIN, the owner or other recipient of
Exchange Notes may be subject to a $50 penalty imposed by the Internal Revenue
Service. In addition, any interest on Exchange Notes paid to such owner or other
recipient may be subject to 30% backup withholding tax.
Certain owners of Notes (including, among others, all corporations and
certain foreign individuals) are not subject to these backup withholding and
reporting requirements. In order for
A-13
a foreign individual to qualify as an exempt recipient, that owner must submit
to the Exchange Agent a properly completed Internal Revenue Service Form W-8ECI,
W-8BEN, W-8EXP or W-8IMY (collectively, a "Form W-8"), signed under penalties of
perjury, attesting to that individual's exempt status. A Form W-8 can be
obtained from the Exchange Agent.
Backup withholding is not an additional tax. Rather, the federal income
tax liability of persons subject to backup withholding will be reduced by the
amount of tax withheld. If withholding results in an overpayment of taxes, a
refund may be obtained from the Internal Revenue Service.
PURPOSE OF SUBSTITUTE FORM W-9
To prevent backup withholding on payments that are made to an owner,
the owner is required to notify the Exchange Agent of the owner's current TIN
(or the TIN of any other payee) by completing the following form, certifying
that the TIN provided on Substitute Form W-9 is correct (or that such owner is
awaiting a TIN), that the holder is a U.S. person (including a resident alien),
and that (i) the owner is exempt from withholding, (ii) the owner has not been
notified by the Internal Revenue Service that the owner is subject to backup
withholding as a result of failure to report all interest or dividends or (iii)
the Internal Revenue Service has notified the owner that the owner is no longer
subject to backup withholding. See the enclosed "Guidelines for Certification of
Taxpayer Identification Number on Substitute Form W-9" for additional
instructions.
WHAT NUMBER TO GIVE THE EXCHANGE AGENT
The Holder is required to give the Exchange Agent the TIN (e.g., social
security number or employer identification number) of the owner of the Original
Notes. If the Original Notes are registered in more than one name or are not
registered in the name of the actual owner, consult the enclosed "Guidelines for
Certification of Taxpayer Identification Number on Substitute Form W-9" for
additional guidance on which number to report.
A-14
PAYER'S NAME: THE BANK OF NEW YORK
SUBSTITUTE PART 1 -- PLEASE PROVIDE YOUR TIN IN Social Security Number(s)
FORM W-9 THE BOX AT THE RIGHT AND CERTIFY BY Or
SIGNING AND DATING BELOW. Employer Identification Number(s)
Department of the Treasury Internal ---------------------------------
Revenue Service
Payer's Request for Taxpayer
Identification Number ("TIN")
PART 2 -- Certifications -- Under penalties of perjury, I certify that:
(1) The number shown on this form is my correct taxpayer identification
number (or I am waiting for a number to be issued to me); and
(2) I am not subject to backup withholding because: (a) I am exempt from
backup withholding or (b) I have not been notified by the Internal
Revenue Service ("IRS") that I am subject to backup withholding as a
result of a failure to report all interest or dividends or (c) the IRS
has notified me that I am no longer subject to backup withholding; and
(3) I am a U.S. person (including a U.S. resident alien).
CERTIFICATION INSTRUCTIONS -- You must cross out item (2) above if you have
been notified by the IRS that you are currently subject to backup
withholding because of under-reporting interest or dividends on your
tax return.
Address:
-----------------------------------
-------------------------------------------
PART 3
------------------------------------------- Check if
Signature Awaiting TIN [ ]
----------------------------------
Date
---------------------------------------
NOTE: FAILURE TO COMPLETE AND RETURN THIS FORM MAY RESULT IN A $50
PENALTY IMPOSED BY THE INTERNAL REVENUE SERVICE AND BACKUP WITHHOLDING
OF 30%. PLEASE REVIEW THE ENCLOSED GUIDELINES FOR CERTIFICATION OF
TAXPAYER IDENTIFICATION NUMBER ON SUBSTITUTE FORM W-9 FOR ADDITIONAL
DETAILS.
A-15
YOU MUST COMPLETE THE FOLLOWING
CERTIFICATE IF YOU CHECKED THE BOX IN PART 3
OF THE SUBSTITUTE FORM W-9
CERTIFICATE OF AWAITING TAXPAYER IDENTIFICATION NUMBER
I certify under penalties of perjury that a taxpayer identification
number has not been issued to me, and either (1) I have mailed or delivered an
application to receive a taxpayer identification number to the appropriate
Internal Revenue Service Center or Social Security Administration Office or (2)
I intend to mail or deliver an application in the near future. I understand that
if I do not provide a taxpayer identification number within 60 days after the
Letter of Transmittal is received by the Exchange Agent, 30% of all reportable
cash payments made to me thereafter will be withheld until I provide a taxpayer
identification number.
Signature Date
----------------------------- ----------------------------------
A-16
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 20. INDEMNIFICATION OF DIRECTORS AND OFFICERS
Section 145 of the Delaware General Corporation Law (the "DGCL")
authorizes, inter alia, a corporation to indemnify any person who was or is a
party or is threatened to be made a party to any threatened, pending or
completed action, suit or proceeding, whether civil, criminal, administrative or
investigative (other than an action by or in the right of the corporation), by
reason of the fact that such person is or was an officer or director of such
corporation, or is or was serving at the request of such corporation as a
director, officer, employee or agent of another corporation, partnership, joint
venture, trust or other enterprise. The indemnity may include expenses
(including attorney's fees), judgments, fines and amounts paid in settlement
actually and reasonably incurred by such person in connection with such action,
suit or proceeding, provided that he acted in good faith and in a manner he
reasonably believed to be in or not opposed to the best interests of the
corporation and, with respect to any criminal action or proceeding, had no
reasonable cause to believe his conduct was unlawful. A Delaware corporation may
indemnify past or present officers and directors of such corporation or of
another corporation or other enterprise at the former corporation's request, in
an action by or in the right of the corporation to procure a judgment in its
favor under the same conditions, except that no indemnification is permitted
without judicial approval if such person is adjudged to be liable to the
corporation. Where an officer or director is successful on the merits or
otherwise in defense of any action referred to above, or in defense of any
claim, issue or matter therein, the corporation must indemnify him against the
expenses (including attorney's fees) which he actually and reasonably incurred
in connection therewith. Section 145 further provides that any indemnification
shall be made by the corporation only as authorized in each specific case upon a
determination by the (i) stockholders, (ii) board of directors by a majority
vote or a quorum consisting of directors who were not parties to such action,
suit or proceeding or (iii) independent counsel if a quorum of disinterested
directors so directs. Section 145 provides that indemnification pursuant to its
provisions is not exclusive of other rights of indemnification to which a person
may be entitled under any bylaw, agreement, vote of stockholders or
disinterested directors or otherwise.
Section 145 of the DGCL also empowers National Oilwell to purchase and
maintain insurance on behalf of any person who is or was an officer or director
of National Oilwell against liability asserted against or incurred by him in any
such capacity, whether or not National Oilwell would have the power to indemnify
such officer or director against such liability under the provisions of Section
145. National Oilwell maintains a directors' and officers' liability policy for
such purposes.
Article Sixth, Part II, Section 1 of National Oilwell's Amended and
Restated Certificate of Incorporation and Article VI of National Oilwell's
Bylaws each provide that directors, officers, employees and agents shall be
indemnified to the fullest extent permitted by Section 145 of the DGCL.
ITEM 21. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES.
(a) Exhibits
Exhibit
Number Description of Exhibit
------- ----------------------
4.1 -- Indenture dated November 22, 2002, between National-Oilwell, Inc. and The Bank of New York, as Trustee.
4.2 -- Form of 5.65% Note (contained in the Indenture filed as Exhibit 4.1).
4.3 -- Registration Rights Agreement dated November 22, 2002 between National-Oilwell, Inc. and Merrill Lynch,
Pierce, Fenner & Smith Incorporated.
5 -- Opinion of Bracewell & Patterson, L.L.P. as to the validity of the notes being offered.
12 -- Calculation of Consolidated Ratios of Earnings to Fixed Charges.
23.1 -- Consent of Bracewell & Patterson, L.L.P. (included in their opinion filed as Exhibit 5 hereto).
23.2 -- Consent of Ernst & Young LLP.
24 -- Powers of Attorney (included on the signature pages herein).
25 -- Form T-1 Statement of Eligibility under the Trust Indenture Act of 1939 of The Bank of New York.
II-1
99.1 -- Form of Notice of Guaranteed Delivery.
99.2 -- Form of Letter to Clients.
(b) Financial Statement Schedules
No financial statement schedules are included herein. All other
schedules for which provision is made in the applicable accounting regulation of
the Commission are not required under the related instructions, are
inapplicable, or the information is included in the consolidated financial
statements, and have therefore been omitted.
(c) Reports, Opinions, and Appraisals
No reports, opinions, and appraisals are included herein.
ITEM 22. UNDERTAKINGS.
Insofar as indemnification for liabilities arising under the Securities
Act may be permitted to directors, officers and controlling persons of the
Company pursuant to the foregoing provisions, or otherwise, the Company has been
advised that in the opinion of the Commission such indemnification is against
public policy as expressed in the Securities Act and is, therefore,
unenforceable. In the event that a claim for indemnification against such
liabilities (other than payment by the Company of expenses incurred or paid by a
director, officer or controlling person of the Company in the successful defense
of any action, suit or proceeding) is asserted by such director, officer or
controlling person in connection with the securities being registered, the
Company will, unless in the opinion of its counsel the matter has been settled
by controlling precedent, submit to a court of appropriate jurisdiction the
question whether such indemnification by it is against public policy as
expressed in the Securities Act and will be governed by the final adjudication
of such issue.
(1) The undersigned registrant hereby undertakes:
(i) To file, during any period in which offers or sales are
being made, a post-effective amendment to this registration statement:
(a) To include any prospectus required by section
10(a)(3) of the Securities Act of 1933;
(b) To reflect in the prospectus any facts or events
arising after the effective date of the registration statement
(or the most recent post-effective amendment thereof) which,
individually or in the aggregate, represent a fundamental
change in the information set forth in the registration
statement. Notwithstanding the foregoing, any increase or
decrease in volume of securities offered (if the total dollar
value of securities offered would not exceed that which was
registered) and any deviation from the low or high end of the
estimated maximum offering range may be reflected in the form
of prospectus filed with the Commission pursuant to Rule
424(b) if, in the aggregate, the changes in volume and price
represent no more than a 20% change in the maximum aggregate
offering price set forth in the "Calculation of Registration
Fee" table in the effective registration statement;
(c) To include any material information with respect
to the plan of distribution not previously disclosed in the
registration statement or any material change to such
information in the registration statement;
(ii) That, for the purpose of determining any liability under
the Securities Act of 1933, each such post-effective amendment shall be
deemed to be a new registration statement relating to the securities
offered therein, and the offering of such securities at that time shall
be deemed to be the initial bona fide offering thereof.
II-2
(iii) To remove from registration by means of a post-effective
amendment any of the securities being registered which remain unsold at
the termination of the offering.
(2) The undersigned registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of the
registrant's annual report pursuant to section 13(a) or section 15(d) of the
Securities Exchange Act of 1934 (and, where applicable, each filing of an
employee benefit plan's annual report pursuant to section 15(d) of the
Securities Exchange Act of 1934) that is incorporated by reference in the
registration statement shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.
(3) The undersigned registrant hereby undertakes to respond to requests
for information that is incorporated by reference into the prospectus pursuant
to Items 4 of this Form, within one business day of receipt of such request, and
to send the incorporated documents by first class mail or other equally prompt
means. This includes information contained in documents filed subsequent to the
effective date of the registration statement through the date of responding to
the request.
(4) The undersigned hereby undertakes to supply by means of a
post-effective amendment all information concerning a transaction, and the
company being acquired therein, that was not the subject of and included in the
registration statement when it became effective.
II-3
SIGNATURES
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT, THE REGISTRANT HAS
DULY CAUSED THIS REGISTRATION STATEMENT TO BE SIGNED ON ITS BEHALF BY THE
UNDERSIGNED, THEREUNTO DULY AUTHORIZED, IN THE CITY OF HOUSTON, STATE OF TEXAS,
ON THIS 7TH DAY OF MARCH, 2003.
NATIONAL-OILWELL, INC.
(Registrant)
By: /s/ Steven W. Krablin
-----------------------------------------
Steven W. Krablin, Vice President and
Chief Financial Officer
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, THAT EACH PERSON WHOSE SIGNATURE
APPEARS BELOW IN SO SIGNING ALSO MAKES, CONSTITUTES AND APPOINTS STEVEN W.
KRABLIN AND M. GAY MATHER, OR EITHER OF THEM ACTING SINGLY, HIS TRUE AND LAWFUL
ATTORNEY-IN-FACT AND AGENT, WITH FULL POWER OF SUBSTITUTION AND RESUBSTITUTION,
FOR HIM AND IN HIS NAME, PLACE AND STEAD, IN ANY AND ALL CAPACITIES, TO EXECUTE
AND CAUSE TO BE FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ANY AND ALL
AMENDMENTS AND POST-EFFECTIVE AMENDMENTS TO THIS REGISTRATION STATEMENT, AND IN
EACH CASE TO FILE THE SAME, WITH ALL EXHIBITS THERETO AND OTHER DOCUMENTS IN
CONNECTION THEREWITH, AND HEREBY RATIFIES AND CONFIRMS ALL THAT SAID
ATTORNEY-IN-FACT AND AGENT OR HIS SUBSTITUTE OR SUBSTITUTES MAY DO OR CAUSE TO
BE DONE BY VIRTUE HEREOF.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed below by the following persons in
the capacities and on the date indicated.
SIGNATURE TITLE DATE
--------- ----- ----
/s/ Merrill A. Miller, Jr. Chairman of the Board of Directors March 7, 2003
- ---------------------------------- (Principal Executive Officer)
Merrill A. Miller, Jr.
/s/ Steven W. Krablin Vice President and Chief Financial March 7, 2003
- ---------------------------------- Officer (Principal Financial Officer)
Steven W. Krablin
Director
- ----------------------------------
Hushang Ansary
/s/ Robert E. Beauchamp Director March 7, 2003
- ----------------------------------
Robert E. Beauchamp
/s/ Jon Gjedebo Director March 7, 2003
- ----------------------------------
Jon Gjedebo
II-4
/s/ Ben A. Guill Director March 7, 2003
- ----------------------------------
Ben A. Guill
/s/ Roger L. Jarvis Director March 7, 2003
- ----------------------------------
Roger L. Jarvis
/s/ William E. Macaulay Director March 7, 2003
- ----------------------------------
William E. Macaulay
/s/ Frederick W. Pheasey Director March 7, 2003
- ----------------------------------
Frederick W. Pheasey
/s/ Joel V. Staff Director March 7, 2003
- ----------------------------------
Joel V. Staff
II-5
EXHIBIT INDEX
Exhibit
Number Description of Exhibit
------- ----------------------
4.1 -- Indenture dated November 22, 2002, between National-Oilwell, Inc. and The Bank of New York, as Trustee.
4.2 -- Form of 5.65% Note (contained in the Indenture filed as Exhibit 4.1).
4.3 -- Registration Rights Agreement dated November 22, 2002 between National-Oilwell, Inc. and Merrill Lynch,
Pierce, Fenner & Smith Incorporated.
5 -- Opinion of Bracewell & Patterson, L.L.P. as to the validity of the notes being offered.
12 -- Calculation of Consolidated Ratios of Earnings to Fixed Charges.
23.1 -- Consent of Bracewell & Patterson, L.L.P. (included in their opinion filed as Exhibit 5 hereto).
23.2 -- Consent of Ernst & Young LLP.
24 -- Powers of Attorney (included on the signature pages herein).
25 -- Form T-1 Statement of Eligibility under the Trust Indenture Act of 1939 of The Bank of New York.
99.1 -- Form of Notice of Guaranteed Delivery.
99.2 -- Form of Letter to Clients.
================================================================================
EXHIBIT 4.1
NATIONAL - OILWELL, INC.
ISSUER
5.65% SENIOR NOTES DUE 2012
INDENTURE
DATED AS OF NOVEMBER 22, 2002
THE BANK OF NEW YORK
TRUSTEE
================================================================================
CROSS-REFERENCE TABLE(1)
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)......................................................................................... 2.5
(b)......................................................................................... 10.3
(c)......................................................................................... 10.3
313(a)......................................................................................... 7.6
(b)(2)...................................................................................... 7.6, 7.7
(c)......................................................................................... 7.6, 10.2
(d)......................................................................................... 7.6
314(a)......................................................................................... 4.5
(a)(4)...................................................................................... 10.5
(c)(1)...................................................................................... N.A.
(c)(2)...................................................................................... N.A.
(c)(3)...................................................................................... N.A.
(e)......................................................................................... 10.5
(f)......................................................................................... N.A.
315(a)......................................................................................... 3.5
(b)......................................................................................... N.A.
(c)......................................................................................... 7.1, 7.2
(d)......................................................................................... N.A.
(e)......................................................................................... 6.11
316(a)(last sentence).......................................................................... N.A.
(a)(1)(A)................................................................................... N.A.
(a)(1)(B)................................................................................... N.A.
(a)(2)...................................................................................... N.A.
(b)......................................................................................... N.A.
(c)......................................................................................... N.A.
317(a)(1)...................................................................................... 6.4
(a)(2)...................................................................................... N.A.
(b)......................................................................................... N.A.
318(a)......................................................................................... N.A.
(b)......................................................................................... N.A.
(c)......................................................................................... 10.1
N.A. means not applicable.
(1)This Cross-Reference Table is not part of this Indenture.
i
TABLE OF CONTENTS
PAGE NO.
--------
ARTICLE I
DEFINITIONS AND INCORPORATION BY REFERENCE
Section 1.1 Definitions.................................................................................... 1
Section 1.2 Other Definitions.............................................................................. 9
Section 1.3 Incorporation by Reference of Trust Indenture Act.............................................. 10
Section 1.4 Rules of Construction.......................................................................... 10
ARTICLE II
THE NOTES
Section 2.1 Form and Dating................................................................................ 10
Section 2.2 Execution and Authentication................................................................... 12
Section 2.3 Registrar and Paying Agent..................................................................... 13
Section 2.4 Paying Agent to Hold Money in Trust............................................................ 13
Section 2.5 Holder Lists................................................................................... 14
Section 2.6 Transfer and Exchange.......................................................................... 14
Section 2.7 Replacement Notes.............................................................................. 29
Section 2.8 Outstanding Notes.............................................................................. 30
Section 2.9 Treasury Notes................................................................................. 30
Section 2.10 Temporary Notes................................................................................ 30
Section 2.11 Cancellation................................................................................... 30
Section 2.12 Defaulted Interest............................................................................. 31
Section 2.13 CUSIP Numbers.................................................................................. 31
ARTICLE III
REDEMPTION
Section 3.1 Redemption at the Option of the Company........................................................ 31
Section 3.2 Notice to the Trustee.......................................................................... 31
Section 3.3 Selection of Notes To Be Redeemed.............................................................. 32
Section 3.4 Notice of Redemption........................................................................... 32
Section 3.5 Effect of Notice of Redemption................................................................. 33
Section 3.6 Deposit of Redemption Price.................................................................... 33
Section 3.7 Notes Redeemed or Purchased in Part............................................................ 33
Section 3.8 Purchase of Notes.............................................................................. 34
ARTICLE IV
COVENANTS
Section 4.1 Payment of Notes............................................................................... 34
Section 4.2 Maintenance of Office or Agency................................................................ 34
Section 4.3 Statement by Officers as to Default............................................................ 35
Section 4.4 Corporate Existence............................................................................ 35
ii
Section 4.5 SEC Reports; Financial Statements.............................................................. 35
Section 4.6 Limitation on Liens............................................................................ 36
Section 4.7 Limitation on Sale and Leaseback Transactions.................................................. 36
ARTICLE V
SUCCESSORS
Section 5.1 Consolidation, Merger, or Sale of Assets....................................................... 37
Section 5.2 Successor Corporation Substituted.............................................................. 37
ARTICLE VI
DEFAULTS AND REMEDIES
Section 6.1 Events of Default.............................................................................. 38
Section 6.2 Acceleration................................................................................... 39
Section 6.3 Other Remedies................................................................................. 39
Section 6.4 Waiver of Past Defaults........................................................................ 39
Section 6.5 Control by Majority............................................................................ 40
Section 6.6 Limitation on Suits............................................................................ 40
Section 6.7 Rights of Holders of Notes to Receive Payment and Institute Proceedings........................ 40
Section 6.8 Collection Suit by Trustee..................................................................... 41
Section 6.9 Trustee May File Proofs of Claim............................................................... 41
Section 6.10 Priorities..................................................................................... 41
Section 6.11 Undertaking for Costs.......................................................................... 42
ARTICLE VII
TRUSTEE
Section 7.1 Duties of Trustee.............................................................................. 42
Section 7.2 Rights of Trustee.............................................................................. 43
Section 7.3 Individual Rights of Trustee................................................................... 44
Section 7.4 Trustee's Disclaimer........................................................................... 44
Section 7.5 Notice of Defaults............................................................................. 44
Section 7.6 Reports by Trustee to Holders of the Notes..................................................... 45
Section 7.7 Compensation and Indemnity..................................................................... 45
Section 7.8 Replacement of Trustee......................................................................... 46
Section 7.9 Successor Trustee by Merger, Etc............................................................... 47
Section 7.10 Eligibility; Disqualification.................................................................. 47
Section 7.11 Preferential Collection of Claims Against Company.............................................. 47
ARTICLE VIII
SATISFACTION AND DISCHARGE; DEFEASANCE
Section 8.1 Satisfaction and Discharge of Indenture........................................................ 47
Section 8.2 Application of Trust Money..................................................................... 48
Section 8.3 Option to Effect Legal Defeasance or Covenant Defeasance....................................... 48
Section 8.4 Defeasance and Discharge....................................................................... 49
Section 8.5 Covenant Defeasance............................................................................ 49
iii
Section 8.6 Conditions to Defeasance or Covenant Defeasance................................................ 49
Section 8.7 Deposited Money and Government Securities to be Held in Trust; Other Miscellaneous Provisions.. 51
Section 8.8 Repayment to Company........................................................................... 51
Section 8.9 Reinstatement.................................................................................. 52
ARTICLE IX
AMENDMENT, SUPPLEMENT AND WAIVER
Section 9.1 Without Consent of Holders of Notes............................................................ 52
Section 9.2 With Consent of Holders of Notes............................................................... 53
Section 9.3 Compliance with Trust Indenture Act............................................................ 54
Section 9.4 Revocation and Effect of Consents.............................................................. 54
Section 9.5 Notation on or Exchange of Notes............................................................... 54
Section 9.6 Trustee to Sign Amendments, Etc................................................................ 55
Section 9.7 Record Dates................................................................................... 55
ARTICLE X
MISCELLANEOUS
Section 10.1 Trust Indenture Act Controls................................................................... 55
Section 10.2 Notices........................................................................................ 55
Section 10.3 Communication by Holders of Notes with Other Holders of Notes.................................. 56
Section 10.4 Certificate and Opinion as to Conditions Precedent............................................. 56
Section 10.5 Statements Required in Certificate or Opinion.................................................. 57
Section 10.6 Rules by Trustee and Agents.................................................................... 57
Section 10.7 No Personal Liability of Directors, Officers, Employees and Stockholders....................... 57
Section 10.8 Governing Law.................................................................................. 57
Section 10.9 No Adverse Interpretation of Other Agreements.................................................. 58
Section 10.10 Successors..................................................................................... 58
Section 10.11 Severability................................................................................... 58
Section 10.12 Counterpart Originals.......................................................................... 58
Section 10.13 Table of Contents, Headings, Etc............................................................... 58
iv
INDENTURE dated as of November 22, 2002 between National-Oilwell, Inc.,
a Delaware corporation (the "Company"), and The Bank of New York, a New York
banking corporation, as trustee (the "Trustee").
RECITALS OF THE COMPANY
The Company has duly authorized the creation of the Notes (as
hereinafter defined), substantially of the tenor and amount hereinafter set
forth, and to provide therefor the Company has duly authorized the execution and
delivery of this Indenture.
All things necessary to make the Notes, when issued by the Company and
authenticated and delivered hereunder and duly issued by the Company, the valid
obligations of the Company, and to make this Indenture a valid agreement of the
Company, in accordance with the terms of the Notes and this Indenture,
respectively, have been done.
Upon the issuance of the Exchange Notes (as hereinafter defined) or the
effectiveness of a registration statement filed pursuant to the Registration
Rights Agreement (as hereinafter defined), this Indenture will be subject to the
provisions of the TIA (as hereinafter defined) that are required to be a part of
this Indenture and shall, to the extent applicable, be governed by such
provisions. Prior thereto, the provisions of the TIA will apply to this
Indenture only to the extent expressly provided herein.
NOW, THEREFORE, THIS INDENTURE WITNESSETH:
For and in consideration of the premises and the purchase of the Notes by
Holders thereof, it is mutually agreed, for the equal and proportionate benefit
of all Holders of the Notes as follows:
ARTICLE I
DEFINITIONS AND INCORPORATION BY REFERENCE
Section 1.1 DEFINITIONS
"Affiliate" of any specified Person means any other Person directly or
indirectly controlling or controlled by or under direct or indirect common
control with such specified Person. For purposes of this definition, "control"
(including, with correlative meanings, the terms "controlling," "controlled by"
and "under common control with"), as used with respect to any Person, shall mean
the possession, directly or indirectly, of the power to direct or cause the
direction of the management or policies of such Person, whether through the
ownership of voting securities, by agreement or otherwise; provided that
beneficial ownership of 10% or more of the voting securities of a Person shall
be deemed to be control.
"Agent" means any Registrar, Paying Agent or co-registrar.
"Applicable Procedures" means, with respect to any transfer or exchange
of or for beneficial interests in any Global Note, the rules and procedures of
the Depositary, Euroclear and Clearstream that apply to such transfer or
exchange.
1
"Bankruptcy Code" means Title 11, U.S. Code, as amended, 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
committee thereof duly authorized to act on behalf of such Board.
"Business Day" means any day other than a Legal Holiday.
"Clearstream" means Clearstream Banking, formerly known as Cedel Bank.
"Consolidated Net Tangible Assets" means the aggregate amount of assets
included on a consolidated balance sheet of the Company, less applicable
reserves and other properly deductible items and after deducting therefrom (a)
all current liabilities (other than liabilities that, by their terms, are
extendible or renewable at the option of the obligor to a date 12 months or more
after the date on which such current liabilities are determined) and (b) all
goodwill, trade names, trademarks, patents, copyrights, unamortized debt
discount and expense and other like intangibles, all in accordance with
generally accepted accounting principles consistently applied.
"Corporate Trust Office of the Trustee" shall be at the address of the
Trustee specified in Section 10.2 hereof or such other address as to which the
Trustee may give notice to the Company.
"Custodian" means any receiver, trustee, assignee, liquidator,
sequester or similar official under the Bankruptcy Code.
"Default" means any event that is or with the passage of time or the
giving of notice (or both) would be an Event of Default.
"Definitive Note" means a certificated Note registered in the name of
the Holder thereof and issued in accordance with Section 2.6 hereof, in the form
of Exhibit A-1 hereto except that such Note shall not bear the Global Note
Legend and shall not have the "Schedule of Exchanges of Interests in the Global
Note" attached thereto.
"Depositary" means, with respect to the Global Notes issued, the Person
specified in Section 2.3 hereof as the Depositary with respect to the Notes, and
any and all successors thereto appointed as depositary hereunder and having
become such pursuant to the applicable provision of this Indenture.
"Euroclear" means Morgan Guaranty Trust Company of New York, Brussels
office, as operator of the Euroclear system.
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
"Exchange Notes" means any Note issued in exchange for an Initial Note
or Initial Notes pursuant to the Exchange Offer or otherwise registered under
the Securities Act (which shall be substantially identical to the Initial Notes
except that the Exchange Notes will have been registered pursuant to an
effective registration statement under the Securities Act, will not be subject
to transfer restrictions or registration rights and will not be entitled to the
benefit of
2
provisions for the increase of the interest rate) and any Note with respect to
which the next preceding predecessor Note of such Note was an Exchange Note.
"Exchange Offer" has the meaning set forth in the Registration Rights
Agreement.
"Exchange Offer Registration Statement" has the meaning set forth in
the Registration Rights Agreement.
"Global Note Legend" means the legend set forth in Section 2.6(g)(ii)
hereof, which is required to be placed on all Global Notes issued under this
Indenture.
"Global Notes" means, individually and collectively, each of the
Restricted Global Notes and the Unrestricted Global Notes, in the form of
Exhibit A hereto issued in accordance with Section 2.1, 2.6(b)(iv), 2.6(d)(iv)
or 2.6(f) hereof.
"Government Securities" means direct obligations of, or obligations
guaranteed by, the United States of America for the payment of which guarantees
or obligations the full faith and credit of the United States is pledged.
"Guarantee" means a guarantee (other than by endorsement of negotiable
instruments for collection in the ordinary course of business), direct or
indirect, in any manner (including, without limitation, letters of credit and
reimbursement agreements in respect thereof or pledging assets to secure), of
all or any part of any indebtedness.
"Holder" means a Person in whose name a Note is registered.
"Indenture" means this Indenture, as amended or supplemented from time
to time.
"Indirect Participant" means a Person who holds a beneficial interest
in a Global Note through a Participant.
"Initial Notes" means all Notes other than Exchange Notes.
"Institutional Accredited Investor" means an institution that is an
"accredited investor," as defined in Rule 501(a)(1), (2), (3) or (7) under the
Securities Act.
"Interest Payment Date" shall have the meaning assigned to it in the
Notes as contemplated by Section 2.1 hereof.
"Issue Date" means the date on which Initial Notes are first
authenticated and delivered under this Indenture.
"Legal Holiday" a Saturday, a Sunday or a day on which banking
institutions in the City of New York or at a place of payment are authorized by
law, regulation or executive order to remain closed. If a payment date is a
Legal Holiday at a place of payment, payment may be made at that place on the
next succeeding day that is not a Legal Holiday, and no interest shall accrue
for the intervening period.
3
"Letter of Transmittal" means the letter of transmittal to be prepared
by the Company and sent to all Holders of the Notes for use by such Holders in
connection with the Exchange Offer.
"Lien" means, with respect to any property or asset, any mortgage,
pledge, lien, encumbrance, charge or security interest of any kind in respect of
such property or asset, whether or not filed, recorded or otherwise perfected
under applicable law, but excluding agreements to refrain from granting Liens.
"Make-Whole Premium" means an amount, with respect to any Note (or
portion thereof) to be redeemed pursuant to Article III hereof, equal to the
excess, if any, of (a) the sum of the present values, calculated as of the
Redemption Date, of (i) each interest payment that, but for such redemption,
would have been payable on the Note (or portion thereof) being redeemed on each
Interest Payment Date occurring after the Redemption Date (excluding any accrued
interest for the period prior to the Redemption Date) and (ii) the principal
amount that, but for such redemption, would have been payable at the final
maturity of the Note (or portion thereof) being redeemed; over (b) the principal
amount of the Note (or portion thereof) being redeemed. The present values of
interest and principal payments referred to in clauses (i) and (ii) above will
be determined in accordance with generally accepted principles of financial
analysis. Such present values will be calculated by discounting the amount of
each payment of interest or principal from the date that each such payment would
have been payable, but for the redemption, to the Redemption Date at a discount
rate equal to the Treasury Yield (as defined below) plus 25 basis points. The
Make-Whole Premium will be calculated by an independent investment banking
institution of national standing appointed by the Company; provided, that if the
Company fails to make such appointment at least 45 days prior to the Redemption
Date, or if the institution so appointed is unwilling or unable to make such
calculation, such calculation will be made by Merrill Lynch, Pierce, Fenner &
Smith Incorporated or if such firm is unwilling or unable to make such
calculation, by an independent investment banking institution of national
standing appointed by the Trustee (in any such case, an "Independent Investment
Banker"). For purposes of determining the Make-Whole Premium, "Treasury Yield"
means a rate of interest per annum equal to the weekly average yield to maturity
of United States Treasury Notes that have a constant maturity that corresponds
to the remaining term to maturity of the Notes, calculated to the nearest 1/12th
of a year (the "Remaining Term"). The Treasury Yield will be determined as of
the third business day immediately preceding the applicable Redemption Date. The
weekly average yields of United States Treasury Notes will be determined by
reference to the most recent statistical release published by the Federal
Reserve Bank of New York and designated "H.15(519) Selected Interest Rates" or
any successor release (the "H.15 Statistical Release"). If the H.15 Statistical
Release sets forth a weekly average yield for United States Treasury Notes
having a constant maturity that is the same as the Remaining Term, then the
Treasury Yield will be equal to such weekly average yield. In all other cases,
the Treasury Yield will be calculated by interpolation, on a straight-line
basis, between the weekly average yields on the United States Treasury Notes
that have a constant maturity closest to and greater than the Remaining Term and
the United States Treasury Notes that have a constant maturity closest to and
less than the Remaining Term (in each case as set forth in the H.15 Statistical
Release). Any weekly average yields as calculated by interpolation will be
rounded to the nearest 1/100th of 1%, with any figure of 1/200% or above being
rounded upward. If weekly average yields for United States Treasury Notes are
not available in the H.15 Statistical Release or otherwise, then the Treasury
4
Yield will be calculated by interpolation of comparable rates selected by the
Independent Investment Banker.
"Non-U.S. Person" means a person who is not a U.S. Person.
"Note Custodian" means the Trustee, as custodian with respect to the
Global Notes, or any successor entity thereto.
"Notes" means the 5.65% Notes due 2012 of the Company, including the
Initial Notes and the Exchange Notes. For all purposes of this Indenture, the
term "Notes" shall include any Exchange Notes issued in exchange for Initial
Notes pursuant to this Indenture and, for purposes of this Indenture, all
outstanding Initial Notes and Exchange Notes shall vote together as one series
of Notes under this Indenture.
"Officer" means, with respect to any Person, the Chairman of the Board,
the Chief Executive Officer, the President, the Chief Operating Officer, the
Chief Financial Officer, the Treasurer, any Assistant Treasurer, the Controller,
the Secretary, any Assistant Secretary or any Vice-President of such Person.
"Officers' Certificate" means a certificate signed on behalf of the
Company by two Officers of the Company, one of whom must be the principal
executive officer, the principal financial officer or the principal accounting
officer of the Company, that meets the requirements of Section 10.5 hereof.
"Opinion of Counsel" means an opinion from legal counsel who is
reasonably acceptable to the Trustee, that meets the requirements of Section
10.5 hereof. The counsel may be an employee of or counsel to the Company or any
Subsidiary of the Company.
"Participant" means, with respect to DTC, Euroclear or Clearstream, a
Person who has an account with DTC, Euroclear or Clearstream, respectively (and,
with respect to DTC, shall include Euroclear and Clearstream).
"Participating Broker-Dealer" has the meaning set forth in the
Registration Rights Agreement.
"Permitted Liens" means:
(a) any Lien on any property hereafter acquired (including
acquisition through merger or consolidation) or constructed by the Company or a
Restricted Subsidiary and created contemporaneously with, or within twelve
months after, such acquisition or the completion of construction to secure or
provide for the payment of all or any part of the purchase price of such
property or the cost of construction thereof, as the case may be; or
(b) statutory liens or landlords', carriers', warehouseman's,
mechanics', suppliers', materialmen's, repairmen's or other similar Liens
arising in the ordinary course of business and with respect to amounts not yet
delinquent or being contested in good faith by appropriate proceedings; or
5
(c) Liens existing on property at the time of acquisition by the
Company or a Restricted Subsidiary; or
(d) Liens existing on the property or on the outstanding shares or
indebtedness of any Person at the time it becomes a Restricted Subsidiary; or
(e) Liens on property of a Person existing at the time such
Person is merged into or consolidated with the Company or a Restricted
Subsidiary; or
(f) Liens on property of the Company or a Restricted Subsidiary
in favor of the United States of America or any State thereof or any foreign
government, or any department, agency or instrumentality or political
subdivision of any thereof, to secure partial, progress, advance or other
payments pursuant to any contract or statute; or
(g) Liens existing on property owned by the Company or any of
its Subsidiaries on the date of this Indenture or provided for pursuant to
agreements existing on the date of the Indenture; or
(h) Liens created pursuant to the creation of trusts or other
arrangements funded solely with cash, cash equivalents or other marketable
investments or securities of the type customarily subject to such arrangements
in customary financial practice with respect to long-term or medium-term
indebtedness for money borrowed, the sole purpose of which is to make provisions
for the retirement or defeasance, without prepayment of indebtedness; or
(i) any extensions, renewals or replacements (or successive
extensions, renewals or replacements) in whole or in part of a Lien referred to
in the foregoing clauses (a) through (h) above; provided, however, that the
principal amount of Secured Debt secured thereby shall not exceed the principal
amount outstanding at the time of such extension, renewal or replacement, and
that such extension, renewal or replacement shall be limited to the property
which secured the Lien so extended, renewed or replaced and additions to such
property.
"Person" means (a) any form of business entity, association,
grouping, trust or other form now or hereafter permitted by the laws of any
state of the United States of America or any foreign government or utilized by
businesses in the conduct of their activities and (b) a natural person, as the
context may require.
"Principal Property" means any real property, manufacturing plant,
office building, warehouse or other physical facility, or any other like
depreciable asset of the Company or of any Restricted Subsidiary, whether owned
at the date of this Indenture or thereafter acquired that in the opinion of the
Board of Directors of the Company is of material importance to the total
business conducted by the Company and its Restricted Subsidiaries, as a whole;
provided, however, that any such property shall not be deemed a Principal
Property if such property does not have a fair value in excess of 5% of the
total assets included on a consolidated balance sheet of the Company and its
Restricted Subsidiaries prepared in accordance with generally accepted
accounting principles consistently applied.
6
"Private Placement Legend" means the legend set forth in Section
2.6(g)(i) hereof to be placed on all Notes issued under this Indenture except
where otherwise permitted by the provisions of this Indenture.
"QIB" means a "qualified institution buyer" as defined in Rule 144A.
"Redemption Date" has the meaning assigned to it in Section 3.1.
"Redemption Price" has the meaning assigned to it in Section 3.1
"Registration Rights Agreement" means the Registration Rights
Agreement, dated as of November 22, 2002, by and among the Company and the other
party named on the signature pages thereof, attached hereto as Exhibit E, as
such agreement may be amended, modified or supplemented from time to time.
"Regulation S" means Regulation S promulgated under the Securities Act.
"Regulation S Global Note" means a Regulation S Temporary Global Note
or Regulation S Permanent Global Note, as appropriate.
"Regulation S Permanent Global Note" means a permanent global Note in
the form of Exhibit A-1 hereto bearing the Global Note Legend and the Private
Placement Legend and deposited with or on behalf of and registered in the name
of the Depositary or its nominee, issued in a denomination equal to the
outstanding principal amount of the Regulation S Temporary Global Note upon
expiration of the Restricted Period.
"Regulation S Temporary Global Note" means a temporary global Note
in the form of Exhibit A-2 hereto bearing the Private Placement Legend and
deposited with or on behalf of and registered in the name of the Depositary or
its nominee, issued in a denomination equal to the outstanding principal amount
of the Notes initially sold in reliance on Rule 903 of Regulation S.
"Remaining Term" has the meaning assigned to it in the definition of
"Make-Whole Premium."
"Responsible Officer," when used with respect to the Trustee, means any
officer, including, without limitation, any vice president, assistant vice
president, assistant treasurer or assistant secretary within the corporate trust
department of the Trustee (or any successor group of the Trustee) or any other
officer of the Trustee customarily performing functions similar to those
performed by any of the above designated officers and also means, with respect
to any particular corporate trust matter, any other officer or employee to whom
such matter is referred because of his knowledge of and familiarity with the
particular subject.
"Restricted Definitive Note" means a Definitive Note bearing the
Private Placement Legend.
"Restricted Global Note" means a Global Note bearing the Private
Placement Legend.
7
"Restricted Period" means the 40-day distribution compliance period as
set forth in Regulation S.
"Restricted Subsidiary" means (a) any currently existing Subsidiary
whose principal assets and business are located in the United States or Canada,
and (b) any Subsidiary that is designated by the Company to be a Restricted
Subsidiary.
"Rule 144" means Rule 144 promulgated under the Securities Act.
"Rule 144A" means Rule 144A promulgated under the Securities Act.
"Rule 144A Global Note" means the Global Note in the form of Exhibit
A-1 hereto bearing the Global Note Legend and the Private Placement Legend and
deposited with and registered in the name of the Depositary or its nominee that
will be issued in a denomination equal to the outstanding principal amount of
the Notes sold in reliance on Rule 144A.
"Rule 903" means Rule 903 promulgated under the Securities Act.
"Rule 904" means Rule 904 promulgated under the Securities Act.
"Sale and Leaseback Transaction" means the sale or transfer by the
Company or a Restricted Subsidiary of any Principal Property owned by it with
the intention of taking back a lease on such property.
"SEC" means the Securities and Exchange Commission.
"Secured Debt" means indebtedness for money borrowed by the Company or
a Restricted Subsidiary, and any other indebtedness of the Company or a
Restricted Subsidiary, on which interest is paid or payable (other than
indebtedness owed by a Restricted Subsidiary to the Company, by a Restricted
Subsidiary to another Restricted Subsidiary or by the Company to a Restricted
Subsidiary), that in any such case is secured by (a) any Lien on any Principal
Property of the Company or a Restricted Subsidiary or (b) a Lien on any shares
of stock or indebtedness of a Restricted Subsidiary that owns a Principal
Property. The amount of Secured Debt at any time outstanding shall be the amount
then owing thereon by the Company or a Restricted Subsidiary.
"Securities Act" means the Securities Act of 1933, as amended.
"Shelf Registration Statement" has the meaning set forth in the
Registration Rights Agreement.
"Significant Subsidiary" means any Subsidiary that would be a
"significant subsidiary" as defined in Article 1, Rule 1-02 of Regulation S-X,
promulgated pursuant to the Securities Act, as such Regulation is in effect on
the date of this Indenture.
"Stated Maturity" means, with respect to any installment of interest or
principal on any series of indebtedness, including the Notes, the date on which
such payment of interest or principal was scheduled to be paid in the original
documentation governing such indebtedness,
8
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 of
which the Company, or the Company and one or more Subsidiaries, or any one or
more Subsidiaries, directly or indirectly own voting securities entitling any
one or more of the Company and its Subsidiaries to elect a majority of the
directors, either at all times, or so long as there is no default or contingency
which permits the holders of any other class or classes of securities to vote
for the election of one or more directors, (b) any partnership of which the
Company, or the Company and one or more of its Subsidiaries, or any one or more
Subsidiaries, is at the date of determination, a general or limited partner of
such partnership, but only if the Company and its Subsidiaries are entitled to
receive more than 50% of the assets of such partnership upon dissolution or more
than 50% of the profits of such partnership, or (c) any other Person (other than
a corporation or partnership) in which the Company, or the Company and one or
more Subsidiaries, or any one or more Subsidiaries, directly or indirectly, at
the date of determination thereof, has (x) at least a majority ownership
interest or (y) the power to elect or direct the election of a majority of the
directors or other governing body of such Person.
"TIA" means the Trust Indenture Act of 1939 (15 U.S.C. Sections
77aaa-77bbbb) as in effect on the date on which this Indenture is qualified
under the TIA, except as provided in Section 9.3 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 Definitive Note" means one or more Definitive Notes that
do not bear and are not required to bear the Private Placement Legend.
"Unrestricted Global Note" means a permanent global Note in the form of
Exhibit A-1 attached hereto that bears the Global Note Legend and that has the
"Schedule of Exchanges of Interests in the Global Note" attached thereto, and
that is deposited with or on behalf of and registered in the name of the
Depositary, representing a series of Notes that do not bear the Private
Placement Legend.
"U.S. Person" means a U.S. person as defined in Rule 902(k) under the
Securities Act.
Section 1.2 OTHER DEFINITIONS
TERM DEFINED IN SECTION
"Covenant Defeasance"............................................ 8.5
"DTC"............................................................ 2.3
"Event of Default"............................................... 6.1
"Defeasance"..................................................... 8.4
"Paying Agent"................................................... 2.3
"Registrar....................................................... 2.3
9
Section 1.3 INCORPORATION BY REFERENCE OF TRUST INDENTURE ACT.
Whenever this Indenture refers to a provision of the TIA, the provision
is incorporated by reference in and made a part of this Indenture The following
TIA terms used in this Indenture have the following meanings:
"indenture securities" means the Notes; and
"obligor" on the Notes means the Company and any successor obligor upon
the Notes.
All other terms used in this Indenture that are defined by the TIA,
defined by TIA reference to another statute or defined by SEC rule under the TIA
have the meanings so assigned to them.
Section 1.4 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 generally accepted
accounting principles set forth in the opinions and
pronouncements of the Accounting Principles Board of the
American Institute of Certified Public Accountants, the
statements and pronouncements of the Financial Accounting
Standards Board and such other statements by such other
entities as have been approved by a significant segment of the
accounting profession, which are applicable at the date of
determination;
(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; and
(6) references to sections of or rules under the Securities Act
shall be deemed to include substitute, replacement of
successor sections or rules adopted by the SEC from time to
time.
ARTICLE II
THE NOTES
Section 2.1 FORM AND DATING
The Notes and the Trustee's certificate of authentication shall be
substantially in the form of Exhibit A 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 in
denominations of $1,000 and integral multiples thereof.
10
The Notes will mature on November 15, 2012, and each Note will bear
interest from the date of initial issuance of such Note (which date shall be set
forth in the certificate representing such Note) at the rate per annum of 5.65%,
which interest shall be payable semiannually on each May 15 and November 15
following the date of initial issuance of such Note, commencing on the first May
15 or November 15 next following the date of initial issuance of such Note
(which date shall be set forth in the certificate representing such Note), to
the Person in whose name the certificate representing such Note is registered at
the close of business on the preceding May 1 or November 1, as the case may be.
The Notes will be subject to redemption prior to maturity pursuant to Article
III of this Indenture. The interest rate accruing on the Initial Notes entitled
to the benefits of the Registration Rights Agreement is subject to increase upon
the occurrence of certain events as provided in the Registration Rights
Agreement.
The Notes are senior unsecured obligations of the Company and rank pari
passu in right of payment with all other unsecured and unsubordinated
indebtedness of the Company.
The terms and provisions contained in the Notes shall constitute, and
are hereby expressly made, a part of this Indenture and the Company and the
Trustee, by their execution and delivery of this Indenture, expressly agree to
such terms and provisions and to be bound thereby. However, to the extent any
provision of any Note conflicts with the express provisions of this Indenture,
the provisions of this Indenture shall govern and be controlling. Notes issued
in global form shall be substantially in the form of Exhibit A-1 or A-2 attached
hereto (including the Global Note Legend and the "Schedule of Exchanges of
Interests in the Global Note" attached thereto). Notes issued in definitive form
shall be substantially in the form of Exhibit A-1 attached hereto (but without
the Global Note Legend and without the "Schedule of Exchanges of Interests in
the Global Note" attached thereto). 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 principal amount of outstanding Notes from time to
time endorsed thereon and that the aggregate principal amount of outstanding
Notes represented thereby may from time to time be reduced or increased, as
appropriate, to reflect exchanges and redemptions. Any endorsement of a Global
Note to reflect the amount of any increase or decrease in the aggregate
principal amount of outstanding Notes represented thereby shall be made by the
Trustee, the Depositary or the Note Custodian, at the direction of the Trustee,
in accordance with instructions given by the Holder thereof as required by
Section 2.6 hereof.
Notes offered and sold in reliance on Regulation S 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 Notes represented thereby with the
Trustee, at its New York office, as custodian for the Depositary, and registered
in the name of the nominee of the Depositary for credit to the accounts of
designated agents holding on behalf of Euroclear or Clearstream, duly executed
by the Company and authenticated by the Trustee as hereinafter provided. The
Restricted Period shall be terminated after the 40-day distribution compliance
period applicable to the Initial Notes (or subsequent Initial Notes issued upon
a reopening of the series of Notes as described in Section 2.2, if applicable)
has expired under Regulation S and upon the receipt by the Trustee of (i) a
written certificate from the Depositary, together with copies of certificates
from Euroclear and Clearstream 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
11
during the Restricted Period pursuant to another exemption from registration
under the Securities Act and who will take delivery of a beneficial ownership
interest in a 144A Global Note bearing a Private Placement Legend, all as
contemplated by Section 2.6(b) hereof), and (ii) an Officers' Certificate from
the Company stating that the applicable Restricted Period has terminated.
Following the termination of the Restricted Period, beneficial interests in the
Regulation S Temporary Global Note shall be exchanged for beneficial interests
in Regulation S Permanent Global Notes pursuant to the Applicable Procedures.
Simultaneously with the authentication of Regulation S Permanent Global Notes,
the Trustee 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 Depositary or its
nominee, as the case may be, in connection with transfers of interests as
hereinafter provided.
The provisions of the "Operating Procedures of the Euroclear System"
and "Terms and Conditions Governing Use of Euroclear" and the "General Terms and
Conditions of Clearstream Bank" and "Customer Handbook" of Clearstream shall be
applicable to transfers of beneficial interests in the Regulation S Temporary
Global Note and the Regulation S Permanent Global Notes that are held by members
of, or Participants, in DTC through Euroclear or Clearstream.
Section 2.2 EXECUTION AND AUTHENTICATION
An Officer (who shall be the Chief Executive Officer, the Chief
Financial Officer or the Treasurer) shall sign the Notes for the Company by
manual or facsimile signature.
If the 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 the Trustee. The signature shall be conclusive evidence that the Note has
been authenticated under this Indenture.
The Trustee shall, upon a written order of the Company signed by an
Officer, authenticate and make available for delivery (1) Initial Notes for
original issue on the date hereof in an aggregate principal amount of $200.0
million (and any Initial Notes subsequently issued by reopening the series of
Notes as described below) and (2) Exchange Notes in exchange for Initial Notes
of an equal principal amount. The aggregate principal amount of Notes which may
be authenticated and delivered under this Indenture is initially limited to
$200,000,000, except for Notes authenticated and delivered upon registration of
transfer of, or in exchange for, or in lieu of, other Notes pursuant to Sections
2.6, 2.7, 2.10, or 9.5; provided, however, that the Company may, so long as no
Event of Default has occurred and is continuing, reopen the series of Notes
represented by the 5.65% Notes due 2012 to issue additional Initial Notes for
such series, which shall form a single series with the Notes and shall have the
same terms, without the consent of the Holders. All Initial Notes issued by
reopening the series of Notes as provided in the previous sentence (and any
Exchange Notes issued in exchange therefor) shall be identical in all respects
to the Initial Notes issued on the date hereof, other than the Issue Date, the
date from which interest accrues and any changes relating thereto.
Notwithstanding the provisions of Section 2.6 permitting the issuance of
Definitive Notes, the Initial Notes issued on the date hereof in the aggregate
principal amount of $200.0 million and the Exchange Notes relating thereto will
be
12
issued in the form of Global Notes only and no Holder shall have the right to
receive such an Initial Note or such Exchange Note in the form of a Definitive
Note unless Definitive Notes are issued as required in Section 2.6(a).
The Trustee may appoint an authenticating agent acceptable to the
Company to authenticate Notes. An authenticating agent may authenticate Notes
whenever the Trustee may do so. Each reference in this Indenture to
authentication by the Trustee includes authentication by such agent. An
authenticating agent has the same rights as an Agent to deal with Holders or an
Affiliate of the Company.
Section 2.3 REGISTRAR AND PAYING AGENT
The Company shall maintain an office or agency within the City and
State of New York where Notes may be presented for registration of transfer or
for exchange ("Registrar") and an office or agency where Notes may be presented
for payment ("Paying Agent"). The Registrar 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 promptly notify the Trustee in writing
of the name and address of any Agent not a party to this Indenture. If the
Company fails to appoint or maintain another entity as Registrar or Paying
Agent, the Trustee shall act as such. The Company or any of its Subsidiaries may
act as Paying Agent or Registrar.
The Company initially appoints The Depository Trust Company ("DTC") to
act as Depositary with respect to the Global Notes.
The Company initially appoints the Trustee to act as the Registrar and
Paying Agent and to act as Note Custodian with respect to the Global Notes.
Section 2.4 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 interest or premium, 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.
13
Section 2.5 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 312(a). If the Trustee
is not the Registrar, the Company shall provide to a Responsible Officer of 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
312(a).
Section 2.6 TRANSFER AND EXCHANGE
(a) Transfer and Exchange of Global Notes. A Global Note may not
be transferred as a whole except by the Depositary to a nominee of the
Depositary, by a nominee of the Depositary to the Depositary or to another
nominee of the Depositary, or by the Depositary or any such nominee to a
successor Depositary or a nominee of such successor Depositary. All Global Notes
will be exchanged by the Company for Definitive Notes if (i) the Company
delivers to the Trustee notice from the Depositary that it is unwilling or
unable to continue to act as Depositary for the Global Notes or that it is no
longer a clearing agency registered under the Exchange Act and, in either case,
a successor Depositary is not appointed by the Company within 90 days after the
date of such notice from the Depositary or (ii) the Company in its sole
discretion notifies the Trustee in writing that it elects to cause issuance of
the Notes in certificated form; provided that in no event shall the Regulation S
Temporary Global Note be exchanged by the Company for Definitive Notes prior to
the expiration of the Restricted Period. Upon the occurrence of either of the
preceding events in (i) or (ii) above, Definitive Notes shall be issued in such
names as the Depositary shall instruct the Trustee. Global Notes also may be
exchanged or replaced, in whole or in part, as provided in Sections 2.7 and 2.11
hereof. Every Note authenticated and delivered in exchange for, or in lieu of, a
Global Note or any portion thereof, pursuant to Section 2.7 or 2.11 hereof,
shall be authenticated and delivered in the form of, and shall be, a Global
Note. A Global Note may not be exchanged for another Note other than as provided
in this Section 2.6(a); however, beneficial interests in a Global Note may be
transferred and exchanged as provided in Section 2.6(b), (c) or (f) hereof.
(b) Transfer and Exchange of Beneficial Interests in the Global
Notes. The transfer and exchange of beneficial interests in the Global Notes
shall be effected through the Depositary, in accordance with the provisions of
this Indenture and the Applicable Procedures. Beneficial interests in the
Restricted Global Notes shall be subject to restrictions on transfer set forth
herein. Transfers of beneficial interests in the Global Notes also shall require
compliance with either subparagraph (i) or (ii) below, as applicable, as well as
one or more of the other following subparagraphs as applicable:
(i) Transfer of Beneficial Interests in the Same Global
Note. Beneficial interests in any Restricted Global
Note may be transferred to Persons who take delivery
thereof in the form of a beneficial interest in the
same Restricted Global Note in accordance with the
transfer restrictions set forth in the Private
Placement Legend; provided, however, that prior to
the expiration of the Restricted Period transfers of
beneficial interests in the
14
Temporary Regulation S Global Note may not be made to
a U.S. Person or for the account or benefit of a U.S.
Person. Beneficial interests in any Unrestricted
Global Note may be transferred only to Persons who
take delivery thereof in the form of a beneficial
interest in an Unrestricted Global Note. No written
orders or instructions shall be required to be
delivered to the Registrar to effect the transfers
described in this Section 2.6(b)(i).
(ii) All Other Transfers and Exchanges of Beneficial
Interests in Global Notes. In connection with all
transfers and exchanges of beneficial interests
(other than a transfer of a beneficial interest in a
Global Note to a Person who takes delivery thereof in
the form of a beneficial interest in the same Global
Note), the transferor of such beneficial interest
must deliver to the Registrar (A) (1) a written order
from a Participant or an Indirect Participant given
to the Depositary in accordance with the Applicable
Procedures directing the Depositary to credit or
cause to be credited a beneficial interest in another
Global Note in an amount equal to the beneficial
interest to be transferred or exchanged and (2)
instructions given in accordance with the Applicable
Procedures containing information regarding the
Participant account to be credited with such increase
or (B) (1) a written order from a Participant or an
Indirect Participant given to the Depositary in
accordance with the Applicable Procedures directing
the Depositary to cause to be issued a Definitive
Note in an amount equal to the beneficial interest to
be transferred or exchanged and (2) instructions
given by the Depositary to the Registrar containing
information regarding the Person in whose name such
Definitive Note shall be registered to effect the
transfer or exchange referred to in (1) above;
provided that (x) no transfer or exchange of a
beneficial interest in a Global Note for a Definitive
Note shall be effective under clause (B) hereof
unless permitted by Applicable Procedures of the
Depositary, (y) in no event shall Definitive Notes be
issued upon the transfer or exchange of beneficial
interests in the Regulation S Temporary Global Note
prior to (1) the expiration of the Restricted Period
and (2) the receipt by the Registrar of any
certificates required pursuant to Rule 903 under the
Securities Act and (z) beneficial interests in a
Global Note may be exchanged for Definitive Notes
only upon at least 20 days prior written notice given
to the Trustee by or on behalf of the Depositary in
accordance with Applicable Procedures. Upon an
Exchange Offer by the Company in accordance with
Section 2.6(f) hereof, the requirements of this
Section 2.6(b)(ii) shall be deemed to have been
satisfied upon receipt by the Registrar of the
instructions contained in the Letter of Transmittal
delivered by the Holder of such beneficial interests
in the Restricted Global Notes. Upon satisfaction of
all of the requirements for transfer or exchange of
beneficial interests in Global Notes contained in
this Indenture, the Trustee shall adjust the
principal amount of the relevant Global Note(s)
pursuant to Section 2.6(h) hereof.
15
(iii) Transfer of Beneficial Interests to Another
Restricted Global Note. A beneficial interest in any
Restricted Global Note may be transferred to a Person
who takes delivery thereof in the form of a
beneficial interest in another Restricted Global Note
if the transfer complies with the requirements of
clause (ii) above and the Registrar receives the
following:
(A) if the transferee will take delivery in the
form of a beneficial interest in the Rule
144A Global Note, then the transferor must
deliver a certificate in the form of Exhibit
B hereto, including the certifications in
Item (1) thereof; or
(B) if the transferee will take delivery in
the form of the Regulation S Temporary
Global Note or the Regulation S Permanent
Global Note, then the transferor must
deliver a certificate in the form of Exhibit
B hereto, including the certifications in
Item (2) thereof.
(iv) Transfer and Exchange of Beneficial Interests in
a Restricted Global Note for Beneficial Interests in
the Unrestricted Global Note. A beneficial interest
in any Restricted Global Note may be exchanged by any
holder thereof for a beneficial interest in an
Unrestricted Global Note or transferred to a Person
who takes delivery thereof in the form of a
beneficial interest in an Unrestricted Global Note if
the exchange or transfer complies with the
requirements of clause (ii) above and:
(A) such exchange or transfer is effected
pursuant to the Exchange Offer in accordance
with the Registration Rights Agreement and
the holder of the beneficial interest to be
transferred, in the case of an exchange, or
the transferee, in the case of a transfer,
is not (1) a broker-dealer, (2) a Person
participating in the distribution of the
Exchange Notes or (3) a Person who is an
affiliate (as defined in Rule 144) of the
Company;
(B) any such transfer is effected pursuant to
the Shelf Registration Statement in
accordance with the Registration Rights
Agreement;
(C) any such transfer is effected by a
Participating Broker-Dealer pursuant to the
Exchange Offer Registration Statement in
accordance with the Registration Rights
Agreement; or
(D) the Registrar receives the following:
(1) if the holder of such beneficial
interest in a Restricted Global
Note proposes to exchange such
beneficial interest for a
beneficial interest in an
Unrestricted Global Note, a
certificate from such holder in the
form of Exhibit C hereto, including
the certifications in Item (1)(a)
thereof;
16
(2) if the holder of such beneficial
interest in a Restricted Global
Note proposes to transfer such
beneficial interest to a Person who
shall take delivery thereof in the
form of a beneficial interest in an
Unrestricted Global Note, a
certificate from such holder in the
form of Exhibit B hereto, including
the certifications in Item (4)
thereof; and
(3) in each such case set forth in this
subparagraph (D), an Opinion of
Counsel in form reasonably
acceptable to the Company to the
effect that such exchange or
transfer is in compliance with the
Securities Act and that the
restrictions on transfer contained
herein and in the Private Placement
Legend are not required in order to
maintain compliance with the
Securities Act.
If any such transfer is effected pursuant to subparagraph (B) or (D)
above at a time when an Unrestricted Global Note has not yet been issued, the
Company shall issue and, upon receipt of an authentication order in accordance
with Section 2.2 hereof, the Trustee shall authenticate one or more Unrestricted
Global Notes in an aggregate principal amount equal to the principal amount of
beneficial interests transferred pursuant to subparagraph (B) or (D) above.
Beneficial interests in an Unrestricted Global Note cannot be exchanged
for, or transferred to Persons who take delivery thereof in the form of, a
beneficial interest in a Restricted Global Note.
(c) Transfer or Exchange of Beneficial Interests for Definitive
Notes.
(i) If any holder of a beneficial interest in a
Restricted Global Note proposes to exchange such
beneficial interest for a Definitive Note or to
transfer such beneficial interest to a Person who
takes delivery thereof in the form of a Definitive
Note, then, upon receipt by the Registrar of the
following documentation:
(A) if the holder of such beneficial interest in
a Restricted Global Note proposes to
exchange such beneficial interest for a
Restricted Definitive Note, a certificate
from such holder in the form of Exhibit C
hereto, including the certifications in Item
(2)(a) thereof;
(B) if such beneficial interest is being
transferred to a QIB in accordance with Rule
144A under the Securities Act, a certificate
to the effect set forth in Exhibit B hereto,
including the certifications in Item (1)
thereof;
(C) if such beneficial interest is being
transferred to a Non-U.S. Person in an
offshore transaction in accordance with Rule
903 or Rule 904 under the Securities Act, a
certificate to the effect set forth in
Exhibit B hereto, including the
certifications in Item (2) thereof;
17
(D) if such beneficial interest is being
transferred pursuant to an exemption from
the registration requirements of the
Securities Act in accordance with Rule 144
under the Securities Act, a certificate to
the effect set forth in Exhibit B hereto,
including the certifications in Item (3)(a)
thereof;
(E) if such beneficial interest is being
transferred to an Institutional Accredited
Investor or in reliance on any other
exemption from the registration requirements
of the Securities Act, in either case other
than those listed in subparagraphs (B)
through (D) above, then the transferor must
deliver a certificate in the form of Exhibit
B hereto, including the certifications,
certificates and Opinion of Counsel required
by Item (3) thereof, if applicable;
(F) if such beneficial interest is being
transferred to the Company or any of its
subsidiaries, a certificate to the effect
set forth in Exhibit B hereto, including the
certifications in Item (3)(b) thereof; or
(G) if such beneficial interest is being
transferred pursuant to an effective
registration statement under the Securities
Act, a certificate to the effect set forth
in Exhibit B hereto, including the
certifications in Item (3)(c) thereof,
the Trustee shall cause the aggregate principal
amount of the applicable Global Note to be reduced
accordingly pursuant to Section 2.6(h) hereof, and
the Company shall execute and the Trustee shall
authenticate and make available for delivery to the
Person designated in the instructions a Definitive
Note in the appropriate principal amount. Any
Definitive Note issued in exchange for a beneficial
interest in a Restricted Global Note pursuant to this
Section 2.6(c) shall be registered in such name or
names and in such authorized denomination or
denominations as the holder of such beneficial
interest shall instruct the Registrar through
instructions from the Depositary and the Participant
or Indirect Participant. The Trustee shall make
available for delivery such Definitive Notes to the
Persons in whose names such Notes are so registered.
Any Definitive Note issued in exchange for a
beneficial interest in a Restricted Global Note
pursuant to this Section 2.6(c)(i) shall bear the
Private Placement Legend and shall be subject to all
restrictions on transfer contained therein.
(ii) Notwithstanding Sections 2.6(c)(i)(A) and (C) hereof,
a beneficial interest in the Regulation S Temporary
Global Note may not be (A) exchanged for a Definitive
Note prior to the expiration of the Restricted Period
or (B) transferred to a Person who takes delivery
thereof in the form of a Definitive Note prior to the
conditions set forth in clause (A) above or unless
the transfer is pursuant to an exemption from the
registration requirements of the Securities Act other
than Rule 903 or Rule 904.
18
(iii) Notwithstanding 2.6(c)(i) hereof, a holder of a
beneficial interest in a Restricted Global Note may
exchange such beneficial interest for an Unrestricted
Definitive Note or may transfer such beneficial
interest to a Person who takes delivery thereof in
the form of an Unrestricted Definitive Note only if:
(A) such exchange or transfer is effected
pursuant to the Exchange Offer in accordance
with the Registration Rights Agreement and
the holder of such beneficial interest, in
the case of an exchange, or the transferee,
in the case of a transfer, is not (1) a
broker-dealer, (2) a Person participating in
the distribution of the Exchange Notes or
(3) a Person who is an affiliate (as defined
in Rule 144) of the Company;
(B) any such transfer is effected pursuant to
the Shelf Registration Statement in
accordance with the Registration Rights
Agreement;
(C) any such transfer is effected by a
Participating Broker-Dealer pursuant to the
Exchange Offer Registration Statement in
accordance with the Registration Rights
Agreement; or
(D) the Registrar receives the following:
(1) if the holder of such beneficial
interest in a Restricted Global
Note proposes to exchange such
beneficial interest for a
Definitive Note that does not bear
the Private Placement Legend, a
certificate from such holder in the
form of Exhibit C hereto, including
the certifications in Item (1)(b)
thereof;
(2) if the holder of such beneficial
interest in a Restricted Global
Note proposes to transfer such
beneficial interest to a Person who
shall take delivery thereof in the
form of a Definitive Note that does
not bear the Private Placement
Legend, a certificate from such
holder in the form of Exhibit B
hereto, including the
certifications in Item (4) thereof;
and
(3) in each such case set forth in this
subparagraph (D), an Opinion of
Counsel in form reasonably
acceptable to the Company, to the
effect that such exchange or
transfer is in compliance with the
Securities Act and that the
restrictions on transfer contained
herein and in the Private Placement
Legend are not required in order to
maintain compliance with the
Securities Act.
(iv) If any holder of a beneficial interest in an
Unrestricted Global Note proposes to exchange such
beneficial interest for a Definitive Note or to
19
transfer such beneficial interest to a Person who
takes delivery thereof in the form of a Definitive
Note, then, upon satisfaction of the conditions set
forth in Section 2.6(b)(ii) hereof, the Trustee shall
cause the aggregate principal amount of the
applicable Global Note to be reduced accordingly
pursuant to Section 2.6(h) hereof, and the Company
shall execute and the Trustee shall authenticate and
make available for delivery to the Person designated
in the instructions a Definitive Note in the
appropriate principal amount. Any Definitive Note
issued in exchange for a beneficial interest pursuant
to this Section 2.6(c)(iv) shall be registered in
such name or names and in such authorized
denomination or denominations as the holder of such
beneficial interest shall instruct the Registrar
through instructions from the Depositary and the
Participant or Indirect Participant. The Trustee
shall make available for delivery such Definitive
Notes to the Persons in whose names such Notes are so
registered. Any Definitive Note issued in exchange
for a beneficial interest pursuant to this Section
2.6(c)(iv) shall not bear the Private Placement
Legend. A beneficial interest in an Unrestricted
Global Note cannot be exchanged for a Definitive Note
bearing the Private Placement Legend or transferred
to a Person who takes delivery thereof in the form of
a Definitive Note bearing the Private Placement
Legend.
(d) Transfer and Exchange of Definitive Notes for Beneficial
Interests.
(i) If any Holder of a Restricted Definitive Note
proposes to exchange such Note for a beneficial
interest in a Restricted Global Note or to transfer
such Definitive Notes to a Person who takes delivery
thereof in the form of a beneficial interest in a
Restricted Global Note, then, upon receipt by the
Registrar of the following documentation:
(A) if the Holder of such Restricted Definitive
Note proposes to exchange such Note for a
beneficial interest in a Restricted Global
Note, a certificate from such Holder in the
form of Exhibit C hereto, including the
certifications in Item (2)(b) thereof;
(B) if such Definitive Note is being transferred
to a QIB in accordance with Rule 144A under
the Securities Act, a certificate to the
effect set forth in Exhibit B hereto,
including the certifications in Item (1)
thereof;
(C) if such Definitive Note is being transferred
to a Non-U.S. Person in an offshore
transaction in accordance with Rule 903 or
Rule 904 under the Securities Act, a
certificate to the effect set forth in
Exhibit B hereto, including the
certifications in Item (2) thereof;
(D) if such Definitive Note is being transferred
pursuant to an exemption from the
registration requirements of the Securities
Act in accordance with Rule 144 under the
Securities Act, a certificate
20
to the effect set forth in Exhibit B hereto,
including the certifications in Item (3)(a)
thereof;
(E) if such Definitive Note is being transferred
to an Institutional Accredited Investor or
in reliance on any other exemption from the
registration requirements of the Securities
Act, in either case other than those listed
in subparagraphs (B) through (D) above, a
certificate in the form of Exhibit B hereto,
including the certifications, certificates
and Opinion of Counsel required by Item (3)
thereof, if applicable;
(F) if such Definitive Note is being transferred
to the Company or any of its subsidiaries, a
certificate to the effect set forth in
Exhibit B hereto, including the
certifications in Item (3)(b) thereof; or
(G) if such Definitive Note is being transferred
pursuant to an effective registration
statement under the Securities Act, a
certificate to the effect set forth in
Exhibit B hereto, including the
certifications in Item (3)(c) thereof,
the Trustee shall cancel the Definitive Note,
increase or cause to be increased the aggregate
principal amount of, in the case of subparagraph (A)
above, the appropriate Restricted Global Note and, in
the case of subparagraph (B) above, the 144A Global
Note, and, in the case of subparagraph (C) above, the
Regulation S Global Note, and, in the case of
subparagraphs (D) through (G) above, the appropriate
Global Note.
(ii) A Holder of a Restricted Definitive Note may exchange
such Note for a beneficial interest in an
Unrestricted Global Note or transfer such Restricted
Definitive Note to a Person who takes delivery
thereof in the form of a beneficial interest in an
Unrestricted Global Note only if:
(A) such exchange or transfer is effected
pursuant to the Exchange Offer in accordance
with the Registration Rights Agreement and
the Holder, in the case of an exchange, or
the transferee, in the case of a transfer,
is not (1) a broker-dealer, (2) a Person
participating in the distribution of the
Exchange Notes or (3) a Person who is an
affiliate (as defined in Rule 144) of the
Company;
(B) any such transfer is effected pursuant to
the Shelf Registration Statement in
accordance with the Registration Rights
Agreement;
(C) any such transfer is effected by a
Participating Broker-Dealer pursuant to the
Exchange Offer Registration Statement in
accordance with the Registration Rights
Agreement; or
(D) the Registrar receives the following:
21
(1) if the Holder of such Definitive
Notes proposes to exchange such
Notes for a beneficial interest in
the Unrestricted Global Note, a
certificate from such Holder in the
form of Exhibit C hereto, including
the certifications in Item (1)(c)
thereof;
(2) if the Holder of such Definitive
Notes proposes to transfer such
Notes to a Person who shall take
delivery thereof in the form of a
beneficial interest in the
Unrestricted Global Note, a
certificate from such Holder in the
form of Exhibit B hereto, including
the certifications in Item (4)
thereof; and
(3) in each such case set forth in this
subparagraph (D), an Opinion of
Counsel in form reasonably
acceptable to the Company to the
effect that such exchange or
transfer is in compliance with the
Securities Act, that the
restrictions on transfer contained
herein and in the Private Placement
Legend are not required in order to
maintain compliance with the
Securities Act, and such Definitive
Notes are being exchanged or
transferred in compliance with any
applicable blue sky securities laws
of any State of the United States.
Upon satisfaction of the conditions of any of the
subparagraphs in this Section 2.6(d)(ii), the Trustee
shall cancel the Definitive Notes and increase or
cause to be increased the aggregate principal amount
of the Unrestricted Global Note.
(iii) A Holder of an Unrestricted Definitive Note may
exchange such Note for a beneficial interest in an
Unrestricted Global Note or transfer such Definitive
Notes to a Person who takes delivery thereof in the
form of a beneficial interest in an Unrestricted
Global Note at any time. Upon receipt of a request
for such an exchange or transfer, the Trustee shall
cancel the applicable Unrestricted Definitive Note
and increase or cause to be increased the aggregate
principal amount of one of the Unrestricted Global
Notes.
(iv) If any such exchange or transfer from a Definitive
Note to a beneficial interest is effected pursuant to
subparagraphs (ii)(B), (ii)(D) or (iii) above at a
time when an Unrestricted Global Note has not yet
been issued, the Company shall issue and, upon
receipt of an authentication order in accordance with
Section 2.2 hereof, the Trustee shall authenticate
one or more Unrestricted Global Notes in an aggregate
principal amount equal to the principal amount of
beneficial interests transferred pursuant to
subparagraphs (ii)(B), (ii)(D) or (iii) above.
22
(e) Transfer and Exchange of Definitive Notes for Definitive
Notes. Upon request by a Holder of Definitive Notes and such
Holder's compliance with the provisions of this Section
2.6(e), the Registrar shall register the transfer or exchange
of Definitive Notes. Prior to such registration of transfer or
exchange, the requesting Holder shall present or surrender to
the Registrar the Definitive Notes duly endorsed or
accompanied by a written instruction of transfer in form
satisfactory to the Registrar duly executed by such Holder or
by his attorney, duly authorized in writing. In addition, the
requesting Holder shall provide any additional certifications,
documents and information, as applicable, pursuant to the
provisions of this Section 2.6(e).
(i) Restricted Definitive Notes may be transferred to and
registered in the name of Persons who take delivery
thereof if the Registrar receives the following:
(A) if the transfer will be made pursuant to
Rule 144A under the Securities Act, then the
transferor must deliver a certificate in the
form of Exhibit B hereto, including the
certifications in Item (1) thereof;
(B) if the transfer will be made pursuant to
Rule 903 or Rule 904 of the Securities Act,
then the transferor must deliver a
certificate in the form of Exhibit B hereto,
including the certifications in Item (2)
thereof; and
(C) if the transfer will be made to an
Institutional Accredited Investor or
pursuant to any other exemption from the
registration requirements of the Securities
Act, then the transferor must deliver a
certificate in the form of Exhibit B hereto,
including the certifications, certificates
and Opinion of Counsel required by Item (3)
thereof, if applicable.
(ii) Any Restricted Definitive Note may be exchanged by
the Holder thereof for an Unrestricted Definitive
Note or transferred to a Person or Persons who take
delivery thereof in the form of an Unrestricted
Definitive Note if:
(A) such exchange or transfer is effected
pursuant to the Exchange Offer in accordance
with the Registration Rights Agreement and
the Holder, in the case of an exchange, or
the transferee, in the case of a transfer,
is not (1) a broker-dealer, (2) a Person
participating in the distribution of the
Exchange Notes or (3) a Person who is an
affiliate (as defined in Rule 144) of the
Company;
(B) any such transfer is effected pursuant to
the Shelf Registration Statement in
accordance with the Registration Rights
Agreement;
23
(C) any such transfer is effected by a
Participating Broker-Dealer pursuant to the
Exchange Offer Registration Statement in
accordance with the Registration Rights
Agreement; or
(D) the Registrar receives the following:
(1) if the Holder of such Restricted
Definitive Notes proposes to
exchange such Notes for an
Unrestricted Definitive Note, a
certificate from such Holder in the
form of Exhibit C hereto, including
the certifications in Item (1)(d)
thereof;
(2) if the Holder of such Restricted
Definitive Notes proposes to
transfer such Notes to a Person who
shall take delivery thereof in the
form of an Unrestricted Definitive
Note, a certificate from such
Holder in the form of Exhibit B
hereto, including the
certifications in Item (4) thereof;
and
(3) in each such case set forth in this
subparagraph (D), an Opinion of
Counsel in form reasonably
acceptable to the Company to the
effect that such exchange or
transfer is in compliance with the
Securities Act, that the
restrictions on transfer contained
herein and in the Private Placement
Legend are not required in order to
maintain compliance with the
Securities Act, and such Restricted
Definitive Note is being exchanged
or transferred in compliance with
any applicable blue sky securities
laws of any State of the United
States.
(iii) A Holder of Unrestricted Definitive Notes may
transfer such Notes to a Person who takes delivery
thereof in the form of an Unrestricted Definitive
Note. Upon receipt of a request for such a transfer,
the Registrar shall register the Unrestricted
Definitive Notes pursuant to the instructions from
the Holder thereof. Unrestricted Definitive Notes
cannot be exchanged for or transferred to Persons who
take delivery thereof in the form of a Restricted
Definitive Note.
(f) Exchange Offer. Upon the occurrence of the Exchange Offer in
accordance with the Registration Rights Agreement, the Company shall issue and,
upon receipt of (A) an authentication order in accordance with Section 2.2
hereof and (B) an Opinion of Counsel opining as to the enforceability of the
Exchange Notes, the Trustee shall authenticate (i) one or more Unrestricted
Global Notes in an aggregate principal amount equal to the principal amount of
the beneficial interests in the Restricted Global Notes tendered for acceptance
by persons that are not (x) broker-dealers, (y) Persons participating in the
distribution of the Exchange Notes or (z) Persons who are affiliates (as defined
in Rule 144) of the Company and accepted for exchange in the Exchange Offer or
(ii) Definitive Notes in an aggregate principal amount equal to the principal
amount of the Restricted Definitive Notes accepted for exchange in the Exchange
Offer. Concurrent with the issuance of such Notes, the Trustee shall cause the
aggregate
24
principal amount of the applicable Restricted Global Notes to be reduced
accordingly, and the Company shall execute and the Trustee shall authenticate
and make available for delivery to the Persons designated by the Holders of
Definitive Notes so accepted Definitive Notes in the appropriate principal
amount.
(g) Legends. The following legends shall appear on the face of all
Global Notes and Definitive Notes issued under this Indenture unless
specifically stated otherwise in the applicable provisions of this Indenture.
(i) Private Placement Legend.
(A) Except as permitted by subparagraph (B)
below, each Global Note and each Definitive
Note (and all Notes issued in exchange
therefor or substitution thereof) shall bear
the legend in substantially the following
form:
"THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES
ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR ANY STATE
SECURITIES LAWS. NEITHER THIS SECURITY NOR ANY INTEREST OR
PARTICIPATION HEREIN MAY BE REOFFERED, SOLD, ASSIGNED,
TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN
THE ABSENCE OF SUCH REGISTRATION OR UNLESS SUCH TRANSACTION IS
EXEMPT FROM, OR NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS
OF THE SECURITIES ACT AND ANY APPLICABLE STATE SECURITIES
LAWS. THE HOLDER OF THIS SECURITY BY ITS ACCEPTANCE HEREOF
AGREES (1) NOT TO OFFER, SELL OR OTHERWISE TRANSFER SUCH
SECURITY, PRIOR TO (X) THE DATE THAT IS TWO YEARS (OR SUCH
SHORTER PERIOD OF TIME AS PERMITTED BY RULE 144(k) UNDER THE
SECURITIES ACT OR ANY SUCCESSOR PROVISION THEREUNDER) AFTER
THE LATER OF THE ORIGINAL ISSUE DATE HEREOF (OR ANY
PREDECESSOR OF THIS SECURITY) AND THE LAST DAY ON WHICH
NATIONAL- OILWELL, INC. (THE "COMPANY") OR ANY AFFILIATE OF
THE COMPANY WAS THE OWNER OF THIS SECURITY (OR ANY PREDECESSOR
OF THIS SECURITY) AND (Y) SUCH LATER DATE, IF ANY, AS MAY BE
REQUIRED BY APPLICABLE LAWS (THE "RESALE RESTRICTION
TERMINATION DATE"), EXCEPT (A) TO THE COMPANY OR A SUBSIDIARY
THEREOF, (B) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT
UNDER THE SECURITIES ACT, (C) FOR SO LONG AS THIS SECURITY IS
ELIGIBLE FOR RESALE PURSUANT TO RULE 144A UNDER THE SECURITIES
ACT ("RULE 144A"), TO A PERSON IT REASONABLY BELIEVES IS A
"QUALIFIED INSTITUTIONAL BUYER" AS DEFINED IN RULE 144A THAT
IS ACQUIRING SUCH SECURITY FOR ITS OWN ACCOUNT OR FOR THE
ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICE IS
GIVEN THAT THE TRANSFER IS BEING MADE IN RELIANCE ON RULE
144A, (D) TO AN INSTITUTIONAL "ACCREDITED INVESTOR" (AS
DEFINED IN RULE
25
501(a)(1), (2), (3) OR (7) UNDER THE SECURITIES ACT) (AN
"INSTITUTIONAL ACCREDITED INVESTOR") THAT, PRIOR TO SUCH
TRANSFER, FURNISHES TO THE TRUSTEE A SIGNED LETTER CONTAINING
CERTAIN REPRESENTATIONS RELATING TO RESTRICTIONS ON TRANSFER
OF THE NOTE EVIDENCED HEREBY (THE FORM OF WHICH LETTER CAN BE
OBTAINED FROM THE TRUSTEE), (E) PURSUANT TO OFFERS AND SALES
TO NON-U.S. PERSONS THAT OCCUR IN AN "OFFSHORE TRANSACTION"
WITHIN THE MEANING OF REGULATION S UNDER THE SECURITIES ACT,
OR (F) PURSUANT TO ANOTHER AVAILABLE EXEMPTION FROM THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT, AND (2) THAT
IT WILL GIVE TO EACH PERSON TO WHOM THIS SECURITY IS
TRANSFERRED A NOTICE SUBSTANTIALLY TO THE EFFECT OF THIS
LEGEND; PROVIDED THAT THE COMPANY, THE TRUSTEE, THE TRANSFER
AGENT AND THE REGISTRAR SHALL HAVE THE RIGHT PRIOR TO ANY SUCH
OFFER, SALE OR TRANSFER (i) PURSUANT TO CLAUSE (C), (D), (E)
OR (F) TO REQUIRE THE DELIVERY OF AN OPINION OF COUNSEL,
CERTIFICATION AND/OR OTHER INFORMATION SATISFACTORY TO EACH OF
THEM, AND (ii) IN EACH OF THE FOREGOING CASES, TO REQUIRE THAT
A CERTIFICATE OF TRANSFER IN THE FORM APPEARING ON THIS
SECURITY IS COMPLETED AND DELIVERED BY THE TRANSFEROR TO THE
TRUSTEE. THIS LEGEND WILL BE REMOVED UPON THE REQUEST OF A
HOLDER AFTER THE RESALE RESTRICTION TERMINATION DATE. THE
HOLDER HEREOF, BY PURCHASING THIS NOTE, REPRESENTS AND AGREES
FOR THE BENEFIT OF THE COMPANY THAT IT IS (1) A QUALIFIED
INSTITUTIONAL BUYER WITHIN THE MEANING OF RULE 144A, (2) AN
INSTITUTIONAL ACCREDITED INVESTOR, (3) A NON-U.S. PERSON AND
IS ACQUIRING THE NOTE IN AN "OFFSHORE TRANSACTION" PURSUANT TO
REGULATION S UNDER THE SECURITIES ACT OR (4) IT IS A PERSON
ELIGIBLE TO BE TRANSFERRED THIS NOTE IN ACCORDANCE WITH CLAUSE
(F) OF THE FOREGOING SENTENCE. THIS LEGEND WILL BE REMOVED
UPON THE REQUEST OF THE HOLDER AFTER THE RESALE RESTRICTION
TERMINATION DATE. AS USED HEREIN, THE TERMS "OFFSHORE
TRANSACTION," "UNITED STATES" AND "U.S. PERSON" HAVE THE
MEANING GIVEN TO THEM BY REGULATION S UNDER THE SECURITIES
ACT."
(B) Notwithstanding the foregoing, any Global
Note or Definitive Note issued pursuant to
subparagraph (b)(iv), (c)(iii), (d)(ii),
(d)(iii), (e)(ii), (e)(iii) or (f) of this
Section 2.6 (and all Notes issued in
exchange therefore or substitution thereof)
shall not bear the Private Placement Legend.
(ii) Global Note Legend. Each Global Note shall bear a
legend in substantially the following form:
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"THIS GLOBAL NOTE IS HELD BY THE DEPOSITARY (AS DEFINED IN THE
INDENTURE GOVERNING THIS NOTE) OR ITS NOMINEE IN CUSTODY FOR
THE BENEFIT OF THE BENEFICIAL OWNERS HEREOF, AND IS NOT
TRANSFERABLE TO ANY PERSON UNDER ANY CIRCUMSTANCES EXCEPT THAT
(I) THE TRUSTEE MAY MAKE SUCH NOTATIONS HEREON AS MAY BE
REQUIRED PURSUANT TO ARTICLE 2 OF THE INDENTURE, (II) THIS
GLOBAL NOTE MAY BE EXCHANGED IN WHOLE BUT NOT IN PART PURSUANT
TO SECTION 2.6(a) OF THE INDENTURE, (III) THIS GLOBAL NOTE MAY
BE DELIVERED TO THE TRUSTEE FOR CANCELLATION PURSUANT TO
SECTION 2.11 OF THE INDENTURE AND (IV) THIS GLOBAL NOTE MAY BE
TRANSFERRED TO A SUCCESSOR DEPOSITARY WITH THE PRIOR WRITTEN
CONSENT OF THE COMPANY."
Additionally, for so long as DTC is the Depositary with respect to the
Global Note, such Global Note shall also bear a legend in substantially the
following form:
"UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE
OF THE DEPOSITARY (AS DEFINED IN THE INDENTURE GOVERNING THIS
NOTE), TO THE COMPANY OR ITS AGENT FOR REGISTRATION OF
TRANSFER, EXCHANGE, OR PAYMENT, AND ANY CERTIFICATE ISSUED IS
REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS
IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITARY
(AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY
AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITARY), 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."
(iii) Regulation S Temporary Global Note Legend. The
Regulation S Temporary Global Note shall bear a
legend in substantially the following form:
"THE RIGHTS ATTACHING TO THIS REGULATION S TEMPORARY GLOBAL
NOTE, AND THE CONDITIONS AND PROCEDURES GOVERNING ITS EXCHANGE
FOR CERTIFICATED NOTES, ARE AS SPECIFIED IN THE INDENTURE (AS
DEFINED HEREIN). NEITHER THE HOLDER NOR THE BENEFICIAL OWNERS
OF THIS REGULATION S TEMPORARY GLOBAL NOTE SHALL BE ENTITLED
TO RECEIVE PAYMENT OF INTEREST HEREON."
(h) Cancellation and/or Adjustment of Global Notes. At such time
as all beneficial interests in a particular Global Note have been exchanged for
Definitive Notes or a particular Global Note has been redeemed, repurchased or
canceled in whole and not in part, each such Global Note shall be returned to or
retained and canceled by the Trustee in accordance with
27
Section 2.11 hereof. At any time prior to such cancellation, if any beneficial
interest in a Global Note is exchanged for or transferred to a Person who will
take delivery thereof in the form of a beneficial interest in another Global
Note or for Definitive Notes, the principal amount of Notes represented by such
Global Note shall be reduced accordingly and an endorsement shall be made on
such Global Note, by the Trustee, the Note Custodian or the Depositary at the
direction of the Trustee, to reflect such reduction; and if the beneficial
interest is being exchanged for or transferred to a Person who will take
delivery thereof in the form of a beneficial interest in another Global Note,
such other Global Note shall be increased accordingly and an endorsement shall
be made on such Global Note, by the Trustee, the Note Custodian or by the
Depositary at the direction of the Trustee, to reflect such increase.
(i) General Provisions Relating to Transfers and Exchanges.
(i) To permit registrations of transfers and exchanges in
accordance with the other provisions of this
Indenture, the Company shall execute and the Trustee
shall authenticate Global Notes and Definitive Notes
upon the Company's order or at the Registrar's
request.
(ii) No service charge shall be made to a holder of a
beneficial interest in a Global Note or to a Holder
of a Definitive Note for any registration of transfer
or exchange, but the Company may require payment of a
sum sufficient to cover any transfer tax or similar
governmental charge payable in connection therewith
(other than any such transfer taxes or similar
governmental charge payable upon exchange or transfer
pursuant to Sections 2.10, 3.7 and 9.5 hereof).
(iii) The Registrar shall not be required to register the
transfer or exchange of any Note selected for
redemption in whole or in part, except the unredeemed
portion of any Note being redeemed in part.
(iv) All Global Notes and Definitive Notes issued upon any
registration of transfer or exchange of Global Notes
or Definitive Notes shall be the valid obligations of
the Company, evidencing the same debt, and entitled
to the same benefits under this Indenture, as the
Global Notes or Definitive Notes surrendered upon
such registration of transfer or exchange.
(v) The Company 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 mailing of a notice of redemption
of Notes for redemption under Section 3.3 hereof and
ending at the close of business on the day of such
mailing, (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 or (C) to register the
transfer of or to exchange a Note between a record
date and the next succeeding Interest Payment Date.
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(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 for all
other purposes, and none of the Trustee, any Agent or
the Company shall be affected by notice to the
contrary.
(vii) The Trustee shall authenticate Global Notes and
Definitive Notes in accordance with the provisions of
Section 2.2 hereof.
(viii) All certifications, certificates and Opinions of
Counsel required to be submitted to the Registrar
pursuant to this Section 2.6 to effect a transfer or
exchange may be submitted by facsimile.
(ix) Each Holder of a Note agrees to indemnify the Company
and the Trustee against any liability that may result
from the transfer, exchange or assignment of such
Holder's Note in violation of any provision of this
Indenture and/or applicable United States federal or
state securities law.
(x) The Trustee shall have no obligation or duty to
monitor, determine or inquire as to compliance with
any restrictions on transfer imposed under this
Indenture or under applicable law with respect to any
transfer of any interest in any Note (including any
transfers between or among Depositary participants or
beneficial owners of interests in any Global Note)
other than to require delivery of such certificates
and other documentation or evidence as are expressly
required by, and to do so if and when expressly
required by the terms of, this Indenture, and to
examine the same to determine substantial compliance
as to form with the express requirements hereof.
Section 2.7 REPLACEMENT NOTES
If any mutilated Note is surrendered to the Trustee or the Company and
the Trustee receives evidence to their 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. An indemnity bond must
be supplied by the Holder that is sufficient in the judgment of the Trustee and
the Company to protect the Company, the Trustee, any Agent and any
authenticating agent from any loss that any of them may suffer if a Note is
replaced. The Company may charge for its expenses in replacing a Note.
Every replacement Note is an additional obligation of the Company and
shall be entitled to all of the benefits of this Indenture equally and
proportionately with all other Notes duly issued hereunder.
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Section 2.8 OUTSTANDING NOTES
The Notes outstanding at any time are all the Notes authenticated by
the Trustee except for those canceled by it, those delivered to it for
cancellation, those reductions in the interest in a Global Note effected by the
Trustee in accordance with the provisions hereof, and those described in this
Section as not outstanding. Except as set forth in Section 2.9 hereof, a Note
does not cease to be outstanding because the Company or an Affiliate of the
Company holds the Note.
If a Note is replaced pursuant to Section 2.7 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 principal amount of any Note is considered paid under Section
4.1 hereof, it ceases to be outstanding and interest on it ceases to accrue. If
the Paying Agent (other than the Company, a Subsidiary or an Affiliate of any
thereof) holds, on a redemption date or maturity date, money sufficient to pay
Notes payable on that date, then on and after that date such Notes shall be
deemed to be no longer outstanding and shall cease to accrue interest.
Section 2.9 TREASURY NOTES
In determining whether the Holders of the required principal amount of
Notes have concurred in any direction, waiver or consent, Notes owned by the
Company, or by any Person directly or indirectly controlling or controlled by or
under direct or indirect common control with the Company, 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 Responsible Officer of the Trustee actually knows are so owned
shall be so disregarded.
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. 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 shall return such
canceled Notes 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.
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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 4.1 hereof. The Company shall promptly 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 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.
Section 2.13 CUSIP NUMBERS
The Company in issuing the Notes may use "CUSIP" numbers (if then
generally in use), and, if so, the Trustee shall use "CUSIP" numbers in notices
of redemption as a convenience to Holders; provided that any such notice may
state that no representation is made as to the correctness of such numbers
either as printed on the Notes or as contained in any notice of a redemption and
that reliance may be placed only on the other identification numbers printed on
the Notes, and any such redemption shall not be affected by any defect in or
omission of such numbers. The Company will promptly notify the Trustee of any
change in the "CUSIP" numbers.
ARTICLE III
REDEMPTION
Section 3.1 REDEMPTION AT THE OPTION OF THE COMPANY.
The Notes are redeemable prior to the Stated Maturity of principal, at
the option of the Company, at any time in whole or from time to time in part,
upon the delivery of the notices provided in Sections 3.2 and 3.4 hereof, on any
date prior to the Stated Maturity of principal selected by the Company (the
"Redemption Date") at a price equal to 100% of the principal amount thereof plus
accrued and unpaid interest, if any, to the Redemption Date (subject to the
right of Holders on the relevant record date to receive interest due on an
Interest Payment Date that is on or prior to the Redemption Date) plus the
Make-Whole Premium, if any (the "Redemption Price"). In no event will the
Redemption Price ever be less than 100% of the principal amount of the Notes
plus accrued interest to the Redemption Date.
Section 3.2 NOTICE TO THE TRUSTEE
If the Company elects to redeem Notes pursuant to this Article III, it
shall notify the Trustee of the Redemption Date and principal amount of the
Notes to be redeemed. The Company shall so notify the Trustee at least 45 days
before the Redemption Date (unless a shorter notice shall be satisfactory to the
Trustee) by delivering to the Trustee an Officers' Certificate stating that such
redemption will comply with the provisions of this Indenture and of the Notes.
31
Any such notice may be canceled at any time prior to the mailing of
such notice of such redemption to any Holder and shall thereupon be void and of
no effect.
Section 3.3 SELECTION OF NOTES TO BE REDEEMED
If less than all the Notes are to be redeemed, the particular Notes to
be redeemed shall be selected not more than 60 days prior to the Redemption Date
by the Trustee, from the outstanding Notes not previously called for redemption,
pro rata, by lot or by such other method as the Trustee shall deem fair and
appropriate and that may provide for the selection for redemption of portions
(equal to the minimum authorized denomination for Notes or any integral multiple
thereof) of the principal amount of Notes of a denomination larger than the
minimum authorized denomination or of the principal amount of Global Notes.
The Trustee shall promptly notify the Company and the Registrar in
writing of the Notes selected for redemption and, in the case of any Notes
selected for partial redemption, the principal amount thereof to be redeemed.
For purposes of this Indenture, unless the context otherwise requires,
all provisions relating to redemption of Notes shall relate, in the case of any
of the Notes redeemed or to be redeemed only in part, to the portion of the
principal amount thereof which has been or is to be redeemed.
Section 3.4 NOTICE OF REDEMPTION
Notice of redemption shall be given by first-class mail, postage
prepaid, mailed not less than 30 nor more than 60 days prior to the Redemption
Date, to each Holder of Notes to be redeemed, at the address of such Holder
appearing in the register of Notes maintained by the Registrar.
All notices of redemption shall identify the Notes to be redeemed
(including CUSIP numbers) and shall state:
(1) the Redemption Date;
(2) the Redemption Price (excluding the
amount of any Make-Whole Premium,
if any);
(3) that, unless the Company defaults
in making the redemption payment,
interest on Notes called for
redemption ceases to accrue on and
after the Redemption Date, and the
only remaining right of the Holders
of such Securities is to receive
payment of the Redemption Price
upon surrender to the Paying Agent
of the Notes redeemed;
(4) if any Note is to be redeemed in
part, the portion of the principal
amount thereof to be redeemed and
that on and after the Redemption
Date, upon surrender for
cancellation of such Note to the
Paying Agent, a new Note or Notes
in
32
the aggregate principal amount
equal to the unredeemed portion
thereof will be issued without
charge to the Holder;
(5) that Note called for redemption
must be surrendered to the Paying
Agent to collect the Redemption
Price and the name and address of
the Paying Agent; and
(6) the CUSIP number, if any, relating
to such Notes.
Notice of redemption of Notes to be redeemed at the election of the
Company shall be given by the Company or, at the Company's written request
delivered at least 15 days prior to the date of the mailing thereof (unless a
shorter period shall be acceptable to the Trustee), by the Trustee in the name
and at the expense of the Company.
Section 3.5 EFFECT OF NOTICE OF REDEMPTION
Once notice of redemption is mailed, Notes called for redemption become
due and payable on the Redemption Date and at the Redemption Price. Upon
surrender to the Paying Agent, such Notes called for redemption shall be paid at
the Redemption Price, but interest installments whose maturity is on or prior to
such Redemption Date will be payable on the day payment of such interest is due
to the Holders of record at the close of business on the relevant record dates
specified pursuant in Section 2.1 hereof and the Notes.
Section 3.6 DEPOSIT OF REDEMPTION PRICE
On or prior to 10:00 a.m., New York City time, on any Redemption Date,
the Company shall deposit with the Trustee or the Paying Agent (or, if the
Company is acting as its own Paying Agent, segregate and hold in trust as
provided in Section 2.4) an amount of money in same day funds sufficient to pay
the Redemption Price of, including (except if the Redemption Date shall be a
date interest is due under the Notes) accrued and unpaid interest if any, on,
the Notes or portions thereof which are to be redeemed on that date, other than
Notes or portions thereof called for redemption on that date which have been
delivered by the Company to the Trustee for cancellation.
If the Company complies with the preceding paragraph, then, unless the
Company defaults in the payment of such Redemption Price, interest on the Notes
to be redeemed will cease to accrue on and after the applicable Redemption Date,
whether or not such Notes are presented for payment, and the Holders of such
Notes shall have no further rights with respect to such Notes except for the
right to receive the Redemption Price upon surrender of such Notes. If any Notes
called for redemption shall not be so paid upon surrender thereof for
redemption, the principal, premium, if any, and, to the extent lawful, accrued
and unpaid interest thereon shall, until paid, bear interest from the Redemption
Date at the rate applicable to such Notes.
Section 3.7 NOTES REDEEMED OR PURCHASED IN PART
Upon surrender to the Paying Agent of a Note to be redeemed in part,
the Company shall execute and the Trustee shall authenticate and make available
for delivery to the Holder of such Note without service charge a new Note or
Notes, and of any authorized denomination as
33
requested by such Holder in aggregate principal amount equal to, and in exchange
for, the unredeemed portion of the principal of the Note so surrendered that is
not redeemed.
Section 3.8 PURCHASE OF NOTES
The Company and any Affiliate of the Company may at any time purchase
or otherwise acquire Notes in the open market or by private agreement. Such
acquisition shall not operate as or be deemed for any purpose to be a redemption
of the indebtedness represented by such Notes. Any Notes purchased or acquired
by the Company may be delivered to the Trustee and, upon such delivery, the
indebtedness represented thereby shall be deemed to be satisfied. Section 2.9
shall apply to all Notes so delivered.
ARTICLE IV
COVENANTS
Section 4.1 PAYMENT OF NOTES
The Company shall pay or cause to be paid the principal of, premium, if
any, and interest on, the Notes on the dates and in the manner provided in the
Notes and this Indenture. Principal and interest, 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 City Time on the due date
money deposited by the Company in immediately available funds and designated for
and sufficient to pay all principal, premium, if any, and interest then due. The
interest rate applicable to the Initial Notes entitled to the benefit of the
Registration Rights Agreement is subject to increase upon the occurrence of
certain events as provided in the Registration Rights Agreement.
The Company shall pay interest on overdue principal at the rate borne
on the Notes to the extent lawful; it shall pay on overdue installments of
interest (without regard to any applicable grace period) at the same rate to the
extent lawful.
Section 4.2 MAINTENANCE OF OFFICE OR AGENCY
The Company shall maintain in the Borough of Manhattan, the City of New
York, an office or agency (which may be an office of the Trustee or an affiliate
of the Trustee, Registrar or co-registrar) where Notes may be surrendered for
registration of transfer or for exchange and where notices and demands to or
upon the Company in respect of the Notes and this Indenture may be served. The
Company 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; provided,
however, that no such designation or rescission shall in any manner relieve the
Company of its obligation to maintain an office or agency in the Borough of
Manhattan, the City of New York for such purposes. The Company shall give
34
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 office of the Trustee at 101 Barclay
Street, Floor 21 West, New York, New York 10286, as one such office or agency of
the Company in accordance with Section 2.3 hereof.
Section 4.3 STATEMENT BY OFFICERS AS TO DEFAULT
The Company will deliver to the Trustee, within 120 days after the end
of each fiscal year of the Company ending after the date hereof, an Officers'
Certificate, stating whether or not to the knowledge of the signers thereof a
Default or Event of Default has occurred during that fiscal year, specifying all
such Defaults or Events of Defaults (as applicable) and the nature and status
thereof.
The Company shall deliver to the Trustee, as soon as possible and in
any event within five days after the Company becomes aware of the occurrence of
any Event of Default or Default, an Officers' Certificate setting forth the
details of such Event of Default or Default and the action which the Company
proposes to take with respect thereto.
Section 4.4 CORPORATE EXISTENCE
Subject to Article 5, the Company shall do or cause to be done all
things necessary to preserve and keep in full force and effect (i) its corporate
existence, and 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 and (ii) the rights (charter and statutory), licenses
and franchises of the Company and its Restricted Subsidiaries; provided,
however, that the Company shall not be required to preserve any such right,
license or franchise, or the corporate, partnership or other existence of any of
its 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, and that the loss
thereof is not adverse in any material respect to the Holders of the Notes.
Section 4.5 SEC REPORTS; FINANCIAL STATEMENTS
(a) The Company shall file with the Trustee, within 15 days after
it files the same with the SEC, copies of the annual reports and the
information, documents and other reports (or copies of such portions of any of
the foregoing) as the SEC may by rules and regulations prescribe that the
Company is required to file with the SEC pursuant to Section 13 or 15(d) of the
Exchange Act. The Company shall also comply with the provisions of TIA Section
314(a).
(b) If the Company is not subject to the requirements of Section
13 or 15(d) of the Exchange Act, the Company shall furnish to all Holders of the
Rule 144A Global Note or Holders that qualify as QIB's who have elected to take
physical delivery of a Restricted Definitive Note, and prospective purchasers
who are acquiring a Restricted Definitive Note or a beneficial interest in the
Rule 144A Global Note as a QIB in accordance with Rule 144A,
35
promptly upon their request, the information required to be delivered pursuant
to clause (d)(4) of Rule 144A.
(c) Delivery of such reports, information and documents to the
Trustee under this Section 4.5 is for informational purposes only and the
Trustee's receipt of such shall not constitute constructive notice of any
information contained therein or determinable from information contained
therein, including the Company's compliance with any of its covenants under this
Article IV (as to which the Trustee is entitled to rely exclusively on Officers'
Certificates).
Section 4.6 LIMITATION ON LIENS
So long as any of the Notes are outstanding, the Company shall not at
any time create, incur, issue, assume or guarantee, and shall not cause, suffer
or permit a Restricted Subsidiary to create, incur, issue, assume or guarantee,
any Secured Debt without making effective provision (and the Company covenants
that in such case it will make or cause to be made such effective provision)
whereby the Notes then outstanding and any other indebtedness of or guaranteed
by the Company or any Restricted Subsidiary then entitled thereto, subject to
applicable priorities of payment, shall be secured, by a Lien equally and
ratably with any and all other obligations and indebtedness thereby secured, so
long as such other obligations and indebtedness shall be so secured; provided,
that if any such Lien securing such Secured Debt ceases to exist, such equal and
ratable security for the benefit of the Holders of Notes shall automatically
cease to exist without any further action; provided, further, that if such
Secured Debt is expressly subordinated to the Notes, the Lien securing such
subordinated Secured Debt shall be subordinate and junior to the Lien securing
the Notes with the same relative priority as such Secured Debt shall have with
respect to the Notes; and provided further, that the foregoing covenants shall
not be applicable to the Secured Debt that is secured by Permitted Liens.
Notwithstanding the foregoing provisions of this Section 4.6, the
Company and its Restricted Subsidiaries may, without equally and ratably
securing the Notes, create, incur, issue, assume or guarantee Secured Debt not
otherwise permitted or excepted if the sum of (a) the amount of such Secured
Debt plus (b) the aggregate value of Sale and Leaseback Transactions (excluding
Sale and Leaseback Transactions identified in (a) through (d) of Section 4.7),
does not exceed 10% of Consolidated Net Tangible Assets (as shown in the
quarterly consolidated balance sheet of the Company most recently published
prior to the date of creation, incurrence, issuance, assumption or guarantee).
Section 4.7 LIMITATION ON SALE AND LEASEBACK TRANSACTIONS
The Company will not, nor will it permit any of its Restricted
Subsidiaries to, engage in a Sale and Leaseback Transaction, unless: (a) such
Sale and Leaseback Transaction occurs within one year from the date of
completion of the acquisition of the Principal Property subject thereto or the
date of the completion of construction, development or substantial repair or
improvements, or commencement of full operations, on such Principal Property,
whichever is later, (b) the Sale and Leaseback Transaction involves a lease for
a period, including renewals, of not more than three years, (c) the Company or
such Restricted Subsidiary would be entitled to incur Secured Debt secured by a
Lien on the Principal Property subject thereto in a principal amount equal to or
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exceeding the net sale proceeds from such Sale and Leaseback Transaction without
equally and ratably securing the Notes pursuant to Section 4.6, or (d) the
Company or such Restricted Subsidiary, within a one-year period after the Sale
and Leaseback Transaction, applies or causes to be applied an amount not less
than the net sale proceeds from such Sale and Leaseback Transaction to (i) the
redemption of the Notes or the prepayment, repayment, reduction or retirement of
any indebtedness of the Company that ranks pari passu with the Notes or (ii) the
expenditure or expenditures for Principal Property used or to be used in the
ordinary course of business of the Company or any of its Restricted
Subsidiaries.
Notwithstanding the foregoing, the Company may, and may permit each of
its Restricted Subsidiaries, to, effect any Sale and Leaseback Transaction that
is not excepted by clauses (a) through (d) (inclusive) of the above paragraph,
provided that, after giving effect thereto and the application of proceeds, if
any, received by the Company or any its Restricted Subsidiaries as a result
thereof, the net sale proceeds from such Sale and Leaseback Transaction,
together with the aggregate principal amount of all Secured Debt then
outstanding (other than the Notes) secured by Liens upon Principal Property
(which are not Permitted Liens) would not exceed 10% of the Consolidated Net
Tangible Assets (as shown in the quarterly consolidated balance sheet of the
Company most recently published prior to the date the Sale and Leaseback
Transaction is effected).
ARTICLE V
SUCCESSORS
Section 5.1 CONSOLIDATION, MERGER, OR SALE OF ASSETS
The Company may (a) consolidate with or merge into, or (b) sell,
convey, transfer, lease or otherwise dispose of its properties and assets
substantially as an entirety to, any Person, provided that (i) in the case of
any such consolidation or merger, the Company is the continuing entity or, if
the Company is not the continuing entity, the continuing entity (or, in the case
of such a sale, conveyance, transfer, lease or other disposition of the
Company's properties and assets substantially as an entirety, the Person to
which such sale, conveyance, transfer, lease or other disposition is made) is a
Person organized and validly existing under the laws of the United States, any
political subdivision thereof or any State thereof and assumes by supplemental
indenture all of the Company's obligations on the Notes and under the Indenture,
and (ii) after giving effect to the transaction no Event of Default, and no
event which, after notice or lapse of time or both, would become an Event of
Default, shall exist. Upon a disposition of assets described in clause (b) of
the preceding sentence, the Company will be released from any further liability
under the Notes and the Indenture.
Section 5.2 SUCCESSOR CORPORATION SUBSTITUTED
Upon any consolidation or merger, transfer or lease of its properties
and assets substantially as an entirety in accordance with Section 5.1 hereof,
the successor corporation formed by such consolidation with, or into which the
Company is merged or to which such conveyance, transfer or lease of its
properties and assets is made shall succeed to, and be substituted for (so that
from and after the date of such consolidation or merger, or conveyance transfer
or lease of its property and assets substantially as an entirety, the provisions
of this
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Indenture referring to the "Company" shall refer instead to the successor
corporation and not to the Company), and may exercise every right and power of
the Company under this Indenture with the same effect as if such successor
Person had been named as the Company herein.
ARTICLE VI
DEFAULTS AND REMEDIES
Section 6.1 EVENTS OF DEFAULT
An "Event of Default" occurs hereunder with respect to the Notes if:
(a) the Company defaults in the payment when due of principal of
or Make-Whole Premium, if any, on, the Notes;
(b) the Company defaults in payment when due of interest on the
Notes and such default continues for a period of 30 days;
(c) the Company or any of its Restricted Subsidiaries fails to
observe or perform any covenant of the Company (other than the covenants
described in clauses (a) or (b) above) in the Notes or this Indenture for 60
days after notice to the Company by the Trustee or the Holders of at least 25%
in aggregate principal amount of the Notes then outstanding;
(d) indebtedness of the Company or any Subsidiary is not paid when
due within the applicable grace period, if any, or is accelerated by the holders
thereof and, in either case, the principal amount of such unpaid or accelerated
indebtedness exceeds $20 million;
(e) the Company or any of its Significant Subsidiaries or any
group of Subsidiaries that, when taken together, would constitute a Significant
Subsidiary:
(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, or
(iv) makes a general assignment for the benefit of its
creditors;
(f) a court of competent jurisdiction enters an order or decree
under the Bankruptcy Code that:
(i) is for relief against the Company or any of its
Significant Subsidiaries or any group of Subsidiaries
that, when taken together, would constitute a
Significant Subsidiary, in an involuntary case;
(ii) appoints a Custodian of the Company or any of its
Significant Subsidiaries or any group of Subsidiaries
that, when taken together, would constitute a
Significant Subsidiary, or for all or substantially
all of the property of the
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Company or any group of Subsidiaries that, when taken
together, would constitute a Significant Subsidiary;
or
(iii) orders the liquidation of the Company or any of its
Significant Subsidiaries or any group of Subsidiaries
that, when taken together, would constitute a
Significant Subsidiary;
and the order or decree remains unstayed and in effect for 60 consecutive days.
Section 6.2 ACCELERATION
If any Event of Default (other than an Event of Default specified in
clauses (e) or (f) of Section 6.1) shall occur and be continuing, either the
Trustee or the Holders of at least 25% of the then outstanding Notes by notice
to the Company may declare the principal amount of the Notes to be due and
payable immediately. If an Event of Default specified in clauses (e) or (f) of
Section 6.1 shall occur, the principal amount of all the then outstanding Notes
will automatically, and without any action by the Trustee or any Holder, become
immediately due and payable. After any acceleration, but before a judgment or
decree for the payment of the money due has been obtained by the Trustee, the
Holders of a majority in aggregate principal amount of the then outstanding
Notes, by written notice to the Trustee, may rescind and annul such acceleration
and its consequences if all Events of Default, other than the non-payment of
accelerated principal, have been cured or waived pursuant to the terms of this
Indenture.
Section 6.3 OTHER REMEDIES
If an Event of Default occurs and is continuing, the Trustee may pursue
any available remedy to collect the payment of principal, premium, if any, and
accrued and unpaid interest, 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 6.4 WAIVER OF PAST DEFAULTS
The Holders of a majority in aggregate principal amount of the
outstanding Notes may on behalf of the Holders of all of the Notes waive any
past Default or Event of Default hereunder and its consequences, except a
Default:
(a) in the payment of the principal of or any premium or interest
on any Note, or
(b) in respect of any other covenant or provision hereof which,
under Section 9.2 hereof, cannot be modified or amended without the consent of
the Holder of each outstanding Note.
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Upon any such waiver, such Default or Event of Default shall cease to
exist and 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
Event of Default or impair any right consequent thereon.
Section 6.5 CONTROL BY MAJORITY
Subject to Section 7.2(f) hereof, Holders of a majority in principal
amount of the then outstanding Notes (together as a single class) 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 the
Trustee.
Section 6.6 LIMITATION ON SUITS
A Holder of a Note may institute any proceeding with respect to this
Indenture, or for the appointment of a receiver or a trustee, or for any other
remedy thereunder with respect to this Indenture or the Note only if:
(a) the Holder of a Note has previously given to the Trustee
written notice of a continuing Event of Default;
(b) the Holders of at least 25% in aggregate principal amount of
the Notes make a written request to the Trustee to institute a proceeding or
pursue a remedy as Trustee;
(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 to be incurred in compliance with such request;
(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 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 or to enforce any right under this Indenture, except in the
manner herein provided and for the equal and ratable benefit of all of such
Holders.
Section 6.7 RIGHTS OF HOLDERS OF NOTES TO RECEIVE PAYMENT AND INSTITUTE
PROCEEDINGS.
Notwithstanding any other provision of this Indenture, the right of any
Holder of a Note to receive payment of principal of, and premium, if any, and
interest on, the Note on or after the respective due dates expressed in the
Note, or to bring suit for the enforcement of any such payment on or after such
respective dates, shall not be impaired, affected or limited in any way
(including by any limitation set forth in Section 6.6 hereof) without the
consent of the Holder of each Note affected thereby.
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Section 6.8 COLLECTION SUIT BY TRUSTEE
If an Event of Default specified in Section 6.1(a) or (b) hereof 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, and premium, if any, and interest remaining unpaid on, the Notes
and interest on overdue principal and, to the extent lawful, interest and such
further amount as shall be sufficient to cover the costs and expenses of
collection, including the reasonable compensation, expenses, disbursements and
advances of the Trustee, its agents and counsel.
Section 6.9 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 7.7 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 7.7 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 any 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 7.7 hereof, including payment of all compensation, expense, and
liabilities incurred, and all advances made, by the Trustee and the costs and
expenses of collection;
Second: to Holders of the Notes for amounts due and unpaid on the Notes
for principal, premium, if any, and interest, ratably, without preference or
priority of any kind, according to the amounts due and payable on the Notes for
principal, premium, if any and interest, respectively; and
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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 cost of the suit, and the
court in its discretion may assess reasonable costs, including reasonable
attorneys' fees and expenses, against any party litigant in the suit, having due
regard to the merits and good faith of the claims or defenses made by the party
litigant. This Section does not apply to a suit by the Trustee, a suit by a
Holder of a Note pursuant to Section 6.7 hereof, or a suit by Holders of more
than 10% in principal amount of the then outstanding Notes.
ARTICLE VII
TRUSTEE
Section 7.1 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 Trustee need perform only those duties that are
specifically set forth in this Indenture and the TIA
and no others, and no implied covenants or
obligations shall be read into this Indenture against
the Trustee. To the extent of any conflict between
the duties of the Trustee hereunder and under the
TIA, the TIA shall control.
(ii) In the absence of bad faith on its part, the Trustee
may conclusively rely, as to the truth of the
statements and the correctness of the opinions
expressed therein, upon certificates or opinions
furnished to the Trustee and conforming to the
requirements of this Indenture. However, in the case
of any such certificates or opinions which by any
provision hereof are specifically required to be
furnished to the Trustee, the Trustee shall examine
the certificates and opinions to determine whether or
not they conform to the requirements of this
Indenture (but need not confirm or investigate the
accuracy of mathematical calculations or other facts
stated therein).
(c) The Trustee may not be relieved from liabilities for its own
negligent action, its own negligent failure to act, or its own willful
misconduct, except that:
42
(i) this paragraph does not limit the effect of paragraph
(b) of this Section;
(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 6.5 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.
(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 7.2 RIGHTS OF TRUSTEE
(a) The Trustee may conclusively rely upon any document (whether
in its original or facsimile form) 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 of its selection and the 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.
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(f) Subject to Section 7.1(b) hereof, 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 security or indemnity satisfactory to the
Trustee against the costs, expenses and liabilities (including fees and expenses
of its agents and counsel) that might be incurred by it in compliance with such
request or direction.
(g) The Trustee, in its individual or 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, including, without limitation, as a lender under the
Company's Senior Credit Facility;
(h) The Trustee shall not be deemed to have notice of any Default
or Event of Default unless a Responsible Officer of the Trustee has actual
knowledge thereof or unless written notice of any event which is in fact such a
default is received by the Trustee at the Corporate Trust Office of the Trustee,
and such notice references the Notes and this Indenture.
(i) The rights, privileges, protections, immunities and benefits
given to the Trustee, including, without limitation, its right to be
indemnified, are extended to, and shall be enforceable by, the Trustee in each
of its capacities hereunder.
Section 7.3 INDIVIDUAL RIGHTS OF TRUSTEE
The Trustee, any Paying Agent, any authenticating agent or registrar in
its individual or any other capacity may become the owner or pledgee of Notes
and may otherwise deal with the Company or any Affiliate of the Company with the
same rights it would have if it were not Trustee. However, in the event that the
Trustee acquires any conflicting interest it must eliminate such conflict within
90 days, apply to the SEC for permission to continue as trustee or resign. Any
Agent may do the same with like rights and duties. The Trustee is also subject
to Sections 7.10 and 7.11 hereof.
Section 7.4 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 7.5 NOTICE OF DEFAULTS
If a Default or Event of Default occurs and is continuing and if it is
actually known to a Responsible Officer of 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 interest or premium, if any, on any Note, the
44
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 7.6 REPORTS BY TRUSTEE TO HOLDERS OF THE NOTES
Within 60 days after each May 15 beginning with the May 15 next
following the date of this Indenture, and for so long as the 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 313(a) (but if no
event described in TIA Section 313(a) has occurred within the twelve months
preceding the reporting date, no report need be transmitted). The Trustee also
shall comply with TIA Section 313(b)(2). The Trustee shall also transmit by mail
all reports as required by TIA Section 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 Notes are listed in accordance
with TIA Section 313(d). The Company shall promptly notify the Trustee when the
Notes are listed on any stock exchange or delisted therefrom.
Section 7.7 COMPENSATION AND INDEMNITY
The Company shall pay to the Trustee from time to time such
compensation for its acceptance of this Indenture and services hereunder as the
parties shall agree from time to time. 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 shall indemnify the Trustee against any and all losses,
liabilities, claims, damages 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 7.7) and defending itself against any claim
(whether asserted by the Company 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, claim, damage or
expense may be attributable to its negligence or bad faith. 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 of
its 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 under this Section 7.7 shall survive the
satisfaction and discharge of this Indenture. To secure the Company's payment
obligations in this Section, the Trustee shall have a Lien prior to any of 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.
45
When the Trustee incurs expenses or renders services after an Event of
Default specified in Section 6.1(e) or (f) 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 the
Bankruptcy Code.
The Trustee shall comply with the provisions of TIA Section 313(b)(2)
to the extent applicable.
Section 7.8 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 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 the Bankruptcy Code;
(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 at least 10% in principal amount of the then outstanding Notes
may, at the expense of the Company, 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, at the expense of the Company, 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
46
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 7.7 hereof. Notwithstanding replacement of the
Trustee pursuant to this Section 7.8, the Company's obligations under Section
7.7 hereof shall continue for the benefit of the retiring Trustee.
Section 7.9 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.
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, or is the subsidiary of a bank holding company that
has, a combined capital and surplus of at least $50,000,000 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 310(a)(1), (2) and
(5). The Trustee is subject to TIA Section 310(b).
Section 7.11 PREFERENTIAL COLLECTION OF CLAIMS AGAINST COMPANY
The Trustee is subject to TIA Section 311(a), excluding any creditor
relationship listed in TIA Section 311(b). A Trustee who has resigned or been
removed shall be subject to TIA Section 311(a) to the extent indicated therein.
ARTICLE VIII
SATISFACTION AND DISCHARGE; DEFEASANCE
Section 8.1 SATISFACTION AND DISCHARGE OF INDENTURE
This Indenture shall upon delivery of a written request of an Officer
of the Company to the Trustee cease to be of further effect with respect to the
Notes (except as to any surviving rights of registration of transfer or exchange
of Notes herein expressly provided for), and the Trustee, at the expense of the
Company, shall execute proper instruments acknowledging satisfaction and
discharge of this Indenture with respect to the Notes, when
(a) either
(i) all such Notes theretofore authenticated and
delivered (other than (1) such Notes which have been
destroyed, lost or stolen and which have been
replaced or paid as provided in Section 2.7 and (2)
such Notes for whose payment money or Government
Securities have theretofore been deposited
47
in trust or segregated and held in trust by the
Company and thereafter repaid to the Company or
discharged from such trust, as provided in Section
8.9) have been delivered to the Trustee for
cancellation; or
(ii) all such Securities not theretofore delivered to the
Trustee for cancellation
(A) have become due and payable, or
(B) will become due and payable at their final
Stated Maturity within one year,
and the Company, in the case of (A) or (B) above, has deposited or
caused to be deposited with the Trustee as trust funds in trust for the purpose
an amount of money or Government Securities sufficient to pay and discharge the
entire indebtedness on such Notes not theretofore delivered to the Trustee for
cancellation, for principal and any premium and interest to the date of such
deposit (in the case of such Notes which have become due and payable) or to the
Stated Maturity of the principal of the Notes;
(b) the Company has paid or caused to be paid all other sums
payable hereunder by the Company with respect to such Notes; and
(c) the Company has delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel, each stating that all conditions
precedent herein provided for relating to the satisfaction and discharge of this
Indenture with respect to such Notes have been complied with.
Notwithstanding the satisfaction and discharge of this Indenture with
respect to the Notes, the obligations of the Company to the Trustee under
Section 7.7 hereof, and, if money or Government Securities shall have been
deposited with the Trustee pursuant to subclause (ii) of clause (b) of this
Section, the obligations of the Company or Trustee under Section 8.2 hereof and
Section 8.9 shall survive.
Section 8.2 APPLICATION OF TRUST MONEY
Subject to the provisions of Section 8.9, all money and Government
Securities deposited with the Trustee pursuant to Section 8.1 hereof shall be
held in trust and applied by it, in accordance with the provisions of the Notes
and this Indenture, to the payment, either directly or through any Paying Agent
(including the Company acting as its own Paying Agent) as the Trustee may
determine, to the Persons entitled thereto, of the principal and any premium and
interest for whose payment such money or Government Securities has been
deposited with the Trustee.
Section 8.3 OPTION TO EFFECT LEGAL DEFEASANCE OR COVENANT DEFEASANCE
The Company may, at the option of its Board of Directors evidenced by a
resolution set forth in an Officers' Certificate, at any time, elect to have
either Section 8.4 or 8.5 hereof be applied to all outstanding Notes, upon
compliance with the conditions set forth in this Article VIII.
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Section 8.4 DEFEASANCE AND DISCHARGE
In addition to discharge of the Indenture pursuant to Section 8.1
hereof, the Company shall be deemed to have paid and discharged the entire
indebtedness on all the Notes on the date of the deposit referred to in clause
(a) of Section 8.6 hereof, and the provisions of this Indenture with respect to
the Notes shall no longer be in effect, (except as to (1) the rights of Holders
of such Notes to receive, solely from the trust fund described in Section 8.6
hereof and as more fully set forth in such Section, payments in respect of the
principal of and any premium and interest on such Notes when payments are due
(other than by acceleration), (2) the Company's obligations with respect to such
Notes under Sections 2.4, 2.6, 2.7, 2.10, 4.2 and 8.9 hereof, and (3) the
rights, powers, trusts, obligations, duties and immunities of the Trustee
hereunder), and the Trustee, at the expense of the Company, upon written request
of an Officer of the Company, shall execute proper instruments acknowledging the
same, if the applicable conditions set forth in Section 8.6 hereof are satisfied
("Defeasance"). For this purpose, such Defeasance means that the Company (and
any other obligor of the Notes) shall be deemed to have paid and discharged the
entire indebtedness represented by the Notes, which shall thereafter be deemed
to be "Outstanding" only for the purposes of Section 8.7 hereof and the rights
and obligations referred to in clauses (1) through (3) (inclusive) of this
Section 8.4, and to have satisfied all its other obligations under such Notes
and this Indenture insofar as such Notes are concerned. Subject to compliance
with this Article, the Company may exercise its option (if any) to have this
Section applied to any Notes notwithstanding the prior exercise of its option
(if any) to have Section 8.5 hereof applied to such Notes.
Section 8.5 COVENANT DEFEASANCE
The Company shall be released on the date of the deposit referred to in
clause (a) of Section 8.6 hereof from its obligations under Sections 4.6, 4.7
and 5.1 hereof, inclusive, on and after the date the applicable conditions set
forth in Section 8.6 hereof are satisfied ("Covenant Defeasance"); and the
occurrence of any event specified in clause (c) of Section 6.1 hereof (with
respect to any of Sections 4.6, 4.7 and 5.1 hereof, inclusive), shall be deemed
not to be or result in an Event of Default, in each case with respect to the
Notes. For this purpose, such Covenant Defeasance means that, with respect to
the Notes (i) the Company may omit to comply with and shall have no liability in
respect of any term, condition or limitation set forth in any such specified
Section, whether directly or indirectly by reason of any reference elsewhere
herein to any such Section or by reason of any reference in any Section to any
other provision herein or in any other document and such omission to comply
shall not constitute a Default or Event of Default under Section 6.1 hereof,
but, except as specified above, the remainder of this Indenture and such Notes
shall be unaffected thereby, and (ii) such Notes shall thereafter be deemed to
be not "Outstanding" for the purposes of any request, demand, authorization,
direction, notice, waiver, consent or declaration or other action of Holders
(and the consequences of any therefor) in connection with such specified
covenants, but shall continue to be deemed Outstanding for all other purposes
hereunder.
Section 8.6 CONDITIONS TO DEFEASANCE OR COVENANT DEFEASANCE
The following shall be the applicable conditions to the application of
Section 8.4 or Section 8.5 hereof to any Notes, as the case may be:
49
(a) The Company shall irrevocably have deposited or caused to be
deposited with the Trustee (or another trustee which satisfies the requirements
contemplated by Section 7.10 hereof and agrees to comply with the provisions of
this Article applicable to it) as trust funds in trust for the purpose of making
the following payments, specifically pledged as security for, and dedicated
solely to, the benefits of the Holders of such Notes, (A) money in an amount, or
(B) Government Securities which through the scheduled payment of principal and
interest in respect thereof in accordance with their terms will provide, not
later than one day before the due date of any payment, money in an amount, or
(C) a combination thereof, in each case sufficient, in the opinion of a
nationally recognized firm of independent public accountants expressed in a
written certificate thereof delivered to the Trustee, to pay the principal of
and any premium and interest on such Notes on the Stated Maturity of the
principal of the Notes in accordance with the terms of this Indenture and such
Notes.
(b) In order to have Section 8.4 hereof apply to any Notes, as the
case may be, the Company shall have delivered to the Trustee an Opinion of
Counsel stating 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 (A) or (B) to the effect that, and based thereon such
opinion shall confirm that, the Holders of such Notes will not recognize gain or
loss for federal income tax purposes as a result of such deposit and Defeasance
and will be subject to federal income tax on the same amount, in the same manner
and at the same times as would have been the case if such deposit and Defeasance
had not occurred.
(c) In order to have Section 8.5 hereof apply to any Notes, as the
case may be, the Company shall have delivered to the Trustee an Opinion of
Counsel to the effect that the Holders of such Notes will not recognize gain or
loss for federal income tax purposes as a result of such deposit and Covenant
Defeasance and will be subject to federal income tax on the same amount, in the
same manner and at the same times as would have been the case if such deposit
and Covenant Defeasance had not occurred.
(d) No Default or Event of Default with respect to such Notes or
any other Notes shall have occurred and be continuing at the time of such
deposit or, with regard to any such event specified in clauses (e) of (f) of
Section 6.1 hereof, at any time on or prior to the 90th day after the date of
such deposit (it being understood that this condition shall not be deemed
satisfied with respect to such specified events until after such 90th day).
(e) Such Defeasance or Covenant Defeasance will not result in a
breach or violation of, or constitute a default under, any material agreement or
instrument (other than this Indenture) to which the Company or any of its
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 to the effect that on the 91st day following the deposit, the trust
funds will not be subject to avoidance under Section 547 of the Bankruptcy Code
or any successor provision thereof.
(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 of Notes
50
over the other creditors of the Company with the intent of defeating, hindering,
delaying or defrauding creditors of the Company or others.
(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 Defeasance or the Covenant Defeasance have
been complied with.
Section 8.7 DEPOSITED MONEY AND GOVERNMENT SECURITIES TO BE HELD IN TRUST;
OTHER MISCELLANEOUS PROVISIONS
Subject to Section 8.8 hereof, all money and Government Securities
(including the proceeds thereof) deposited with the Trustee or other qualifying
trustee (solely for purposes of this Section and Section 8.9 hereof, the Trustee
and any such other trustee are referred to collectively as the "Trustee")
pursuant to Section 8.6 hereof in respect of any 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 such Paying Agent
(including the Company acting as its own Paying Agent) as the Trustee may
determine, to the Holders of such Notes for the payment or redemption of which
such funds have been deposited with the Trustee, of all sums due and to become
due thereon in respect of principal and any premiums and interest, but money so
held in trust need not be segregated from other funds except to the extent
required by law.
Anything in this Article to the contrary notwithstanding, the Trustee
or the Paying Agent, as applicable, shall promptly return, deliver or pay to the
Company from time to time upon Company request any money or Government
Securities held by it as provided in Section 8.6 hereof with respect to any
Notes which, at any time, are in excess of the amount thereof which would then
be required to effect the Defeasance or Covenant Defeasance, as the case may be,
with respect to such Securities. The provisions of Section 8.8 hereof shall
apply to any money held by the Trustee or any Paying Agent under this Article
that remains unclaimed for two years after the Stated Maturity of the Notes for
which money or Government Securities have been deposited pursuant to Section 8.6
hereof.
The Company shall pay and indemnify the Trustee against any tax, fee or
other charge imposed on or assessed against the Government Securities deposited
pursuant to this Article 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 outstanding Notes.
Section 8.8 REPAYMENT TO COMPANY
Any money deposited with the Trustee or any Paying Agent, or then held
by the Company, in trust for the payment of the principal of, and premium and
interest, if any, on, any Note and remaining unclaimed for two years after such
principal, premium or interest has become due and payable shall be paid to the
Company on its written request or (if then held by the Company) shall be
discharged from such trust; and the Holder of such Note shall thereafter, as an
unsecured 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
51
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.
Section 8.9 REINSTATEMENT
If the Trustee or Paying Agent is unable to apply any U.S. dollars or
non-callable Government Securities in accordance with Section 8.4 or 8.5 hereof,
as the case may be, by reason of any order or judgment of any court or
governmental authority enjoining, restraining or otherwise prohibiting such
application, then the Company's obligations under this Indenture and the Notes
shall be revived and reinstated as though no deposit had occurred pursuant to
Section 8.4 or 8.5 hereof until such time as the Trustee or Paying Agent is
permitted to apply all such money in accordance with Section 8.4 or 8.5 hereof,
as the case may be; 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 IX
AMENDMENT, SUPPLEMENT AND WAIVER
Section 9.1 WITHOUT CONSENT OF HOLDERS OF NOTES
Notwithstanding Section 9.2 hereof, the Company and the Trustee may
amend or supplement this Indenture or the Notes without the consent of Holders
of the Notes:
(a) to cure any ambiguity, defect or inconsistency;
(b) to provide for uncertificated Notes in addition to or in place
of certificated Notes or to alter the provisions of Article 2 hereof (including
the related definitions) in a manner that does not materially adversely affect
any Holder;
(c) to provide for the assumption of the Company's obligations to
the Holders of any of the Notes in the case of a merger, consolidation or sale
of assets of the Company pursuant to Article 5 hereof;
(d) to make any change that would provide any additional rights or
benefits to the Holders of the Notes or that does not adversely affect the legal
rights hereunder of any such Holder in any material respect;
(e) to comply with requirements of the SEC in order to effect or
maintain the qualification of this Indenture under the TIA; or
(f) to allow any guarantor to guarantee the Notes.
52
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
9.6 hereof, the Trustee shall join with the Company 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,
liabilities or immunities under this Indenture or otherwise.
Section 9.2 WITH CONSENT OF HOLDERS OF NOTES
Except as provided below in this Section 9.2, the Company and the
Trustee may amend or supplement this Indenture and the Notes may be amended or
supplemented with the consent of the Holders of a majority in principal amount
of the Notes then outstanding (including, without limitation, consents obtained
in connection with a tender offer or exchange offer for the Notes), and, subject
to Sections 6.4 and 6.7 hereof, any existing Default or Event of Default (other
than a Default or Event of Default in the payment of the principal of, or
premium, if any, or interest on, the Notes, except a payment default resulting
from an acceleration that has been rescinded) 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
a Responsible Officer of the Trustee of the documents described in Section 9.6
hereof, the Trustee shall join with the Company in the execution of such amended
or supplemental Indenture. It shall not be necessary for the consent of the
Holders of Notes under this Section 9.2 to approve the particular form of any
proposed amendment 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 6.4 and 6.7 hereof, the Holders of a
majority in aggregate 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 or waiver may not (with respect to any Notes held by a nonconsenting
Holder):
(a) change the Stated Maturity of the principal of, or any
installment of principal of or interest on, any such Note;
(b) reduce the principal amount of, or any interest on, any such
Note;
53
(c) reduce the amount of principal of any such Note payable upon
acceleration of the Stated Maturity thereof;
(d) change the place or currency of payment of principal of, or
interest on, any such Note;
(e) impair the right to institute suit for the enforcement of any
payment on or with respect to any such Note;
(f) reduce the percentage in principal amount of such Notes, the
consent of whose Holders is required for modification or amendment of the
Indenture;
(g) reduce the percentage in principal amount of such Notes
necessary for waiver of compliance with certain provisions of the Indenture or
for waiver of certain defaults;
(h) modify such provisions with respect to modification and
waiver;
(i) waive, reduce or modify a Make-Whole Premium payable with
respect to any Note called for redemption; or
(j) make any change in Section 6.4 or 6.7 hereof or in the
foregoing amendment and waiver provisions.
Section 9.3 COMPLIANCE WITH TRUST INDENTURE ACT
If this Indenture shall be qualified under the TIA, 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 9.4 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 9.5 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.
54
Section 9.6 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 Trustee
may, but shall not be obligated to, enter into any such supplemental Indenture
which affects the Trustee's own rights, duties, liabilities or immunities under
this Indenture or otherwise. The Company may not sign an amended 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 7.1 hereof) 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.
Section 9.7 RECORD DATES
Except as otherwise provided in this Indenture or the Notes, the
Company will be entitled to set any day as a record date for the purpose of
determining the Holders of Notes entitled to give or take any direction, notice,
consent, waiver or other action under the Indenture. Pursuant to Section 6.10,
the Trustee also will be entitled to set a record date for certain payments to
Holders of Notes. If a record date is set for any action to be taken by Holders
of the Notes, such action may be taken only by persons who are Holders of the
Notes on the record date. To be effective, such action must be taken by Holders
of the requisite principal amount of the Notes within a specified period
following the record date. For any particular record date, this period will be
180 days or such shorter period as may be specified by the Company (or the
Trustee, if it sets the record date), and may be shortened or lengthened (but
not beyond 180 days) from time to time.
ARTICLE X
MISCELLANEOUS
Section 10.1 TRUST INDENTURE ACT CONTROLS
If any provision of this Indenture limits, qualifies or conflicts with
the duties imposed by TIA Section 318(c), the imposed duties shall control.
Section 10.2 NOTICES
Any notice or communication by the Company or the Trustee to the other
is duly given if in writing and delivered in Person or mailed by first class
mail (registered or certified, return receipt requested), telecopier or
overnight air courier guaranteeing next day delivery, to the others' address:
If to the Company:
National-Oilwell, Inc.
10000 Richmond Avenue
Houston, Texas 77042
Telecopier No.: (713) 346-7995
55
Attention: Chief Financial Officer
If to the Trustee:
The Bank of New York
101 Barclay Street, Floor 21 West
New York, New York 10286
Attention: Corporate Trust Trustee Administration
Telecopier No.: 212-815-5915
Ref: National-Oilwell, Inc.
The Company 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, postage prepaid, 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
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 10.3 COMMUNICATION BY HOLDERS OF NOTES WITH OTHER HOLDERS OF NOTES
Holders may communicate pursuant to TIA Section 312(b) with other
Holders with respect to their rights under this Indenture or the Notes. The
Company, the Trustee, the Registrar and anyone else shall have the protection of
TIA Section 312(c).
Section 10.4 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 10.5 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
56
(b) an Opinion of Counsel in form and substance reasonably
satisfactory to the Trustee (which shall include the statements set forth in
Section 10.5 hereof) stating that, in the opinion of such counsel, all such
conditions precedent and covenants have been satisfied.
Section 10.5 STATEMENTS REQUIRED IN CERTIFICATE OR OPINION
Each certificate or opinion with respect to compliance with a condition
or covenant provided for in this Indenture (other than a certificate provided
pursuant to TIA Section 314(a)(4)) shall comply with the provisions of TIA
Section 314(e) and shall include:
(a) a statement that the Person making such certificate 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 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 10.6 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 10.7 NO PERSONAL LIABILITY OF DIRECTORS, OFFICERS, EMPLOYEES AND
STOCKHOLDERS
No past, present or future director, officer, employee, incorporator,
partner, member or stockholder of the Company, or of any member, partner or
stockholder of any such entity, as such, shall have any liability for any
obligation of the Company under the Notes, 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. Such waiver
may not be effective to waive liabilities under the federal securities laws and
it is the view of the SEC that such a waiver is against public policy.
Section 10.8 GOVERNING LAW
THE INTERNAL LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO CONFLICTS
OF LAWS PRINCIPLES THEREOF, SHALL GOVERN AND BE USED TO CONSTRUE THIS INDENTURE
AND THE NOTES.
57
Section 10.9 NO ADVERSE INTERPRETATION OF OTHER AGREEMENTS
This Indenture may not be used to interpret any other indenture, loan
or debt agreement of the Company or its Subsidiaries or of any other Person. Any
such indenture, loan or debt agreement may not be used to interpret this
Indenture.
Section 10.10 SUCCESSORS
All agreements of the Company in this Indenture and the Notes shall
bind its successors. All agreements of the Trustee in this Indenture shall bind
its successors.
Section 10.11 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 10.12 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 10.13 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.
[Signatures Page(s) Follow]
58
SIGNATURES
Dated as of November 22, 2002
COMPANY:
NATIONAL-OILWELL, INC.
By: __________________
Name:_____________
Title:____________
TRUSTEE:
THE BANK OF NEW YORK
By: __________________
Name:_____________
Title:____________
EXHIBIT A-1
(FACE OF NOTE)
[Insert the Global Note Legend, if applicable, pursuant to the
provisions of the Indenture]
[Insert the Private Placement Legend, if applicable, pursuant
to the provisions of the Indenture]
CUSIP: _______________
5.65% SENIOR NOTES DUE 2012[, SERIES B]*
No.__________ $_______________
NATIONAL-OILWELL, INC
promises to pay to _________________ or registered assigns, the principal sum of
___________ Dollars on November 15, 2012
Interest Payment Dates: May 15 and November 15
Record Dates: May 1 and November 1
NATIONAL-OILWELL, INC.
By: __________________
Name:_____________
Title:____________
This is one of the [Global]
Notes referred to in the
within-mentioned Indenture:
The Bank of New York
as Trustee
By:________________________ Dated: ______________
Authorized Signatory
*This bracketed language should appear only in Exchange Notes
A1-1
(Back of Note)
5.65% Senior Notes due 2012[, Series B]*
Capitalized terms used herein shall have the meanings assigned to them
in the Indenture referred to below unless otherwise indicated.
1. INTEREST. National-Oilwell, Inc., a Delaware corporation (the
"Company"), promises to pay interest on the principal amount of this Note at
5.65% per annum, from __________________ until maturity [and shall pay any
additional interest payable on the principal amount of this Note pursuant to
Section 2.5 of the Registration Rights Agreement referred to below].(dagger) The
Company will pay interest semi-annually in arrears on each May 15 and November
15 following the date of issuance of this Note, or if any such day is not a
Business Day, on the next succeeding Business Day (each an "Interest Payment
Date"). Interest on the Notes will accrue from the most recent date to which
interest has been paid or, if no interest has been paid, from the date of
issuance; provided that if there is no existing Default in the payment of
interest, and if this Note is authenticated between a record date referred to on
the face hereof and the next succeeding Interest Payment Date, interest shall
accrue from such next succeeding Interest Payment Date; provided, further, that
the first Interest Payment Date shall be the Interest Payment Date next
following the date set forth in the first sentence of this paragraph. The
Company shall pay interest on overdue principal and premium, if any, from time
to time as provided in Section 2.12 of the Indenture at the rate borne on the
Notes; it shall pay interest on overdue installments of interest (without regard
to any applicable grace periods) from time to time as provided in Section 2.12
of the Indenture 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) 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 canceled after such record date and on or
before such Interest Payment Date, except as provided in Section 2.12 of the
Indenture with respect to defaulted interest or in Article III with respect to
redemption. The Notes will be payable as to principal, premium, if any, and
interest 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 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 and premium, if any, 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, The Bank of New York,
the Trustee under the Indenture, will act as Paying Agent and Registrar. The
Company may change any
- --------------------------
* This bracketed language should appear in Exchange Notes only.
(dagger) Omit this bracketed language in Exchange Notes.
A1-2
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 November 22, 2002 ("Indenture") between the Company and the Trustee.
The terms of the Notes include those stated in the Indenture and those made part
of the Indenture by reference to the Trust Indenture Act of 1939, as amended (15
U.S. Code Sections 77aaa-77bbbb). The Notes are subject to all such terms, and
Holders are referred to the Indenture and such Act for a statement of such
terms. To the extent any provision of this Note conflicts with the express
provisions of the Indenture, the provisions of the Indenture shall govern and be
controlling. The Notes are obligations of the Company initially limited to
$200,000,000 in aggregate principal amount, but the aggregate principal amount
may be increased as provided in the Indenture.
5. OPTIONAL REDEMPTION. The Notes are redeemable prior to their
final Stated Maturity, at the option of the Company, at any time in whole or
from time to time in part, on any date prior to their Stated Maturity selected
by the Company (the "Redemption Date") at a price equal to 100% of the principal
amount thereof plus accrued and unpaid interest, if any, to the Redemption Date
(subject to the right of Holders on the relevant record date to receive interest
due on an Interest Payment Date that is on or prior to the Redemption Date) plus
the Make-Whole Premium (as defined in the Indenture), if any (the "Redemption
Price"). In no event will the Redemption Price ever be less than 100% of the
principal amount of the Notes plus accrued interest to the Redemption Date.
6. MANDATORY REDEMPTION. The Company shall not be required to
make mandatory redemption payments with respect to the Notes.
7. 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.
8. 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
the mailing of a notice of redemption of Notes to be redeemed or during the
period between a record date and the corresponding Interest Payment Date.
9. PERSONS DEEMED OWNERS. The registered Holder of a Note may be
treated as its owner for all purposes.
A1-3
10. 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 or to
alter the provisions in Article 2 of the Indenture in a manner that does not
materially adversely affect any Holder, to provide for the assumption of the
Company's obligations to Holders of the Notes in case of a merger, consolidation
or sale of assets in accordance with Article 5 of the Indenture, to make any
change that would provide any additional rights or benefits to the Holders of
the Notes or that does not adversely affect the legal rights under the Indenture
of any such Holder in any material respect, to comply with the requirements of
the SEC in order to effect or maintain the qualification of the Indenture under
the TIA, or to allow any guarantor to guarantee the Notes.
11. DEFAULTS AND REMEDIES. Events of Default include: (a) default
in the payment when due of principal of, or Make-Whole Premium, if any, on, the
Notes; (b) default in the payment when due of interest on the Notes and such
default continues for a period of 30 days; (c) failure by the Company or any of
its Restricted Subsidiaries to observe or perform any other covenant (other than
the covenants described in (a) and (b) above) in the Indenture or the Notes for
60 days after notice to the Company by the Trustee or the Holders of at least
25% in aggregate principal amount of the Notes then outstanding; (d) failure by
the Company or any Subsidiary to pay indebtedness when due within the applicable
grace period, if any, or the acceleration of such indebtedness by the holders
thereof and, in either case, the principal amount of such unpaid or accelerated
indebtedness exceeds $20 million; or (e) certain events of bankruptcy or
insolvency with respect to the Company or any of its Significant Subsidiaries as
specified in Section 6.1 of the Indenture. 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 by notice to the Company may declare all the Notes to
be due and payable immediately. Notwithstanding the foregoing, in the case of an
Event of Default arising from certain events of bankruptcy or insolvency, the
principal amount of all then 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, premium, if any, 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 interest or premium, if any, on, or the principal of,
the Notes or in respect of any other covenant or provision of the Indenture
which, under Section 9.2 of the Indenture, cannot be modified without the
consent of the Holder of each outstanding Note. 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.
A1-4
12. 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.
13. NO RECOURSE AGAINST OTHERS. A director, officer, employee,
incorporator, partner, member or stockholder of the Company or any Subsidiary of
the Company, as such, shall not have any liability for any obligations of the
Company under the Notes, 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.
14. AUTHENTICATION. This Note shall not be valid until
authenticated by the manual signature of an authorized signatory of the Trustee
or an authenticating agent.
15. 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).
16. 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 CUSIP numbers will be used 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.
17. ADDITIONAL RIGHTS OF HOLDERS OF [RESTRICTED GLOBAL NOTES AND
RESTRICTED DEFINITIVE] NOTES. [In addition to the rights provided to Holders of
Notes under the Indenture, Holders of Restricted Global Notes and Restricted
Definitive Notes shall have all the rights set forth in the Registration Rights
Agreement dated as of November 22, 2002, between the Company and the parties
named on the signature pages thereof (the "Registration Rights
Agreement").](double dagger) The Company will furnish to any Holder upon written
request and without charge a copy of the Indenture [and/or the Registration
Rights Agreement.]Section Requests may be made to the principal office of the
Company, attention Chief Financial Officer.
- ------------------------
(double dagger) Omit this bracketed language in Exchange Notes.
Section Omit this bracketed language in Exchange Notes.
A1-5
ASSIGNMENT FORM
To assign this Note, fill in the form below: (I) or (we) assign and
transfer this Note to
________________________________________________________________________________
(Insert assignee's social security or tax identification number)
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(Print or type assignee's name, address and zip code)
and irrevocably appoint ___________________________________________ as agent
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
___________________________________
Signatures must be guaranteed by an
"eligible guarantor institution"
meeting the requirements of the
Registrar, which requirements
include membership or participation
in the Security Transfer Agent
Medallion Program ("STAMP") or such
other "signature guarantee program"
as may be determined by the
Registrar in addition to, or in
substitution for, STAMP, all in
accordance with the Securities
Exchange Act of 1934, as amended.
A1-6
SCHEDULE OF EXCHANGES OF INTERESTS IN THE GLOBAL
NOTE**
The following exchanges of a part of this Global Note for an interest
in another Note, or exchanges of a part of another Note for an interest in this
Global Note, have been made:
Amount of decrease in Amount of increase in Signature of
Principal Amount of Principal Amount of Principal Amount of authorized
this this this Global Note following signatory of
Date of Exchange Global Note Global Note such decrease (or increase) Note custodian
- ---------------- --------------------- --------------------- ---------------------------- --------------
- ------------------
**This should be included if the Note is a Global Note.
A1-7
EXHIBIT A-2
(FACE OF REGULATION S TEMPORARY GLOBAL NOTE)
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.
UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR NOTES IN DEFINITIVE
FORM, THIS NOTE MAY NOT BE TRANSFERRED EXCEPT AS A WHOLE BY THE DEPOSITARY TO A
NOMINEE OF THE DEPOSITARY OR BY A NOMINEE OF THE DEPOSITARY TO THE DEPOSITARY OR
ANOTHER NOMINEE OF THE DEPOSITARY OR BY THE DEPOSITARY OR ANY SUCH NOMINEE TO A
SUCCESSOR DEPOSITARY OR A NOMINEE OF SUCH SUCCESSOR DEPOSITARY. UNLESS THIS
CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST
COMPANY (55 WATER STREET, NEW YORK, NEW YORK) ("DTC"), TO THE COMPANY OR ITS
AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE
ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR SUCH OTHER NAME AS MAY BE
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO
CEDE & CO. OR SUCH OTHER ENTITY AS MAY BE REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED (THE "SECURITIES ACT"), OR ANY STATE SECURITIES LAWS. NEITHER THIS
SECURITY NOR ANY INTEREST OR PARTICIPATION HEREIN MAY BE REOFFERED, SOLD,
ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN THE
ABSENCE OF SUCH REGISTRATION OR UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT
SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND ANY
APPLICABLE STATE SECURITIES LAWS. THE HOLDER OF THIS SECURITY BY ITS ACCEPTANCE
HEREOF AGREES (1) NOT TO OFFER, SELL OR OTHERWISE TRANSFER SUCH SECURITY, PRIOR
TO (X) THE DATE THAT IS TWO YEARS (OR SUCH SHORTER PERIOD OF TIME AS PERMITTED
BY RULE 144(k) UNDER THE SECURITIES ACT OR ANY SUCCESSOR PROVISION THEREUNDER)
AFTER THE LATER OF THE ORIGINAL ISSUE DATE HEREOF (OR ANY PREDECESSOR OF THIS
SECURITY) AND THE LAST DAY ON WHICH NATIONAL-OILWELL, INC. (THE "COMPANY") OR
ANY AFFILIATE OF THE COMPANY WAS THE OWNER OF THIS SECURITY (OR ANY PREDECESSOR
OF THIS SECURITY) AND (Y) SUCH LATER DATE, IF ANY, AS MAY BE REQUIRED BY
APPLICABLE LAWS (THE "RESALE RESTRICTION TERMINATION DATE"), EXCEPT (A) TO THE
COMPANY OR A SUBSIDIARY THEREOF, (B) PURSUANT TO AN
A2-1
EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT, (C) FOR SO LONG AS
THIS SECURITY IS ELIGIBLE FOR RESALE PURSUANT TO RULE 144A UNDER THE SECURITIES
ACT ("RULE 144A"), TO A PERSON IT REASONABLY BELIEVES IS A "QUALIFIED
INSTITUTIONAL BUYER" AS DEFINED IN RULE 144A THAT IS ACQUIRING SUCH SECURITY FOR
ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO WHOM
NOTICE IS GIVEN THAT THE TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, (D) TO
AN INSTITUTIONAL "ACCREDITED INVESTOR" (AS DEFINED IN RULE 501(a)(1), (2), (3)
OR (7) UNDER THE SECURITIES ACT) (AN "INSTITUTIONAL ACCREDITED INVESTOR") THAT,
PRIOR TO SUCH TRANSFER, FURNISHES TO THE TRUSTEE A SIGNED LETTER CONTAINING
CERTAIN REPRESENTATIONS RELATING TO RESTRICTIONS ON TRANSFER OF THE NOTE
EVIDENCED HEREBY (THE FORM OF WHICH LETTER CAN BE OBTAINED FROM THE TRUSTEE),
(E) PURSUANT TO OFFERS AND SALES TO NON-U.S. PERSONS THAT OCCUR IN AN "OFFSHORE
TRANSACTION" WITHIN THE MEANING OF REGULATION UNDER THE SECURITIES ACT, OR (F)
PURSUANT TO ANOTHER AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF
THE SECURITIES ACT, AND (2) THAT IT WILL GIVE TO EACH PERSON TO WHOM THIS
SECURITY IS TRANSFERRED A NOTICE SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND;
PROVIDED THAT THE COMPANY, THE TRUSTEE, THE TRANSFER AGENT AND THE REGISTRAR
SHALL HAVE THE RIGHT PRIOR TO ANY SUCH OFFER, SALE OR TRANSFER (i) PURSUANT TO
CLAUSE (C), (D), (E) OR (F) TO REQUIRE THE DELIVERY OF AN OPINION OF COUNSEL,
CERTIFICATION AND/OR OTHER INFORMATION SATISFACTORY TO EACH OF THEM, AND (ii) IN
EACH OF THE FOREGOING CASES, TO REQUIRE THAT A CERTIFICATE OF TRANSFER IN THE
FORM APPEARING ON THIS SECURITY IS COMPLETED AND DELIVERED BY THE TRANSFEROR TO
THE TRUSTEE. THIS LEGEND WILL BE REMOVED UPON THE REQUEST OF A HOLDER AFTER THE
RESALE RESTRICTION TERMINATION DATE. THE HOLDER HEREOF, BY PURCHASING THIS NOTE,
REPRESENTS AND AGREES FOR THE BENEFIT OF THE COMPANY THAT IT IS (1) A QUALIFIED
INSTITUTIONAL BUYER WITHIN THE MEANING OF RULE 144A, (2) AN INSTITUTIONAL
ACCREDITED INVESTOR, (3) A NON-U.S. PERSON AND IS ACQUIRING THE NOTE IN AN
"OFFSHORE TRANSACTION" PURSUANT TO REGULATION S UNDER THE SECURITIES ACT OR (4)
IT IS A PERSON ELIGIBLE TO BE TRANSFERRED THIS NOTE IN ACCORDANCE WITH CLAUSE
(F) OF THE FOREGOING SENTENCE. THIS LEGEND WILL BE REMOVED UPON THE REQUEST OF
THE HOLDER AFTER THE RESALE RESTRICTION TERMINATION DATE. AS USED HEREIN, THE
TERMS "OFFSHORE TRANSACTION," "UNITED STATES" AND "U.S. PERSON" HAVE THE MEANING
GIVEN TO THEM BY REGULATION S UNDER THE SECURITIES ACT.
CUSIP/CINS: __________
5.65% SENIOR NOTES DUE 2012
No.__________ $__________
A2-2
NATIONAL-OILWELL, INC
promises to pay to _________________ or registered assigns, the principal sum of
___________ Dollars on November 15, 2012.
Interest Payment Dates: May 15 and November 15
Record Dates: May 1 and November 1
NATIONAL-OILWELL, INC.
By: __________________
Name:_____________
Title:____________
This is one of the [Global]
Notes referred to in the
within-mentioned Indenture:
The Bank of New York
as Trustee
By:_________________________ Dated: _______________
Authorized Signatory
A2-3
(BACK OF REGULATION S TEMPORARY GLOBAL NOTE)
5.65% SENIOR NOTES DUE 2012
Capitalized terms used herein shall have the meanings assigned to them
in the indenture referred to below unless otherwise indicated.
1. INTEREST. National-Oilwell, Inc., a Delaware corporation (the
"Company"), promises to pay interest on the principal amount of this Note at
5.65% per annum, from ___________ until maturity [and shall pay any additional
interest payable on the principal amount of this Note pursuant to Section 2.5 of
the Registration Rights Agreement referred to below.]* The Company will pay
interest semi-annually in arrears on each May 15 and November 15 following the
date of issuance of this Note, or if any such day is not a Business Day, on the
next succeeding Business Day (each an "Interest Payment Date"). Interest on the
Notes will accrue from the most recent date to which interest has been paid or,
if no interest has been paid, from the date of issuance; provided that if there
is no existing Default in the payment of interest, and if this Note is
authenticated between a record date referred to on the face hereof and the next
succeeding Interest Payment Date, interest shall accrue from such next
succeeding Interest Payment Date; provided, further, that the first Interest
Payment Date shall be the Interest Payment Date next following the date set
forth in the first sentence of this paragraph. The Company shall pay interest on
overdue principal and premium, if any, from time to time as provided in Section
2.2 of the Indenture at the rate borne on the Notes; it shall pay interest on
overdue installments of interest (without regard to any applicable grace
periods) from time to time as provided in Section 2.2 of the Indenture at the
same rate to the extent lawful. Interest will be computed on the basis of a
360-day year of twelve 30-day months.
Until this Regulation S Temporary Global Note is exchanged for one or
more Regulation S Permanent Global Notes, the Holder hereof shall not be
entitled to receive payments of interest hereon; until so exchanged in full,
this Regulation S Temporary Global Note shall in all other respects be entitled
to the same benefits as other Notes under the Indenture.
2. METHOD OF PAYMENT. The Company will pay interest on the Notes
(except defaulted interest) 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 canceled after such record date and on or
before such Interest Payment Date, except as provided in Section 2.12 of the
Indenture with respect to defaulted interest or in Article III with respect to
redemption. The Notes will be payable as to principal, premium, if any, and
interest 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 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 and premium, if any, 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.
- ----------------------------
* Omit this bracketed language if the Note is an Exchange Note.
A2-4
3. PAYING AGENT AND REGISTRAR. Initially, The Bank of New York,
the Trustee under the Indenture, will act as Paying Agent and Registrar. The
Company may change any Paying Agent or Registrar without notice to any Holder.
The Company or any of its Subsidiaries may act in any such capacity.
4. INDENTURE. The Company issued the Notes under an Indenture
dated as of November 22, 2002 (the "Indenture") between the Company and the
Trustee. The terms of the Notes include those stated in the Indenture and those
made part of the Indenture by reference to the Trust Indenture Act of 1939, as
amended (15 U.S. Code Sections 77aaa-77bbbb). The Notes are subject to all such
terms, and Holders are referred to the Indenture and such Act for a statement of
such terms. To the extent any provision of this Note conflicts with the express
provisions of the Indenture, the provisions of the Indenture shall govern and be
controlling. The Notes are obligations of the Company initially limited to
$200,000,000 in aggregate principal amount, but the aggregate principal amount
may be increased as provided in the Indenture.
5. OPTIONAL REDEMPTION. The Notes are redeemable prior to their
final Stated Maturity, at the option of the Company, at any time in whole or
from time to time in part, on any date prior to their Stated Maturity selected
by the Company (the "Redemption Date") at a price equal to 100% of the principal
amount thereof plus accrued and unpaid interest, if any, to the Redemption Date
(subject to the right of Holders on the relevant record date to receive interest
due on an Interest Payment Date that is on or prior to the Redemption Date) plus
the Make-Whole Premium (as defined in the Indenture), if any (the "Redemption
Price"). In no event will the Redemption Price ever be less than 100% of the
principal amount of the Notes plus accrued interest to the Redemption Date.
6. MANDATORY REDEMPTION. The Company shall not be required to
make mandatory redemption payments with respect to the Notes.
7. 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.
8. 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
the mailing of a notice of redemption of Notes to be redeemed or during the
period between a record date and the corresponding Interest Payment Date.
A2-5
This Regulation S Temporary Global Note is exchangeable in whole or in
part for one or more Global Notes only (i) on or after the termination of the
40-day restricted period (as defined in Regulation S) and (ii) upon presentation
of certificates (accompanied by an Opinion of Counsel, if applicable) required
by Article 2 of the Indenture. Upon exchange of this Regulation S Temporary
Global Note for one or more Global Notes, the Trustee shall cancel this
Regulation S Temporary Global Note.
9. PERSONS DEEMED OWNERS. The registered Holder of a Note may be
treated as its owner for all purposes.
10. 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 or to
alter the provisions in Article 2 of the Indenture in a manner that does not
materially adversely affect any Holder, to provide for the assumption of the
Company's obligations to Holders of the Notes in case of a merger, consolidation
or sale of assets in accordance with Article 5 of the Indenture, to make any
change that would provide any additional rights or benefits to the Holders of
the Notes or that does not adversely affect the legal rights under the Indenture
of any such Holder in any material respect, or to comply with the requirements
of the SEC in order to effect or maintain the qualification of the Indenture
under the TIA or to allow any guarantor to guarantee the Notes.
11. DEFAULTS AND REMEDIES. Events of Default include: (a) default
in the payment when due of principal of, or Make-Whole Premium, if any, on, the
Notes; (b) default in the payment when due of interest on the Notes and such
default continues for a period of 30 days; (c) failure by the Company or any of
its Restricted Subsidiaries to observe or perform any other covenant (other than
the covenants described in (a) and (b) above) in the Indenture or the Notes for
60 days after notice to the Company by the Trustee or the Holders of at least
25% in aggregate principal amount of the Notes then outstanding; (d) failure by
the Company or any Subsidiary to pay indebtedness when due within the applicable
grace period, if any, or the acceleration of such indebtedness by the holders
thereof and, in either case, the principal amount of such unpaid or accelerated
indebtedness exceeds $20 million; or (e) certain events of bankruptcy or
insolvency with respect to the Company or any of its Significant Subsidiaries as
specified in Section 6.1 of the Indenture. 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 by notice to the Company may declare all the Notes to
be due and payable immediately. Notwithstanding the foregoing, in the case of an
Event of Default arising from certain events of bankruptcy or insolvency, the
principal amount of all then 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,
A2-6
premium, if any, 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 interest or premium, if any, on, or the principal of, the
Notes or in respect of any other covenant or provision of the Indenture which,
under Section 9.2 of the Indenture, cannot be modified without the consent of
the Holder of each outstanding Note. 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.
12. 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.
13. NO RECOURSE AGAINST OTHERS. A director, officer, employee,
incorporator, partner, member or stockholder of the Company or any Subsidiary of
the Company, as such, shall not have any liability for any obligations of the
Company under the Notes, 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.
14. AUTHENTICATION. This Note shall not be valid until
authenticated by the manual signature of an authorized signatory of the Trustee
or an authenticating agent.
15. 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).
16. 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 CUSIP numbers will be used 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.
17. [ADDITIONAL RIGHTS OF HOLDERS OF RESTRICTED GLOBAL NOTES AND
RESTRICTED DEFINITIVE NOTES. In addition to the rights provided to Holders of
Notes under the Indenture, Holders of Restricted Global Notes and Restricted
Definitive Notes shall have all the rights set forth in the Registration Rights
Agreement dated as of November 22, 2002, between the Company and the parties
named on the signature pages thereof (the "Registration Rights Agreement").]
(dagger)
- ------------------------------
(dagger) Omit this bracketed language in the Exchange Notes.
A2-7
The Company will furnish to any Holder upon written request and without
charge a copy of the Indenture [and/or the Registration Rights
Agreement.](double dagger) Requests may be made to the principal office of the
Company, attention Chief Financial Officer.
- ------------------------
(double dagger) Omit this bracketed language in the Exchange Notes.
A2-8
ASSIGNMENT FORM
To assign this Note, fill in the form below: (I) or (we) assign and
transfer this Note to
________________________________________________________________________________
(Insert assignee's social security or tax identification number)
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(Print or type assignee's name, address and zip code)
and irrevocably appoint ___________________________________________ as agent 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
___________________________________
Signatures must be guaranteed by an
"eligible guarantor institution"
meeting the requirements of the
Registrar, which requirements
include membership or participation
in the Security Transfer Agent
Medallion Program ("STAMP") or such
other "signature guarantee program"
as may be determined by the
Registrar in addition to, or in
substitution for, STAMP, all in
accordance with the Securities
Exchange Act of 1934, as amended.
A2-9
SCHEDULE OF EXCHANGES OF INTERESTS IN THE GLOBAL
NOTE
The following exchanges of a part of this Regulation S Temporary Global
Note for an interest in another Note, or of other Restricted Notes for an
interest in this Regulation S Temporary Global Note, have been made:
Amount of decrease in Amount of increase in Principal Amount of Signature of
Principal Amount of Principal Amount of this Global Note following authorized signatory of
Date of Exchange this Global Note this Global Note such decrease (or increase) Note custodian
- ---------------- --------------------- --------------------- --------------------------- -----------------------
A2-10
EXHIBIT B
FORM OF CERTIFICATE OF TRANSFER
National-Oilwell, Inc.
10000 Richmond Avenue
Houston, Texas 77042
Telecopier No.:(713) _______________
Attention: Chief Financial Officer
The Bank of New York
101 Barclay Street, Floor 21 West
New York, New York 10286
Attention: Corporate Trust Trustee Administration
Re: 5.65% Senior Notes due 2012
Reference is hereby made to the Indenture, dated as of November 22,
2002 (the "Indenture"), between National-Oilwell, Inc., as issuer (the
"Company") and The Bank of New York, as trustee. Capitalized terms used but not
defined herein shall have the meanings given to them in the Indenture.
____________________, (the "Transferor") owns and proposes to transfer
the Note[s] or interest in such in such Note[s] specified in Annex A hereto, in
the principal amount of $__________ in such Note[s] or interests (the
"Transfer"), to ____________________ (the "Transferee"), as further specified in
Annex A hereto. In connection with the Transfer, the Transferor hereby certifies
that:
[CHECK ALL THAT APPLY]
1. [ ] CHECK IF TRANSFEREE WILL TAKE DELIVERY OF A BENEFICIAL
INTEREST IN THE RULE 144A GLOBAL NOTE OR A DEFINITIVE NOTE PURSUANT TO RULE
144A. The Transfer is being effected pursuant to and in accordance with Rule
144A under the United States Securities Act of 1933, as amended (the "Securities
Act"), and, accordingly, the Transferor hereby further certifies that the
beneficial interest or Definitive Note is being transferred to a Person that the
Transferor reasonably believed and believes is purchasing the beneficial
interest or Definitive Note for its own account, or for one or more accounts
with respect to which such Person exercises sole investment discretion, and such
Person and each such account is a "qualified institutional buyer" within the
meaning of Rule 144A in a transaction meeting the requirements of Rule 144A and
such Transfer is in compliance with any applicable blue sky securities laws of
any state of the United States. Upon consummation of the proposed Transfer in
accordance with the terms of the Indenture, the transferred beneficial interest
or Definitive Note will be subject to the restrictions on transfer enumerated in
the Private Placement Legend printed on the Rule 144A Global Note and/or the
Definitive Note and in the Indenture and the Securities Act.
B-1
2. [ ] CHECK IF TRANSFEREE WILL TAKE DELIVERY OF A BENEFICIAL
INTEREST IN THE REGULATION S TEMPORARY GLOBAL NOTE, THE REGULATION S PERMANENT
GLOBAL NOTE OR A DEFINITIVE NOTE PURSUANT TO REGULATION S. The Transfer is being
effected pursuant to and in accordance with Rule 903 or Rule 904 under the
Securities Act and, accordingly, the Transferor hereby further certifies that
(i) the Transfer is not being made to a person in the United States and (x) at
the time the buy order was originated, the Transferee was outside the United
States or such Transferor and any Person acting on its behalf reasonably
believed and believes that the Transferee was outside the United States or (y)
(1) for Transfers being effected in accordance with Rule 903, the transaction is
executed in, on or through a physical trading floor of an established foreign
securities exchange that is located outside the United States or (2) for
Transfers being effected in accordance with Rule 904, the transaction was
executed in, on or through the facilities of a designated offshore securities
market and neither such Transferor nor any Person acting on its behalf knows
that the transaction was prearranged with a buyer in the United States, (ii) no
directed selling efforts have been made in contravention of the requirements of
Rule 903(a) or Rule 904(a) of Regulation S under the Securities Act, (iii) the
transaction is not part of a plan or scheme to evade the registration
requirements of the Securities Act and (iv) if the proposed transfer is being
made prior to the expiration of the Restricted Period, the transfer is not being
made to a U.S. Person or for the account or benefit of a U.S. Person. Upon
consummation of the proposed transfer in accordance with the terms of the
Indenture, the transferred beneficial interest or Definitive Note will be
subject to the restrictions on Transfer enumerated in the Private Placement
Legend printed on the Regulation S Permanent Global Note, the Regulation S
Temporary Global Note and/or the Definitive Note and in the Indenture and the
Securities Act.
3. [ ] CHECK AND COMPLETE IF TRANSFEREE WILL TAKE DELIVERY OF A
DEFINITIVE NOTE PURSUANT TO ANY PROVISION OF THE SECURITIES ACT OTHER THAN RULE
144A OR REGULATION S. The Transfer is being effected in compliance with the
transfer restrictions applicable to beneficial interests in Restricted Global
Notes and Restricted Definitive Notes and pursuant to and in accordance with the
Securities Act and any applicable blue sky securities laws of any state of the
United States, and accordingly the Transferor hereby further certifies that
(check one):
(a) [ ] such Transfer is being effected pursuant to and
in accordance with Rule 144 under the Securities Act;
or
(b) [ ] such Transfer is being effected to the Company or
a subsidiary thereof;
or
(c) [ ] such Transfer is being effected pursuant to an
effective registration statement under the Securities Act and in compliance with
the prospectus delivery requirements of the Securities Act;
or
B-2
(d) [ ] such Transfer is being effected to an
Institutional Accredited Investor or pursuant to another exemption from the
registration requirements of the Securities Act other than Rule 144A, Rule 144,
Rule 903 or Rule 904 and the Transferor hereby certifies that the Transfer
complies with the transfer restrictions applicable to beneficial interests in a
Restricted Global Note or Restricted Definitive Notes and the requirements of
the exemption claimed, which certification is supported by (1) if the Transfer
is to an Institutional Accredited Investor, a certificate executed by the
Transferee in the form of Exhibit D to the Indenture and (2) an Opinion of
Counsel provided by the Transferor or the Transferee (a copy of which the
Transferor has attached to this certificate) to the effect that such Transfer is
in compliance with the Securities Act (provided that an Opinion of Counsel need
not be furnished in respect of Transfers of a principal amount of Notes of
$250,000 or more at the time of Transfer to an Institutional Accredited Investor
who furnishes the certificate set forth in (1) above). Upon consummation of the
proposed transfer in accordance with the terms of the Indenture, the transferred
beneficial interest or Definitive Note will be subject to the restrictions on
transfer enumerated in the Private Placement Legend printed on the Global Note
and/or the Definitive Notes and in the Indenture and the Securities Act.
4. [ ] CHECK IF TRANSFEREE WILL TAKE DELIVERY OF A BENEFICIAL
INTEREST IN AN UNRESTRICTED GLOBAL NOTE OR OF AN UNRESTRICTED DEFINITIVE NOTE.
(a) [ ] CHECK IF TRANSFER IS PURSUANT TO RULE 144. (i)
The Transfer is being effected pursuant to and in accordance with Rule 144 under
the Securities Act and in compliance with the transfer restrictions contained in
the Indenture and any applicable blue sky securities laws of any state of the
United States and (ii) the restrictions on transfer contained in the Indenture
and the Private Placement Legend are not required in order to maintain
compliance with the Securities Act. Upon consummation of the proposed Transfer
in accordance with the terms of the Indenture, the transferred beneficial
interest or Definitive Note will no longer be subject to the restrictions on
transfer enumerated in the Private Placement Legend printed on the Restricted
Global Notes, on Restricted Definitive Notes and in the Indenture.
(b) [ ] CHECK IF TRANSFER IS PURSUANT TO REGULATION S.
(i) The transfer is being effected pursuant to and in accordance with Rule 903
or Rule 904 under the Securities Act and in compliance with the transfer
restrictions contained in the Indenture and any applicable blue sky securities
laws of any state of the United States and (ii) the restrictions on transfer
contained in the Indenture and the Private Placement Legend are not required in
order to maintain compliance with the Securities Act. Upon consummation of the
proposed Transfer in accordance with the terms of the Indenture, the transferred
beneficial interest or Definitive Note will no longer be subject to the
restrictions on transfer enumerated in the Private Placement Legend printed on
the Restricted Global Notes, on Restricted Definitive Notes and in the
Indenture.
(c) [ ] CHECK IF TRANSFER IS PURSUANT TO OTHER EXEMPTION.
(i) The Transfer is being effected pursuant to and in compliance with an
exemption from the registration requirements of the Securities Act other than
Rule 144, Rule 903 or Rule 904 and in compliance with the transfer restrictions
contained in the Indenture and any applicable blue sky
B-3
securities laws of any State of the United States and (ii) the restrictions on
transfer contained in the Indenture and the Private Placement Legend are not
required in order to maintain compliance with the Securities Act. Upon
consummation of the proposed Transfer in accordance with the terms of the
Indenture, the transferred beneficial interest or Definitive Note will not be
subject to the restrictions on transfer enumerated in the Private Placement
Legend printed on the Restricted Global Notes or Restricted Definitive Notes and
in the Indenture.
This certificate and the statements contained herein are made for your
benefit and the benefit of the Company.
___________________________________
(Insert Name of Transferor)
By: _______________________________
Name:__________________________
Title:_________________________
B-4
ANNEX A TO CERTIFICATE OF TRANSFER
1. The Transferor owns and proposes to transfer the following:
[CHECK ONE OF (a) OR (b)]
(a) a beneficial interest in the:
(i) [ ] 144A Global Note (CUSIP __________), or
(ii) [ ] Regulation S Global Note (CUSIP _________); or
(b) [ ] a Restricted Definitive Note
2. After the Transfer the Transferee will hold:
[CHECK ONE]
(a) a beneficial interest in the:
(i) [ ] 144A Global Note (CUSIP __________), or
(ii) [ ] Regulation S Global Note (CUSIP __________), or
(iii) [ ] Unrestricted Global Note (CUSIP __________); or
(b) [ ] a Restricted Definitive Note
(c) [ ] an Unrestricted Definitive Note,
in accordance with the terms of the Indenture.
B-5
EXHIBIT C
FORM OF CERTIFICATE OF EXCHANGE
National-Oilwell, Inc.
10000 Richmond Avenue
Houston, Texas 77042
Telecopier No.:(713) _______________
Attention: Chief Financial Officer
The Bank of New York
101 Barclay Street, Floor 21 West
New York, New York 10286
Attention: Corporate Trust Trustee Administration
Re: 5.65% Senior Notes due 2012
Reference is hereby made to the Indenture, dated as November 22, 2002
(the "Indenture"), between National-Oilwell, Inc., as issuer (the "Company"),
and The Bank of New York, as trustee. Capitalized terms used but not defined
herein shall have the meanings given to them in the Indenture. _________________
(the "Owner") owns and proposes to exchange the Note[s] or interest in such
Note[s] in an exchange transaction specified herein, in the principal amount of
$__________ in such Note[s] or interests (the "Exchange"). In connection with
the Exchange, the Owner hereby certifies that:
1. EXCHANGE OF RESTRICTED DEFINITIVE NOTES OR BENEFICIAL
INTERESTS IN A RESTRICTED GLOBAL NOTE FOR UNRESTRICTED DEFINITIVE NOTES OR
BENEFICIAL INTERESTS IN AN UNRESTRICTED GLOBAL NOTE.
(a) [ ] CHECK IF EXCHANGE IS FROM BENEFICIAL INTEREST IN
A RESTRICTED GLOBAL NOTE TO BENEFICIAL INTEREST IN AN UNRESTRICTED GLOBAL NOTE.
In connection with the Exchange of the Owner's beneficial interest in a
Restricted Global Note for a beneficial interest in an Unrestricted Global Note
in an equal principal amount, the Owner hereby certifies (i) the beneficial
interest is being acquired for the Owner's own account without transfer, (ii)
such Exchange has been effected in compliance with the transfer restrictions
applicable to the Global Notes and pursuant to and in accordance with the United
States Securities Act of 1933, as amended (the "Securities Act"), (iii) the
restrictions on transfer contained in the Indenture and the Private Placement
Legend are not required in order to maintain compliance with the Securities Act
and (iv) the beneficial interest in an Unrestricted Global Note is being
acquired in compliance with any applicable blue sky securities laws of any state
of the United States.
(b) [ ] CHECK IF EXCHANGE IS FROM BENEFICIAL INTEREST IN
A RESTRICTED GLOBAL NOTE TO UNRESTRICTED DEFINITIVE NOTE. In connection with the
Exchange of the Owner's beneficial interest in a Restricted Global Note for an
Unrestricted Definitive Note, the Owner hereby certifies (i) the Definitive Note
is being acquired
C-1
for the Owner's own account without transfer, (ii) such Exchange has been
effected in compliance with the transfer restrictions applicable to the
Restricted Global Notes and pursuant to and in accordance with the Securities
Act, (iii) the restrictions on transfer contained in the Indenture and the
Private Placement Legend are not required in order to maintain compliance with
the Securities Act and (iv) the Definitive Note is being acquired in compliance
with any applicable blue sky securities laws of any state of the United States.
(c) [ ] CHECK IF EXCHANGE IS FROM RESTRICTED DEFINITIVE
NOTE TO BENEFICIAL INTEREST IN AN UNRESTRICTED GLOBAL NOTE. In connection with
the Owner's Exchange of a Restricted Definitive Note for a beneficiary interest
in an Unrestricted Global Note, the Owner hereby certifies (i) the beneficial
interest is being acquired for the Owner's own account without transfer, (ii)
such Exchange has been effected in compliance with the transfer restrictions
applicable to Restricted Definitive Notes and pursuant to and in accordance with
the Securities Act, (iii) the restrictions on transfer contained in the
Indenture and the Private Placement Legend are not required in order to maintain
compliance with the Securities Act and (iv) the beneficial interest is being
acquired in compliance with any applicable blue sky securities laws of any state
of the United States.
(d) [ ] CHECK IF EXCHANGE IS FROM RESTRICTED DEFINITIVE
NOTE TO UNRESTRICTED DEFINITIVE NOTE. In connection with the Owner's Exchange of
a Restricted Definitive Note for an Unrestricted Definitive Note, the Owner
hereby certifies (i) the Unrestricted Definitive Note is being acquired for the
Owner's own account without transfer, (ii) such Exchange has been effected in
compliance with the transfer restrictions applicable to Restricted Definitive
Notes and pursuant to and in accordance with the Securities Act, (iii) the
restrictions on transfer contained in the Indenture and the Private Placement
Legend are not required in order to maintain compliance with the Securities Act
and (iv) the Unrestricted Definitive Note is being acquired in compliance with
any applicable blue sky securities laws of any state of the United States.
2. EXCHANGE OF RESTRICTED DEFINITIVE NOTES OR BENEFICIAL
INTERESTS IN RESTRICTED GLOBAL NOTES FOR RESTRICTED DEFINITIVE NOTES OR
BENEFICIAL INTERESTS IN RESTRICTED GLOBAL NOTES.
(a) [ ] CHECK IF EXCHANGE IS FROM BENEFICIAL INTEREST IN
A RESTRICTED GLOBAL NOTE TO RESTRICTED DEFINITIVE NOTE. In connection with the
Exchange of the Owner's beneficial interest in a Restricted Global Note for a
Restricted Definitive Note with an equal principal amount, the Owner hereby
certifies that the Restricted Definitive Note is being acquired for the Owner's
own account without transfer. Upon consummation of the proposed Exchange in
accordance with the terms of the Indenture, the Restricted Definitive Note
issued will continue to be subject to the restrictions on transfer enumerated in
the Private Placement Legend printed on the Restricted Definitive Note and in
the Indenture and the Securities Act.
C-2
(b) [ ] CHECK IF EXCHANGE IS FROM RESTRICTED DEFINITIVE
NOTE TO BENEFICIAL INTEREST IN A RESTRICTED GLOBAL NOTE. In connection with the
Exchange of the Owner's Restricted Definitive Note for a beneficial interest in
the
[CHECK ONE]
[ ] 144A Global Note [ ] Regulation S Global Note
with an equal principal amount, the Owner hereby certifies (i) the beneficial
interest is being acquired for the Owner's own account without transfer and (ii)
such Exchange has been effected in compliance with the transfer restrictions
applicable to the Restricted Global Notes and pursuant to and in accordance with
the Securities Act, and in compliance with any applicable blue sky securities
laws of any state of the United States. Upon consummation of the proposed
Exchange in accordance with the terms of the Indenture, the beneficial interest
issued will be subject to the restrictions on transfer enumerated in the Private
Placement Legend printed on the relevant Restricted Global Note and in the
Indenture and the Securities Act.
This certificate and the statements contained herein are made for your
benefit and the benefit of the Company.
___________________________________
(Insert Name of Owner)
By: _______________________________
Name:__________________________
Title:_________________________
C-3
EXHIBIT D
FORM OF CERTIFICATE FROM ACQUIRING INSTITUTIONAL
ACCREDITED INVESTOR
National-Oilwell, Inc.
10000 Richmond Avenue
Houston, Texas 77042
Telecopier No.:(713) ____________
Attention: Chief Financial Officer
The Bank of New York
101 Barclay Street, Floor 21 West
New York, New York 10286
Attention: Corporate Trust Trustee Administration
Re: National-Oilwell, Inc. 5.65% Senior Notes due 2012
Reference is hereby made to the Indenture, dated as of November 22,
2002 (the "Indenture"), between National-Oilwell, Inc., as issuer (the
"Company") and The Bank of New York, as trustee. Capitalized terms used but not
defined herein shall have the meanings given to them in the Indenture.
In connection with our proposed purchase of $___________ aggregate
principal amount of:
(a) [ ] a beneficial interest in a Global Note, or
(b) [ ] a Definitive Note,
we confirm that:
1. we 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");
2. (A) any purchase of the Notes by us will be for our own
account or for the account of one or more other institutional
accredited investors or as fiduciary for the account of one or
more trusts, each of which is an "accredited investor" within
the meaning of Rule 501(a)(7) under the Securities Act and for
each of which we exercise sole investment discretion or (B) we
are a "bank," within the meaning of Section 3(a)(2) of the
Securities Act, or a "savings and loan association" or other
institution described in Section 3(a)(5)(A) of the Securities
Act that is acquiring
D-1
Notes as fiduciary for the account of one or more institutions
for which we exercise sole investment discretion;
3. in the event that we purchase any Notes, we will acquire Notes
having a minimum purchase price of not less than $250,000 for
our own account and for each separate account for which we are
acting;
4. we have such knowledge and experience in financial and
business matters that we are capable of evaluating the merits
and risks of purchasing Notes;
5. we are not acquiring the 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 jurisdictions, provided 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;
6. we have received a copy of the Offering Memorandum relating to
the offering of the Notes 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
the Notes; and
7. (a) we are not an employee benefit plan or other arrangement
that is subject to the Employee Retirement Income Security Act
of 1974, as amended, or Section 4975 of the Internal Revenue
Code of 1986, as amended, or an entity whose underlying assets
include assets of such a plan or arrangement (pursuant to 29
C.F.R. Section 2510.3-101 or otherwise), and we are not
purchasing (and will not hold) the Notes on behalf of, or with
the assets of, any such plan, arrangement or entity; or (b)
our purchase and holding of the Notes are completely covered
by the full exemptive relief provided by U.S. Department of
Labor Prohibited Transaction Class Exemption 96-23, 95-60,
91-38, 90-1 or 84-14.
We understand that the Notes are being 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 if in the future we decide to resell or otherwise transfer such Notes, such
Notes will not be offered, sold or otherwise transferred prior to (x) the date
that is two years (or such shorter period of time as permitted by Rule 144(k)
under the Securities Act or any successor provision thereunder) after the later
of the original Issue Date thereof (or any predecessor of such Note) and the
last day on which National-Oilwell, Inc. (the "Company") or any affiliate of the
Company was the owner of the Note (or any predecessor of such Note) and (y) such
later date, if any, as may be required by applicable laws (the "Resale
Restriction Termination Date"), except (a) to the Company or a subsidiary
thereof, (b) pursuant to an effective registration statement under the
Securities Act, (c) for so long as the Note is eligible for resale pursuant to
Rule 144A under the Securities Act ("Rule 144A"), to a person we reasonably
believe is a "qualified institutional buyer" as defined in Rule 144A that is
acquiring the Note for its own account or for the account of a qualified
institutional buyer to whom notice is given that
D-2
the transfer is being made in reliance on Rule 144A, (d) to an institutional
"accredited investor" (as defined in Rule 501(a)(1), (2), (3) or (7) under the
Securities Act) (an "institutional accredited investor") that, prior to such
transfer, furnishes to the trustee a signed letter containing certain
representations relating to restrictions on transfer of the Note (the form of
which letter can be obtained from the Trustee), (e) pursuant to offers and sales
to non-U.S. Persons that occur in an "offshore transaction" within the meaning
of Regulation S under the Securities Act, or (f) pursuant to another available
exemption from the registration requirements of the Securities Act; provided
that the Company, the Trustee, the transfer agent and the registrar shall have
the right prior to any such offer, sale or transfer (i) pursuant to clause (c),
(d), (e) or (f) to require the delivery of an opinion of counsel, certification
and/or other information satisfactory to each of them, and (ii) in each of the
foregoing cases, to require that a certificate of transfer in the form appearing
on the Note is completed and delivered by the transferor to the Trustee. We
further agree to provide any person purchasing any of the Notes other than
pursuant to clause (b) above from us a notice advising such purchaser that
resales of the Notes are restricted as stated above. We understand that the
registrar and transfer agent for the Notes 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 further understand that any Notes that we receive in the
form of physical certificates will bear a legend reflecting the substance of
this paragraph.
THIS LETTER SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE
LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO CONFLICTS OF LAWS PRINCIPLES
THEREOF.
You and the Company are entitled to rely upon this letter and are
irrevocably authorized to produce this letter or a copy hereof to any interested
party in any administrative or legal proceedings or official inquiry with
respect to the matters covered hereby.
_________________________________________________
(Insert Name of Accredited Investor)
By: _____________________________________________
Name:________________________________________
Title:_______________________________________
D-3
EXHIBIT 4.3
-------------------------------
REGISTRATION RIGHTS AGREEMENT
DATED AS OF NOVEMBER 22, 2002
AMONG
NATIONAL-OILWELL, INC.
AND
MERRILL LYNCH, PIERCE, FENNER & SMITH
INCORPORATED
-------------------------------
REGISTRATION RIGHTS AGREEMENT
This Registration Rights Agreement (the "Agreement") is made
and entered into this 22nd day of November, 2002 among National-Oilwell, Inc., a
Delaware corporation (the "Company"), and Merrill Lynch, Pierce, Fenner & Smith
Incorporated (the "Initial Purchaser").
This Agreement is made pursuant to the Purchase Agreement,
dated November 15, 2002, among the Company and the Initial Purchaser (the
"Purchase Agreement"), which provides for the sale by the Company to the Initial
Purchaser of an aggregate of $200 million principal amount of the Company's
5.65% Senior Notes due 2012 (the "Securities"). In order to induce the Initial
Purchaser to enter into the Purchase Agreement, the Company has agreed to
provide to the Initial Purchaser and their direct and indirect transferees the
registration rights set forth in this Agreement. The execution of this Agreement
is a condition to the closing under the Purchase Agreement.
In consideration of the foregoing, the parties hereto agree as
follows:
1. Definitions.
As used in this Agreement, the following capitalized defined
terms shall have the following meanings:
"1933 Act" shall mean the Securities Act of 1933, as amended
from time to time.
"1934 Act" shall mean the Securities Exchange Act of l934, as
amended from time to time.
"Closing Date" shall mean the Closing Time as defined in the
Purchase Agreement.
"Company" shall have the meaning set forth in the preamble and
shall also include the Company's successors.
"Depositary" shall mean The Depository Trust Company, or any
other depositary appointed by the Company, provided, however, that such
depositary must have an address in the Borough of Manhattan, in the
City of New York.
"Exchange Offer" shall mean the exchange offer by the Company
of Exchange Securities for Registrable Securities pursuant to Section
2.1 hereof.
2
"Exchange Offer Registration" shall mean a registration under
the 1933 Act effected pursuant to Section 2.1 hereof.
"Exchange Offer Registration Statement" shall mean an exchange
offer registration statement on Form S-4 (or, if applicable, on another
appropriate form), and all amendments and supplements to such
registration statement, including the Prospectus contained therein, all
exhibits thereto and all documents incorporated by reference therein.
"Exchange Period" shall have the meaning set forth in Section
2.1 hereof.
"Exchange Securities" shall mean the 5.65% Senior Notes due
2012, Series B issued by the Company under the Indenture containing
terms identical to the Securities in all material respects (except for
references to certain interest rate provisions, restrictions on
transfers and restrictive legends), to be offered to Holders of
Securities in exchange for Registrable Securities pursuant to the
Exchange Offer.
"Holder" shall mean the Initial Purchaser, for so long as it
owns any Registrable Securities, and each of its successors, assigns
and direct and indirect transferees who become registered owners of
Registrable Securities under the Indenture and each Participating
Broker-Dealer that holds Exchange Securities for so long as such
Participating Broker-Dealer is required to deliver a prospectus meeting
the requirements of the 1933 Act in connection with any resale of such
Exchange Securities.
"Indenture" shall mean the Indenture relating to the
Securities, dated as of November 22, 2002, between the Company and The
Bank of New York, as trustee, as the same may be amended, supplemented,
waived or otherwise modified from time to time in accordance with the
terms thereof.
"Initial Purchaser" shall have the meaning set forth in the
preamble.
"Majority Holders" shall mean the Holders of a majority of the
aggregate principal amount of Outstanding (as defined in the Indenture)
Registrable Securities; provided, however, that whenever the consent or
approval of Holders of a specified percentage of Registrable Securities
is required hereunder, Registrable Securities held by the Company and
other obligors on the Securities or any Affiliate (as defined in the
Indenture) of the Company shall be disregarded in determining whether
such consent or approval was given by the Holders of such required
percentage amount.
3
"Participating Broker-Dealer" shall mean Merrill Lynch,
Pierce, Fenner & Smith Incorporated and any other broker-dealer which
makes a market in the Securities and exchanges Registrable Securities
in the Exchange Offer for Exchange Securities.
"Person" shall mean an individual, partnership (general or
limited), corporation, limited liability company, trust or
unincorporated organization, or a government or agency or political
subdivision thereof.
"Prospectus" shall mean the prospectus included in a
Registration Statement, including any preliminary prospectus, and any
such prospectus as amended or supplemented by any prospectus
supplement, including any such prospectus supplement with respect to
the terms of the offering of any portion of the Registrable Securities
covered by a Shelf Registration Statement, and by all other amendments
and supplements to a prospectus, including post-effective amendments,
and in each case including all material incorporated by reference
therein.
"Purchase Agreement" shall have the meaning set forth in the
preamble.
"Registrable Securities" shall mean the Securities; provided,
however, that Securities shall cease to be Registrable Securities when
(i) a Registration Statement with respect to such Securities shall have
been declared effective under the 1933 Act and such Securities shall
have been disposed of pursuant to such Registration Statement, (ii)
such Securities have been sold to the public pursuant to Rule l44 (or
any similar provision then in force, but not Rule 144A) under the 1933
Act or are eligible to be sold to the public pursuant to Rule 144(k)
under the 1933 Act, (iii) such Securities shall have ceased to be
outstanding or (iv) the Exchange Offer is consummated (except in the
case of Securities purchased from the Company and continued to be held
by the Initial Purchaser).
"Registration Expenses" shall mean any and all expenses
incident to performance of or compliance by the Company with this
Agreement, including without limitation: (i) all SEC, stock exchange or
National Association of Securities Dealers, Inc. (the "NASD")
registration and filing fees, including, if applicable, the fees and
expenses of any "qualified independent underwriter" (and its counsel)
that is required to be retained by any holder of Registrable Securities
in accordance with the rules and regulations of the NASD, (ii) all fees
and expenses incurred in connection with compliance with state
securities or blue sky laws and compliance with the rules of the NASD
(including reasonable fees and disbursements of one firm of legal
counsel for any underwriters or Holders in
4
connection with blue sky qualification of any of the Exchange
Securities or Registrable Securities and any filings with the NASD),
(iii) all expenses of any Persons in preparing or assisting in
preparing, word processing, printing and distributing any Registration
Statement, any Prospectus, any amendments or supplements thereto, any
underwriting agreements, securities sales agreements and other
documents relating to the performance of and compliance with this
Agreement, (iv) all fees and expenses incurred in connection with the
listing, if any, of any of the Registrable Securities on any securities
exchange or exchanges, (v) all rating agency fees, (vi) the fees and
disbursements of counsel for the Company and of the independent public
accountants of the Company, including the expenses of any special
audits or "cold comfort" letters required by or incident to such
performance and compliance, (vii) the fees and expenses of the Trustee,
and any escrow agent or custodian, (viii) the reasonable fees and
expenses of the Initial Purchaser in connection with the Exchange
Offer, including the reasonable fees and expenses of one firm of legal
counsel to the Initial Purchaser in connection therewith, (ix) the
reasonable fees and disbursements of one law firm of special counsel
representing the Holders of Registrable Securities and (x) any fees and
disbursements of the underwriters customarily required to be paid by
issuers or sellers of securities and the fees and expenses of any
special experts retained by the Company in connection with any
Registration Statement, but excluding underwriting discounts and
commissions and transfer taxes, if any, relating to the sale or
disposition of Registrable Securities by a Holder.
"Registration Statement" shall mean any registration statement
of the Company which covers any of the Exchange Securities or
Registrable Securities pursuant to the provisions of this Agreement,
and all amendments and supplements to any such Registration Statement,
including post-effective amendments, in each case including the
Prospectus contained therein, all exhibits thereto and all material
incorporated by reference therein.
"SEC" shall mean the Securities and Exchange Commission or any
successor agency or government body performing the functions currently
performed by the United States Securities and Exchange Commission.
"Shelf Registration" shall mean a registration effected
pursuant to Section 2.2 hereof.
"Shelf Registration Statement" shall mean a "shelf"
registration statement of the Company pursuant to the provisions of
Section 2.2 of this Agreement which covers all of the Registrable
Securities on an appropriate form under Rule 415 under the 1933 Act, or
any similar rule that may be adopted by the SEC, and all amendments and
supplements to such registration statement, including post-
5
effective amendments, in each case including the Prospectus contained
therein, all exhibits thereto and all material incorporated by
reference therein.
"Trustee" shall mean the trustee with respect to the
Securities under the Indenture.
2. Registration Under the 1933 Act.
2.1 Exchange Offer. The Company shall, for the benefit of
the Holders, at the Company's cost, (A) prepare and, as soon as practicable but
not later than 105 days following the Closing Date, file with the SEC an
Exchange Offer Registration Statement on an appropriate form under the 1933 Act
with respect to a proposed Exchange Offer and the issuance and delivery to the
Holders, in exchange for the Registrable Securities, of a like principal amount
of Exchange Securities, (B) use its reasonable best efforts to cause the
Exchange Offer Registration Statement to be declared effective under the 1933
Act within 150 days of the Closing Date, (C) use its reasonable best efforts to
keep the Exchange Offer Registration Statement effective until the closing of
the Exchange Offer and (D) use its reasonable best efforts to cause the Exchange
Offer to be consummated not later than 180 days following the Closing Date. The
Exchange Securities will be issued under the Indenture. Upon the effectiveness
of the Exchange Offer Registration Statement, the Company shall promptly
commence the Exchange Offer, it being the objective of such Exchange Offer to
enable each Holder eligible and electing to exchange Registrable Securities for
Exchange Securities (assuming that such Holder (a) is not an affiliate of the
Company within the meaning of Rule 405 under the 1933 Act, (b) is not a
broker-dealer tendering Registrable Securities acquired directly from the
Company for its own account, (c) acquired the Exchange Securities in the
ordinary course of such Holder's business and (d) has no arrangements or
understandings with any Person to participate in the Exchange Offer for the
purpose of distributing the Exchange Securities) to transfer such Exchange
Securities from and after their receipt without any limitations or restrictions
under the registration requirements of the 1933 Act and under state securities
or blue sky laws.
In connection with the Exchange Offer, the Company shall:
(a) mail as promptly as practicable to each
Holder a copy of the Prospectus forming part of the Exchange
Offer Registration Statement, together with an appropriate
letter of transmittal and related documents;
(b) keep the Exchange Offer open for acceptance
for a period of not less than 30 calendar days after the date
notice thereof is mailed to the
6
Holders (or longer if required by applicable law) (such period
referred to herein as the "Exchange Period");
(c) utilize the services of the Depositary for
the Exchange Offer;
(d) permit Holders to withdraw tendered
Registrable Securities at any time prior to 5:00 p.m. (Eastern
Time), on the last business day of the Exchange Period, by
sending to the institution specified in the notice, a
telegram, telex, facsimile transmission or letter setting
forth the name of such Holder, the principal amount of
Registrable Securities delivered for exchange, and a statement
that such Holder is withdrawing such Holder's election to have
such Securities exchanged;
(e) notify each Holder that any Registrable
Security not tendered will remain outstanding and continue to
accrue interest, but will not retain any rights under this
Agreement (except in the case of the Initial Purchaser and
Participating Broker-Dealers as provided herein); and
(f) otherwise comply in all material respects
with all applicable laws relating to the Exchange Offer.
As soon as practicable after the close of the Exchange Offer,
the Company shall:
(i) accept for exchange all Registrable
Securities duly tendered and not validly withdrawn
pursuant to the Exchange Offer in accordance with the
terms of the Exchange Offer Registration Statement
and the letter of transmittal which shall be an
exhibit thereto;
(ii) deliver or cause to be delivered to
the Trustee for cancellation all Registrable
Securities so accepted for exchange; and
(iii) cause the Trustee promptly to
authenticate and deliver Exchange Securities to each
Holder of Registrable Securities so accepted for
exchange in a principal amount equal to the principal
amount of the Registrable Securities of such Holder
so accepted for exchange.
The Exchange Securities shall be issued under (i) the
Indenture or (ii) an indenture identical in all material respects to the
Indenture and which, in either case, has been qualified under the Trust
Indenture Act of 1939, as amended (the "TIA"), or is
7
exempt from such qualification, and shall provide that the F Exchange Securities
shall not be subject to the transfer restrictions set forth in the Indenture.
Interest on each Exchange Security will accrue from the last
date on which interest was paid on the Registrable Securities surrendered in
exchange therefor or, if no interest has been paid on the Registrable
Securities, from the date of original issuance. The Exchange Offer shall not be
subject to any conditions, other than (i) that the Exchange Offer, or the making
of any exchange by a Holder, does not violate applicable law or any applicable
interpretation of the staff of the SEC, (ii) the due tendering of Registrable
Securities in accordance with the Exchange Offer, (iii) that each Holder of
Registrable Securities exchanged in the Exchange Offer shall have represented
that all Exchange Securities to be received by it shall be acquired in the
ordinary course of its business and that at the time of the consummation of the
Exchange Offer it shall have no arrangement or understanding with any person to
participate in the distribution (within the meaning of the 1933 Act) of the
Exchange Securities and shall have made such other representations as may be
reasonably necessary under applicable SEC rules, regulations or interpretations
to render the use of Form S-4 or other appropriate form under the 1933 Act
available and (iv) that no action or proceeding shall have been instituted or
threatened in any court or by or before any governmental agency with respect to
the Exchange Offer which, in the Company's judgment, would reasonably be
expected to impair the ability of the Company to proceed with the Exchange
Offer. The Company shall inform the Initial Purchaser of the names and addresses
of the Holders to whom the Exchange Offer is made, and the Initial Purchaser
shall have the right to contact such Holders and otherwise facilitate the tender
of Registrable Securities in the Exchange Offer.
2.2 Shelf Registration. (i) If, because of any changes in
law, SEC rules or regulations or applicable interpretations thereof by the staff
of the SEC, the Company is not permitted to effect the Exchange Offer as
contemplated by Section 2.1 hereof, (ii) if for any other reason the Exchange
Offer Registration Statement is not declared effective within 150 days following
the Closing Date or the Exchange Offer is not consummated within 180 days after
the Closing Date, (iii) upon the request of the Initial Purchaser (but only with
respect to any Registrable Securities which the Initial Purchaser acquired
directly from the Company) or (iv) if a Holder is not permitted by the federal
securities laws or applicable interpretations thereof by the staff of the SEC to
participate in the Exchange Offer or does not receive fully tradeable Exchange
Securities pursuant to the Exchange Offer, then in case of each of clauses (i)
through (iv) the Company shall, at its cost:
(a) As promptly as practicable, file with the
SEC, and thereafter shall use its reasonable best efforts to
cause to be declared effective as promptly as practicable but
no later than 210 days after the Closing Date, a
8
Shelf Registration Statement relating to the offer and sale of
the Registrable Securities by the Holders from time to time in
accordance with the methods of distribution elected by the
Majority Holders participating in the Shelf Registration and
set forth in such Shelf Registration Statement; provided,
however, that with respect to Exchange Securities received by
a broker-dealer in exchange for any securities that were
acquired by such broker-dealer as a result of market making or
other trading activities, the Company may, if permitted by
then applicable federal securities laws and interpretations
thereof by the SEC, file one or more post-effective amendments
to the Exchange Offer Registration Statement in satisfaction
of its obligations under this paragraph (a) solely with
respect to broker-dealers who acquired their securities as a
result of market making or other trading activities and use
its reasonable best efforts to keep such Exchange Offer
Registration Statement, as so amended, continuously effective
for such period of time as may be necessary to permit such
broker-dealers to comply with the applicable prospectus
delivery requirements under the 1933 Act and as otherwise
required herein; and any such Exchange Offer Registration
Statement, as so amended, shall be referred to herein as, and
governed by the provisions herein applicable to, a Shelf
Registration Statement;
(b) Use its reasonable best efforts to keep the
Shelf Registration Statement continuously effective in order
to permit the Prospectus forming part thereof to be usable by
Holders for a period of two years from the date the Shelf
Registration Statement is declared effective by the SEC, or
for such shorter period that will terminate when all
Registrable Securities covered by the Shelf Registration
Statement have been sold pursuant to the Shelf Registration
Statement or cease to be outstanding or otherwise cease to be
Registrable Securities (the "Effectiveness Period"); provided,
however, that the Company shall not be obligated to keep such
Shelf Registration Statement effective if (A) any event occurs
or facts are discovered which make any statement made in such
Shelf Registration Statement or the related Prospectus untrue
in any material respect or which require the making of any
changes in such Shelf Registration Statement or Prospectus in
order to make the statements therein not misleading; (B) the
Company determines, in its reasonable judgment, upon advice of
counsel, as authorized by a resolution of its Board of
Directors, that the continued effectiveness and useability of
such Shelf Registration Statement would (x) require the
disclosure of material information, which the Company has a
bona fide business reason for preserving as confidential, or
(y) interfere with any financing, acquisition, corporate
reorganization or other material transaction involving the
Company or any of its subsidiaries, and provided,
9
further, that the failure to keep such Shelf Registration
Statement effective and usable for offers and sales of
Registrable Securities for any of the foregoing reasons shall
last no longer than 45 days in any 12-month period whereafter
Additional Interest (as defined in Section 2.5) shall become
payable in accordance with Section 2.5, and (B) the Company
thereafter complies as promptly as practicable with the
requirements of Section 3(k) hereof, if applicable. Any such
period during which the Company is excused from keeping the
Shelf Registration Statement effective and usable for offers
and sales of Registrable Securities is referred to herein as a
"Suspension Period"; a Suspension Period shall commence on and
include the date that the Company gives prompt notice to the
Holders that the Shelf Registration Statement is no longer
effective or the prospectus included therein is no longer
usable for offers and sales of Registrable Securities as a
result of the application of the proviso (which contains
clauses (A) and (B)) of the foregoing sentence and shall end
on the earlier to occur of (1) the date on which each seller
of Registrable Securities covered by the Shelf Registration
Statement either receives the copies of the supplemented or
amended prospectus contemplated by Section 3(k) hereof or is
advised in writing by the Company as promptly as practicable
following its determination that use of the prospectus may be
resumed and (2) the expiration of 45 days in any 12-month
period during which one or more Suspension Periods has been in
effect. The Company shall extend the Effectiveness Period (or
the period during which Participating Broker-Dealers are
entitled to use the prospectus included in the Exchange Offer
Registration Statement in connection with the resale of the
Exchange Securities, as the case may be) by the number of days
during either such period from and including the date of the
giving of such notice to and including the date which is the
earlier to occur as described in the preceding sentence.
(c) Notwithstanding any other provisions hereof,
use its reasonable best efforts to ensure that (i) any Shelf
Registration Statement and any amendment thereto and any
Prospectus forming part thereof and any supplement thereto
complies in all material respects with the 1933 Act and the
rules and regulations thereunder, (ii) any Shelf Registration
Statement and any amendment thereto does not, when it becomes
effective, contain an untrue statement of a material fact or
omit to state a material fact required to be stated therein or
necessary to make the statements therein not misleading and
(iii) any Prospectus forming part of any Shelf Registration
Statement, and any supplement to such Prospectus (as amended
or supplemented from time to time), does not include an untrue
statement of a material fact or omit to state a material fact
necessary in order to make the
10
statements, in light of the circumstances under which they
were made, not misleading.
Without the consent of the Initial Purchaser, which consent
shall not be unreasonably withheld, the Company shall not permit any securities
other than Registrable Securities to be included in the Shelf Registration
Statement. The Company further agrees, if necessary, to supplement or amend the
Shelf Registration Statement, as required by Section 3(b) below, and to furnish
to the Holders of Registrable Securities copies of any such supplement or
amendment promptly after its being used or filed with the SEC.
2.3 Expenses. The Company shall pay all Registration
Expenses in connection with the registration pursuant to Section 2.1 or 2.2.
Each Holder shall pay all underwriting discounts and commissions and transfer
taxes, if any, relating to the sale or disposition of such Holder's Registrable
Securities pursuant to the Shelf Registration Statement.
2.4. Effectiveness. (a) The Company will be deemed not to
have used its reasonable best efforts to cause the Exchange Offer Registration
Statement or the Shelf Registration Statement, as the case may be, to become, or
to remain, effective during the requisite period if the Company voluntarily
takes any action that would, or omits to take any action which omission would,
result in any such Registration Statement not being declared effective or in the
Holders of Registrable Securities covered thereby not being able to exchange or
offer and sell such Registrable Securities during that period as and to the
extent contemplated hereby, unless such action is required by applicable law.
(b) An Exchange Offer Registration Statement
pursuant to Section 2.1 hereof or a Shelf Registration
Statement pursuant to Section 2.2 hereof will not be deemed to
have become effective unless it has been declared effective by
the SEC; provided, however, that if, after it has been
declared effective, the offering of Registrable Securities
pursuant to an Exchange Offer Registration Statement or a
Shelf Registration Statement is interfered with by any stop
order, injunction or other order or requirement of the SEC or
any other governmental agency or court, such Registration
Statement will be deemed not to have become effective during
the period of such interference, until the offering of
Registrable Securities pursuant to such Registration Statement
may legally resume.
2.5 Interest. In the event that either (a) the Exchange
Offer Registration Statement is not filed with the Commission on or prior to the
105th calendar day following the Closing Date, (b) the Exchange Offer
Registration Statement has not been
11
declared effective on or prior to the 150th calendar day following the Closing
Date, (c) the Exchange Offer is not consummated on or prior to the 180th
calendar day following the Closing Date, or (d) a Shelf Registration Statement
is not declared effective on or prior to the 210th calendar day following the
Closing Date (each such event referred to in clauses (a) through (d) above, a
"Registration Default"), the interest rate borne by the Securities shall be
increased ("Additional Interest") by one-quarter of one percent per annum upon
the occurrence of each Registration Default, which rate will increase by one
quarter of one percent each 90-day period that such Additional Interest
continues to accrue under any such circumstance, provided that the maximum
aggregate increase in the interest rate will in no event exceed one-half of one
percent (0.50%) per annum. Following the cure of all Registration Defaults the
accrual of Additional Interest will cease and the interest rate will revert to
the original rate.
If the Shelf Registration Statement is unusable by the Holders
for any reason (including without limitation any of the reasons described in
clauses (A) or (B) of Section 2.2(b)) and the aggregate number of days in any
consecutive twelve-month period for which the Shelf Registration Statement shall
not be usable exceeds 45 days in the aggregate, then the interest rate borne by
the Securities will be increased by 0.25% per annum of the principal amount of
the Securities for the first 90-day period (or portion thereof) beginning on the
46th such date that such Shelf Registration Statement ceases to be usable, which
rate shall be increased by an additional 0.25% per annum of the principal amount
of the Securities at the beginning of each subsequent 90-day period, provided
that the maximum aggregate increase in the interest rate will in no event exceed
one-half of one percent (0.50%) per annum. Any amounts payable under this
paragraph shall also be deemed "Additional Interest" for purposes of this
Agreement. Upon the Shelf Registration Statement once again becoming usable, the
interest rate borne by the Securities will be reduced to the original interest
rate if the Company is otherwise in compliance with this Agreement at such time.
Additional Interest shall be computed based on the actual number of days elapsed
in each 90-day period in which the Shelf Registration Statement is unusable.
The Company shall notify the Trustee within three business
days after each and every date on which an event occurs in respect of which
Additional Interest is required to be paid (an "Event Date"). Additional
Interest shall be paid by depositing with the Trustee, in trust, for the benefit
of the Holders of Registrable Securities, on or before the applicable semiannual
interest payment date, immediately available funds in sums sufficient to pay the
Additional Interest then due. The Additional Interest due shall be payable on
each interest payment date to the record Holder of Securities entitled to
receive the interest payment to be paid on such date as set forth in the
Indenture. Each obligation to pay Additional Interest shall be deemed to accrue
from and including the day following the applicable Event Date.
12
3. Registration Procedures.
In connection with the obligations of the Company with respect
to Registration Statements pursuant to Sections 2.1 and 2.2 hereof, the Company
shall:
(a) prepare and file with the SEC a Registration
Statement, within the relevant time period specified in
Section 2, on the appropriate form under the 1933 Act, which
form (i) shall be selected by the Company, (ii) shall, in the
case of a Shelf Registration, be available for the sale of the
Registrable Securities by the selling Holders thereof, (iii)
shall comply as to form in all material respects with the
requirements of the applicable form and include or incorporate
by reference all financial statements required by the SEC to
be filed therewith or incorporated by reference therein, and
(iv) shall comply in all respects with the requirements of
Regulation S-T under the 1933 Act, and use its reasonable best
efforts to cause such Registration Statement to become
effective and remain effective in accordance with Section 2
hereof;
(b) prepare and file with the SEC such
amendments and post-effective amendments to each Registration
Statement as may be necessary under applicable law to keep
such Registration Statement effective for the applicable
period; and cause each Prospectus to be supplemented by any
required prospectus supplement, and as so supplemented to be
filed pursuant to Rule 424 (or any similar provision then in
force) under the 1933 Act and comply with the provisions of
the 1933 Act, the 1934 Act and the rules and regulations
thereunder applicable to them with respect to the disposition
of all securities covered by each Registration Statement
during the applicable period in accordance with the intended
method or methods of distribution by the selling Holders
thereof (including sales by any Participating Broker-Dealer);
(c) in the case of a Shelf Registration, (i)
notify each Holder of Registrable Securities, at least five
business days prior to filing, that a Shelf Registration
Statement with respect to the Registrable Securities is being
filed and advising such Holders that the distribution of
Registrable Securities will be made in accordance with the
method selected by the Majority Holders participating in the
Shelf Registration; (ii) furnish to each Holder of Registrable
Securities and to each underwriter of an underwritten offering
of Registrable Securities, if any, without charge, as many
copies of each Prospectus, including each preliminary
Prospectus, and any amendment or supplement thereto and such
other documents as such Holder or underwriter may reasonably
request, including financial
13
statements and schedules and, if the Holder so requests, all
exhibits in order to facilitate the public sale or other
disposition of the Registrable Securities; and (iii) hereby
consent to the use of the Prospectus or any amendment or
supplement thereto by each of the selling Holders of
Registrable Securities in connection with the offering and
sale of the Registrable Securities covered by the Prospectus
or any amendment or supplement thereto;
(d) use its reasonable best efforts to register
or qualify the Registrable Securities under all applicable
state securities or "blue sky" laws of such jurisdictions as
any Holder of Registrable Securities covered by a Registration
Statement and each underwriter of an underwritten offering of
Registrable Securities shall reasonably request by the time
the applicable Registration Statement is declared effective by
the SEC, and do any and all other acts and things which may be
reasonably necessary or advisable to enable each such Holder
and underwriter to consummate the disposition in each such
jurisdiction of such Registrable Securities owned by such
Holder; provided, however, that the Company shall not be
required to (i) qualify as a foreign corporation or as a
dealer in securities in any jurisdiction where it would not
otherwise be required to qualify but for this Section 3(d), or
(ii) take any action which would subject it to general service
of process or taxation in any such jurisdiction where it is
not then so subject;
(e) notify promptly each Holder of Registrable
Securities under a Shelf Registration or any Participating
Broker-Dealer who has notified the Company that it is
utilizing the Exchange Offer Registration Statement as
provided in paragraph (f) below and, if requested by such
Holder or Participating Broker-Dealer, confirm such advice in
writing promptly (i) when a Registration Statement has become
effective and when any post-effective amendments and
supplements thereto become effective, (ii) of any request by
the SEC or any state securities authority for post-effective
amendments and supplements to a Registration Statement and
Prospectus or for additional information after the
Registration Statement has become effective, (iii) of the
issuance by the SEC or any state securities authority of any
stop order suspending the effectiveness of a Registration
Statement or the initiation of any proceedings for that
purpose, (iv) in the case of a Shelf Registration, if, between
the effective date of a Registration Statement and the closing
of any sale of Registrable Securities covered thereby, the
representations and warranties of the Company contained in any
underwriting agreement, securities sales agreement or other
similar agreement, if any, relating to the offering cease to
be true and correct in all material respects, (v) of the
happening of any event or the discovery of any
14
facts during the period a Shelf Registration Statement is
effective which makes any statement made in such Registration
Statement or the related Prospectus untrue in any material
respect or which requires the making of any changes in such
Registration Statement or Prospectus in order to make the
statements therein not misleading, (vi) of the receipt by the
Company of any notification with respect to the suspension of
the qualification of the Registrable Securities or the
Exchange Securities, as the case may be, for sale in any
jurisdiction or the initiation or threatening of any
proceeding for such purpose and (vii) of any determination by
the Company that a post-effective amendment to such
Registration Statement would be appropriate;
(f) (A) in the case of the Exchange Offer
Registration Statement (i) include in the Exchange Offer
Registration Statement a section entitled "Plan of
Distribution" which section shall be reasonably acceptable to
the Initial Purchaser on behalf of the Participating
Broker-Dealers, and which shall contain a summary statement of
the positions taken or policies made by the staff of the SEC
with respect to the potential "underwriter" status of any
broker-dealer that holds Registrable Securities acquired for
its own account as a result of market-making activities or
other trading activities and that will be the beneficial owner
(as defined in Rule 13d-3 under the Exchange Act) of Exchange
Securities to be received by such broker-dealer in the
Exchange Offer, whether such positions or policies have been
publicly disseminated by the staff of the SEC or such
positions or policies, in the reasonable judgment of the
Initial Purchaser on behalf of the Participating
Broker-Dealers and its counsel, represent the prevailing views
of the staff of the SEC, including a statement that any such
broker-dealer who receives Exchange Securities for Registrable
Securities pursuant to the Exchange Offer may be deemed a
statutory underwriter and must deliver a prospectus meeting
the requirements of the 1933 Act in connection with any resale
of such Exchange Securities, (ii) furnish to each
Participating Broker-Dealer who has delivered to the Company
the notice referred to in Section 3(e), without charge, as
many copies of each Prospectus included in the Exchange Offer
Registration Statement, including any preliminary prospectus,
and any amendment or supplement thereto, as such Participating
Broker-Dealer may reasonably request, (iii) hereby consent to
the use of the Prospectus forming part of the Exchange Offer
Registration Statement or any amendment or supplement thereto,
by any Person subject to the prospectus delivery requirements
of the SEC, including all Participating Broker-Dealers, in
connection with the sale or transfer of the Exchange
Securities covered by the Prospectus or any amendment or
supplement thereto, and (iv) include in the transmittal letter
or similar
15
documentation to be executed by an exchange offeree in order
to participate in the Exchange Offer (x) the following
provision:
"If the exchange offeree is a broker-dealer holding
Registrable Securities acquired for its own account as a
result of market-making activities or other trading
activities, it will deliver a prospectus meeting the
requirements of the 1933 Act in connection with any resale of
Exchange Securities received in respect of such Registrable
Securities pursuant to the Exchange Offer;" and
(y) a statement to the effect that by a broker-dealer making the acknowledgment
described in clause (x) and by delivering a Prospectus in connection with the
exchange of Registrable Securities, the broker-dealer will not be deemed to
admit that it is an underwriter within the meaning of the 1933 Act; and
(B) in the case of any Exchange Offer
Registration Statement, the Company agrees to use its reasonable best efforts to
cause to be delivered to the Initial Purchaser on behalf of the Participating
Broker-Dealers upon the effectiveness of the Exchange Offer Registration
Statement a comfort letter or comfort letters in customary form to the extent
permitted by Statement on Auditing Standards No. 72 of the American Institute of
Certified Public Accountants (or if such a comfort letter is not permitted, an
agreed upon procedures letter in customary form) from the Company's independent
certified public accountants (and, if necessary, any other independent certified
public accountants of any subsidiary of the Company or of any business acquired
by the Company for which financial statements are, or are required to be,
included in the Registration Statement) at least as broad in scope and coverage
as the comfort letter or comfort letters delivered to the Initial Purchaser in
connection with the initial sale of the Securities to the Initial Purchaser;
(g) (i) in the case of an Exchange Offer,
furnish to one firm of legal counsel for the Initial Purchaser
and (ii) in the case of a Shelf Registration, furnish to one
firm of legal counsel for the Holders of Registrable
Securities copies of any comment letters received from the SEC
or any other request by the SEC or any state securities
authority for amendments or supplements to a Registration
Statement and Prospectus or for additional information;
(h) make every reasonable effort to obtain the
withdrawal of any order suspending the effectiveness of a
Registration Statement as soon as practicable;
16
(i) in the case of a Shelf Registration, furnish
to each Holder of Registrable Securities, and each
underwriter, if any, without charge, at least one conformed
copy of each Registration Statement and any post-effective
amendment thereto, including financial statements and
schedules (without documents incorporated therein by reference
and all exhibits thereto, unless requested);
(j) in the case of a Shelf Registration,
cooperate with the selling Holders of Registrable Securities
to facilitate the timely preparation and delivery of
certificates representing Registrable Securities to be sold
and not bearing any restrictive legends; and enable such
Registrable Securities to be in such denominations (consistent
with the provisions of the Indenture) and registered in such
names as the selling Holders or the underwriters, if any, may
reasonably request at least three business days prior to the
closing of any sale of Registrable Securities;
(k) in the case of a Shelf Registration, upon
the occurrence of any event or the discovery of any facts,
each as contemplated by Sections 3(e)(v) and 3(e)(vi) hereof,
as promptly as practicable after the occurrence of such an
event, use its reasonable best efforts to prepare a supplement
or post-effective amendment to the Registration Statement or
the related Prospectus or any document incorporated therein by
reference or file any other required document so that, as
thereafter delivered to the purchasers of the Registrable
Securities or Participating Broker-Dealers, such Prospectus
will not contain at the time of such delivery any untrue
statement of a material fact or omit to state a material fact
necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading or
will remain so qualified. At such time as such public
disclosure is otherwise made or the Company determines that
such disclosure is not necessary, in each case to correct any
misstatement of a material fact or to include any omitted
material fact, the Company agrees promptly to notify each
Holder of such determination and to furnish each Holder such
number of copies of the Prospectus as amended or supplemented,
as such Holder may reasonably request;
(m) obtain a CUSIP number for all Exchange
Securities or Registrable Securities, as the case may be, not
later than the effective date of a Registration Statement, and
provide the Trustee with any necessary printed certificates
for the Exchange Securities or the Registrable Securities, as
the case may be, in a form eligible for deposit with the
Depositary;
17
(n) (i) use its reasonable best efforts cause
the Indenture to be qualified under the TIA in connection with
the registration of the Exchange Securities or Registrable
Securities, as the case may be, (ii) cooperate with the
Trustee and the Holders to effect such changes to the
Indenture as may be required for the Indenture to be so
qualified in accordance with the terms of the TIA and (iii)
execute, and use its reasonable best efforts to cause the
Trustee to execute, all documents as may be required to effect
such changes, and all other forms and documents required to be
filed with the SEC to enable the Indenture to be so qualified
in a timely manner;
(o) in the case of a Shelf Registration, enter
into agreements (including underwriting agreements) and take
all other customary and appropriate actions in order to
expedite or facilitate the disposition of such Registrable
Securities and in such connection whether or not an
underwriting agreement is entered into and whether or not the
registration is an underwritten registration:
(i) make such representations and
warranties to the Holders of such Registrable
Securities and the underwriters, if any, in form,
substance and scope as are customarily made by
issuers to underwriters in similar underwritten
offerings as may be reasonably requested by them;
(ii) obtain opinions of counsel to the
Company and updates thereof (which counsel and
opinions (in form, scope and substance) shall be
reasonably satisfactory to the managing underwriters,
if any, and the holders of a majority in principal
amount of the Registrable Securities being sold)
addressed to each selling Holder and the
underwriters, if any, covering the matters
customarily covered in opinions requested in sales of
securities or underwritten offerings and such other
matters as may be reasonably requested by such
Holders and underwriters;
(iii) obtain "cold comfort" letters and
updates thereof from the Company's independent
certified public accountants (and, if necessary, any
other independent certified public accountants of any
subsidiary of the Company or of any business acquired
by the Company for which financial statements are, or
are required to be, included in the Registration
Statement) addressed to the underwriters, if any, and
use reasonable efforts to have such letter addressed
to the selling Holders of Registrable Securities (to
the extent consistent with Statement on Auditing
Standards No. 72 of the
18
American Institute of Certified Public Accounts),
such letters to be in customary form and covering
matters of the type customarily covered in "cold
comfort" letters to underwriters in connection with
similar underwritten offerings;
(iv) if requested by the Majority
Holders, enter into a securities sales agreement with
the Holders and an agent of the Holders providing
for, among other things, the appointment of such
agent for the selling Holders for the purpose of
soliciting purchases of Registrable Securities, which
agreement shall be in form, substance and scope
customary for similar offerings;
(v) if an underwriting agreement is
entered into, cause the same to set forth
indemnification provisions and procedures
substantially equivalent to the indemnification
provisions and procedures set forth in Section 4
hereof with respect to the underwriters and all other
parties to be indemnified pursuant to said Section
or, at the request of any underwriters, in the form
customarily provided to such underwriters in similar
types of transactions; and
(vi) deliver such documents and
certificates as may be reasonably requested and as
are customarily delivered in similar offerings to the
Holders of a majority in principal amount of the
Registrable Securities being sold and the managing
underwriters, if any.
The above shall be done at (i) the effectiveness of such Registration Statement
(and each post-effective amendment thereto) and (ii) each closing under any
underwriting or similar agreement as and to the extent required thereunder;
(p) in the case of a Shelf Registration, make
available for inspection by representatives of the Holders of
the Registrable Securities, one firm of legal counsel and one
accountant retained by such representatives, representatives
of the underwriters participating in any disposition pursuant
to a Shelf Registration Statement, and one firm of legal
counsel and one accountant retained by such representatives,
all financial and other records, pertinent corporate documents
and properties of the Company reasonably requested by any such
persons, and cause the respective officers, directors,
employees, and any other agents of the Company to supply all
information reasonably requested by any such representative,
underwriter, special counsel or accountant in connection
19
with a Registration Statement, and make such representatives
of the Company available for discussion of such documents as
shall be reasonably requested by the Initial Purchaser;
provided that any such records, documents, properties and such
information shall be kept confidential by any such Persons and
shall be used only in connection with such Registration
Statement, unless disclosure thereof is made in connection
with a court proceeding or required by law or such records,
documents, properties or information (i) is already in the
possession of such Persons and was obtained by such Persons
without an accompanying obligation of confidentiality or (ii)
has become available (not in violation of this agreement) to
the public generally or through a third party without an
accompanying obligation of confidentiality, and the Company
shall be entitled to request that such Persons sign a
customary confidentiality agreement to the foregoing effect in
a form reasonably acceptable to the parties thereto;
(q) (i) in the case of an Exchange Offer
Registration Statement, a reasonable time prior to the filing
of any Exchange Offer Registration Statement, any Prospectus
forming a part thereof, any amendment to an Exchange Offer
Registration Statement or amendment or supplement to such
Prospectus, provide copies of such document to the Initial
Purchaser and to one firm of legal counsel to the Holders of
Registrable Securities and make such changes in any such
document prior to the filing thereof as the Initial Purchaser
or such counsel to the Holders of Registrable Securities may
reasonably request and, except as otherwise required by
applicable law, not file any such document in a form to which
the Initial Purchaser on behalf of the Holders of Registrable
Securities and one firm of legal counsel to the Holders of
Registrable Securities shall not have previously been advised
and furnished a copy of or to which the Initial Purchaser on
behalf of the Holders of Registrable Securities or such
counsel to the Holders of Registrable Securities shall
reasonably object within a reasonable time period, and make
the representatives of the Company available for discussion of
such documents as shall be reasonably requested by the Initial
Purchaser; and
(ii) in the case of a Shelf
Registration, a reasonable time prior to filing any
Shelf Registration Statement, any Prospectus forming
a part thereof, any amendment to such Shelf
Registration Statement or amendment or supplement to
such Prospectus, provide copies of such document to
the Holders of Registrable Securities, to the Initial
Purchaser, to one firm of legal counsel for the
Holders and to the underwriter or underwriters of an
underwritten offering of
20
Registrable Securities, if any, make such changes in
any such document prior to the filing thereof as the
Initial Purchaser, the counsel to the Holders or the
underwriter or underwriters reasonably request and
not file any such document in a form to which the
Majority Holders, the Initial Purchaser on behalf of
the Holders of Registrable Securities, counsel for
the Holders of Registrable Securities or any
underwriter shall not have previously been advised
and furnished a copy of or to which the Majority
Holders, the Initial Purchaser on behalf of the
Holders of Registrable Securities, counsel to the
Holders of Registrable Securities or any underwriter
shall reasonably object, and make the representatives
of the Company available for discussion of such
document as shall be reasonably requested by the
Holders of Registrable Securities, the Initial
Purchaser on behalf of such Holders, counsel for the
Holders of Registrable Securities or any underwriter.
(r) otherwise use its reasonable best efforts to
comply with all applicable rules and regulations of the SEC
and make available to its security holders, as soon as
reasonably practicable, an earnings statement covering at
least 12 months which shall satisfy the provisions of Section
11(a) of the 1933 Act and Rule 158 thereunder;
(s) cooperate and assist in any filings required
to be made with the NASD and, in the case of a Shelf
Registration, in the performance of any due diligence
investigation by any underwriter and its counsel (including
any "qualified independent underwriter" that is required to be
retained in accordance with the rules and regulations of the
NASD); and
In the case of a Shelf Registration Statement, the Company may
(as a condition to such Holder's participation in the Shelf Registration)
require each Holder of Registrable Securities to furnish to the Company such
information regarding the Holder and the proposed distribution by such Holder of
such Registrable Securities as the Company may from time to time reasonably
request in writing.
In the case of a Shelf Registration Statement, each Holder
agrees that, upon receipt of any notice from the Company of the happening of any
event or the discovery of any facts, each of the kind described in Section
3(e)(v) hereof, such Holder will forthwith discontinue disposition of
Registrable Securities pursuant to a Registration Statement until such Holder's
receipt of the copies of the supplemented or amended Prospectus contemplated by
Section 3(k) hereof, and, if so directed by the Company, such Holder will
deliver to the Company (at its expense) all copies in such Holder's possession,
other than permanent file copies then in such Holder's possession, of the
21
Prospectus covering such Registrable Securities current at the time of receipt
of such notice.
In the event that the Company fails to effect the Exchange
Offer or file any Shelf Registration Statement and maintain the effectiveness of
any Shelf Registration Statement as provided herein, the Company shall not file
any Registration Statement with respect to the registration or offer to exchange
any senior debt securities (within the meaning of Section 2(1) of the 1933 Act)
of the Company (other than Registrable Securities) that are issued and sold
after the date hereof pursuant to Rule 144A under the 1993 Act.
If any of the Registrable Securities covered by any Shelf
Registration Statement are to be sold in an underwritten offering, the
underwriter or underwriters and manager or managers that will manage such
offering will be selected by the Company and shall be acceptable to the Majority
Holders of Registrable Securities included in such offering. No Holder of
Registrable Securities may participate in any underwritten registration
hereunder unless such Holder (a) agrees to sell such Holder's Registrable
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 questionnaires, powers of attorney, indemnities, underwriting
agreements and other documents required under the terms of such underwriting
arrangements.
4. Indemnification; Contribution.
(a) The Company agrees to indemnify and hold
harmless the Initial Purchaser, each Holder, each
Participating Broker-Dealer, each Person who participates as
an underwriter (any such Person being an "Underwriter") and
each Person, if any, who controls any Holder or Underwriter
within the meaning of Section 15 of the 1933 Act or Section 20
of the 1934 Act as follows:
(i) against any and all loss,
liability, claim, damage and expense whatsoever, as
incurred, arising out of any untrue statement or
alleged untrue statement of a material fact contained
in any Registration Statement (or any amendment or
supplement thereto) pursuant to which Exchange
Securities or Registrable Securities were registered
under the 1933 Act, including all documents
incorporated therein by reference, or the omission or
alleged omission therefrom of a material fact
required to be stated therein or necessary to make
the statements therein not misleading, or arising out
of any untrue statement or alleged untrue statement
of a material fact contained in any Prospectus (or
any amendment or supplement
22
thereto) or the omission or alleged omission
therefrom of a material fact necessary in order to
make the statements therein, in the light of the
circumstances under which they were made, not
misleading;
(ii) against any and all loss,
liability, claim, damage and expense whatsoever, as
incurred, to the extent of the aggregate amount paid
in settlement of any litigation, or any investigation
or proceeding by any governmental agency or body,
commenced or threatened, or of any claim whatsoever
based upon any such untrue statement or omission, or
any such alleged untrue statement or omission;
provided that (subject to Section 4(d) below) any
such settlement is effected with the written consent
of the Company; and
(iii) against any and all expense
whatsoever, as incurred (including the fees and
disbursements of one firm of legal counsel chosen by
each indemnified party), reasonably incurred in
investigating, preparing or defending against any
litigation, or any investigation or proceeding by any
governmental agency or body, commenced or threatened,
or any claim whatsoever based upon any such untrue
statement or omission, or any such alleged untrue
statement or omission, to the extent that any such
expense is not paid under subparagraph (i) or (ii)
above;
provided, however, that this indemnity agreement shall not apply to any loss,
liability, claim, damage or expense to the extent arising out of any untrue
statement or omission or alleged untrue statement or omission (i) made in
reliance upon and in conformity with written information furnished to the
Company by the Holder or Underwriter expressly for use in a Registration
Statement (or any amendment thereto) or any Prospectus (or any amendment or
supplement thereto) or (ii) if the Person asserting any such loss, liability,
claim, damage or expense was not sent or given a copy of the final Prospectus
(or any amendment or supplement thereto) (in each case exclusive of the
documents from which information is incorporated by reference) at or prior to
the sale of such Registrable Securities to such Person (other than as a result
of the failure by the Company to comply with its obligations under Section 3(c)
hereof) and the untrue statement contained in or omitted from such final
Prospectus was subsequently corrected in the final Prospectus (or any amendment
or supplement thereto).
(b) Each Holder severally, but not jointly,
agrees to indemnify and hold harmless the Company, the Initial
Purchaser, each Underwriter and the other selling Holders, and
each of their respective directors and officers, and each
Person, if any, who controls the Company, the Initial
Purchaser, any Underwriter or any other selling Holder within
the meaning
23
of Section 15 of the 1933 Act or Section 20 of the 1934 Act,
against any and all loss, liability, claim, damage and expense
described in the indemnity contained in Section 4(a) hereof,
as incurred, but only with respect to untrue statements or
omissions, or alleged untrue statements or omissions, made in
the Shelf Registration Statement (or any amendment thereto) or
any Prospectus included therein (or any amendment or
supplement thereto) in reliance upon and in conformity with
written information with respect to such Holder furnished to
the Company by such Holder expressly for use in the Shelf
Registration Statement (or any amendment thereto) or such
Prospectus (or any amendment or supplement thereto); provided,
however, that no such Holder shall be liable for any claims
hereunder in excess of the amount of net proceeds received by
such Holder from the sale of Registrable Securities pursuant
to such Shelf Registration Statement.
(c) Each indemnified party shall give notice as
promptly as reasonably practicable to each indemnifying party
of any action or proceeding commenced against it in respect of
which indemnity may be sought hereunder, but failure so to
notify an indemnifying party shall not relieve such
indemnifying party from any liability hereunder to the extent
it is not materially prejudiced as a result thereof and in any
event shall not relieve it from any liability which it may
have otherwise than on account of this indemnity agreement. An
indemnifying party may participate at its own expense in the
defense of such action; provided, however, that counsel to the
indemnifying party shall not (except with the consent of the
indemnified party) also be counsel to the indemnified party.
In no event shall the indemnifying party or parties be liable
for the fees and expenses of more than one counsel (in
addition to any local counsel) separate from their own counsel
for all indemnified parties in connection with any one action
or separate but similar or related actions in the same
jurisdiction arising out of the same general allegations or
circumstances. No indemnifying party shall, without the prior
written consent of the indemnified parties, settle or
compromise or consent to the entry of any judgment with
respect to any litigation, or any investigation or proceeding
by any governmental agency or body, commenced or threatened,
or any claim whatsoever in respect of which indemnification or
contribution could be sought under this Section 4 (whether or
not the indemnified parties are actual or potential parties
thereto), unless such settlement, compromise or consent (i)
includes an unconditional release of each indemnified party
from all liability arising out of such litigation,
investigation, proceeding or claim and (ii) does not include a
statement as to or an admission of fault, culpability or a
failure to act by or on behalf of any indemnified party.
24
(d) If at any time an indemnified party shall
have requested an indemnifying party to reimburse the
indemnified party for fees and expenses of counsel, such
indemnifying party agrees that it shall be liable for any
settlement of the nature contemplated by Section 4(a)(ii)
effected without its written consent if (i) such settlement is
entered into more than 45 days after receipt by such
indemnifying party of the aforesaid request, (ii) such
indemnifying party shall have received notice of the terms of
such settlement at least 30 days prior to such settlement
being entered into and (iii) such indemnifying party shall not
have reimbursed such indemnified party in accordance with such
request prior to the date of such settlement.
(e) If the indemnification provided for in this
Section 4 is for any reason unavailable to or insufficient to
hold harmless an indemnified party in respect of any losses,
liabilities, claims, damages or expenses referred to therein,
then each indemnifying party shall contribute to the aggregate
amount of such losses, liabilities, claims, damages and
expenses incurred by such indemnified party, as incurred, in
such proportion as is appropriate to reflect the relative
fault of the Company on the one hand and the Holders and the
Initial Purchaser on the other hand in connection with the
statements or omissions which resulted in such losses,
liabilities, claims, damages or expenses, as well as any other
relevant equitable considerations.
The relative fault of the Company on the one hand and the Holders and
the Initial Purchaser on the other hand shall be determined by reference to,
among other things, whether any such untrue or alleged untrue statement of a
material fact or omission or alleged omission to state a material fact relates
to information supplied by the Company, the Holders or the Initial Purchaser and
the parties' relative intent, knowledge, access to information and opportunity
to correct or prevent such statement or omission.
The Company, the Holders and the Initial Purchaser agree that it would
not be just and equitable if contribution pursuant to this Section 4 were
determined by pro rata allocation or by any other method of allocation which
does not take account of the equitable considerations referred to above in this
Section 4. The aggregate amount of losses, liabilities, claims, damages and
expenses incurred by an indemnified party and referred to above in this Section
4 shall be deemed to include any legal or other expenses reasonably incurred by
such indemnified party in investigating, preparing or defending against any
litigation, or any investigation or proceeding by any governmental agency or
body, commenced or threatened, or any claim whatsoever based upon any such
untrue or alleged untrue statement or omission or alleged omission.
25
Notwithstanding the provisions of this Section 4, the Initial Purchaser
shall not be required to contribute any amount in excess of the amount by which
the total price at which the Securities sold by it were offered exceeds the
amount of any damages which the Initial Purchaser has otherwise been required to
pay by reason of such untrue or alleged untrue statement or omission or alleged
omission.
No Person guilty of fraudulent misrepresentation (within the meaning of
Section 11(f) of the 1933 Act) shall be entitled to contribution from any Person
who was not guilty of such fraudulent misrepresentation.
For purposes of this Section 4, each Person, if any, who controls an
Initial Purchaser or Holder within the meaning of Section 15 of the 1933 Act or
Section 20 of the 1934 Act shall have the same rights to contribution as such
Initial Purchaser or Holder, and each director of the Company, and each Person,
if any, who controls the Company within the meaning of Section 15 of the 1933
Act or Section 20 of the 1934 Act shall have the same rights to contribution as
the Company.
5. Miscellaneous.
5.1 Rule 144 and Rule 144A. For so long as the Company is
subject to the reporting requirements of Section 13 or 15 of the 1934 Act, the
Company covenants that it will file the reports required to be filed by it under
Section 13(a) or 15(d) of the 1934 Act and the rules and regulations adopted by
the SEC thereunder. If the Company ceases to be so required to file such
reports, the Company covenants that it will upon the request of any Holder of
Registrable Securities (a) make publicly available such information as is
necessary to permit sales pursuant to Rule 144 under the 1933 Act, (b) deliver
such information to a prospective purchaser as is necessary to permit sales
pursuant to Rule 144A under the 1933 Act and it will take such further action as
any Holder of Registrable Securities may reasonably request, and (c) take such
further action that is reasonable in the circumstances, in each case, to the
extent required from time to time to enable such Holder to sell its Registrable
Securities without registration under the 1933 Act within the limitation of the
exemptions provided by (i) Rule 144 under the 1933 Act, as such Rule may be
amended from time to time, (ii) Rule 144A under the 1933 Act, as such Rule may
be amended from time to time, or (iii) any similar rules or regulations
hereafter adopted by the SEC. Upon the request of any Holder of Registrable
Securities, the Company will deliver to such Holder a written statement as to
whether it has complied with such requirements.
5.2 No Inconsistent Agreements. The Company has not entered
into and the Company will not after the date of this Agreement enter into any
agreement which is inconsistent with the rights granted to the Holders of
Registrable Securities in this Agreement or otherwise conflicts with the
provisions hereof. The rights granted to the
26
Holders hereunder do not and will not for the term of this Agreement in any way
conflict with the rights granted to the holders of the Company's other issued
and outstanding securities under any such agreements.
5.3 Amendments and Waivers. The provisions of this
Agreement, including the provisions of this sentence, may not be amended,
modified or supplemented, and waivers or consents to departures from the
provisions hereof may not be given unless the Company has obtained the written
consent of Holders of at least a majority in aggregate principal amount of the
outstanding Registrable Securities affected by such amendment, modification,
supplement, waiver or departure.
5.4 Notices. All notices and other communications
provided for or permitted hereunder shall be made in writing by hand delivery,
registered first-class mail, telex, telecopier, or any courier guaranteeing
overnight delivery (a) if to a Holder, at the most current address given by such
Holder to the Company by means of a notice given in accordance with the
provisions of this Section 5.4, which address initially is the address set forth
in the Purchase Agreement with respect to the Initial Purchaser; and (b) if to
the Company, initially at the Company's address set forth in the Purchase
Agreement, and thereafter at such other address of which notice is given in
accordance with the provisions of this Section 5.4.
All such notices and communications shall be deemed to have
been duly given: at the time delivered by hand, if personally delivered; two
business days after being deposited in the mail, postage prepaid, if mailed;
when answered back, if telexed; when receipt is 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
under the Indenture, at the address specified in such Indenture.
5.5 Successor and Assigns. This Agreement shall inure to
the benefit of and be binding upon the successors, assigns and transferees of
each of the parties, including, without limitation and without the need for an
express assignment, subsequent Holders; provided, however, that nothing herein
shall be deemed to permit any assignment, transfer or other disposition of
Registrable Securities in violation of the terms of the Purchase Agreement or
the Indenture. If any transferee of any Holder shall acquire Registrable
Securities, in any manner, whether by operation of law or otherwise, such
Registrable Securities shall be held subject to all of the terms of this
Agreement, and by taking and holding such Registrable Securities such person
shall be conclusively deemed to have agreed to be bound by and to perform all of
the terms and provisions of this Agreement, including the restrictions on resale
set forth in this Agreement and, if
27
applicable, the Purchase Agreement, and such person shall be entitled to receive
the benefits hereof.
5.6 Third Party Beneficiaries. The Initial Purchaser
(even if the Initial Purchaser is not a Holder of Registrable Securities) shall
be a third party beneficiary to the agreements made hereunder between the
Company, on the one hand, and the Holders, on the other hand, and shall have the
right to enforce such agreements directly to the extent they deem such
enforcement necessary or advisable to protect their rights or the rights of
Holders hereunder. Each Holder of Registrable Securities shall be a third party
beneficiary to the agreements made hereunder between the Company, on the one
hand, and the Initial Purchaser, on the other hand, and shall have the right to
enforce such agreements directly to the extent it deems such enforcement
necessary or advisable to protect its rights hereunder.
5.7. Specific Enforcement. Without limiting the remedies
available to the Initial Purchaser and the Holders, the Company acknowledges
that any failure by the Company to comply with its obligations under Sections
2.1 through 2.4 hereof may result in material irreparable injury to the Initial
Purchaser or the Holders for which there is no adequate remedy at law, that it
would not be possible to measure damages for such injuries precisely and that,
in the event of any such failure, the Initial Purchaser or any Holder may obtain
such relief as may be required to specifically enforce the Company's obligations
under Sections 2.1 through 2.4 hereof.
5.8. Restriction on Resales. Until the expiration of two
years after the original issuance of the Securities, the Company will not, and
will cause its "affiliates" (as such term is defined in Rule 144(a)(1) under the
1933 Act) not to, resell any Securities which are "restricted securities" (as
such term is defined under Rule 144(a)(3) under the 1933 Act) that have been
reacquired by any of them and shall immediately upon any purchase of any such
Securities submit such Securities to the Trustee for cancellation.
5.9 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.
5.10 Headings. The headings in this Agreement are for
convenience of reference only and shall not limit or otherwise affect the
meaning hereof.
5.11 GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY
AND CONSTRUED IN ACCORDANCE WITH THE LAW OF
28
THE STATE OF NEW YORK WITHOUT REGARD TO THE PRINCIPLES OF CONFLICT OF LAWS
THEREOF.
5.12 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.
29
IN WITNESS WHEREOF, the parties have executed this Agreement
as of the date first written above.
NATIONAL-OILWELL, INC.
By: ___________________________________
Name:
Title:
Confirmed and accepted as
of the date first above
written:
MERRILL LYNCH, PIERCE, FENNER & SMITH
INCORPORATED
BY: MERRILL LYNCH, PIERCE, FENNER & SMITH
INCORPORATED
By: ____________________________
Name:
Title:
30
EXHIBIT 5
March 7, 2003
National-Oilwell, Inc.
10000 Richmond Avenue
Houston, Texas 77042
Ladies and Gentlemen:
We have acted as counsel to National-Oilwell, Inc., a Delaware corporation (the
"Company"), in connection with the offer by the Company to exchange $1,000
principal amount of its 5.65% Senior Notes due 2012, Series B (the "Exchange
Notes") for each outstanding $1,000 principal amount of its 5.65% Senior Notes
due 2012 (the "Original Notes"), of which an aggregate of $200,000,000 principal
amount is outstanding (the "Exchange Offer"). The Company has filed with the
Securities and Exchange Commission (the "Commission") a registration statement
on Form S-4 (the "Registration Statement"), with respect to the Exchange Offer
under the Securities Act of 1933, as amended (the "Securities Act").
We have examined originals or copies of the Registration Statement and of (a)
the Indenture, dated as of November 22, 2002 (the "Indenture"), by and between
the Company and The Bank of New York, as Trustee (the "Trustee"), pursuant to
which the Original Notes were issued and the Exchange Notes will be issued; (b)
the Amended and Restated Certificate of Incorporation of the Company, as amended
to date; (c) the Bylaws of the Company, as amended to date; (d) certain
resolutions of the Board of Directors of the Company; and (e) such other
documents and records as we have deemed necessary and relevant for the purposes
hereof. In addition, we have relied on certificates of officers of the Company,
public officials and others as to certain matters of fact relating to this
opinion and have made such investigations of law as we have deemed necessary and
relevant as a basis hereof. In such examination, we have assumed the genuineness
of all signatures, the authenticity of all documents and records submitted to us
as originals, the conformity to authentic original documents and records of all
documents and records submitted to us as copies, and the truthfulness of all
statements of fact contained therein. We have also assumed the due execution and
delivery of the Indenture and the due authentication of the Original Notes by a
duly authorized officer of the Trustee.
National-Oilwell, Inc.
March 7, 2003
Page 2 of 2
Based on the foregoing and subject to the limitations, assumptions and
qualifications set forth herein, and having due regard for such legal
considerations as we deem relevant, we are of the opinion that:
1. The Company is validly existing and in good standing as a
corporation under the laws of the State of Delaware; and
2. The Original Notes have been validly authorized and issued,
the Exchange Notes have been validly authorized, and (subject to the
Indenture being qualified under the Trust Indenture Act of 1939, as
amended) when (i) the Exchange Notes have been duly executed (manually
or in facsimile) by a duly authorized officer of the Company, (ii) the
Exchange Notes have been duly authenticated by the Trustee under the
Indenture, and (iii) Original Notes have been validly tendered and not
withdrawn and accepted for exchange by the Company, all in accordance
with the terms of the Exchange Offer as described in the Registration
Statement, the Exchange Notes issued in exchange for such Original
Notes in accordance with the terms of the Exchange Offer will be
validly issued and legally binding obligations of the Company entitled
to the benefits of the Indenture.
We hereby consent to the filing of this opinion with the Commission as Exhibit 5
to the Registration Statement and to the references to our firm under the
heading "Validity of the Exchange Notes" in the Prospectus included in the
Registration Statement. By giving such consent, we do not admit that we are
experts with respect to any part of the Registration Statement, including this
Exhibit, within the meaning of the term "expert" as used in the Securities Act
or the rules and regulations thereunder.
Very truly yours,
/s/ Bracewell & Patterson, L.L.P.
Bracewell & Patterson, L.L.P.
.
.
.
EXHIBIT 12
NATIONAL-OILWELL, INC.
COMPUTATION OF CONSOLIDATED RATIOS OF EARNINGS TO FIXED CHARGES
FISCAL YEAR ENDED DECEMBER 31,
--------------------------------------------------------
($000's) 2002 2001 2000 1999 1998
-------- -------- ------- -------- --------
Earnings before Income Taxes $112,465 $168,017 $27,037 $(14,859) $125,021
Fixed Charges:
- --------------
Interest Expense $ 24,136 $ 22,873 $17,298 $ 14,083 $ 13,106
Amortization of Debt Issuance Costs 634 481 1,281 191 181
Interest Portion of Rental Expense 3,180 2,844 1,897 2,151 1,545
Total Fixed Charges $ 27,950 $ 26,198 $20,476 $ 16,425 $ 14,832
Ratio of Earnings to Fixed Charges 5.0 7.4 2.3 0.1 9.4
Exhibit 23.2
CONSENT OF INDEPENDENT AUDITORS
We consent to the reference to our firm under the caption "Experts" in the
Registration Statement (Form S-4) and related Prospectus of National Oilwell,
Inc. for the registration of $200,000,000 5.65% Senior Notes due 2012 and to the
incorporation by reference therein of our report dated February 18, 2003, with
respect to the consolidated financial statements of National Oilwell, Inc.
included in its Annual Report (Form 10-K) for the year ended December 31, 2002,
filed with the Securities and Exchange Commission.
March 6, 2003
Houston, Texas
EXHIBIT 25
================================================================================
FORM T-1
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
STATEMENT OF ELIGIBILITY
UNDER THE TRUST INDENTURE ACT OF 1939 OF A
CORPORATION DESIGNATED TO ACT AS TRUSTEE
CHECK IF AN APPLICATION TO DETERMINE
ELIGIBILITY OF A TRUSTEE PURSUANT TO
SECTION 305(b)(2) [ ]
THE BANK OF NEW YORK
(Exact name of trustee as specified in its charter)
New York 13-5160382
(State of incorporation (I.R.S. employer
if not a U.S. national bank) identification no.)
One Wall Street, New York, N.Y. 10286
(Address of principal executive offices) (Zip code)
NATIONAL-OILWELL, INC.
(Exact name of obligor as specified in its charter)
Delaware 76-0475815
(State or other jurisdiction of (I.R.S. employer
incorporation or organization) identification no.)
10000 Richmond Avenue
Houston, Texas 77042-4200
(Address of principal executive offices) (Zip code)
-------------
5.65% Senior Notes due 2012
(Title of the indenture securities)
================================================================================
1. GENERAL INFORMATION. FURNISH THE FOLLOWING INFORMATION AS TO THE
TRUSTEE:
(a) NAME AND ADDRESS OF EACH EXAMINING OR SUPERVISING AUTHORITY TO
WHICH IT IS SUBJECT.
- ------------------------------------------------------------------------------------------------------
Name Address
- ------------------------------------------------------------------------------------------------------
Superintendent of Banks of the State of 2 Rector Street, New York,
New York N.Y. 10006, and Albany, N.Y. 12203
Federal Reserve Bank of New York 33 Liberty Plaza, New York, N.Y.
N.Y. 10045
Federal Deposit Insurance Corporation Washington, D.C. 20429
New York Clearing House Association New York, New York 10005
(b) WHETHER IT IS AUTHORIZED TO EXERCISE CORPORATE TRUST POWERS.
Yes.
2. AFFILIATIONS WITH OBLIGOR.
IF THE OBLIGOR IS AN AFFILIATE OF THE TRUSTEE, DESCRIBE EACH SUCH
AFFILIATION.
None.
16. LIST OF EXHIBITS.
EXHIBITS IDENTIFIED IN PARENTHESES BELOW, ON FILE WITH THE COMMISSION,
ARE INCORPORATED HEREIN BY REFERENCE AS AN EXHIBIT HERETO, PURSUANT TO
RULE 7A-29 UNDER THE TRUST INDENTURE ACT OF 1939 (THE "ACT") AND 17
C.F.R. 229.10(d).
1. A copy of the Organization Certificate of The Bank of New York
(formerly Irving Trust Company) as now in effect, which contains
the authority to commence business and a grant of powers to
exercise corporate trust powers. (Exhibit 1 to Amendment No. 1 to
Form T-1 filed with Registration Statement No. 33-6215, Exhibits
1a and 1b to Form T-1 filed with Registration Statement No.
33-21672 and Exhibit 1 to Form T-1 filed with Registration
Statement No. 33-29637.)
4. A copy of the existing By-laws of the Trustee. (Exhibit 4 to Form
T-1 filed with Registration Statement No. 33-31019.)
6. The consent of the Trustee required by Section 321(b) of the Act.
(Exhibit 6 to Form T-1 filed with Registration Statement No.
33-44051.)
7. A copy of the latest report of condition of the Trustee published
pursuant to law or to the requirements of its supervising or
examining authority.
-2-
SIGNATURE
Pursuant to the requirements of the Act, the Trustee, The Bank of New
York, a corporation organized and existing under the laws of the State of New
York, has duly caused this statement of eligibility to be signed on its behalf
by the undersigned, thereunto duly authorized, all in The City of New York, and
State of New York, on the 6th day of March, 2003.
THE BANK OF NEW YORK
By: /s/ VAN K. BROWN
------------------------------
Name: VAN K. BROWN
Title: VICE PRESIDENT
EXHIBIT 7
Consolidated Report of Condition of
THE BANK OF NEW YORK
of One Wall Street, New York, N.Y. 10286
And Foreign and Domestic Subsidiaries,
a member of the Federal Reserve System, at the close of business September 30,
2002, published in accordance with a call made by the Federal Reserve Bank of
this District pursuant to the provisions of the Federal Reserve Act.
Dollar Amounts
In Thousands
ASSETS
Cash and balances due from depository institutions:
Noninterest-bearing balances and currency and coin.. $3,735,469
Interest-bearing balances........................... 3,791,026
Securities:
Held-to-maturity securities......................... 1,140,688
Available-for-sale securities....................... 15,232,384
Federal funds sold in domestic offices................. 1,286,657
Securities purchased under agreements to
resell.............................................. 1,035,718
Loans and lease financing receivables:
Loans and leases held for sale...................... 869,285
Loans and leases, net of unearned
income...............34,695,130
LESS: Allowance for loan and
lease losses............645,382
Loans and leases, net of unearned
income and allowance.............................. 34,049,748
Trading Assets......................................... 9,044,881
Premises and fixed assets (including capitalized
leases)............................................. 823,722
Other real estate owned................................ 778
Investments in unconsolidated subsidiaries and
associated companies................................ 226,274
Customers' liability to this bank on acceptances
outstanding......................................... 249,803
Intangible assets......................................
Goodwill............................................ 1,852,232
Other intangible assets............................. 54,714
Other assets........................................... 4,961,572
-----------
Total assets........................................... $78,354,951
===========
LIABILITIES
Deposits:
In domestic offices................................. $32,962,289
Noninterest-bearing.......................12,792,415
Interest-bearing..........................20,169,874
In foreign offices, Edge and Agreement
subsidiaries, and IBFs............................ 24,148,516
Noninterest-bearing..........................445,725
Interest-bearing..........................23,702,791
Federal funds purchased in domestic
offices.............................................. 959,287
Securities sold under agreements to repurchase......... 491,806
Trading liabilities.................................... 2,916,377
Other borrowed money:
(includes mortgage indebtedness and obligations
under capitalized leases)........................... 1,691,634
Bank's liability on acceptances executed and
outstanding......................................... 251,701
Subordinated notes and debentures...................... 2,090,000
Other liabilities...................................... 5,815,688
-----------
Total liabilities...................................... $71,327,298
===========
Minority interest in consolidated
subsidiaries........................................ 500,019
EQUITY CAPITAL
Perpetual preferred stock and related
surplus............................................. 0
Common stock........................................... 1,135,284
Surplus................................................ 1,056,724
Retained earnings...................................... 4,218,003
Accumulated other comprehensive income................. (117,623)
Other equity capital components........................ 0
- ---------------------------------------------------------------------------
Total equity capital................................... 6,527,634
---------
Total liabilities minority interest and equity capital. $78,354,951
===========
I, Thomas J. Mastro, Senior Vice President and Comptroller of the
above-named bank do hereby declare that this Report of Condition is true and
correct to the best of my knowledge and belief.
Thomas J. Mastro,
Senior Vice President and Comptroller
We, the undersigned directors, attest to the correctness of this
statement of resources and liabilities. We declare that it has been examined by
us, and to the best of our knowledge and belief has been prepared in conformance
with the instructions and is true and correct.
Thomas A. Renyi )
Gerald L. Hassell ) Directors
Alan R. Griffith )
EXHIBIT 99.1
NATIONAL-OILWELL, INC.
NOTICE OF GUARANTEED DELIVERY
FOR TENDER FOR EXCHANGE OF
5.65% SENIOR NOTES DUE 2012
PURSUANT TO THE PROSPECTUS DATED ______________, 2003
THE EXCHANGE AGENT FOR THE EXCHANGE OFFER IS:
THE BANK OF NEW YORK
BY REGISTERED OR CERTIFIED MAIL: BY FACSIMILE: BY HAND OR OVERNIGHT DELIVERY:
The Bank of New York (Eligible Institutions Only) The Bank of New York
Corporate Trust Operations Corporate Trust Operations
Reorganization Unit (212) 298-1915 Reorganization Unit
101 Barclay Street - 7 East 101 Barclay Street
New York, New York 10286 To Confirm by Telephone or Corporate Trust Services Window
(212) 815-3738
THE EXCHANGE AGENT MUST RECEIVE THIS FORM PRIOR TO THE EXPIRATION DATE
WHICH IS ___________, 2003, UNLESS EXTENDED.
DELIVERY OF THIS NOTICE OF GUARANTEED DELIVERY TO AN ADDRESS, OR
TRANSMISSION VIA FACSIMILE, OTHER THAN AS SET FORTH ABOVE WILL NOT CONSTITUTE
VALID DELIVERY.
As set forth under the caption "The Exchange Offer--Procedures for
Tendering Original Notes--Guaranteed Delivery" in the Prospectus dated
___________, 2003 (the "Prospectus") of National-Oilwell, Inc. (the "Company")
and in Instruction 2 of the related Letter of Transmittal (the "Letter of
Transmittal" and, together with the Prospectus, the "Exchange Offer"), this form
must be used to accept the Company's offer to exchange its 5.65% Senior Notes
due 2012, Series B for its 5.65% Senior Notes due 2012 (the "Original Notes") if
time will not permit the Letter of Transmittal, certificates representing such
Original Notes and other required documents to reach the Exchange Agent, or the
procedures for book-entry transfer cannot be completed, on or prior to the
Expiration Date. This form must be delivered by an Eligible Institution (as
defined in the Prospectus) by mail or hand delivery, or transmitted, via
facsimile, to the Exchange Agent as set forth above. All capitalized terms used
herein but not defined herein shall have the meaning ascribed to them in the
Prospectus.
THIS FORM IS NOT TO BE USED TO GUARANTEE SIGNATURES. IF A SIGNATURE ON
THE LETTER OF TRANSMITTAL IS REQUIRED TO BE GUARANTEED BY AN "ELIGIBLE
INSTITUTION" UNDER THE INSTRUCTIONS TO THE LETTER OF TRANSMITTAL, SUCH SIGNATURE
GUARANTEE MUST APPEAR IN THE APPLICABLE SPACE PROVIDED IN THE LETTER OF
TRANSMITTAL FOR GUARANTEE OF SIGNATURES.
Ladies and Gentlemen:
The undersigned hereby tender(s) to National-Oilwell, Inc. for
exchange, upon the terms and subject to the conditions set forth in the
Prospectus and the Letter of Transmittal, and the instructions thereto (receipt
of which are hereby acknowledged), the principal amount of the Original Notes
specified below pursuant to the guaranteed delivery procedures set forth under
the caption "The Exchange Offer--Procedures for Tendering Original
Notes--Guaranteed Delivery" of the Prospectus.
The undersigned understands that no withdrawal of a tender of Original
Notes may be made on or after the Expiration Date. The undersigned understands
that for a withdrawal of a tender of Original Notes to be effective, a written
notice of withdrawal must be timely received by the Exchange Agent at one of its
addresses specified on the cover of this Notice of Guaranteed Delivery prior to
the Expiration Date.
The undersigned understands that payment by the Exchange Agent for
Original Notes tendered and accepted for exchange pursuant to the Exchange Offer
will be made only after timely receipt by the Exchange Agent of such Original
Notes (or Book-Entry Confirmation of the transfer of such Original Notes into
the Exchange Agent's account at DTC) and a Letter of Transmittal (or facsimile
thereof) with respect to such Original Notes properly completed and duly
executed, with any required signature guarantees and any other documents
required by the Letter of Transmittal or a properly transmitted Agent's Message.
All authority conferred or agreed to be conferred by this Notice of
Guaranteed Delivery shall not be affected by, and shall survive, the death or
incapacity of the undersigned, and every obligation of the undersigned under
this Notice of Guaranteed Delivery shall be binding upon the heirs, executors,
administrators, trustees in bankruptcy, personal and legal representatives,
successors and assigns of the undersigned.
-2-
PLEASE COMPLETE AND SIGN
AGGREGATE PRINCIPAL
AMOUNT
CERTIFICATE OR REPRESENTED BY ORIGINAL PRINCIPAL AMOUNT TENDERED
REGISTRATION NUMBERS NOTE(S) (MUST BE IN INTEGRAL MULTIPLES
OF $1,000)
If Original Notes will be tendered by book-entry transfer, please provide
the following information:
DTC Account Number:________________________________________________
Transaction Code (if available):___________________________________
Date:______________________________________________________________
PLEASE SIGN HERE
This Notice of Guaranteed Delivery must be signed by the Holder(s)
exactly as their name(s) appear on certificate(s) for Original Notes, or if
tendered by a participant in DTC exactly as such participant's name appears on a
security position listing as the owner of Original Notes, or by person(s)
authorized to become Holder(s) by endorsements and documents transmitted with
this Notice of Guaranteed Delivery. If signature is by a trustee, executor,
administrator, guardian, attorney-in-fact, officer or other person acting in a
fiduciary or representative capacity, such person must provide the following
information:
PLEASE PRINT NAME(S) AND ADDRESS(ES)
Signature(s) of Owner(s) or Authorized Signatory:____________________________
Name(s):_____________________________________________________________________
Capacity:____________________________________________________________________
Address(es) and Telephone:___________________________________________________
_____________________________________________________________________________
Taxpayer Identification Number or Social Security Number:____________________
Date:______________________________________________
DO NOT SEND ORIGINAL NOTES WITH THIS FORM. NOTES SHOULD BE SENT TO THE EXCHANGE
AGENT TOGETHER WITH A PROPERLY COMPLETED AND DULY EXECUTED LETTER OF
TRANSMITTAL.
THE SIGNATURE GUARANTEE ON THE NEXT PAGE MUST BE COMPLETED.
-3-
GUARANTEE OF DELIVERY
(NOT TO BE USED FOR SIGNATURE GUARANTEE)
The undersigned, a recognized member of the Medallion Signature
Guarantee Program or any other "eligible guarantor institution," as such term is
defined in Rule 17Ad-15 promulgated under the Securities Exchange Act of 1934,
as amended (each, an "Eligible Institution"), hereby (i) represents that the
above-named persons are deemed to own the Original Notes tendered hereby within
the meaning of Rule 14e-4 promulgated under the Securities Exchange Act of 1934,
as amended ("Rule 14e-4"), (ii) represents that such tender of Original Notes
complies with Rule 14e-4, and (iii) guarantees that the Original Notes tendered
hereby in proper form for transfer (pursuant to the procedures set forth in the
Prospectus under the caption "The Exchange Offer--Procedures for Tendering
Notes--Guaranteed Delivery"), together with a properly completed and duly
executed Letter of Transmittal (or manually signed facsimile thereof) with any
required signature guarantee and any other documents required by the Letter of
Transmittal or a properly transmitted Agent's Message, will be received by the
Exchange Agent at one of its addresses set forth above within two business days
after the date of execution hereof.
The Eligible Institution that completes this form must communicate the
guarantee to the Exchange Agent and must deliver the Letter of Transmittal, or
Agent's Message, and Original Notes to the Exchange Agent within the time period
shown herein. Failure to do so could result in a financial loss to such Eligible
Institution.
Name of Firm:____________________________________
Authorized Signature:____________________________
_________________________________________________
Name:____________________________________________
Title:___________________________________________
Address:_________________________________________
_________________________________________________
(Zip Code)
Area Code and Telephone Number:__________________
Dated: , 2003
DO NOT SEND CERTIFICATES REPRESENTING ORIGINAL NOTES WITH THIS FORM.
CERTIFICATES REPRESENTING ORIGINAL NOTES SHOULD BE SENT ONLY WITH A LETTER OF
TRANSMITTAL.
-4-
EXHIBIT 99.2
NATIONAL-OILWELL, INC.
OFFER TO EXCHANGE
5.65% SENIOR NOTES DUE 2012, SERIES B
FOR
5.65% SENIOR NOTES DUE 2012
THIS OFFER WILL EXPIRE AT 5:00 P.M., NEW YORK CITY TIME,
ON ____________, ________, 2003, UNLESS EXTENDED.
To Brokers, Dealers, Commercial
Banks, Trust Companies and
Other Nominees:
We are enclosing herewith the materials listed below relating to the
offer by National-Oilwell, Inc. (the "Company") to exchange up to $200,000,000
aggregate principal amount of the Company's new 5.65% Senior Notes due 2012,
Series B for any and all outstanding 5.65% Senior Notes due 2012, all as
described in, and upon the terms and subject to the conditions set forth in, the
Company's Prospectus dated ________, 2003, and the related Letter of Transmittal
(which together constitute the "Exchange Offer").
For your information and for forwarding to your clients for whom you
hold Notes registered in your name or in the name of your nominee, we are
enclosing the following documents:
1. Prospectus dated _____________, 2003.
2. The Letter of Transmittal for your use. A copy of
the Letter of Transmittal is included in the
Prospectus for the information of your clients.
3. Guidelines for Certification of Taxpayer
Identification Number on Substitute Form W-9.
4. Notice of Guaranteed Delivery.
YOUR PROMPT ACTION IS REQUESTED. The Exchange Offer will expire at 5:00
p.m., New York city time, on __________, _________, 2003, unless extended by
National-Oilwell, Inc., in its sole discretion (the "Expiration Date"). The
5.65% Senior Notes due 2012 tendered pursuant to the exchange offer may be
withdrawn at any time before the Expiration Date.
The Exchange Offer is not conditioned upon any minimum number of
original notes being tendered.
Any inquiries you may have with respect to the procedures for tendering
pursuant to the Exchange Offer, or requests for additional copies of the
enclosed materials, should be directed to the Exchange Agent, The Bank of New
York, at (212) 815-3738.
Very truly yours,
National-Oilwell, Inc.
NOTHING CONTAINED HEREIN OR IN THE ENCLOSED DOCUMENTS SHALL CONSTITUTE
YOU THE AGENT OF NATIONAL-OILWELL, INC. OR THE EXCHANGE AGENT OR AUTHORIZE YOU
OR ANY OTHER PERSON TO USE ANY DOCUMENT OR MAKE ANY STATEMENT ON BEHALF OF ANY
OF THEM IN CONNECTION WITH THE OFFER OTHER THAN THE DOCUMENTS ENCLOSED HEREWITH
AND THE STATEMENTS CONTAINED THEREIN.
