EXHIBIT 10.40
EXECUTION COPY
AMENDMENT AND CONSENT
AMENDMENT AND CONSENT, dated as of June 26, 2000 (this "Amendment"),
to (i) the Guarantee (the "2000 Guarantee"), as defined in the Participation
Agreement, dated as of March 13, 2000 (as the same may be amended, supplemented
or otherwise modified from time to time, the "2000 Participation Agreement"),
among Hanover Compressor Company ("Holdings"), Hanover Compression Inc., a
Delaware corporation ("HCC"), Hanover Equipment Trust 2000A, (the "2000
Lessor"), First Union National Bank and Scotiabanc Inc. (the "2000 Investors"),
the lenders parties thereto (the "2000 Lenders"), and The Chase Manhattan Bank,
a New York banking corporation, as the agent for the 2000 Lenders (the "Agent"),
(ii) the Guarantee (the "1999 Guarantee"), as defined in the Participation
Agreement, dated as of June 15, 1999 (as the same may be amended, supplemented
or otherwise modified from time to time, the "1999 Participation Agreement"),
among HCC, Hanover Equipment Trust 1999A (the "1999 Lessor"), and Societe
Generale Financial Corporation and FBTC Leasing Corp., Inc. (the "1999
Investors"), the lenders parties thereto (the "1999 Lenders") and the Agent as
agent for the 1999 Lenders, (iii) the Guarantee (the "1998 Guarantee"), as
defined in the Participation Agreement, dated as of July 22, 1998 (as the same
may be amended, supplemented or otherwise modified from time to time, the "1998
Participation Agreement"), among HCC, Hanover Equipment Trust 1998A (the "1998
Lessor"), Societe Generale Financial Corporation (the "1998 Investor"), and the
lenders parties thereto (the "1998 Lenders") and the Agent, as agent for the
1998 Lenders, and (iv) the Amended and Restated Senior Credit Agreement ("Senior
Credit Agreement"), dated March 13, 2000, among Holdings, HCC, the Agent, and
the lenders parties thereto (the "Senior Credit Lenders"). The 2000
Participation Agreement, the 1999 Participation Agreement and the 1998
Participation Agreement are collectively hereinafter referred to as the
"Participation Agreements".
W I T N E S S E T H:
WHEREAS, Holdings and HCC have requested that the Agent and the
Required Lenders under each of the Synthetic Guarantees and the Senior Credit
Agreement amend certain covenants in each of the Synthetic Guarantees and the
Senior Credit Agreement; and
WHEREAS, the Agent and the Required Lenders under each of the
Synthetic Guarantees and the Senior Credit Agreement are agreeable to the
requested amendments, but only on the terms and subject to the conditions set
forth herein;
NOW THEREFORE, in consideration of the premises herein contained and
for other good and valuable consideration, the receipt of which is hereby
acknowledged, the parties hereto hereby agree as follows:
I. Defined Terms. As used in this Amendment, terms defined in the
preamble hereof and the recitals hereto are used herein as so defined, terms
defined in any of the Participation Agreements or the Senior Credit Agreement
are used herein as therein defined and the following terms shall have the
following meanings:
" Synthetic Guarantee" shall mean any of the 2000 Guarantee, the 1999
Guarantee, or the 1998 Guarantee.
" Guarantor" shall mean a Guarantor under any of the Synthetic
Guarantees or the Senior Credit Agreement.
II. Amendments to the Senior Credit Agreement and the Synthetic
Guarantees.
1. Amendment to Subsection 11.2 of each of the Synthetic
Guarantees and Subsection 8.2 of the Senior Credit Agreement. (a) Subsections
11.2 of each of the Synthetic Guarantees are hereby amended by deleting
paragraph (d) in its entirety therefrom and substituting in place thereof the
following:
" (d) Indebtedness of Holdings and any of its Subsidiaries in
an aggregate amount not to exceed $50,000,000 at any time outstanding which
is recourse only to the assets of HCC or any of its Subsidiaries acquired
or financed with the proceeds of such Indebtedness; provided that,
immediately after giving effect to the incurrence of such Indebtedness,
Holdings shall be in compliance, on a pro forma basis after giving effect
to such Indebtedness, with the covenants in subsection 11.1 recomputed as
at the last day of the most recently ended fiscal quarter of Holdings as if
such Indebtedness had been incurred on the first day of each relevant
period for testing such compliance, and Holdings shall have delivered to
the Agent an officers' certificate to such effect, together with all
relevant financial information."
(b) Subsection 8.2 of the Senior Credit Agreement is hereby amended by
deleting paragraph (d) in its entirety therefrom and substituting in place
thereof the following:
" (d) Indebtedness of Holdings and any of its Subsidiaries in
an aggregate amount not to exceed $50,000,000 at any time outstanding which
is recourse only to the assets of HCC or any of its Subsidiaries acquired
or financed with the proceeds of such Indebtedness; provided that,
immediately after giving effect to the incurrence of such Indebtedness,
Holdings shall be in compliance, on a pro forma basis after giving effect
to such Indebtedness, with the covenants in subsection 8.1 recomputed as at
the last day of the most recently ended fiscal quarter of Holdings as if
such Indebtedness had been incurred on the first day of each relevant
period for testing such compliance, and Holdings shall have delivered to
the Administrative Agent an officers' certificate to such effect, together
with all relevant financial information."
(c) Subsections 11.2(j) of each of the Synthetic Guarantees and 8.2(j)
of the Senior Credit Agreement are hereby amended by replacing "$5,000,000" with
"$20,000,000".
2. Amendment to Subsection 11.8 of each of the Synthetic
Guarantees and Subsection 8.8 of the Senior Credit Agreement. Subsections 11.8
of each of the Synthetic Guarantees and 8.8 of the Senior Credit Agreement are
hereby amended by (i) deleting the word "and" which appears before clause (v)
thereof and (ii) adding the following new clause (vi) at the end thereof:
" and (vi) HCC may declare and pay dividends or make distributions to
Holdings to the extent necessary to allow Holdings to make payments on
its promissory notes to be issued in favor of the sellers of the KCC
Group Limited so long as (A) the aggregate amount of such
declarations, payments or distributions pursuant to this clause (vi)
does not exceed (pound)6,000,000 (UK) plus accrued interest thereon
and (B) no such dividend may be paid more than three Business Days
prior to the date the equivalent payment is made on such notes."
3. Amendment to Subsection 11.10 of each of the Synthetic
Guarantees and Subsection 8.10 of the Senior Credit Agreement. (a) Subsections
11.10 of each of the Synthetic Guarantees are hereby amended by deleting
paragraph (g) in its entirety therefrom and substituting in place thereof the
following:
" (g) Investments constituting Permitted Business-Acquisitions
so long as, after giving effect to the consummation of the transactions
contemplated by each Permitted Business Acquisition, the Loans to be made
and the Letters of Credit to be issued under the Corporate Credit Agreement
and the loans to be made under the Equipment Lease Credit Agreements in
connection therewith, the sum of (i) the cash and Cash Equivalents then
held by Holdings, (ii) the Available Commitments of all the Lenders under
the Corporate Credit Agreement, and (iii) the Available Commitments and
Available Investor Commitments under the Equipment Lease Participation
Agreements at such time, equals at least $20,000,000;".
(b) Subsection 8.10 of the Senior Credit Agreement is hereby amended
by deleting paragraph (g) in its entirety therefrom and substituting in place
thereof the following:
" (g) Investments constituting Permitted Business Acquisitions
so long as, after giving effect to the consummation of the transactions
contemplated by each Permitted Business Acquisition, the Loans to be made
and the Letters of Credit to be issued hereunder and the loans to be made
under the Equipment Lease Credit Agreements in connection therewith, the
sum of (i) the cash and Cash Equivalents then held by Holdings, (ii) the
Available Commitments of all the Lenders hereunder, and (iii) the Available
Commitments and Available Investor Commitments (each as defined in the
Participation Agreements) under the Equipment Lease Participation
Agreements at such time, equals at least $20,000,000;".
III. Consent.
Each of the Required Lenders and the Investors, as party to each
Participation Agreement and each other Operative Document, as applicable,
consents to the amendments in Section I hereto.
IV. General.
1. Effectiveness. This Amendment shall become effective upon
fulfillment of the following conditions precedent: (a) Holdings and HCC shall
have delivered to the Agent duly executed copies of this Amendment, (b) the
Guarantors (other than Holdings or HCC) shall have delivered to the Agent duly
executed copies of this Amendment, (c) the Agent shall have received duly
executed copies of this Amendment from the Required Lenders, and (d) no Default
or Event of Default shall have occurred and be continuing on the date hereof
after giving effect to this Amendment.
2. Representations and Warranties. Holdings, HCC and each of the other
Guarantors hereby represents and warrants that the representations and
warranties contained in each of the Participation Agreements and the Operative
Agreements will be, after giving effect to this Amendment, true and correct in
all material respects, as if made on and as of the date hereof (except those
which expressly speak as of a certain date).
3. Continuing Effect of the Senior Credit Agreement, Participation
Agreements and Operative Agreements. This Amendment shall not constitute an
amendment or waiver of any other provision of the Participation Agreements, the
Senior Credit Agreement, Loan Documents or the Operative Agreements not
expressly referred to herein and shall not be construed as a waiver or consent
to any further or future action on the part of HCC, Holdings, the 2000 Lessor,
1999 Lessor, the 1998 Lessor or the other Guarantors that would require a waiver
or consent of the Agent and/or the 2000 Lenders, 1999 Lenders or 1998 Lenders.
Except as expressly amended hereby, the provisions of each of the Participation
Agreements, the Senior Credit Agreement, the Loan Documents and the Operative
Agreements are and shall remain in full force and effect.
4. Counterparts. This Amendment may be executed in counterparts and
all of the said counterparts taken together shall be deemed to constitute one
and the same instrument. Delivery of an executed signature page of this
Amendment by facsimile transmission shall be effective as delivery of a manually
executed counterpart hereof.
5. GOVERNING LAW. THIS AMENDMENT SHALL BE GOVERNED BY, AND CONSTRUED
AND INTERPRETED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.
6. Expenses. Holdings and HCC agree to pay or reimburse the Agent for
all of its reasonable out-of-pocket costs and expenses incurred in connection
with the preparation, negotiation and execution of this Amendment, including,
without limitation, the fees and disbursements of counsel to the Agent.
IN WITNESS WHEREOF, the parties hereto have caused this Amendment to
be duly executed by their respective officers thereunto duly authorized as of
the day and year first above written.
HANOVER COMPRESSOR COMPANY, as a signatory to
the Senior Credit Agreement and as a Guarantor
By: /s/ [Illegible]
---------------------------------------
Name:
Title:
HANOVER COMPRESSION INC., as a signatory to
the Senior Credit Agreement and as a Guarantor
By: /s/ [Illegible]
---------------------------------------
Name:
Title:
HANOVER EQUIPMENT TRUST 2000A, as a Borrower
under the 2000 Participation Agreement
By: Wilmington Trust Company, not individually but
solely as Trustee
By:
----------------------------------------
Name:
Title:
HANOVER EQUIPMENT TRUST 1999A, as a Borrower
under the 1999 Participation Agreement
By: Wilmington Trust Company, not individually but
solely as Trustee
By:
----------------------------------------
Name:
Title:
HANOVER EQUIPMENT TRUST 1998A, as a Borrower
under the 1998 Participation Agreement
By: Wilmington Trust Company, not individually but
solely as Trustee
By:
--------------------------------------------
Name:
Title:
HANOVER/XXXXX, LIMITED PARTNERSHIP, as a Guarantor
By: Hanover General Holdings, Inc., its general partner
By: /s/ [Illegible]
--------------------------------------------
Name:
Title:
HANOVER MAINTECH, LIMITED PARTNERSHIP, as a Guarantor
By: Hanover General Holdings, Inc., its general partner
By: /s/ [Illegible]
--------------------------------------------
Name:
Title:
HANOVER LAND LIMITED PARTNERSHIP, as a Guarantor
By: Hanover General Holdings, Inc., its general partner
By: /s/ [Illegible]
--------------------------------------------
Name:
Title:
HANOVER COMPRESSOR LIMITED HOLDINGS, LLC
By: Hanover General Holdings, Inc., as sole member
By: /s/ [Illegible]
--------------------------------------------
Name:
Title:
THE CHASE MANHATTAN BANK, as Agent, a 2000 Lender, 1999
Lender, 1998 Lender, and Senior Credit Lender
By: /s/ Xxxxxx Xxxx
--------------------------------------------
Name: Xxxxxx Xxxx
Title: Vice President
FIRST UNION NATIONAL BANK, as a 2000 Lender,
1998 Lender, and Senior Credit Lender
By: /s/ Xxxxxx X. Xxxxxxxxx
--------------------------------------------
Name: Xxxxxx X. Xxxxxxxxx
Title: Senior Vice President
SOCIETE GENERALE, SOUTHWEST AGENCY, as a
1999 Lender and 1998 Lender
By: /s/ Xxxx X. Xxx
--------------------------------------------
Name: Xxxx X. Xxx
Title: Director
ABN AMBRO BANK N.V., as a 1999 Lender and 1998
Lender
By: /s/ Xxxxxx Xxxxxxx
--------------------------------------------
Name: Xxxxxx Xxxxxxx
Title: Vice President
By: /s/ Xxxx XxXxxx
--------------------------------------------
Name: Xxxx XxXxxx
Title: Assistant Vice President
THE BANK OF NOVA SCOTIA, as a 2000 Lender, 1999
Lender, 1998 Lender, and Senior Credit Lender
By: /s/ F.C.H Xxxxx
--------------------------------------------
Name: F.C.H. Xxxxx
Title: Senior Manager Loan Operations
BANK OF SCOTLAND, as a 1999 Lender
By: /s/ Xxxxxx Xxxxxx
--------------------------------------------
Name: Xxxxxx Xxxxxx
Title: Vice President
BNP PARIBAS, as a 2000 Lender, 1999 Lender, and Senior
Credit Lender
By: /s/ Xxxxxx Xxxxxxxxxx
--------------------------------------------
Name: Xxxxxx Xxxxxxxxxx
Title: Vice President
By: /s/ Xxxxx Xxxxxx
--------------------------------------------
Name: Xxxxx Xxxxxx
Title: Vice President
CREDIT LYONNAIS NEW YORK BRANCH, as a 1999
Lender, 1998 Lender, and Senior Credit Lender
By: /s/ [ILLEGIBLE]
--------------------------------------------
Name: [ILLEGIBLE]
Title: [ILLEGIBLE]
DG BANK DEUTSCHE GENOSSENSCHAFTSBANK AG,
as a 2000 Lender and 1999 Lender
By: /s/ Xxxx X. Xxxxxxxx
--------------------------------------------
Name: Xxxx X. Xxxxxxxx
Title: Vice President
By: /s/ Xxxxxxx X. Xxxxxxx
--------------------------------------------
Name: Xxxxxxx X. Xxxxxxx
Title: Vice President
DRESDNER BANK AG, NEW YORK AND GRAND
CAYMAN BRANCHES, as a 1998 Lender
By: /s/ B. Xxxxx Xxxxxxxx
--------------------------------------------
Name: B. Xxxxx Xxxxxxxx
Title: Vice President
By: /s/ Xxxxxxx Xxxxxxxxxx
--------------------------------------------
Name: Xxxxxxx Xxxxxxxxxx
Title: First Vice President
BANK ONE, N.A. (formerly known as The First National
Bank of Chicago), as a 1998 Lender, 1999 Lender, and 2000
Lender
By: /s/ Xxxxx Xxxxxxxxx
--------------------------------------------
Name: Xxxxx Xxxxxxxxx
Title: First Vice President
THE INDUSTRIAL BANK OF JAPAN, LTD., NEW
YORK BRANCH, as a 2000 Lender and 1999 Lender
By: /s/ Xxxxxxx X. Xxxxx
--------------------------------------------
Name: Xxxxxxx X. Xxxxx
Title: Senior Vice President, HOUSTON OFFICE
SUNTRUST BANK, as a 2000 Lender, 1999 Lender and
1998 Lender
By: /s/ Xxxxx X. Xxxxxxx
--------------------------------------------
Name: Xxxxx X. Xxxxxxx
Title: Director
XXXXX FARGO BANK (TEXAS) N.A., as a 1999 Lender
and Senior Credit Lender
By: /s/ Xxxxxxx Xxxxx
--------------------------------------------
Name: Xxxxxxx Xxxxx
Title: Vice President
CREDIT SUISSE FIRST BOSTON, as a 2000 Lender
By: /s/ Xxxxx X. Xxxxx
--------------------------------------------
Name: Xxxxx X. Xxxxx
Title: Director
By: /s/ Xxxxxxx X. Xxxxxxx
--------------------------------------------
Name: Xxxxxxx X. Xxxxxxx
Title: Vice President
NATEXIS BANQUE BFCE, as a 2000 Lender
By: /s/ Xxxxxxx X. Xxxxxxxxx
--------------------------------------------
Name: Xxxxxxx X. Xxxxxxxxx
Title: Vice President
By: /s/ Xxxxxx X. x'Xxxxxx
--------------------------------------------
Name: Xxxxxx X. x'Xxxxxx
Title: Senior Vice President
and Regional Manager
NATEXIS BANQUE BFCE, as a 2000 Lender
By: /s/ Xxxxxxx X. Xxxxxxxxx
--------------------------------------------
Name: Xxxxxxx X. Xxxxxxxxx
Title: Vice President
By: /s/ Xxxxxx X. x'Xxxxxx
--------------------------------------------
Name: Xxxxxx X. x'Xxxxxx
Title: Senior Vice President
and Regional Manager
NATIONAL CITY BANK, as a 2000 Lender
By: /s/ Xxxxx X. Xxxxxx
--------------------------------------------
Name: Xxxxx X. Xxxxxx
Title: AVP
