EXHIBIT 4.2
EXECUTION COPY
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HLI OPERATING COMPANY, INC.
$250,000,000
10 1/2% SENIOR NOTES DUE 2010
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INDENTURE
Dated as of June 3, 2003
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U.S. BANK NATIONAL ASSOCIATION,
as Trustee
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This INDENTURE, dated as of June 3, 2003, is entered into by
and among HLI Operating Company, Inc., a Delaware corporation ("HLI"), each
Guarantor listed on the signature pages hereto, and U.S. Bank National
Association, as Trustee (the "Trustee").
HLI, the Guarantors and the Trustee agree as follows for the
benefit of each other and for the equal and ratable benefit of the Holders of
the 10 1/2% Senior Notes due June 15, 2010 (the "Notes"):
ARTICLE 1.
DEFINITIONS AND INCORPORATION BY REFERENCE
Section 1.01. DEFINITIONS.
For all purposes of this Indenture, except as otherwise
expressly provided or unless the context otherwise requires:
"144A Global Note" means a Global Note in the form of Exhibit
A 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
shall be issued in a denomination equal to the outstanding principal amount of
the Notes sold for initial resale in reliance on Rule 144A.
"Additional Assets" means:
(1) any Property (other than cash, Cash Equivalents and
securities) owned by Holdco or any Restricted Subsidiary and used in a
Related Business; or
(2) Capital Stock of a Person that becomes or has become
a Restricted Subsidiary as a result of the acquisition of such Capital
Stock by Holdco or another Restricted Subsidiary from any Person other
than Holdco or an Affiliate of Holdco; provided, however, that, in the
case of clause (2), such Restricted Subsidiary is primarily engaged in
a Related Business.
"Additional Notes" means any Notes (other than Initial Notes
and Notes issued under Sections 2.06, 2.07, 2.10, 3.06 and 3.09), issued under
this Indenture in accordance with Sections 2.02 and 2.15, as part of the same
series as the Initial Notes or as an additional series.
"Affiliate" of any specified Person means:
(1) any other Person directly or indirectly controlling
or controlled by or under direct or indirect common control with such
specified Person, or
(2) any other Person who is a director or officer of:
(a) such specified Person,
(b) any Subsidiary of such specified Person, or
(c) any Person described in clause (1) above.
For the purposes of this definition, "control," when used with
respect to any Person, means the power to direct the management and policies of
such Person, directly or indirectly, whether through the ownership of voting
securities, by contract or otherwise; and the terms "controlling" and
"controlled" have meanings correlative to the foregoing. For purposes of
Sections 4.13 and 4.15, and the definition of "Additional Assets" only,
"Affiliate" shall also mean any beneficial owner of shares
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representing 10% or more of the total voting power of the Voting Stock (on a
fully diluted basis) of Holdco or of rights or warrants to purchase such Voting
Stock (whether or not currently exercisable) and any Person who would be an
Affiliate of any such beneficial owner pursuant to the first sentence hereof.
"Agent" means any Registrar, co-registrar, Paying Agent or
additional paying agent.
"Applicable Procedures" means, with respect to any transfer,
redemption 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, redemption or exchange.
"Asset Sale" means any sale, lease, transfer, issuance or
other disposition (or series of related sales, leases, transfers, issuances or
dispositions) by Holdco or any Restricted Subsidiary, including any disposition
by means of a merger, consolidation or similar transaction (each referred to for
the purposes of this definition as a "disposition"), of
(1) any shares of Capital Stock of any Restricted
Subsidiary (other than directors' qualifying shares), or
(2) any other Property of Holdco or any Restricted
Subsidiary outside of the ordinary course of business of Holdco or such
Restricted Subsidiary,
other than,
(a) any disposition by a Restricted Subsidiary
to HLI or by Holdco, HLI or a Restricted Subsidiary to a
Wholly Owned Restricted Subsidiary,
(b) any disposition that constitutes a Permitted
Investment or Restricted Payment permitted by Section 4.10,
(c) any disposition effected in compliance with
Section 5.01(a) or (b),
(d) any disposition in a single transaction or a
series of related transactions of assets for aggregate
consideration of less than $2.5 million,
(e) any disposition of cash or Cash Equivalents,
and
(f) any sale of accounts receivable and related
assets (including contract rights) of the type specified in
the definition of "Qualified Securitization Transaction" to or
by a Securitization Entity for the fair market value thereof.
"Attributable Debt" in respect of a Sale and Leaseback
Transaction means, at any date of determination,
(1) if such Sale and Leaseback Transaction is a Capital
Lease Obligation, the amount of Debt represented thereby according to
the definition of "Capital Lease Obligations," and
(2) in all other instances, the greater of:
(a) the fair market value of the Property
subject to such Sale and Leaseback Transaction at the time of
the consummation thereof, and
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(b) the present value (discounted at the
interest rate borne by the Notes, compounded annually) of the
total obligations of the lessee for rental payments during the
remaining term of the lease included in such Sale and
Leaseback Transaction at the time of consummation thereof
(including any period for which such lease has been extended).
"Average Life" means, as of any date of determination, with
respect to any Debt or Preferred Stock, the quotient obtained by dividing:
(1) the sum of the product of the numbers of years
(rounded to the nearest one-twelfth of one year) from the date of
determination to the dates of each successive scheduled principal
payment of such Debt or redemption or similar payment with respect to
such Preferred Stock multiplied by the amount of such payment by
(2) the sum of all such payments.
"Bankruptcy Law" means Title 11, U.S. Code or any similar
federal or state law for the relief of debtors, or the law of any other
jurisdiction relating to bankruptcy, insolvency, winding up, liquidation,
reorganization or relief of debtors.
"Beneficial Owner" has the meaning assigned to such term in
Rule 13d-3 and Rule 13d-5 under the Exchange Act, except that in calculating the
beneficial ownership of any particular "person" (as such term is used in Section
13(d)(3) of the Exchange Act), such "person" shall be deemed to have beneficial
ownership of all securities that such "person" has the right to acquire by
conversion or exercise of other securities, whether such right is currently
exercisable or is exercisable only upon the occurrence of a subsequent
condition.
"Board of Directors" means the board of directors of HLI.
"Board Resolution" means a copy of a resolution certified by
the secretary or an assistant secretary (or individual performing comparable
duties) of the applicable Person to have been duly adopted by the board of
directors (or committee serving a similar function) of such Person and to be in
full force and effect on the date of such certification, and delivered to the
Trustee.
"Business Day" means any day other than a Legal Holiday.
"Capital Lease Obligations" means any obligation under a lease
that is required to be capitalized for financial reporting purposes in
accordance with GAAP; and the amount of Debt represented by such obligation
shall be the capitalized amount of such obligations determined in accordance
with GAAP; and the Stated Maturity thereof shall be the date of the last payment
of rent or any other amount due under such lease prior to the first date upon
which such lease may be terminated by the lessee without payment of a penalty.
For purposes of Section 4.11, a Capital Lease Obligation shall be deemed secured
by a Lien on the Property being leased.
"Capital Stock" means, with respect to any Person, any shares
or other equivalents (however designated) of any class of corporate stock or
partnership interests or any other participations, rights, warrants, options or
other interests in the nature of an equity interest in such Person, including
Preferred Stock, but excluding any debt security convertible or exchangeable
into such equity interest.
"Capital Stock Sale Proceeds" means the aggregate cash
proceeds received by Holdco from the issuance or sale (other than to a
Subsidiary of Holdco or an employee stock ownership plan or trust established by
Holdco or any such Subsidiary for the benefit of their employees) by Holdco of
its Capital Stock (other than Disqualified Stock) after the Issue Date, net of
attorneys' fees, accountants' fees, underwriters' or placement agents' fees,
discounts or commissions and brokerage, consultant and other fees
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actually incurred in connection with such issuance or sale and net of taxes paid
or payable as a result thereof.
"Captive Insurance Subsidiary" means any Wholly Owned
Restricted Subsidiary created solely for the purpose of, and engaged solely in
the business of, purchasing or providing insurance to, or otherwise directly
facilitating the provision of insurance for, Holdco and its Restricted
Subsidiaries, provided that any such Wholly Owned Restricted Subsidiary shall be
funded by Holdco and its Restricted Subsidiaries in the ordinary course of
business solely with such amounts as are reasonably necessary to purchase,
provide or facilitate insurance consistent with the past practice of Holdco and
its Subsidiaries. In addition, such Wholly Owned Restricted Subsidiary shall
satisfy each of the conditions required for the designation of a Subsidiary as
an Unrestricted Subsidiary as set forth in clauses (i) through (v) of Section
4.17(a), although designation as an Unrestricted Subsidiary under such Section
is not required.
"Cash Equivalents" means any of the following:
(1) Investments in U.S. Government Obligations maturing
within 365 days of the date of acquisition thereof;
(2) Investments in time deposit accounts, certificates of
deposit and money market deposits maturing within 365 days of the date
of acquisition thereof issued by a bank or trust company organized
under the laws of the United States of America or any state thereof
having capital, surplus and undivided profits aggregating in excess of
$500 million and whose long-term debt is rated "A-3" or "A-" or higher
according to Xxxxx'x or S&P (or such similar equivalent rating by at
least one "nationally recognized statistical rating organization" (as
defined in Rule 436 under the Securities Act));
(3) repurchase obligations with a term of not more than
30 days for underlying securities of the types described in clause (1)
entered into with:
(a) a bank meeting the qualifications described
in clause (2) above, or
(b) any primary government securities dealer
reporting to the Market Reports Division of the Federal
Reserve Bank of New York;
(4) Investments in commercial paper, maturing not more
than 180 days after the date of acquisition, issued by a corporation
(other than an Affiliate of Holdco) organized and in existence under
the laws of the United States of America with a rating at the time as
of which any Investment therein is made of "P-1" (or higher) according
to Xxxxx'x or "A-1" (or higher) according to S&P (or such similar
equivalent rating by at least one "nationally recognized statistical
rating organization" (as defined in Rule 436 under the Securities
Act));
(5) direct obligations (or certificates representing an
ownership interest in such obligations) of any state of the United
States of America (including any agency or instrumentality thereof) for
the payment of which the full faith and credit of such state is pledged
and which are not callable or redeemable at the issuer's option,
provided that:
(a) the long-term debt of such state is rated
"A-3" or "A-" or higher according to Xxxxx'x or S&P (or such
similar equivalent rating by at least one "nationally
recognized statistical rating organization" (as defined in
Rule 436 under the Securities Act)), and
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(b) such obligations mature within 180 days of
the date of acquisition thereof; and
(6) in the case of any Foreign Restricted Subsidiary:
(a) direct obligations of the sovereign nation
(or agency thereof) in which such Foreign Restricted
Subsidiary is organized and is conducting business or
obligations fully and unconditionally guaranteed by such
sovereign nation (or any agency thereof) and
(b) investment of the type and maturity
described in clauses (1) through (5) above of foreign
obligors, which investments or obligors have ratings described
in such clauses or equivalent ratings from comparable foreign
rating agencies, and
(c) investments of the type and maturity
described in clauses (1) through (5) above of foreign
obligors, which investments or obligors are not rated as
provided in such clauses or in (b) above but which are, in the
reasonable judgment of HLI, comparable in investment quality
to such investments and obligors, provided that the amount of
such investments pursuant to this clause (6)(c) outstanding at
any time shall not exceed $15 million.
"Change of Control" means the occurrence of any of the
following events:
(1) if any "person" or "group" (as such terms are used in
Sections 13(d) and 14(d) of the Exchange Act or any successor
provisions to either of the foregoing), including any group acting for
the purpose of acquiring, holding, voting or disposing of securities
within the meaning of Rule 13d-5(b)(1) under the Exchange Act, other
than any one or more of the Permitted Holders, becomes the "beneficial
owner" (as defined in Rule 13d-3 under the Exchange Act, except that a
person will be deemed to have "beneficial ownership" of all shares that
any such person has the right to acquire, whether such right is
exercisable immediately or only after the passage of time), directly or
indirectly, of 50% or more of the total voting power of the Voting
Stock of Holdco, HLI Parent or HLI (for purposes of this clause (1),
such person or group shall be deemed to beneficially own any Voting
Stock of a corporation held by any other corporation (the "parent
corporation") so long as such person or group beneficially owns,
directly or indirectly, in the aggregate at least a majority of the
total voting power of the Voting Stock of such parent corporation); or
(2) the sale, transfer, assignment, lease, conveyance or
other disposition, directly or indirectly, of all or substantially all
the Property of Holdco, HLI Parent, HLI and their Restricted
Subsidiaries, considered as a whole (other than a disposition of such
Property as an entirety or virtually as an entirety to a Wholly Owned
Restricted Subsidiary or one or more Permitted Holders), shall have
occurred, or Holdco, HLI Parent or HLI merges, consolidates or
amalgamates with or into any other Person (other than one or more
Permitted Holders) or any other Person (other than one or more
Permitted Holders) merges, consolidates or amalgamates with or into
Holdco, HLI Parent or HLI in any such event pursuant to a transaction
in which the outstanding Voting Stock of Holdco, HLI Parent or HLI is
reclassified into or exchanged for cash, securities or other Property,
other than any such transaction where:
(a) the outstanding Voting Stock of Holdco, HLI
Parent or HLI is reclassified into or exchanged for other
Voting Stock of Holdco, HLI Parent or HLI or for Voting Stock
of the Surviving Person, and
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(b) the holders of the Voting Stock of Holdco,
HLI Parent or HLI immediately prior to such transaction own,
directly or indirectly, not less than a majority of the Voting
Stock of Holdco, HLI Parent or HLI or the Surviving Person
immediately after such transaction and in substantially the
same proportion as before the transaction; or
(3) during any period of two consecutive years,
individuals who at the beginning of such period constituted the board
of directors of, as relevant, Holdco, HLI Parent or HLI (together with
any new directors whose election or appointment by such board or whose
nomination for election by the shareholders of, as relevant, Holdco,
HLI Parent or HLI, was approved by a vote of not less than a majority
of the directors then still in office who were either directors at the
beginning of such period or whose election or nomination for election
was previously so approved) cease for any reason to constitute at least
a majority of the relevant board of directors then in office; or
(4) the shareholders of Holdco, HLI Parent or HLI shall
have approved any plan of liquidation or dissolution of Holdco, HLI
Parent or HLI, as applicable.
"Clearstream" means Clearstream Banking S.A. and any successor
thereto.
"Code" means the U.S. Internal Revenue Code of 1986, as
amended.
"Commodity Price Protection Agreement" means, in respect of a
Person, any forward contract, commodity swap agreement, commodity option
agreement or other similar agreement or arrangement designed to protect such
Person against fluctuations in commodity prices.
"Comparable Treasury Issue" means the United States treasury
security selected by an Independent Investment Banker as having a maturity
comparable to the remaining term of the Notes that would be utilized, at the
time of selection and in accordance with customary financial practice, in
pricing new issues of corporate debt securities of comparable maturity to the
remaining term of such Notes. "Independent Investment Banker" means one of the
Reference Treasury Dealers appointed by the Trustee after consultation with HLI.
"Comparable Treasury Price" means, with respect to any
redemption date:
(1) the average of the bid and ask prices for the
Comparable Treasury Issue (expressed in each case as a percentage of
its principal amount) on the third Business Day preceding such
redemption date, as set forth in the most recently published
statistical release designated "H.15(519)" (or any successor release)
published by the Board of Governors of the Federal Reserve System and
which establishes yields on actively traded United States treasury
securities adjusted to constant maturity under the caption "Treasury
Constant Maturities," or
(2) if such release (or any successor release) is not
published or does not contain such prices on such Business Day, the
average of the Reference Treasury Dealer Quotations for such redemption
date.
"Consolidated Interest Coverage Ratio" means, as of any date
of determination, the ratio of:
(1) the aggregate amount of EBITDA for the most recent
four consecutive fiscal quarters in respect of which financial
statements have been delivered in accordance with the terms of the
Indenture to
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(2) Consolidated Interest Expense for such four fiscal
quarters;
provided, however, that:
(a) if
(i) since the beginning of such
period Holdco or any Restricted Subsidiary
has Incurred any Debt that remains
outstanding or Repaid any Debt, or
(ii) the transaction giving rise to
the need to calculate the Consolidated
Interest Coverage Ratio is an Incurrence or
Repayment of Debt,
Consolidated Interest Expense for such period shall be calculated after giving
effect on a pro forma basis to such Incurrence or Repayment as if such Debt was
Incurred or Repaid on the first day of such period, provided that the amount of
Debt Incurred under revolving credit facilities shall be deemed to be the
average daily balance of such Debt during such four-quarter period (or any
shorter period in which such facilities are in effect) and, provided further, in
the event of any such Repayment of Debt, EBITDA for such period shall be
calculated as if Holdco or such Restricted Subsidiary had not earned any
interest income actually earned during such period in respect of the funds used
to Repay such Debt, and
(b) if
(i) since the beginning of such
period Holdco or any Restricted Subsidiary
shall have made any Asset Sale or an
Investment (by merger or otherwise) in any
Restricted Subsidiary (or any Person which
becomes a Restricted Subsidiary) or an
acquisition of Property which constitutes
all or substantially all of an operating
unit of a business,
(ii) the transaction giving rise to
the need to calculate the Consolidated
Interest Coverage Ratio is such an Asset
Sale, Investment or acquisition, or
(iii) since the beginning of such
period any Person (that subsequently became
a Restricted Subsidiary or was merged with
or into Holdco or any Restricted Subsidiary
since the beginning of such period) shall
have made such an Asset Sale, Investment or
acquisition,
then EBITDA for such period shall be calculated after giving
pro forma effect to such Asset Sale, Investment or acquisition
as if such Asset Sale, Investment or acquisition had occurred
on the first day of such period.
If any Debt bears a floating rate of interest and is being
given pro forma effect, the interest expense on such Debt shall be calculated as
if the interest rate in effect for such floating rate of interest on the date of
determination had been the applicable interest rate for the entire period
(taking into account any Interest Rate Agreement applicable to such Debt if such
Interest Rate Agreement has a remaining term in excess of 12 months). In the
event the Capital Stock of any Restricted Subsidiary is sold during the period,
Holdco shall be deemed, for purposes of clause (2)(a) above, to have Repaid
during such period the Debt of such Restricted Subsidiary to the extent Holdco
and its continuing Restricted Subsidiaries are no longer liable for such Debt
after such sale.
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"Consolidated Interest Expense" means, for any period, the
total interest expense of Holdco and its consolidated Restricted Subsidiaries
(net of interest income and payments received in respect of Interest Rate
Agreements), plus, to the extent not included in such total interest expense,
and to the extent Incurred by Holdco or its Restricted Subsidiaries:
(1) interest expense attributable to leases constituting
part of a Sale and Leaseback Transaction and to Capital Lease
Obligations;
(2) amortization of debt discount and debt issuance cost,
including commitment fees;
(3) capitalized interest;
(4) non-cash interest expense;
(5) commissions, discounts and other fees and charges
owed with respect to letters of credit and banker's acceptance
financing;
(6) costs associated with Interest Rate Agreements
(including amortization of fees);
(7) Disqualified Stock Dividends;
(8) Preferred Stock Dividends;
(9) interest Incurred in connection with Investments in
discontinued operations;
(10) interest accruing on any Debt of any other Person to
the extent such Debt is Guaranteed by Holdco or any of its Restricted
Subsidiaries; and
(11) the cash contributions to any employee stock
ownership plan or similar trust to the extent such contributions are
used by such plan or trust to pay interest or fees to any Person (other
than Holdco) in connection with Debt Incurred by such plan or trust.
"Consolidated Net Income" means, for any period, the net
income (loss) of Holdco and its consolidated Restricted Subsidiaries; provided,
however, that there shall not be included in such Consolidated Net Income:
(1) any net income (loss) of any Person (other than
Holdco) if such Person is not a Restricted Subsidiary, except that:
(a) subject to the exclusion contained in clause
(3) below, equity of Holdco and its consolidated Restricted
Subsidiaries in the net income of any such Person for such
period shall be included in such Consolidated Net Income up to
the aggregate amount of cash distributed by such Person during
such period to Holdco or a Restricted Subsidiary as a dividend
or other distribution (subject, in the case of a dividend or
other distribution to a Restricted Subsidiary, to the
limitations contained in clause (2) below), and
(b) the equity of Holdco and its consolidated
Restricted Subsidiaries in a net loss of any such Person other
than an Unrestricted Subsidiary for such period shall be
included in determining such Consolidated Net Income,
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(2) any net income (loss) of any Restricted Subsidiary if
such Restricted Subsidiary is subject to restrictions, directly or
indirectly, on the payment of dividends or the making of distributions,
directly or indirectly, to Holdco or HLI, except that:
(a) subject to the exclusion contained in clause
(3) below, the equity of Holdco and its consolidated
Restricted Subsidiaries in the net income of any such
Restricted Subsidiary for such period shall be included in
such Consolidated Net Income up to the aggregate amount of
cash distributed by such Restricted Subsidiary during such
period to Holdco or another Restricted Subsidiary as a
dividend or other distribution (subject, in the case of a
dividend or other distribution to another Restricted
Subsidiary, to the limitation contained in this clause), and
(b) the equity of Holdco and its consolidated
Restricted Subsidiaries in a net loss of any such Restricted
Subsidiary for such period shall be included in determining
such Consolidated Net Income,
(3) any gain or loss realized upon the sale or other
disposition of any Property of Holdco or any of its consolidated
Restricted Subsidiaries (including pursuant to any Sale and Leaseback
Transaction) that is not sold or otherwise disposed of in the ordinary
course of business,
(4) any extraordinary gain or loss,
(5) the cumulative effect of a change in accounting
principles.
(6) any non-cash compensation expense realized for grants
of performance shares, stock options or other rights to officers,
directors and employees of Holdco or any Restricted Subsidiary,
provided that such shares, options or other rights can be redeemed at
the option of the holder only for Capital Stock of Holdco (other than
Disqualified Stock), and
(7) any non-cash income or expense related to changes in
the book value of Capital Stock of Holdco or its consolidated
Restricted Subsidiaries.
Notwithstanding the foregoing, for purposes of Section 4.10 only, there shall be
excluded from Consolidated Net Income any dividends, returns of capital,
repayments of loans or advances, interest or other transfers of Property from
Unrestricted Subsidiaries to Holdco or a Restricted Subsidiary to the extent
such dividends, returns, repayments, interest or transfers increase the amount
of Restricted Payments permitted under such covenant pursuant to clause
(a)(iii)(4) thereof.
"Corporate Trust Office of the Trustee" shall be at the
address of the Trustee specified in Section 12.02, or such other address as to
which the Trustee may give notice to HLI.
"Credit Facilities" means, with respect to Holdco or any
Restricted Subsidiary, one or more debt or commercial paper facilities with
banks or other institutional lenders (including the New Credit Facility)
providing for revolving credit loans, term loans, receivables or inventory
financing (including through the sale of receivables or inventory to such
lenders or to special purpose, bankruptcy remote entities formed to borrow from
such lenders against such receivables or inventory) or trade or standby letters
of credit, in each case together with any Refinancings thereof.
"Currency Exchange Protection Agreement" means, in respect of
a Person, any foreign exchange contract, currency swap agreement, currency
option, forward contract or other similar agreement
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or arrangement, in each case, including any Guarantee and collateral documents
referred to therein, designed to protect such Person against fluctuations in
currency exchange rates.
"Custodian" means, with respect to the Notes issuable or
issued in whole or in part in global form, the Person specified in Section
2.03(c) as Custodian with respect to the Notes, and any and all successors
thereto appointed as custodian hereunder and having become such pursuant to the
applicable provisions of this Indenture.
"Debt" means, with respect to any Person on any date of
determination (without duplication):
(1) the principal of and premium (if any) in respect of:
(a) debt of such Person for money borrowed, and
(b) debt evidenced by notes, debentures, bonds
or other similar instruments for the payment of which such
Person is responsible or liable;
(2) all Capital Lease Obligations of such Person and all
Attributable Debt in respect of Sale and Leaseback Transactions entered
into by such Person;
(3) all obligations of such Person representing the
deferred purchase price of Property, all conditional sale obligations
of such Person and all obligations of such Person under any title
retention agreement (but excluding trade accounts payable arising in
the ordinary course of business);
(4) all obligations of such Person for the reimbursement
of any obligor on any letter of credit, banker's acceptance or similar
credit transaction (other than obligations with respect to letters of
credit securing obligations (other than obligations described in (1)
through (3) above) entered into in the ordinary course of business of
such Person to the extent such letters of credit are not drawn upon or,
if and to the extent drawn upon, such drawing is reimbursed no later
than the third Business Day following receipt by such Person of a
demand for reimbursement following payment on the letter of credit);
(5) the amount of all obligations of such Person with
respect to the Repayment of any Disqualified Stock or, with respect to
any Subsidiary of such Person, any Preferred Stock (but excluding, in
each case, any accrued dividends);
(6) all obligations of the type referred to in clauses
(1) through (5) above of other Persons and all dividends of other
Persons for the payment of which, in either case, such Person is
responsible or liable, directly or indirectly, as obligor, guarantor or
otherwise, including by means of any Guarantee;
(7) all obligations of the type referred to in clauses
(1) through (6) above of other Persons secured by any Lien on any
Property of such Person (whether or not such obligation is assumed by
such Person), the amount of such obligation being deemed to be the
lesser of the fair market value of such Property and the amount of the
obligation so secured; and
(8) to the extent not otherwise included in this
definition, Hedging Obligations of such Person.
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The amount of Debt of any Person at any date shall be the outstanding balance,
or the accreted value of such Debt in the case of Debt issued with original
issue discount, at such date of all unconditional obligations as described above
and the maximum liability, upon the occurrence of the contingency giving rise to
the obligation, of any contingent obligations at such date. The amount of Debt
represented by a Hedging Obligation shall be equal to:
(A) zero if such Hedging Obligation has been Incurred
pursuant to clause (b)(vi), (vii) or (viii) of Section 4.09, or
(B) the notional amount of such Hedging Obligation if not
Incurred pursuant to such clauses.
"Default" means any event which is, or after notice or passage
of time or both would be, an Event of Default.
"Definitive Note" means a certificated Note registered in the
name of the Holder thereof and issued in accordance with Section 2.06, in
substantially the form of Exhibit A hereto except that such Note shall not bear
the Global Note Legend and shall not have the "Schedule of Exchanges of
Interests in the Global Note" attached thereto.
"Depositary" means, with respect to the Notes issuable or
issued in whole or in part in global form, the Person specified in Section 2.03
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 provisions of this Indenture.
"Disqualified Stock" means any Capital Stock of Holdco or any
of its Restricted Subsidiaries that by its terms (or by the terms of any
security into which it is convertible or for which it is exchangeable, in either
case at the option of the holder thereof) or otherwise:
(1) matures or is mandatorily redeemable pursuant to a
sinking fund obligation or otherwise;
(2) is or may become redeemable or repurchaseable at the
option of the holder thereof, in whole or in part, or
(3) is convertible or exchangeable at the option of the
holder thereof for Debt or Disqualified Stock,
on or prior to, in the case of clause (1), (2) or (3), the first anniversary of
the Stated Maturity of the Notes.
"Disqualified Stock Dividends" means all dividends with
respect to Disqualified Stock of Holdco held by Persons other than a Wholly
Owned Restricted Subsidiary. The amount of any such dividend shall be equal to
the quotient of such dividend divided by the difference between one and the
maximum statutory federal income tax rate (expressed as a decimal number between
1 and 0) then applicable to Holdco.
"Distribution Compliance Period" means the 40-day distribution
compliance period as defined in Regulation S.
"Domestic Restricted Subsidiary" means any Restricted
Subsidiary other than (1) a Foreign Restricted Subsidiary or (2) a Subsidiary of
a Foreign Restricted Subsidiary.
"EBITDA" means, for any period, an amount equal to, for Holdco
and its consolidated Restricted Subsidiaries:
11
(1) the sum of Consolidated Net Income for such period,
plus the following to the extent reducing Consolidated Net Income for
such period:
(a) amount of any foreign, U.S. Federal, State
or local taxes included in Consolidated Net Income,
(b) Consolidated Interest Expense,
(c) depreciation,
(d) amortization of intangibles,
(e) any other non-cash items (other than any
such non-cash item to the extent that it represents an accrual
of, or reserve for, cash expenditures in any future period),
(f) cash charges of up to $20 million in respect
of facility closures and other restructuring activities,
(g) the following adjustments made pursuant to
fresh-start accounting:
(A) all such adjustments made prior to
the date Xxxxx Lemmerz International, Inc. emerges
from Chapter 11 bankruptcy proceedings (the
"Emergence Date"); and
(B) any expense arising after the
Emergence Date that is included in cost of goods sold
arising from adjustments to inventory that are made
in connection with fresh-start accounting,
(h) the following items for HLI and its
consolidated Subsidiaries in respect of the period commencing
on February 1, 2002 and ending on the Emergence Date:
(A) non-recurring charges and
restructuring charges that in accordance with GAAP
are charged against operating income;
(B) all professional fees, financing
costs and other costs, expenses and items directly
related to the Chapter 11 cases as reflected in the
consolidated statement of operations, including any
administrative expense reflecting such costs,
expenses or other items;
(C) all charges to earnings with
respect to employee severance;
(D) the non-cash effect attributable to
minority interest income or expense, and
(i) costs under employee retention programs
approved by the U.S. Bankruptcy Court in the bankruptcy
proceedings of Xxxxx Lemmerz International, Inc.; minus
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(2) all non-cash items increasing Consolidated Net Income
for such period (other than any such non-cash item to the extent that
it represents a change of an accrual of, or reserve for, cash
expenditures in any future period).
Notwithstanding the foregoing clause (1), the provision for taxes and the
depreciation, amortization and non-cash items of a Restricted Subsidiary shall
be added to Consolidated Net Income to compute EBITDA only to the extent (and in
the same proportion) that the net income of such Restricted Subsidiary was
included in calculating Consolidated Net Income and only if a corresponding
amount would be permitted at the date of determination to be dividended to
Holdco by such Restricted Subsidiary without prior approval (that has not been
obtained), pursuant to the terms of its charter and all agreements, instruments,
judgments, decrees, orders, statutes, rules and governmental regulations
applicable to such Restricted Subsidiary or its shareholders.
"Euroclear" means Euroclear Bank, S.A./N.V., as operator of
the Euroclear systems, and any successor thereto.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended.
"Exchange Notes" means the notes issued in exchange for the
Initial Notes or any Additional Notes pursuant to the Registration Rights
Agreement.
"Exchange Offer" has the meaning set forth in a Registration
Rights Agreement relating to an exchange of Notes registered under the
Securities Act for Notes not so registered.
"Exchange Offer Registration Statement" has the meaning set
forth in a Registration Rights Agreement.
"fair market value" means, with respect to any Property, (1)
the price that could be negotiated in an arm's-length free market transaction,
for cash, between a willing seller and a willing buyer, neither of whom is under
undue pressure or compulsion to complete the transaction and (2) in the case of
any determination of fair market value for purposes of Section 4.10:
(a) if such Property has a fair market value equal to or
less than $5.0 million, by any Officer of HLI;
(b) if such Property has a fair market value in excess
$5.0 million, by at least a majority of the Board of Directors and
evidenced by a Board Resolution, dated within 30 days of the relevant
transaction; or
(c) if such Property has a fair market value in excess of
$25 million, by an Independent Financial Advisor and evidenced by a
written opinion from such Independent Financial Advisor, dated within
30 days of the relevant transaction, and delivered to the Trustee.
"Foreign Restricted Subsidiary" means any Restricted
Subsidiary which is not organized under the laws of the United States of America
or any State thereof or the District of Columbia.
"GAAP" means accounting principles generally accepted in the
United States as in effect on the Issue Date, including those set forth in:
(1) the opinions and pronouncements of the Accounting
Principles Board of the American Institute of Certified Public
Accountants;
13
(2) the statements and pronouncements of the Financial
Accounting Standards Board;
(3) such other statements by such other entity as
approved by a significant segment of the accounting profession; and
(4) the rules and regulations of the SEC governing the
inclusion of financial statements (including pro forma financial
statements) in periodic reports required to be filed pursuant to
Section 13 of the Exchange Act, including opinions and pronouncements
in staff accounting bulletins and similar written statements from the
accounting staff of the SEC.
"Global Note Legend" means the legend set forth in Section
2.06(g)(ii), which is required to be placed on all Global Notes issued under
this Indenture.
"Global Notes" means the global Notes in the form of Exhibit A
hereto issued in accordance with Article 2.
"Guarantee" means any obligation, contingent or otherwise, of
any Person directly or indirectly guaranteeing any Debt of any other Person and
any obligation, direct or indirect, contingent or otherwise, of such Person:
(1) to purchase or pay (or advance or supply funds for
the purchase or payment of) such Debt of such other Person (whether
arising by virtue of partnership arrangements, or by agreements to
keep-well, to purchase assets, goods, securities or services, to
take-or-pay or to maintain financial statement conditions or otherwise)
or
(2) entered into for the purpose of assuring in any other
manner the obligee against loss in respect thereof (in whole or in
part);
provided, however, that the term "Guarantee" shall not include:
(a) endorsements for collection or deposit in
the ordinary course of business or
(b) a contractual commitment by one Person to
invest in another Person for so long as such Investment is
reasonably expected to constitute a Permitted Investment under
clause (1), (2) or (3) of the definition of "Permitted
Investment."
The term "Guarantee" used as a verb has a corresponding meaning.
"Guarantor" means Holdco, each Domestic Restricted Subsidiary
(other than HLI, Captive Insurance Subsidiaries, Securitization Entities and HLI
(Europe), LLC and HLI Swiss Holdings, LLC and, initially, CMI-Quaker Alloy,
Inc., HLI Netherlands Holdings, Inc., Xxxxx Lemmerz Funding Company, LLC, Xxxxx
Lemmerz Funding Corporation and Xxxxx Lemmerz International Import, Inc. (See
Section 4.19(b))) and any other Person that becomes a Guarantor pursuant to
Section 4.19 or who otherwise executes and delivers a supplemental indenture to
the Trustee providing for a Note Guaranty.
"Hedging Obligation" of any Person means any obligation or
liability, direct or indirect, contingent or otherwise, of such Person in
respect of any Interest Rate Agreement, Currency Exchange Protection Agreement,
Commodity Price Protection Agreement or any other similar agreement or
arrangement.
14
"HLI Parent" means HLI Parent Company, Inc., a Delaware
corporation, the owner of 100% of the common stock of HLI.
"Holdco" means Xxxxx Lemmerz International, Inc., a Delaware
corporation, the owner of 100% of the common stock of HLI Parent.
"Holder" means a Person in whose name a Note is registered in
the Security Register.
"IAI Global Note" means a Global Note in the form of Exhibit A
hereto, bearing the name of the Depositary or its nominee that will be issued in
a denomination equal to the outstanding principal amounts of the Notes sold to
Institutional Accredited Investors, if any.
"Incur" means, with respect to any Debt or other obligation of
any Person, to create, issue, incur (by merger, conversion, exchange or
otherwise), extend, assume, Guarantee or become liable in respect of such Debt
or other obligation or the recording, as required pursuant to GAAP or otherwise,
of any such Debt or obligation on the balance sheet of such Person (and
"Incurrence" and "Incurred" shall have meanings correlative to the foregoing);
provided, however, that a change in GAAP that results in an obligation of such
Person that exists at such time, and is not theretofore classified as Debt,
becoming Debt shall not be deemed an Incurrence of such Debt; provided further,
however, that any Debt or other obligations of a Person existing at the time
such Person becomes a Subsidiary (whether by merger, consolidation, acquisition
or otherwise) shall be deemed to be Incurred by such Subsidiary at the time it
becomes a Subsidiary.
"Indenture" means this instrument, as originally executed or
as it may from time to time be supplemented or amended in accordance with
Article 9.
"Independent Financial Advisor" means an investment banking
firm of national standing or any third party appraiser of national standing,
provided that such firm or appraiser is not an Affiliate of Holdco.
"Indirect Participant" means a Person who holds a beneficial
interest in a Global Note through a Participant.
"Initial Notes" means $250.0 million aggregate principal
amount of Notes issued under this Indenture on the date hereof.
"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 Dates" shall have the meaning set forth in
paragraph 1 of each Note.
"Interest Rate Agreement" means, for any Person, any interest
rate swap agreement, interest rate cap agreement, interest rate collar agreement
or other similar agreement, in each case, including any Guarantee and collateral
documents referred to therein designed to protect such Person against
fluctuations in interest rates.
"Investment" by any Person means any direct or indirect loan
(other than advances to customers in the ordinary course of business that are
recorded as accounts receivable on the balance sheet of such Person), advance or
other extension of credit or capital contribution (by means of transfers of cash
or other Property to others or payments for Property or services for the account
or use of others, or otherwise) to, or Incurrence of a Guarantee of any
obligation of, or purchase or acquisition of Capital Stock, bonds, notes,
debentures or other securities or evidence of Debt issued by, any other Person.
For purposes of Sections 4.10 and 4.17 and the definition of "Restricted
Payment," the term "Investment" shall include the portion (proportionate to
Holdco's beneficial equity interest in such Subsidiary) of the fair
15
market value of the net worth of any Subsidiary of Holdco at the time that such
Subsidiary is designated an Unrestricted Subsidiary; provided, however, that
upon a redesignation of such Subsidiary as a Restricted Subsidiary, Holdco shall
be deemed to continue to have a permanent "Investment" in an Unrestricted
Subsidiary of an amount (if positive) equal to:
(1) Holdco's "Investment" in such Subsidiary at the time
of such redesignation, less
(2) the portion (proportionate to Holdco's equity
interest in such Subsidiary) of the fair market value of the net assets
of such Subsidiary at the time of such redesignation.
In determining the amount of any Investment made by transfer of any Property
other than cash, such Property shall be valued at its fair market value at the
time of such Investment.
"Issue Date" means the date on which the Initial Notes are
initially issued.
"Legal Holiday" means a Saturday, a Sunday or a day on which
banking institutions in each of the City of New York, New York, the city in
which the Corporate Trust Office of the Trustee is located or any other place of
payment on the Notes are authorized by law, regulation or executive order to
remain closed.
"Letter of Transmittal" means the letter of transmittal, or
its electronic equivalent in accordance with the Applicable Procedures, to be
prepared by HLI and sent to all Holders of the Initial Notes or any Additional
Notes for use by such Holders in connection with an Exchange Offer.
"Lien" means, with respect to any Property of any Person, any
mortgage or deed of trust, pledge, hypothecation, assignment, deposit
arrangement, security interest, lien, charge, easement (other than any easement
not materially impairing usefulness or marketability), encumbrance, preference,
priority or other security agreement or preferential arrangement of any kind or
nature whatsoever on or with respect to such Property (including any Capital
Lease Obligation, conditional sale or other title retention agreement having
substantially the same economic effect as any of the foregoing or any Sale and
Leaseback Transaction).
"Moody's" means Xxxxx'x Investors Service, Inc. or any
successor to the rating agency business thereof.
"Net Available Cash" from any Asset Sale means cash payments
received therefrom (including any cash payments received by way of deferred
payment of principal pursuant to a note or installment receivable or otherwise,
but only as and when received, but excluding any other consideration received in
the form of assumption by the acquiring Person of Debt or other obligations
relating to the Property that is the subject of such Asset Sale or received in
any other non-cash form), in each case net of:
(1) all legal, title and recording tax expenses,
commissions and other fees and expenses incurred, and all Federal,
state, provincial, foreign and local taxes required to be accrued as a
liability under GAAP, as a consequence of such Asset Sale;
(2) all payments made on or in respect of any Debt that
is secured by any Property subject to such Asset Sale, in accordance
with the terms of the Lien on such Property securing such Debt, or
which must by its terms, or in order to obtain a necessary consent to
such Asset Sale, or by applicable law, be repaid out of the proceeds of
such Asset Sale;
16
(3) all distributions and other payments required to be
made to minority interest holders in Subsidiaries or joint ventures as
a result of such Asset Sale; and
(4) the deduction of appropriate amounts provided by the
seller as a reserve, in accordance with GAAP, against any liabilities
associated with the Property disposed of in such Asset Sale and
retained by Holdco or any Restricted Subsidiary after such Asset Sale.
"New Credit Facility" means the credit facilities provided
under the Credit Agreement dated as of June 3, 2003, among Holdco, HLI, the
lenders from time to time party thereto, Citicorp North America, Inc., as
Administrative Agent and Xxxxxx Commercial Paper Inc. as Syndication Agent,
including any related notes, collateral documents, letters of credit and
documentation and guarantees and any appendices, exhibits or schedules to any of
the preceding, as well as any or all of such agreements (or any other agreement
that Refinances any of or all such agreements), as may be amended, restated,
modified or supplemented from time to time, or renewed, refunded, refinanced,
restructured, replaced, repaid or extended from time to time, whether with the
original agents and lenders or other agents or lenders.
"Note Guaranty" means a Guarantee of HLI's obligations with
respect to the Notes on the terms set forth in the Indenture.
"Obligations" means all obligations for principal, premium,
interest, penalties, fees, indemnifications, reimbursements, damages and other
liabilities payable under the documentation governing any Debt.
"Officer" means the Chief Executive Officer, the President,
the Chief Financial Officer or any Vice President of HLI.
"Officers' Certificate" means a certificate signed by two
Officers of HLI, at least one of whom shall be the principal executive officer
or principal financial officer of HLI, and delivered to the Trustee.
"Opinion of Counsel" means a written opinion from legal
counsel who is acceptable to the Trustee. The counsel may be an employee of or
counsel to HLI or the Trustee.
"Participant" means, with respect to the Depositary, Euroclear
or Clearstream, a Person who has an account with the Depositary, Euroclear or
Clearstream, respectively, and, with respect to DTC, shall include Euroclear and
Clearstream.
"Permitted Holders" means (1) Apollo Management V, L.P. and
other investment funds under common management, or any Person of which the
foregoing "beneficially owns" (as defined in Rule 13d-3 under the Exchange Act),
individually or collectively with any of the foregoing, at least a majority of
the total voting power of the Voting Stock of such Person and (2) Q Investment
L.P. and other investment funds under common management, or any Person of which
the foregoing "beneficially owns" (as defined in Rule 13d-3 under the Exchange
Act), individually or collectively with any of the foregoing, at least a
majority of the total voting power of the Voting Stock of such Person. In
addition, Holdco shall be a Permitted Holder with respect to HLI Parent and HLI
Parent shall be a Permitted Holder with respect to HLI.
"Permitted Investment" means any Investment by Holdco, HLI or
any of their Restricted Subsidiaries in:
(1) Holdco or any Restricted Subsidiary;
17
(2) any Person that will, upon the making of such
Investment, become a Restricted Subsidiary, provided that the primary
business of such Restricted Subsidiary is a Related Business;
(3) any Person if as a result of such Investment such
Person is merged or consolidated with or into, or transfers or conveys
all or substantially all of its Property to, Holdco or a Restricted
Subsidiary, provided that such Person's primary business is a Related
Business;
(4) Cash Equivalents;
(5) receivables owing to Holdco or a Restricted
Subsidiary, if created or acquired in the ordinary course of business
and payable or dischargeable in accordance with customary trade terms;
provided, however, that such trade terms may include such concessionary
trade terms as Holdco or such Restricted Subsidiary deems reasonable
under the circumstances;
(6) payroll, travel and similar advances to cover matters
that are expected at the time of such advances ultimately to be treated
as expenses for accounting purposes and that are made in the ordinary
course of business;
(7) loans and advances to employees made in the ordinary
course of business consistent with past practices of Holdco or such
Restricted Subsidiary, as the case may be, provided that such loans and
advances do not exceed $1 million in the aggregate at any one time
outstanding;
(8) stock, obligations or other securities received in
settlement of obligations created in the ordinary course of business
and owing to Holdco or a Restricted Subsidiary or in satisfaction of
judgments;
(9) any Person to the extent such Investment represents
the non-cash portion of the consideration received in connection with
(a) an Asset Sale consummated in compliance with Section 4.13 or (b)
any disposition of Property not constituting an Asset Sale;
(10) a Securitization Entity or any Investment by a
Securitization Entity in any other Person in connection with a
Qualified Securitization Transaction; provided that any Investment in a
Securitization Entity is in the form of a Purchase Money Note,
contribution of additional receivables and related assets or any equity
interests; and
(11) other Investments made for fair market value that do
not exceed $75 million in the aggregate outstanding at any one time.
"Permitted Liens" means:
(1) Liens to secure Debt permitted to be Incurred under
Section 4.09(b)(ii), Liens to secure obligations with respect to cash
management arrangements entered into in the ordinary course of business
with lenders or affiliates thereof of Debt permitted to be Incurred
under Section 4.09(b)(ii), Liens to secure Debt permitted to be
Incurred under Section 4.09(b)(vi) to the extent they relate to Debt
permitted under Section 4.09(b)(ii) and Liens to secure Debt permitted
to be Incurred under Section 4.09(b)(vii) and (viii);
(2) Liens to secure Debt permitted to be Incurred under
Section 4.09(b)(iii), provided that any such Lien may not extend to any
Property of Holdco or any
18
Restricted Subsidiary, other than the Property acquired, constructed or
leased with the proceeds of such Debt and any improvements or
accessions to such Property;
(3) Liens for taxes, assessments or governmental charges
or levies on the Property of Holdco or any Restricted Subsidiary if the
same shall not at the time be delinquent or thereafter can be paid
without penalty, or are being contested in good faith and by
appropriate proceedings promptly instituted and diligently concluded,
provided that any reserve or other appropriate provision that shall be
required in conformity with GAAP shall have been made therefor;
(4) Liens imposed by law, such as carriers',
warehousemen's, landlord's, materialmen's and mechanics' Liens and
other similar Liens, on the Property of Holdco or any Restricted
Subsidiary arising in the ordinary course of business and securing
payment of obligations that are not more than 60 days past due or are
being contested in good faith and by appropriate proceedings;
(5) Liens on the Property of Holdco or any Restricted
Subsidiary Incurred in the ordinary course of business to secure
performance of obligations with respect to statutory or regulatory
requirements, performance or return-of-money bonds, surety bonds or
other obligations of a like nature and Incurred in a manner consistent
with industry practice, in each case which are not Incurred in
connection with the borrowing of money, the obtaining of advances or
credit or the payment of the deferred purchase price of Property and
which do not in the aggregate impair in any material respect the use of
Property in the operation of the business of Holdco and the Restricted
Subsidiaries taken as a whole;
(6) Liens on Property at the time Holdco or any
Restricted Subsidiary acquired such Property, including any acquisition
by means of a merger or consolidation with or into Holdco or any
Restricted Subsidiary; provided, however, that any such Lien may not
extend to any other Property of Holdco or any Restricted Subsidiary;
provided further, however, that such Liens shall not have been Incurred
in anticipation of or in connection with the transaction or series of
transactions pursuant to which such Property was acquired by Holdco or
any Restricted Subsidiary;
(7) Liens on the Property of a Person at the time such
Person becomes a Restricted Subsidiary; provided, however, that any
such Lien may not extend to any other Property of Holdco or any other
Restricted Subsidiary that is not a direct Subsidiary of such Person;
provided further, however, that any such Lien was not Incurred in
anticipation of or in connection with the transaction or series of
transactions pursuant to which such Person became a Restricted
Subsidiary;
(8) pledges or deposits by Holdco or any Restricted
Subsidiary under workers' compensation laws, unemployment insurance
laws or similar legislation, or good faith deposits in connection with
bids, tenders, contracts (other than for the payment of Debt) or leases
to which Holdco or any Restricted Subsidiary is party, or deposits to
secure public or statutory obligations of Holdco, or deposits for the
payment of rent, in each case Incurred in the ordinary course of
business;
(9) utility easements, building and zoning restrictions
and such other encumbrances or charges against real Property as are of
a nature generally existing with respect to properties of a similar
character;
19
(10) Liens on the Capital Stock of any joint venture that
is not a Subsidiary of Holdco or any Restricted Subsidiary, provided,
that such Lien secures only obligations of such joint venture;
(11) Liens existing on the Issue Date not otherwise
described in clauses (1) through (10) above;
(12) Liens not otherwise described in clauses (1) through
(11) above on the Property of any Restricted Subsidiary that is not a
Guarantor to secure any Debt permitted to be Incurred by such
Restricted Subsidiary pursuant to Section 4.09;
(13) Liens on the Property of Holdco or any Restricted
Subsidiary to secure any Refinancing, in whole or in part, of any Debt
secured by Liens referred to in clause (2), (6), (7) or (11) above;
provided, however, that any such Lien shall be limited to all or part
of the same Property that secured the original Lien (together with
improvements and accessions to such Property), and the aggregate
principal amount of Debt that is secured by such Lien shall not be
increased to an amount greater than the sum of:
(a) the outstanding principal amount, or, if
greater, the committed amount, of the Debt secured by Liens
described under clause (2), (6), (7) or (11) above, as the
case may be, at the time the original Lien became a Permitted
Lien under the Indenture;
(b) an amount necessary to pay any fees and
expenses, including premiums and defeasance costs related to
such Refinancing; and
(c) accrued and unpaid interest on the Debt
being Refinanced;
(14) Liens on accounts receivable and related assets of
the type specified in the definition "Qualified Securitization
Transaction" transferred to a Securitization Entity in a Qualified
Securitization Transaction;
(15) Liens created by Sale and Leaseback Transactions not
involving Capital Lease Obligations;
(16) Liens securing Debt permitted to be Incurred under
Section 4.09(b)(iv), and
(17) Liens not otherwise permitted by clauses (1) through
(16) above encumbering Property having an aggregate fair market value
not in excess of $5 million.
"Permitted Refinancing Debt" means any Debt that Refinances
any other Debt, including any successive Refinancings, so long as:
(1) such Debt is in an aggregate principal amount (or if
Incurred with original issue discount, an aggregate issue price) not in
excess of the sum of
(a) the aggregate principal amount (or if
Incurred with original issue discount, the aggregate accreted
value) then outstanding of the Debt being Refinanced plus
accrued and unpaid interest, and
(b) an amount necessary to pay any fees and
expenses, including premiums and defeasance costs, related to
such Refinancing;
20
(2) the Average Life of such Debt is equal to or greater
than the Average Life of the Debt being Refinanced;
(3) the Stated Maturity of such Debt is no earlier than
the Stated Maturity of the Debt being Refinanced; and
(4) the new Debt shall not be senior in right of payment
to the Debt that is being Refinanced,
provided, however, that Permitted Refinancing Debt shall not include:
(A) Debt of a Subsidiary of Holdco other than
HLI that is not a Guarantor that Refinances Debt of HLI or a
Guarantor; or
(B) Debt of Holdco or a Restricted Subsidiary
that Refinances Debt of an Unrestricted Subsidiary.
"Person" means any individual, corporation, company (including
any limited liability company), association, partnership, joint venture, trust,
unincorporated organization, government or any agency or political subdivision
thereof or any other entity.
"Predecessor Note" of any particular Note means every previous
Note evidencing all or a portion of the same Debt as that evidenced by such
particular Note; and any Note authenticated and delivered under Section 2.07 in
lieu of a lost, destroyed or stolen Note shall be deemed to evidence the same
Debt as the lost, destroyed or stolen Note.
"Preferred Stock" means any Capital Stock of a Person, however
designated, which entitles the holder thereof to a preference with respect to
the payment of dividends, or as to the distribution of assets upon any voluntary
or involuntary liquidation or dissolution of such Person, over shares of any
other class of Capital Stock issued by such Person.
"Preferred Stock Dividends" means all dividends with respect
to Preferred Stock of Restricted Subsidiaries held by Persons other than Holdco
or a Wholly Owned Restricted Subsidiary. The amount of any such dividend shall
be equal to the quotient of such dividend divided by the difference between one
and the maximum statutory federal income rate (expressed as a decimal number
between 1 and 0) then applicable to the issuer of such Preferred Stock.
"Private Placement Legend" means the legend set forth in
Section 2.06(g)(i) to be placed on all Notes issued under this Indenture except
as otherwise permitted by the provisions of this Indenture.
"pro forma" means, with respect to any calculation made or
required to be made pursuant to the terms hereof, a calculation performed in
accordance with Article 11 of Regulation S-X promulgated under the Securities
Act, as interpreted in good faith by the Board of Directors after consultation
with the independent certified public accountants of HLI, or otherwise a
calculation made in good faith by the Board of Directors after consultation with
the independent certified public accountants of HLI, as the case may be.
"Property" means, with respect to any Person, any interest of
such Person in any kind of property or asset, whether real, personal or mixed,
or tangible or intangible, including Capital Stock in, and other securities of,
any other Person. For purposes of any calculation required pursuant to this
Indenture, the value of any Property shall be its fair market value.
"Public Equity Offering" means an underwritten public offering
of common stock of Holdco pursuant to an effective registration statement under
the Securities Act.
21
"Purchase Money Debt" means Debt:
(1) consisting of the deferred purchase price of
Property, conditional sale obligations, obligations under any title
retention agreement, other purchase money obligations and obligations
in respect of industrial revenue bonds, in each case where the maturity
of such Debt at the time of Incurrence thereof does not exceed the
anticipated useful life of the Property being financed; and
(2) Incurred to finance the acquisition, construction or
lease by HLI or a Guarantor of such Property, including additions and
improvements thereto,
provided, however, that such Debt is Incurred within 180 days after the
acquisition, construction or lease of such Property by HLI or such Guarantor.
"Purchase Money Note" means a promissory note evidencing a
line of credit, or evidencing other Debt owed to Holdco or any Restricted
Subsidiary in connection with a Qualified Securitization Transaction, which note
shall be repaid from cash available to the maker of such note, other than
amounts required to be established as reserves, amounts paid to investors in
respect of interest, principal and other amounts owing to such investors and
amounts paid in connection with the purchase of newly generated accounts
receivable.
"QIB" means a "qualified institutional buyer" as defined in
Rule 144A.
"Qualified Securitization Transaction" means any transaction
or series of transactions that may be entered into by Holdco or any Restricted
Subsidiary pursuant to which Holdco or any Restricted Subsidiary may sell,
convey or otherwise transfer pursuant to customary terms to: (1) a
Securitization Entity (in the case of a transfer by Holdco or any Restricted
Subsidiary); and (2) any other Person (in the case of transfer by a
Securitization Entity), or may grant a security interest in any accounts
receivable (whether now existing or arising or acquired in the future) of Holdco
or any Restricted Subsidiary, and any assets related thereto including all
collateral securing such accounts receivable, all contracts and contract rights
and all guarantees or other obligations in respect of such accounts receivable,
proceeds of such accounts receivable and other assets (including contract
rights) which are customarily transferred or in respect of which security
interests are customarily granted in connection with asset securitization
transactions involving accounts receivable.
"Reference Treasury Dealer" means Citigroup Global Markets
Inc. and its successors; provided, however, that if the foregoing shall cease to
be a primary U.S. Government securities dealer in New York City (a "Primary
Treasury Dealer"), HLI shall substitute therefor another Primary Treasury
Dealer.
"Reference Treasury Dealer Quotations" means, with respect to
each Reference Treasury Dealer and any redemption date, the average, as
determined by the Trustee, of the bid and ask prices for the Comparable Treasury
Issue (expressed in each case as a percentage of its principal amount) quoted in
writing to the Trustee by such Reference Treasury Dealer at 5:00 p.m. on the
third Business Day preceding such redemption date.
"Refinance" means, in respect of any Debt, to refinance,
extend, renew, refund or Repay, or to issue other Debt, in exchange or
replacement for, such Debt. "Refinanced" and "Refinancing" shall have
correlative meanings.
"Registration Rights Agreement" means the Registration Rights
Agreement, dated as of the Issue Date, among HLI, the Guarantors and the initial
purchasers named therein, as such agreement may be amended, modified or
supplemented from time to time and, with respect to any Additional Notes, one or
more registration rights agreements between HLI and the other parties thereto,
as such agreement(s)
22
may be amended, modified or supplemented from time to time, relating to rights
given by HLI to the purchasers of Additional Notes to register such Additional
Notes, or exchange such Additional Notes for registered Notes, under the
Securities Act.
"Regular Record Date" for the interest payable on any Interest
Payment Date means the applicable date specified as a "Record Date" on the face
of the Note.
"Regulation S" means Regulation S promulgated under the
Securities Act.
"Regulation S Global Note" means a Global Note in the form of
Exhibit A 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 shall be issued in a denomination equal to the outstanding principal amount
of the Notes sold for initial resale in reliance on Rule 904.
"Related Business" means any business that is related,
ancillary or complementary to the businesses of HLI and the Restricted
Subsidiaries on the Issue Date.
"Repay" means, in respect of any Debt, to repay, prepay,
repurchase, redeem, legally defease or otherwise retire such Debt. "Repayment"
and "Repaid" shall have the correlative meanings. For purposes of Section 4.13
and the definition of "Consolidated Interest Coverage Ratio," Debt shall be
considered to have been Repaid only to the extent the related loan commitment,
if any, shall have been permanently reduced in connection therewith.
"Responsible Officer," when used with respect to the Trustee,
means any officer within the Corporate Trust Department of the Trustee (or any
successor group of the Trustee) with direct responsibility for the
administration of this Indenture and also means, with respect to a particular
corporate trust matter, any other officer to whom such matter is referred
because of his or her knowledge of and familiarity with the particular subject.
"Restricted Definitive Note" means one or more Definitive
Notes bearing the Private Placement Legend.
"Restricted Global Notes" means 144A Global Note, IAI Global
Note and Regulation S Global Note.
"Restricted Payment" means:
(1) any dividend or distribution (whether made in cash,
securities or other Property) declared or paid on or with respect to
any shares of Capital Stock of Holdco or any Restricted Subsidiary
(including any payment in connection with any merger or consolidation
with or into Holdco or any Restricted Subsidiary), except for any
dividend or distribution that is made solely to Holdco or a Restricted
Subsidiary (and, if such Restricted Subsidiary is not a Wholly Owned
Restricted Subsidiary, to the other shareholders of such Restricted
Subsidiary on a pro rata basis or on a basis that results in the
receipt by Holdco or a Restricted Subsidiary of dividends or
distributions of greater value than it would receive on a pro rata
basis) or any dividend or distribution payable solely in shares of
Capital Stock (other than Disqualified Stock) of Holdco;
(2) the purchase, repurchase, redemption, acquisition or
retirement for value of any Capital Stock of Holdco or any Restricted
Subsidiary or any securities exchangeable for or convertible into any
such Capital Stock (other than from Holdco or a Restricted Subsidiary),
including the exercise of any option to exchange any Capital Stock
(other than for or into Capital Stock of Holdco that is not
Disqualified Stock);
23
(3) the purchase, repurchase, redemption, acquisition or
retirement for value, prior to the date for any scheduled maturity,
sinking fund or amortization or other installment payment, of any
Subordinated Obligation (other than the purchase, repurchase or other
acquisition of any Subordinated Obligation purchased in anticipation of
satisfying a scheduled maturity, sinking fund or amortization or other
installment obligation, in each case due within one year of the date of
acquisition);
(4) any Investment (other than Permitted Investments) in
any Person; or
(5) the issuance, sale or other disposition of Capital
Stock of any Restricted Subsidiary to a Person other than Holdco or a
Restricted Subsidiary if the result thereof is that such Restricted
Subsidiary shall cease to be a Restricted Subsidiary, in which event
the amount of such "Restricted Payment" shall be the fair market value
of the remaining interest, if any, in such former Restricted Subsidiary
held by Holdco and the other Restricted Subsidiaries.
"Restricted Subsidiary" means HLI Parent, HLI and any other
Subsidiary of Holdco other than an Unrestricted Subsidiary.
"Rule 144" means Rule 144 promulgated under the Securities
Act.
"Rule 144A" means Rule 144A promulgated under the Securities
Act.
"Rule 903" means Rule 903 promulgated under the Securities
Act.
"Rule 904" means Rule 904 promulgated under the Securities
Act.
"S&P" means Standard & Poor's Ratings Services or any
successor to the rating agency business thereof.
"Sale and Leaseback Transaction" means any direct or indirect
arrangement relating to Property now owned or hereafter acquired whereby Holdco
or a Restricted Subsidiary transfers such Property to another Person and Holdco
or a Restricted Subsidiary leases it from such Person, provided, however, that a
Sale and Leaseback Transaction shall not include any transfer and leaseback of
any Property completed with 90 days of the acquisition of such Property by
Holdco or any Restricted Subsidiary.
"SEC" means the U.S. Securities and Exchange Commission.
"Securities Act" means the Securities Act of 1933, as amended.
"Securitization Entity" means any Wholly Owned Subsidiary of
Holdco or any Restricted Subsidiary (or another Person in which Holdco or any
Restricted Subsidiary makes an Investment and to which Holdco or any Restricted
Subsidiary transfers accounts receivables and related assets):
(1) which engages in no activities other than in
connection with the financing of accounts receivable and related
assets;
(2) which is designated by the Board of Directors (as
provided below) as a Securitization Entity;
(3) no portion of the Debt or any other Obligations
(contingent or otherwise) of which
24
(a) is guaranteed by Holdco or any Restricted
Subsidiary (excluding guarantees of Obligations (other than
the principal of, and interest on, Debt) pursuant to Standard
Securitization Undertakings and guarantees by the
Securitization Entity,
(b) is recourse to or obligates Holdco or any
Restricted Subsidiary (other than the Securitization Entity)
in any way other than pursuant to Standard Securitization
Undertakings or
(c) subjects any property or asset of Holdco or
any Restricted Subsidiary (other than the Securitization
Entity), directly or indirectly, contingently or otherwise, to
the satisfaction thereof, other than pursuant to Standard
Securitization Undertakings and other than any interest in the
accounts receivable and related assets being financed (whether
in the form of any equity interest in such assets or
subordinated indebtedness payable primarily from such financed
assets) retained or acquired by Holdco or any Restricted
Subsidiary;
(4) with which none of Holdco nor any Restricted
Subsidiary has any material contract, agreement, arrangement or
understanding other than those customary for a Qualified Securitization
Transaction and, in any event, on terms no less favorable to Holdco or
such Restricted Subsidiary than those that might be obtained at the
time from Persons that are not Affiliates of Holdco or such Restricted
Subsidiary; and
(5) to which none of Holdco nor any Restricted Subsidiary
has any obligation to maintain or preserve such entity's financial
condition or cause such entity to achieve certain levels of operating
results. Any such designation by the Board of Directors shall be
evidenced to the Trustee by filing with the Trustee a certified copy of
the resolution of the Board of Directors giving effect to such
designation and an officers' certificate certifying that such
designation complied with the foregoing conditions.
"Senior Debt" of HLI means:
(1) all obligations consisting of the principal, premium,
if any, and accrued and unpaid interest (including interest accruing on
or after the filing of any petition in bankruptcy or for reorganization
relating to HLI to the extent post-filing interest is allowed in such
proceeding) in respect of
(a) Debt of HLI for borrowed money, and
(b) Debt of HLI evidenced by notes, debentures,
bonds or other similar instruments permitted under the
Indenture for the payment of which HLI is responsible or
liable;
(2) all Capital Lease Obligations of HLI and all
Attributable Debt in respect of Sale and Leaseback Transactions entered
into by HLI;
(3) all obligations of HLI
(a) for the reimbursement of any obligor on any
letter of credit, banker's acceptance or similar credit
transaction,
(b) under Hedging Obligations, or
25
(c) issued or assumed as the deferred purchase
price of Property and all conditional sale obligations of HLI
and all obligations under any title retention agreement
permitted under the Indenture; and
(4) all obligations of other Persons of the type referred
to in clauses (1), (2) and (3) for the payment of which HLI is
responsible or liable as Guarantor,
provided, however, that Senior Debt shall not include:
(A) Debt of HLI that is by its terms subordinate
in right of payment to the Notes, including any Subordinated
Debt;
(B) any Debt Incurred in violation of the
provisions of this Indenture;
(C) accounts payable or any other obligations of
HLI to trade creditors created or assumed by HLI in the
ordinary course of business in connection with the obtaining
of materials or services (including Guarantees thereof or
instruments evidencing such liabilities);
(D) any liability for Federal, state, local or
other taxes owed or owing by HLI;
(E) any obligation of HLI to any of its
Subsidiaries; or
(F) any obligations with respect to any Capital
Stock of HLI.
"Senior Debt" of any Guarantor shall have a correlative
meaning.
"Shelf Registration Statement" has the meaning set forth in
any Registration Rights Agreement relating to registering Notes under the
Securities Act.
"Significant Subsidiary" means any "significant Subsidiary" of
Holdco within the meaning of Rule 1-02 under Regulation S-X promulgated by the
SEC.
"Special Interest" means the additional interest, if any, to
be paid on the Notes as set forth in Section 4 of the Registration Rights
Agreement relating to the Initial Notes or the correlative Section in any other
relevant Registration Rights Agreement. For all purposes under this Indenture
the term "Interest" shall include Special Interest, if any, with respect to the
Notes.
"Standard Securitization Undertakings" means representations,
warranties, covenants and indemnities entered into by Holdco or any Restricted
Subsidiary which are reasonably customary in an accounts receivable
securitization transaction.
"Stated Maturity" means, with respect to any security, the
date specified in such security as the fixed date on which the payment of
principal of such security is due and payable, including pursuant to any
mandatory redemption provision (but excluding any provision providing for the
repurchase of such security at the option of the holder thereof upon the
happening of any contingency beyond the control of the issuer unless such
contingency has occurred).
"Subordinated Debt" means any Debt of HLI or any Guarantor
(whether outstanding on the Issue Date or thereafter Incurred) that is
subordinate or junior in right of payment to the Notes or the applicable Note
Guaranty pursuant to a written agreement to that effect.
26
"Subsidiary" means, in respect of any Person, any corporation,
company (including any limited liability company), association, partnership,
joint venture or other business entity of which at least a majority of the total
voting power of the Voting Stock is at the time owned or controlled, directly or
indirectly, by:
(1) such Person;
(2) such Person and one or more Subsidiaries of such
Person; or
(3) one or more Subsidiaries of such Person.
"Surviving Person" means the surviving Person formed by a
merger, consolidation or amalgamation and, for purposes of Section 5.01, a
Person to whom all or substantially all of the Property of HLI or a Guarantor is
sold, transferred, assigned, leased, conveyed or otherwise disposed.
"TIA" means the U.S. Trust Indenture Act of 1939, as amended,
and the rules and regulations thereunder, including any successor legislation
and rules and regulations.
"Treasury Rate" means, with respect to any redemption date,
the rate per annum equal to the yield to maturity of the Comparable Treasury
Issue, compounded semi-annually, assuming a price for such Comparable Treasury
Issue (expressed as a percentage of its principal amount) equal to the
Comparable Treasury Price for such redemption date.
"Trustee" means the Person named as the "Trustee" in the first
paragraph of this Indenture until a successor Trustee shall have become such
pursuant to the applicable provisions of this Indenture, and thereafter
"Trustee" shall mean such successor Trustee.
"Unrestricted Definitive Notes" means one or more Definitive
Notes that do not and are not required to bear the Private Placement Legend.
"Unrestricted Global Notes" means one or more Global Notes
that do not and are not required to bear the Private Placement Legend and are
deposited with and registered in the name of the Depositary or its nominee.
"Unrestricted Subsidiary" means:
(1) any Subsidiary of Holdco that is designated after the
Issue Date as an Unrestricted Subsidiary as permitted or required
pursuant to Section 4.17 and is not thereafter redesignated as a
Restricted Subsidiary as permitted pursuant thereto; and
(2) any Subsidiary of an Unrestricted Subsidiary.
"U.S. Dollar Equivalent" means, with respect to any monetary
amount in a currency other than U.S. dollars, at any time of determination
thereof, the amount of U.S. dollars obtained by converting such foreign currency
involved in such computation into U.S. dollars at the spot rate for purchase of
U.S. dollars with the applicable foreign currency as published in the Financial
Times on the date two Business Days prior to such determination, provided, that
if any such amount is subject to at least a coterminous Currency Exchange
Protection Agreement with respect to U.S. dollars covering all principal,
premium, if any, and interest payable on such amount, the amount of such
currency will be as provided in the Currency Exchange Protection Agreement.
Whenever it is necessary to determine whether Holdco or a
Restricted Subsidiary has complied with any covenant in this Indenture or a
Default has occurred or is continuing and an amount is
27
expressed in a currency other than U.S. dollars, such amount will be treated as
the U.S. Dollar Equivalent determined as of the date such amount is initially
determined in such currency.
"U.S. Government Obligations" means direct obligations (or
certificates representing an ownership interest in such obligations) of the
United States of America (including any agency or instrumentality thereof) for
the payment of which the full faith and credit of the United States of America
is pledged and which are not callable or redeemable at the issuer's option.
"Voting Stock" of any Person means all classes of Capital
Stock or other interests (including partnership interests) of such Person then
outstanding and normally entitled (without regard to the occurrence of any
contingency) to vote in the election of directors, managers or trustees thereof.
"Wholly Owned Restricted Subsidiary" means, at any time, a
Restricted Subsidiary all the Voting Stock of which (except directors'
qualifying shares and other de minimis amounts of shares required to be issued
to third parties pursuant to local law requirements, including the 100,000
shares (the "Preferred Shares") of series A cumulative redeemable exchangeable
preferred stock of HLI issued pursuant to the Plan of Reorganization of Xxxxx
Lemmerz International, Inc. and outstanding on the Issue Date) is at such time
owned, directly or indirectly, by Holdco and its other Wholly Owned
Subsidiaries.
"Wholly Owned Subsidiary" means, at any time, a Subsidiary all
the Voting Stock of which (except directors' qualifying shares and other de
minimis amounts of shares required to be issued to third parties pursuant to
local law requirements, including the Preferred Shares) is at such time owned,
directly or indirectly, by Holdco and its other Wholly Owned Restricted
Subsidiaries.
Section 1.02. OTHER DEFINITIONS.
Defined in
Term Section
-------------------------------------------------------------------------------
"ACCELERATION NOTICE"......................................... 6.02
"AFFILIATE TRANSACTION"....................................... 4.15
"AUTHENTICATION ORDER"........................................ 2.02(d)
"BENEFITED PARTY"............................................. 10.01
"CHANGE OF CONTROL OFFER"..................................... 4.18(a)
"CHANGE OF CONTROL AMOUNT".................................... 4.18(a)
"COVENANT DEFEASANCE"......................................... 8.03
"DTC"......................................................... 2.03(b)
"EVENT OF DEFAULT"............................................ 6.01
"EXCESS PROCEEDS"............................................. 4.13(c)
"HLI"......................................................... PREAMBLE
"LEGAL DEFEASANCE"............................................ 8.02
"LOSSES"...................................................... 7.07
"NOTES"....................................................... PREAMBLE
"OFFER AMOUNT"................................................ 3.09(c)(ii)
"OFFER PERIOD"................................................ 3.09(d)
"OFFER TO PURCHASE"........................................... 3.09(a)
"PAYING AGENT"................................................ 2.03(a)
"PREPAYMENT OFFER"............................................ 4.13(d)
"PURCHASE DATE"............................................... 3.09(d)
"REGISTRAR"................................................... 2.03(a)
"SECURITY REGISTER"........................................... 3.03
-------------------------------------------------------------------------------
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Section 1.03. INCORPORATION BY REFERENCE OF TRUST INDENTURE ACT.
(a) Whenever this Indenture refers to a provision of the
TIA, the provision is incorporated by reference in and made a part of this
Indenture.
(b) The following TIA terms used in this Indenture have
the following meanings:
"indenture securities" means the Notes and the Note
Guarantees;
"indenture security holder" means a Holder;
"indenture to be qualified" means this Indenture;
"indenture trustee" or "institutional trustee" means the
Trustee; and
"obligor" on the Notes means HLI, the Guarantors and any
successor obligor upon the Notes or the Note Guarantees.
(c) 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 and not otherwise defined herein have the meanings so
assigned to them either in the TIA, by another statute or SEC rule, as
applicable.
Section 1.04. RULES OF CONSTRUCTION.
(a) Unless the context otherwise requires:
(i) a term has the meaning assigned to it;
(ii) an accounting term not otherwise defined
herein has the meaning assigned to it in accordance with GAAP;
(iii) "or" is not exclusive;
(iv) words in the singular include the plural,
and in the plural include the singular;
(v) all references in this instrument to
"Articles," "Sections" and other subdivisions are to the designated
Articles, Sections and subdivisions of this instrument as originally
executed;
(vi) the words "herein," "hereof" and "hereunder"
and other words of similar import refer to this Indenture as a whole
and not to any particular Article, Section or other subdivision.
(vii) "including" means "including without
limitation;"
(viii) provisions apply to successive events and
transactions; and
(ix) references to sections of or rules under the
Securities Act, the Exchange Act or the TIA shall be deemed to include
substitute, replacement or successor sections or rules adopted by the
SEC from time to time thereunder.
29
ARTICLE 2.
THE NOTES
Section 2.01. FORM AND DATING.
(a) GENERAL. The Notes and the Trustee's certificate of
authentication shall be substantially in the form included in Exhibit A hereto,
which is hereby incorporated in and expressly made part of this Indenture. The
Notes may have notations, legends or endorsements required by law, exchange rule
or usage in addition to those set forth on Exhibit A. Each Note shall be dated
the date of its authentication. The Notes shall be in denominations of $1,000
and integral multiples thereof. The terms and provisions contained in the Notes
shall constitute a part of this Indenture, and HLI, the Guarantors and the
Trustee, by their execution and delivery of this Indenture, expressly agree to
such terms and provisions and to be bound thereby. To the extent any provision
of any Note conflicts with the express provisions of this Indenture, the
provisions of this Indenture shall govern and be controlling.
(b) FORM OF NOTES. Notes shall be issued initially in
global form and shall be substantially in the form of Exhibit A attached hereto
(including the Global Note Legend thereon and the "Schedule of Exchanges of
Interests in the Global Note" attached thereto). Notes issued in definitive form
shall be substantially in the form of Exhibit A attached hereto (but without the
Global Note Legend thereon and without the "Schedule of Exchanges of Interests
in the Global Note" attached thereto). Each Global Note shall represent such
aggregate principal amount 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 and transfers of interests therein. 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 or
the Custodian, at the direction of the Trustee, in accordance with instructions
given by the Holder thereof as required by Section 2.06.
(c) BOOK-ENTRY PROVISIONS. This Section 2.01(c) shall
apply only to Global Notes deposited with the Trustee, as custodian for the
Depositary. Participants and Indirect Participants shall have no rights under
this Indenture or any Global Note with respect to any Global Note held on their
behalf by the Depositary or by the Trustee as custodian for the Depositary, and
the Depositary shall be treated by HLI, the Trustee and any agent of HLI or the
Trustee as the absolute owner of such Global Note for all purposes whatsoever.
Notwithstanding the foregoing, nothing herein shall prevent HLI, the Trustee or
any agent of HLI or the Trustee from giving effect to any written certification,
proxy or other authorization furnished by the Depositary or impair, as between
the Depositary and its Participants or Indirect Participants, the Applicable
Procedures or the operation of customary practices of the Depositary governing
the exercise of the rights of a holder of a beneficial interest in any Global
Note.
(d) EUROCLEAR AND CLEARSTREAM PROCEDURES APPLICABLE. The
provisions of the "Operating Procedures of the Euroclear System" and "Terms and
Conditions Governing Use of Euroclear" and the "General Terms and Conditions of
Clearstream" and "Customer Handbook" of Clearstream shall be applicable to
transfers of beneficial interests in Global Notes that are held by Participants
through Euroclear or Clearstream.
Section 2.02. EXECUTION AND AUTHENTICATION.
(a) One Officer shall execute the Notes on behalf of HLI
by manual or facsimile signature.
(b) If an Officer whose signature is on a Note no longer
holds that office at the time a Note is authenticated by the Trustee, the Note
shall nevertheless be valid.
30
(c) 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 form of Trustee's
certificate of authentication to be borne by the Note shall be substantially as
set forth in Exhibit A hereto.
(d) The Trustee shall, upon a written order of HLI signed
by an Officer (an "Authentication Order"), authenticate Notes for original
issue.
(e) The Trustee may appoint an authenticating agent
acceptable to HLI to authenticate Notes. Unless otherwise provided in such
appointment, 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 shall have the
same rights as an Agent with respect to Holders.
Section 2.03. REGISTRAR AND PAYING AGENT.
(a) HLI shall maintain an office or agency where Notes
may be presented for registration of transfer or for exchange ("Registrar") and
an office or agency where Notes may be presented for payment ("Paying Agent").
The Registrar shall keep a register of the Notes and of their transfer and
exchange. HLI 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. HLI may enter into an
appropriate agency agreement with any Agent not party to this Indenture, which
may incorporate the provisions of the TIA. Such Agreement shall implement the
provisions of this Indenture that relate to such Agent. HLI may change any
Paying Agent or Registrar without notice to any Holder. HLI shall notify the
Trustee in writing of the name and address of any Agent not a party to this
Indenture. If HLI fails to appoint or maintain another entity as Registrar or
Paying Agent, the Trustee shall act as such and shall be entitled to appropriate
compensation in accordance with Section 7.07. HLI, any Guarantor or any of their
Subsidiaries may act as Paying Agent or Registrar.
(b) HLI initially appoints The Depository Trust Company
("DTC") to act as Depositary with respect to the Global Notes.
(c) HLI initially appoints the Trustee to act as
Registrar and Paying Agent, agent for service of notices and demands in
connection with the Global Note and to act as Custodian with respect to the
Global Notes, and the Trustee hereby agrees so to initially act.
Section 2.04. PAYING AGENT TO HOLD MONEY IN TRUST.
HLI shall require each Paying Agent other than the Trustee to
agree in writing that the Paying Agent shall hold in trust for the benefit of
Holders or the Trustee all money held by the Paying Agent for the payment of
principal, premium, if any, or interest on the Notes, and shall notify the
Trustee of any Default by HLI in making any such payment. While any such Default
continues, the Trustee may require a Paying Agent to pay all funds held by it
relating to the Notes to the Trustee. HLI at any time may require a Paying Agent
to pay all funds held by it relating to the Notes to the Trustee. Upon payment
over to the Trustee, the Paying Agent (if other than HLI, any Guarantor or any
of their Subsidiaries) shall have no further liability for such funds. If HLI,
any Guarantor or any of their Subsidiaries acts as Paying Agent, it shall
segregate and hold in a separate trust fund for the benefit of the Holders all
funds held by it as Paying Agent. Upon any Event of Default under Sections
6.01(a)(ix) or (x) relating to HLI or any Guarantor, the Trustee shall serve as
Paying Agent for the Notes.
Section 2.05. HOLDER LISTS.
The Trustee shall preserve in as current a form as is
reasonably practicable the most recent list available to it of the names and
addresses of all Holders and shall otherwise comply with TIA
31
Section 312(a). If the Trustee is not the Registrar, HLI shall furnish or cause
to be furnished to the Trustee at least seven Business Days before each Interest
Payment Date and at such other times as the Trustee may request in writing, a
list in such form and as of such date or such shorter time as the Trustee may
allow, as the Trustee may reasonably require of the names and addresses of the
Holders and HLI shall otherwise comply with TIA Section 312(a).
Section 2.06. TRANSFER AND EXCHANGE.
(a) TRANSFER AND EXCHANGE OF GLOBAL NOTES. A Global Note
may not be transferred as a whole except by the Depositary to a nominee of the
Depositary, by a nominee of the Depositary to the Depositary or to another
nominee of the Depositary, or by the Depositary or any such nominee to a
successor Depositary or a nominee of such successor Depositary. HLI shall
exchange Global Notes for Definitive Notes if: (1) HLI delivers to the Trustee a
notice from the Depositary that the Depositary is unwilling or unable to
continue to act as Depositary for the Global Notes or that it has ceased to be a
clearing agency registered under the Exchange Act and, in either case, a
successor Depositary is not appointed by HLI within 120 days after the date of
such notice from the Depositary; (2) HLI at its option determines that the
Global Notes shall be exchanged for Definitive Notes and delivers a written
notice to such effect to the Trustee; or (3) a Default or Event of Default shall
have occurred and be continuing. Upon the occurrence of any of the events in
clauses (1), (2) or (3) above, Definitive Notes shall be issued in denominations
of $1,000 or integral multiples thereof and in such names as the Depositary
shall instruct the Trustee in writing. Global Notes also may be exchanged or
replaced, in whole or in part, as provided in Sections 2.07 and 2.10. Except as
provided above, every Note authenticated and delivered in exchange for, or in
lieu of, a Global Note or any portion thereof, pursuant to this Section 2.06 or
Section 2.07 or 2.10, shall be authenticated and delivered in the form of, and
shall be, a Global Note. A Global Note may not be exchanged for another Note
other than as provided in this Section 2.06(a), and beneficial interests in a
Global Note may not be transferred and exchanged other than as provided in
Section 2.06(b), (c) or (f).
(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
Restricted Global Notes shall be subject to restrictions on transfer comparable
to those set forth herein to the extent required by the Securities Act.
Transfers of beneficial interests in Global Notes also shall require compliance
with either clause (i) or (ii) below, as applicable, as well as one or more of
the other following clauses, 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 and any Applicable Procedures; provided, however, that prior to
the expiration of the Distribution Compliance Period, transfers of
beneficial interests in a Regulation S Global Note may not be made to
or for the account or benefit of a "U.S. Person" (as defined in Rule
902(k) of Regulation S) (other than a "distributor" (as defined in Rule
902(d) of Regulation S)). Beneficial interests in any Unrestricted
Global Note may be transferred to Persons who take delivery thereof in
the form of a beneficial interest in an Unrestricted Global Note.
Except as may be required by any Applicable Procedures, no written
orders or instructions shall be required to be delivered to the
Registrar to effect the transfers described in this Section 2.06(b)(i).
(ii) All Other Transfers and Exchanges of
Beneficial Interests in Global Notes. In connection with all transfers
and exchanges of beneficial interests that are not subject to Section
2.06(b)(i) above, the transferor of such beneficial interest must
deliver to the Registrar either (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
32
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) if
permitted under Section 2.06(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 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 (B)(1) above. Upon consummation of
an Exchange Offer by HLI in accordance with Section 2.06(f), the
requirements of this Section 2.06(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 and the Notes or otherwise
applicable under the Securities Act, the Trustee shall adjust the
principal amount of the relevant Global Note(s) pursuant to Section
2.06(h).
(iii) Transfer of Beneficial Interests in a
Restricted Global Note to Another Restricted Global Note. A beneficial
interest in any Restricted Global Note may be transferred to a Person
who takes delivery thereof in the form of a beneficial interest in
another Restricted Global Note if the transfer complies with the
requirements of Section 2.06(b)(ii) above and the Registrar receives
the following:
(A) if the transferee shall take
delivery in the form of a beneficial interest in a
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,
if permitted by Applicable Procedures, item (3)
thereof;
(B) if the transferee shall take
delivery in the form of a beneficial interest in a
Regulation S Global Note, then the transferor must
deliver a certificate in the form of Exhibit B
hereto, including the certifications in item (2)
thereof; and
(C) if the transferee will take
delivery in the form of a beneficial interest in the
IAI Global Note, then the transferor must deliver a
certificate in the form of Exhibit B hereto,
including the certifications and certificates and
Opinion of Counsel required by item (3) thereof, if
applicable.
(iv) Transfer and Exchange of Beneficial
Interests in a Restricted Global Note for Beneficial Interests in an
Unrestricted Global Note. A beneficial interest in any Restricted
Global Note may be exchanged by any holder thereof for a beneficial
interest in an Unrestricted Global Note or transferred to a Person who
takes delivery thereof in the form of a beneficial interest in an
Unrestricted Global Note only if the exchange or transfer complies with
the requirements of Section 2.06(b)(ii) above and:
(A) such exchange or transfer is
effected pursuant to an Exchange Offer in accordance
with a 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, makes any and all certifications in
the applicable Letter of Transmittal (or is deemed to
have made such certifications if delivery is made
through the Applicable Procedures) as may be required
by such Registration Rights Agreement;
(B) such transfer is effected pursuant
to a Shelf Registration Statement in accordance with
a Registration Rights Agreement;
33
(C) such transfer is effected by a
broker-dealer pursuant to an Exchange Offer
Registration Statement in accordance with a
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; or
(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, in each such case set forth in this clause (D), if the
Registrar so requests or if the Applicable Procedures so
require, an Opinion of Counsel in form reasonably acceptable
to the Registrar to the effect that such exchange or transfer
shall be effected in compliance with the Securities Act and
that the restrictions on transfer contained herein and in the
Private Placement Legend shall no longer be required in order
to maintain compliance with the Securities Act.
If any such transfer is effected pursuant to clause (B) or (D)
above at a time when an Unrestricted Global Note has not yet been issued, HLI
shall execute and, upon receipt of an Authentication Order in accordance with
Section 2.02, the Trustee shall authenticate one or more Unrestricted Global
Notes in an aggregate principal amount equal to the aggregate principal amount
of beneficial interests transferred pursuant to clause (B) or (D) above.
(v) Transfer or Exchange of Beneficial Interests
in Unrestricted Global Notes for Beneficial Interests in Restricted
Global Notes Prohibited. Beneficial interests in an Unrestricted Global
Note may not be exchanged for, or transferred to Persons who take
delivery thereof in the form of, beneficial interests in a Restricted
Global Note.
(c) TRANSFER OR EXCHANGE OF BENEFICIAL INTERESTS FOR
DEFINITIVE NOTES.
(i) Beneficial Interests in Restricted Global
Notes to Restricted Definitive Notes. Subject to Section 2.06(a), if
any holder of a beneficial interest in a Restricted Global Note
proposes to exchange such beneficial interest for a Restricted
Definitive Note or to transfer such beneficial interest to a Person who
takes delivery thereof in the form of a Restricted Definitive Note,
then, upon receipt by the Registrar of the following documentation:
(A) if the holder of such beneficial
interest in a Restricted Global Note proposes to
exchange such beneficial interest for a Restricted
Definitive Note, a certificate from such holder in
the form of Exhibit C hereto, including the
certifications in item (2)(a) thereof;
(B) if such beneficial interest is
being transferred to a QIB in accordance with Rule
144A, a certificate to the effect set forth in
Exhibit B hereto, including the certifications in
item (1) thereof;
(C) if such beneficial interest is
being transferred to a "non-U.S. Person" (as defined
in Rule 902(k) of Regulation S) in an offshore
transaction in
34
accordance with Rule 903 or Rule 904, a certificate
to the effect set forth in Exhibit B hereto,
including the certifications in item (2) thereof;
(D) if such beneficial interest is
being transferred pursuant to an exemption from the
registration requirements of the Securities Act in
accordance with Rule 144 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 HLI, any Guarantor or any of
their respective Subsidiaries, a certificate to the
effect set forth in Exhibit B hereto, including the
certifications in item (3)(b) thereof;
(F) if such beneficial interest is
being transferred to an Institutional Accredited
Investor in reliance on an exemption from the
registration requirements of the Securities Act other
than those listed in clauses (B) through (D) above, a
certificate to the effect set forth in Exhibit B
hereto, including the certifications, certificates
and Opinion of Counsel required by item (3)(d)
thereof,
the Trustee shall reduce or cause to be reduced in a corresponding
amount pursuant to Section 2.06(h) the aggregate principal amount of
the applicable Restricted Global Note, and HLI shall execute and, upon
receipt of an Authentication Order in accordance with Section 2.02, the
Trustee shall authenticate and deliver a Restricted Definitive Note in
the appropriate principal amount to the Person designated by the holder
of such beneficial interest in instructions delivered to the Registrar
by the Depositary and the applicable Participant or Indirect
Participant on behalf of such holder. Any Restricted Definitive Note
issued in exchange for a beneficial interest in a Restricted Global
Note pursuant to this Section 2.06(c)(i) shall be registered in such
name or names and in such authorized denomination or denominations as
the holder of such beneficial interest shall designate in such
instructions. The Trustee shall deliver such Restricted Definitive
Notes to the Persons in whose names such Notes are so registered. Any
Restricted Definitive Note issued in exchange for a beneficial interest
in a Restricted Global Note pursuant to this Section 2.06(c)(i) shall
bear the Private Placement Legend and shall be subject to all
restrictions on transfer contained therein.
(ii) Beneficial Interests in Restricted Global
Notes to Unrestricted Definitive Notes. Subject to Section 2.06(a), 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 an Exchange Offer in accordance
with a 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, makes any and all certifications in the
applicable Letter of Transmittal (or is deemed to
have made such certifications if delivery is made
through the Applicable Procedures) as may be required
by such Registration Rights Agreement;
(B) such transfer is effected pursuant
to a Shelf Registration Statement in accordance with
a Registration Rights Agreement;
(C) such transfer is effected by a
broker-dealer pursuant to an Exchange Offer
Registration Statement in accordance with a
Registration Rights Agreement; or
35
(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 an
Unrestricted Definitive Note, a certificate from such
holder in the form of Exhibit C hereto, including the
certifications in item (1)(b) thereof; or
(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
an Unrestricted Definitive Note, a certificate from
such holder in the form of Exhibit B hereto,
including the certifications in item (4) thereof;
and, in each such case set forth in this clause (D), if the
Registrar so requests or if the Applicable Procedures so
require, an Opinion of Counsel in form reasonably acceptable
to the Registrar to the effect that such exchange or transfer
shall be effected in compliance with the Securities Act and
that the restrictions on transfer contained herein and in the
Private Placement Legend shall no longer be required in order
to maintain compliance with the Securities Act.
Upon satisfaction of the conditions of any of the clauses of
this Section 2.06(c)(ii) HLI shall execute, and, upon receipt of an
Authentication Order in accordance with Section 2.02, the Trustee shall
authenticate and deliver an Unrestricted Definitive Note in the
appropriate principal amount to the Person designated by the holder of
such beneficial interest in instructions delivered to the Registrar by
the Depositary and the applicable Participant or Indirect Participant
on behalf of such holder, and the Trustee shall reduce or cause to be
reduced in a corresponding amount pursuant to Section 2.06(h) the
aggregate principal amount of the applicable Restricted Global Note.
(iii) Beneficial Interests in Unrestricted Global
Notes to Unrestricted Definitive Notes. Subject to Section 2.06(a), if
any holder of a beneficial interest in an Unrestricted Global Note
proposes to exchange such beneficial interest for an Unrestricted
Definitive Note or to transfer such beneficial interest to a Person who
takes delivery thereof in the form of an Unrestricted Definitive Note,
then, upon satisfaction of the applicable conditions set forth in
Section 2.06(b)(ii), the Trustee shall reduce or cause to be reduced in
a corresponding amount pursuant to Section 2.06(h) the aggregate
principal amount of the applicable Unrestricted Global Note, and HLI
shall execute and, upon receipt of an Authentication Order in
accordance with Section 2.02, the Trustee shall authenticate and
deliver an Unrestricted Definitive Note in the appropriate principal
amount to the Person designated by the holder of such beneficial
interest in instructions delivered to the Registrar by the Depositary
and the applicable Participant or Indirect Participant on behalf of
such holder. Any Unrestricted Definitive Note issued in exchange for a
beneficial interest pursuant to this Section 2.06(c)(iii) shall be
registered in such name or names and in such authorized denomination or
denominations as the holder of such beneficial interest shall designate
in such instructions. The Trustee shall deliver such Unrestricted
Definitive Notes to the Persons in whose names such Notes are so
registered. Any Unrestricted Definitive Note issued in exchange for a
beneficial interest pursuant to this Section 2.06(c)(iii) shall not
bear the Private Placement Legend.
(d) TRANSFER AND EXCHANGE OF DEFINITIVE NOTES FOR
BENEFICIAL INTERESTS.
(i) Restricted Definitive Notes to Beneficial
Interests in Restricted Global Notes. If any holder of a Restricted
Definitive Note proposes to exchange such Note for a beneficial
interest in a Restricted Global Note or to transfer such Restricted
Definitive Note to a
36
Person who takes delivery thereof in the form of a beneficial interest
in a Restricted Global Note, then, upon receipt by the Registrar of the
following documentation:
(A) if the holder of such Restricted
Definitive Note proposes to exchange such Note for a
beneficial interest in a Restricted Global Note, a
certificate from such holder in the form of Exhibit C
hereto, including the certifications in item (2)(b)
thereof;
(B) if such Restricted Definitive Note
is being transferred to a QIB in accordance with Rule
144A, a certificate to the effect set forth in
Exhibit B hereto, including the certifications in
item (1) thereof;
(C) if such Restricted Definitive Note
is being transferred to a "non-U.S. Person" (as
defined in Rule 902(k) of Regulation S) in an
offshore transaction in accordance with Rule 903 or
Rule 904, a certificate to the effect set forth in
Exhibit B hereto, including the certifications in
item (2) thereof;
(D) if such Restricted Definitive Note
is being transferred pursuant to an exemption from
the registration requirements of the Securities Act
in accordance with Rule 144, a certificate to the
effect set forth in Exhibit B hereto, including the
certifications in item (3)(a) thereof;
(E) if such Restricted Definitive Note
is being transferred to HLI, any Guarantor, or any of
their respective Subsidiaries, a certificate to the
effect set forth in Exhibit B hereto, including the
certifications in item (3)(b) thereof;
(F) if such Restricted Definitive Note
is being transferred to an Institutional Accredited
Investor in reliance on an exemption from the
registration requirements of the Securities Act other
than those listed in clauses (B) through (D) above, a
certificate to the effect set forth in Exhibit B
hereto, including the certifications, certificates
and Opinion of Counsel required by item (3)(d)
thereof; or
(G) if such Restrictive 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 certification in item 3(c)
thereof,
the Trustee shall cancel the Restricted Definitive Note and increase or
cause to be increased in a corresponding amount pursuant to Section
2.06(h) the aggregate principal amount of the appropriate Restricted
Global Note.
(ii) Restricted Definitive Notes to Beneficial
Interests in Unrestricted Global Notes. A holder of a Restricted
Definitive Note may exchange such Note for a beneficial interest in an
Unrestricted Global Note or transfer such Restricted Definitive Note to
a Person who takes delivery thereof in the form of a beneficial
interest in an Unrestricted Global Note only if:
(A) such exchange or transfer is
effected pursuant to a Exchange Offer in accordance
with a 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, makes such certifications in the applicable
Letter of Transmittal (or is deemed to have made such
certifications if delivery is made through the
Applicable Procedures) as may be required by such
Registration Rights Agreement;
37
(B) such transfer is effected pursuant
to a Shelf Registration Statement in accordance with
a Registration Rights Agreement;
(C) such transfer is effected by a
broker-dealer pursuant to an Exchange Offer
Registration Statement in accordance with a
Registration Rights Agreement; or
(D) the Registrar receives the
following:
(1) if the holder of such
Restricted Definitive Note proposes to exchange such
Note 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)(c) thereof; or
(2) if the holder of such
Restricted Definitive Note proposes to transfer such
Note to a Person who shall take delivery thereof in
the form of a beneficial interest in an Unrestricted
Global Note, a certificate from such holder in the
form of Exhibit B hereto, including the
certifications in item (4) thereof;
and, in each such case set forth in this clause (D), if the
Registrar so requests or if the Applicable Procedures so
require, an Opinion of Counsel in form reasonably acceptable
to the Registrar to the effect that such exchange or transfer
shall be effected in compliance with the Securities Act and
that the restrictions on transfer contained herein and in the
Private Placement Legend shall no longer be required in order
to maintain compliance with the Securities Act.
Upon satisfaction of the conditions of any of the clauses in
this Section 2.06(d)(ii), the Trustee shall cancel such Restricted Definitive
Note and increase or cause to be increased in a corresponding amount pursuant to
Section 2.06(h) the aggregate principal amount of the Unrestricted Global Note.
(iii) Unrestricted Definitive Notes to Beneficial
Interests in Unrestricted Global Notes. A holder of an Unrestricted
Definitive Note may exchange such Note for a beneficial interest in an
Unrestricted Global Note or transfer such Unrestricted Definitive Note
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 in a corresponding amount pursuant to Section 2.06(h) the
aggregate principal amount of one of the Unrestricted Global Notes.
(iv) Transfer or Exchange of Unrestricted
Definitive Notes to Beneficial Interests in Restricted Global Notes
Prohibited. An Unrestricted Definitive Note may not be exchanged for,
or transferred to Persons who take delivery thereof in the form of,
beneficial interests in a Restricted Global Note.
(v) Issuance of Unrestricted Global Notes. If
any such exchange or transfer of a Definitive Note for a beneficial
interest in an Unrestricted Global Note is effected pursuant to clause
(ii) above at a time when an Unrestricted Global Note has not yet been
issued, HLI shall issue and, upon receipt of an Authentication Order in
accordance with Section 2.02, the Trustee shall authenticate one or
more Unrestricted Global Notes in an aggregate principal amount equal
to the principal amount of Definitive Notes so transferred.
38
(e) TRANSFER AND EXCHANGE OF DEFINITIVE NOTES FOR
DEFINITIVE NOTES. Upon request by a holder of Definitive Notes and such holder's
compliance with the provisions of this Section 2.06(e), the Registrar 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. In addition, the requesting holder shall provide any
additional certifications, documents and information, as applicable, required
pursuant to the following provisions of this Section 2.06(e).
(i) Restricted Definitive Notes to Restricted
Definitive Notes. Any Restricted Definitive Note may be transferred to
and registered in the name of Persons who take delivery thereof in the
form of a Restricted Definitive Note if the Registrar receives the
following:
(A) if the transfer shall be made
pursuant to Rule 144A, a certificate in the form of
Exhibit B hereto, including the certifications in
item (1) thereof;
(B) if the transfer shall be made
pursuant to Rule 903 or Rule 904, a certificate in
the form of Exhibit B hereto, including the
certifications in item (2) thereof; and
(C) if the transfer shall be made
pursuant to any other exemption from the registration
requirements of the Securities Act, 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) Restricted Definitive Notes to Unrestricted
Definitive Notes. Any Restricted Definitive Note may be exchanged by
the holder thereof for an Unrestricted Definitive Note or transferred
to a Person or Persons who take delivery thereof in the form of an
Unrestricted Definitive Note only if:
(A) such exchange or transfer is
effected pursuant to an Exchange Offer in accordance
with a 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, makes such certifications in the applicable
Letter of Transmittal (or is deemed to have made such
certifications if delivery is made through the
Applicable Procedures) as may be required by such
Registration Rights Agreement;
(B) any such transfer is effected
pursuant to a Shelf Registration Statement in
accordance with a Registration Rights Agreement;
(C) any such transfer is effected by a
broker-dealer pursuant to an Exchange Offer
Registration Statement in accordance with a
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; or
39
(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, in each such case set forth in this clause (D), if the
Registrar so requests, an Opinion of Counsel in form
reasonably acceptable to the Registrar to the effect that such
exchange or transfer shall be effected in compliance with the
Securities Act and that the restrictions on transfer contained
herein and in the Private Placement Legend shall no longer be
required in order to maintain compliance with the Securities
Act.
Upon satisfaction of the conditions of any of the clauses of
Section 2.06(e)(ii) the Trustee shall cancel the prior
Restricted Definitive Note and HLI shall execute, and, upon
receipt of an Authentication Order in accordance with Section
2.02, the Trustee shall authenticate and deliver an
Unrestricted Definitive Note in the appropriate principal
amount to the Person designated by the holder of such prior
Restricted Definitive Note in instructions delivered to the
Registrar by such holder.
(iii) Unrestricted Definitive Notes to
Unrestricted Definitive Notes. A holder of Unrestricted Definitive
Notes may transfer such Notes to a Person who takes delivery thereof in
the form of an Unrestricted Definitive Note. Upon receipt of a request
to register such a transfer, the Registrar shall register the
Unrestricted Definitive Notes pursuant to the instructions from the
Holders thereof.
(f) EXCHANGE OFFER. Upon the occurrence of an Exchange
Offer in accordance with a Registration Rights Agreement, HLI shall issue and,
upon receipt of an Authentication Order in accordance with Section 2.02, 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 applicable Restricted Global Notes (A) tendered for acceptance
by Persons that make any and all certifications in the applicable Letters of
Transmittal (or are deemed to have made such certifications if delivery is made
through the Applicable Procedures) as may be required by such Registration
Rights Agreement, and (B) accepted for exchange in the Exchange Offer and (ii)
Unrestricted Definitive Notes in an aggregate principal amount equal to the
principal amount of the Restricted Definitive Notes tendered for acceptance by
Persons who made the foregoing certification and accepted for exchange in the
Exchange Offer. Concurrently with the issuance of such Notes, the Trustee shall
reduce or cause to be reduced in a corresponding amount the aggregate principal
amount of the applicable Restricted Global Notes, and HLI shall execute and the
Trustee shall authenticate and deliver to the Persons designated by the Holders
of Restricted Definitive Notes so accepted Unrestricted 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 clause (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 THE SECURITIES LAWS OF
ANY STATE OR OTHER JURISDICTION. NEITHER THIS SECURITY NOR ANY INTEREST
OR PARTICIPATION HEREIN MAY BE REOFFERED, SOLD, ASSIGNED,
40
TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN THE
ABSENCE OF SUCH REGISTRATION OR UNLESS SUCH TRANSACTION IS EXEMPT FROM,
OR NOT SUBJECT TO, SUCH REGISTRATION. THE HOLDER OF THIS SECURITY BY
ITS ACCEPTANCE HEREOF AGREES TO OFFER, SELL OR OTHERWISE TRANSFER SUCH
SECURITY, PRIOR TO THE DATE (THE "RESALE RESTRICTION TERMINATION DATE")
WHICH IS TWO YEARS AFTER THE LATER OF THE ORIGINAL ISSUE DATE HEREOF
AND THE LAST DATE ON WHICH THE COMPANY OR ANY AFFILIATE OF THE COMPANY
WAS THE OWNER OF THIS SECURITY (OR ANY PREDECESSOR OF SUCH SECURITY),
ONLY: (A) TO THE COMPANY OR ANY OF ITS SUBSIDIARIES; (B) PURSUANT TO A
REGISTRATION STATEMENT THAT HAS BEEN DECLARED EFFECTIVE UNDER THE
SECURITIES ACT; (C) FOR SO LONG AS THE SECURITIES ARE 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 PURCHASES 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) PURSUANT TO
OFFERS AND SALES TO NON-U.S. PERSONS THAT OCCUR OUTSIDE THE UNITED
STATES WITHIN THE MEANING OF REGULATION S UNDER THE SECURITIES ACT; (E)
TO AN "ACCREDITED INVESTOR" WITHIN THE MEANING OF RULE 501(a)(1), (2),
(3) OR (7) UNDER THE SECURITIES ACT THAT IS AN INSTITUTIONAL ACCREDITED
INVESTOR ACQUIRING THE SECURITY FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT
OF SUCH AN INSTITUTIONAL ACCREDITED INVESTOR, IN EACH CASE IN A MINIMUM
PRINCIPAL AMOUNT OF THE SECURITIES OF $250,000, FOR INVESTMENT PURPOSES
AND NOT WITH A VIEW TO OR FOR OFFER OR SALE IN CONNECTION WITH ANY
DISTRIBUTION IN VIOLATION OF THE SECURITIES ACT; OR (F) PURSUANT TO ANY
OTHER AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE
SECURITIES ACT, SUBJECT TO THE COMPANY'S AND THE TRUSTEE'S RIGHT PRIOR
TO ANY SUCH OFFER, SALE OR TRANSFER PURSUANT TO CLAUSES (D), (E) OR (F)
TO REQUIRE THE DELIVERY OF AN OPINION OF COUNSEL, CERTIFICATION AND/OR
OTHER INFORMATION SATISFACTORY TO EACH OF THEM. THIS LEGEND WILL BE
REMOVED UPON THE REQUEST OF THE HOLDER AFTER THE RESALE RESTRICTION
TERMINATION DATE.
(B) Notwithstanding the foregoing, any
Global Note or Definitive Note issued pursuant to
clauses (b)(iv), (c)(ii), (c)(iii), (d)(ii),
(d)(iii), (e)(ii), (e)(iii) or (f) to this Section
2.06 (and all Notes issued in exchange therefor 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:
"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 SECTION 2.06 OF
THE INDENTURE, (II) THIS GLOBAL NOTE MAY BE EXCHANGED IN WHOLE BUT NOT
IN PART PURSUANT TO SECTION 2.06(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
HLI.
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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 NOTE IS PRESENTED BY
AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY (55 XXXXX
XXXXXX, XXX XXXX, XXX XXXX) ("XXX"), TO HLI OR ITS AGENT FOR
REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY NOTE ISSUED IS
REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS MAY BE
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS
MADE TO CEDE & CO. OR TO 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."
(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 cancelled in whole and not in part, each such Global Note shall
be returned to or retained and cancelled by the Trustee in accordance with
Section 2.11. At any time prior to such cancellation, if any beneficial interest
in a Global Note is exchanged for or transferred to a Person who shall 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 or by the Depositary at the direction of the Trustee
to reflect such reduction; and if the beneficial interest is being exchanged for
or transferred to a Person who shall 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 or by the Depositary at the direction of the Trustee to reflect such
increase.
(i) GENERAL PROVISIONS RELATING TO TRANSFERS AND
EXCHANGES.
(i) 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 HLI
may require payment of a sum sufficient to cover any transfer tax or
similar governmental charge payable in connection therewith (other than
any such transfer taxes or similar governmental charge payable upon
exchange or transfer pursuant to Sections 2.10, 3.06, 3.09, 4.13, 4.18
and 9.05).
(ii) 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 HLI, evidencing the
same Debt, as the Global Notes or Definitive Notes surrendered upon
such registration of transfer or exchange and shall be entitled to all
of the benefits of this Indenture equally and proportionately with all
other Notes duly issued hereunder.
(iii) Neither the Registrar nor HLI shall be
required (A) to issue, to register the transfer of or to exchange any
Notes during a period beginning at the opening of business 15 days
before the day of any selection of Notes for redemption under Section
3.02 and ending at the close of business on the date of selection, (B)
to register the transfer of or to exchange any Note so selected for
redemption in whole or in part, except the unredeemed portion of any
Note being redeemed in part or (C) to register the transfer of or to
exchange a Note between a record date (including a Regular Record Date)
and the next succeeding Interest Payment Date.
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(iv) Prior to due presentment for the
registration of a transfer of any Note, the Trustee, any Agent and HLI
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 Note and for all other purposes, in
each case regardless of any notice to the contrary.
(v) All certifications, certificates and
Opinions of Counsel required to be submitted to the Registrar pursuant
to this Section 2.06 to effect a registration of transfer or exchange
may be submitted by facsimile.
(vi) The Trustee is hereby authorized and
directed to enter into a letter of representation with the Depositary
in the form provided by HLI and to act in accordance with such letter.
(vii) To permit registrations of transfers and
exchanges, HLI shall execute, and the Trustee shall authenticate,
Global Notes and Definitive Notes upon HLI's order or at the
Registrar's request.
(viii) The Registrar shall not be required to
register the transfer of or exchange any Note selected for redemption
in whole or in part, except the unredeemed portion of any Note being
redeemed in part.
(ix) The Trustee shall authenticate Global Notes
and Definitive Notes in accordance with the provisions of Section 2.02.
Section 2.07. REPLACEMENT NOTES.
If any mutilated Note is surrendered to the Trustee or HLI and
the Trustee receives evidence to its satisfaction of the destruction, loss or
theft of any Note, HLI shall issue and the Trustee, upon receipt of an
Authentication Order in accordance with Section 2.02, shall authenticate a
replacement Note. If required by the Trustee or HLI, the Holder of such Note
shall provide indemnity sufficient, in the judgment of the Trustee or HLI, as
applicable, to protect HLI, the Trustee, any Agent and any authenticating agent
from any loss that any of them may suffer in connection with such replacement.
If required by HLI, such Holder shall reimburse HLI for its reasonable expenses
in connection with such replacement.
Every replacement Note issued in accordance with this Section
2.07 shall be the valid obligation of HLI evidencing the same Debt as the
destroyed, lost or stolen Note and shall be entitled to all of the benefits of
this Indenture equally and proportionately with all other Notes duly issued
hereunder.
Section 2.08. OUTSTANDING NOTES.
(a) The Notes outstanding at any time shall be the entire
principal amount of Notes represented by all the Global Notes and Definitive
Notes authenticated by the Trustee except for those cancelled by it, those
delivered to it for cancellation, those subject to reductions in beneficial
interests effected by the Trustee in accordance with Section 2.06, and those
described in this Section 2.08 as not outstanding. Except as set forth in
Section 2.09, a Note shall not cease to be outstanding because HLI or an
Affiliate of HLI holds the Note; provided, however, that Notes held by HLI, a
Guarantor or any of their respective Subsidiaries shall be deemed not to be
outstanding for purposes of Section 3.07(b).
(b) If a Note is replaced pursuant to Section 2.07, it
shall cease to be outstanding unless the Trustee receives proof satisfactory to
it that the replaced Note is held by a bona fide purchaser.
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(c) If the principal amount of any Note is considered
paid under Section 4.01, it shall cease to be outstanding and interest on it
shall cease to accrue.
(d) If the Paying Agent (other than HLI, a Guarantor or
any of their respective Subsidiaries or an Affiliate of any thereof) holds, on a
redemption date, a Purchase Date or maturity date, funds 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 2.09. TREASURY NOTES.
In determining whether the Holders of the required principal
amount of Notes have concurred in any direction, waiver or consent, Notes owned
by HLI, a Guarantor, any of their respective Subsidiaries or any of Affiliates
or any thereof, 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 the Trustee knows are so
owned shall be so disregarded.
Section 2.10. TEMPORARY NOTES.
Until certificates representing Notes are ready for delivery,
HLI may prepare and the Trustee, upon receipt of an Authentication Order in
accordance with Section 2.02, shall authenticate temporary Notes. Temporary
Notes shall be substantially in the form of Definitive Notes but may have
variations that HLI considers appropriate for temporary Notes and as shall be
reasonably acceptable to the Trustee. Without unreasonable delay, HLI shall
prepare and the Trustee shall authenticate Global Notes or Definitive Notes in
exchange for temporary Notes, as applicable.
Holders of temporary Notes shall be entitled to all of the
benefits of this Indenture equally and proportionately with all other Notes duly
issued hereunder.
Section 2.11. CANCELLATION.
HLI 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.
Upon sole direction of HLI, the Trustee and no one else shall cancel all Notes
surrendered for registration of transfer, exchange, payment, replacement or
cancellation and shall destroy cancelled Notes (subject to the record retention
requirements of the Exchange Act or other applicable laws) unless HLI directs
them to be returned to it. Certification of the destruction of all cancelled
Notes shall be delivered to HLI from time to time upon request unless by a
written order, signed by an Officer of HLI, HLI shall direct that cancelled
Notes be returned to it. HLI may not issue new Notes to replace Notes that it
has paid or that have been delivered to the Trustee for cancellation.
Section 2.12. DEFAULTED INTEREST.
If HLI defaults in a payment of interest on the Notes, it
shall pay the defaulted interest in any lawful manner plus, to the extent
lawful, interest payable on the defaulted interest, to the Persons who are
Holders on a subsequent special record date, in each case at the rate provided
in the Notes and in Section 4.01. HLI shall notify the Trustee in writing of the
amount of defaulted interest proposed to be paid on each Note and the date of
the proposed payment. HLI 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, HLI (or, upon the written
request of HLI, the Trustee in the name and at the expense of HLI) 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.
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Section 2.13. CUSIP OR ISIN NUMBERS.
HLI in issuing the Notes may use "CUSIP" and/or "ISIN" numbers
(if then generally in use), and, if so, the Trustee shall use "CUSIP" and/or
"ISIN" numbers in notices of redemption as a convenience to Holders; provided,
however, 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 or notice of an Offer to Purchase and that reliance
may be placed only on the other identification numbers printed on the Notes, and
any such redemption or Offer to Purchase shall not be affected by any defect in
or omission of such numbers. HLI shall promptly notify the Trustee of any change
in the "CUSIP" and/or "ISIN" numbers.
Section 2.14. SPECIAL INTEREST.
If Special Interest is payable by HLI pursuant to a
Registration Rights Agreement and paragraph 1 of the Notes, HLI shall deliver to
the Trustee a certificate to that effect stating (i) the amount of such Special
Interest that is payable and (ii) the date on which such interest is payable
pursuant to Section 4.01. Unless and until a Responsible Officer of the Trustee
receives such a certificate or instruction or direction from the Holders in
accordance with the terms of this Indenture, the Trustee may assume without
inquiry that no Special Interest is payable. The foregoing shall not prejudice
the rights of the Holders with respect to their entitlement to Special Interest
as otherwise set forth in this Indenture or the Notes and pursuing any action
against HLI directly or otherwise directing the Trustee to take any such action
in accordance with the terms of this Indenture and the Notes. If HLI has paid
Special Interest directly to the Persons entitled to it, HLI shall deliver to
the Trustee an Officers' Certificate setting forth the details of such payment.
Section 2.15. ISSUANCE OF ADDITIONAL NOTES.
HLI shall be entitled, subject to its compliance with Section
4.09, to issue Additional Notes under this Indenture which shall have identical
terms as the Initial Notes issued on the date hereof, other than with respect to
the date of issuance, issue price and rights under a related Registration Rights
Agreement, if any. The Initial Notes issued on the date hereof, any Additional
Notes and all Exchange Notes issued in exchange therefor shall be treated as a
single class for all purposes under this Indenture, including, directions,
waivers, amendments, consents, redemptions and Offers to Purchase.
With respect to any Additional Notes, HLI shall set forth in a
Board Resolution and an Officers' Certificate, a copy of each of which shall be
delivered to the Trustee, the following information:
(a) the aggregate principal amount of such Additional
Notes to be authenticated and delivered pursuant to this Indenture;
(b) the issue price, the issue date and the CUSIP and/or
ISIN number of such Additional Notes; provided, however, that no Additional
Notes may be issued at a price that would cause such Additional Notes to have
"original issue discount" within the meaning of Section 1273 of the Code, other
than a de minimis original issue discount within the meaning of Section 1273 of
the Code; and
(c) whether such Additional Notes shall be subject to the
restrictions on transfer set forth in Section 2.06 relating to Restricted Global
Notes and Restricted Definitive Notes.
Section 2.16. Record Date.
The record date for purposes of determining the identity of
Holders of Notes entitled to vote or consent to any action by vote or consent
authorized or permitted under this Indenture shall be determined as provided for
in TIA Section 316(c).
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ARTICLE 3.
REDEMPTION AND PREPAYMENT
Section 3.01. NOTICES TO TRUSTEE.
If HLI elects to redeem Notes pursuant to the optional
redemption provisions of Section 3.07, it shall furnish to the Trustee, at least
30 days but not more than 60 days before a redemption date (or such shorter
period as allowed by the Trustee), an Officers' Certificate setting forth (a)
the applicable section of this Indenture pursuant to which the redemption shall
occur, (b) the redemption date, (c) the principal amount of Notes to be redeemed
and (d) the redemption price.
Section 3.02. SELECTION OF NOTES TO BE REDEEMED.
If less than all of the Notes are to be redeemed at any time,
the Trustee shall select the Notes to be redeemed among the Holders in
compliance with the requirements of the principal national securities exchange,
if any, on which the Notes are listed or, if the Notes are not so listed, on a
pro rata basis, by lot or in accordance with any other method the Trustee deems
fair and appropriate (and in compliance with applicable legal requirements).
However, no Notes of a principal amount of $1,000 or less shall be redeemed in
part, and, if a partial redemption of Notes is made with the proceeds of a
public offering of common equity securities of Holdco, selection of the Notes or
portions of the Notes for redemption shall be made by the Trustee only on a
proportional basis or on as nearly a proportional basis as is practicable
(except as required by the procedures of DTC), unless that method is otherwise
prohibited. In the event of partial redemption by lot, the particular Notes to
be redeemed shall be selected, unless otherwise provided herein, not less than
30 nor more than 60 days prior to the redemption date by the Trustee from the
outstanding Notes not previously called for redemption.
The Trustee shall promptly notify HLI in writing of the Notes
selected for redemption and, in the case of any Note selected for partial
redemption, the principal amount thereof to be redeemed. Notes and portions of
Notes selected shall be in amounts of $1,000 or integral multiples of $1,000,
except that if all of the Notes of a Holder are to be redeemed, the entire
outstanding amount of Notes held by such Holder, even if not an integral
multiple of $1,000, shall be redeemed. Except as provided in the preceding
sentence, provisions of this Indenture that apply to Notes called for redemption
also apply to portions of Notes called for redemption.
Section 3.03. NOTICE OF REDEMPTION.
At least 30 days but not more than 60 days prior to a
redemption date, HLI shall mail or cause to be mailed, by first class mail, a
notice of redemption to each Holder whose Notes are to be redeemed at such
Holder's address appearing in the securities register maintained in respect of
the Notes by the Registrar (the "Security Register").
The notice shall identify the Notes to be redeemed and shall
state:
(a) the redemption date;
(b) The appropriate calculation of the redemption price,
but need not include the redemption price itself. The actual redemption price,
calculated as described above, shall be set forth in an Officers' Certificate
delivered to the Trustee no later than two (2) Business Days prior to the
redemption date unless clause (2) of the definition of "Comparable Treasury
Price" is applicable, in which case such Officer's Certificate should be
delivered on the redemption date;
(c) if any Note is being redeemed in part, the portion of
the principal amount of such Note to be redeemed and that, after the redemption
date upon surrender of such Note, if applicable, a
46
new Note or Notes in principal amount equal to the unredeemed portion shall be
issued upon cancellation of the original Note;
(d) the name and address of the Paying Agent;
(e) that Notes called for redemption must be surrendered
to the Paying Agent to collect the redemption price;
(f) that, unless HLI defaults in making such redemption
payment, interest on Notes called for redemption ceases to accrue on and after
the redemption date;
(g) the applicable section of this Indenture pursuant to
which the Notes called for redemption are being redeemed; and
(h) that no representation is made as to the correctness
of the CUSIP and/or ISIN numbers, if any, listed in such notice or printed on
the Notes.
At HLI's request, the Trustee shall give the notice of
redemption in HLI's name and at its expense; provided, however, that HLI shall
have delivered to the Trustee, at least 30 days (or such shorter period allowed
by the Trustee) prior to the redemption date, an Officers' Certificate
requesting that the Trustee give such notice (in the name and at the expense of
HLI) and setting forth the information to be stated in such notice as provided
in this Section 3.03.
Section 3.04. EFFECT OF NOTICE OF REDEMPTION.
Once notice of redemption is mailed in accordance with Section
3.03, Notes called for redemption shall become irrevocably due and payable on
the redemption date at the redemption price. A notice of redemption may not be
conditional.
Section 3.05. DEPOSIT OF REDEMPTION PRICE.
On or prior to 11:00 a.m. Eastern time on the Business Day
prior to any redemption date, HLI shall deposit with the Trustee or with the
Paying Agent money sufficient to pay the redemption price of and, if applicable,
accrued and unpaid interest on all Notes to be redeemed on that date. The
Trustee or the Paying Agent shall promptly, and in any event within two (2)
Business Days after the redemption date, return to HLI any money deposited with
the Trustee or the Paying Agent by HLI in excess of the amounts necessary to pay
the redemption price of, and, accrued and unpaid interest, if any, on all Notes
to be redeemed.
If HLI complies with the provisions of the preceding
paragraph, on and after the redemption date, interest shall cease to accrue on
Notes or portions of Notes called for purchase or redemption in accordance with
Section 2.08(d), whether or not such Notes are presented for payment. If a Note
is redeemed on or after a Regular Record Date but on or prior to the related
Interest Payment Date, then any accrued and unpaid interest, if any, shall be
paid to the Person in whose name such Note was registered at the close of
business on such Regular Record Date. If any Note called for redemption shall
not be so paid upon surrender for redemption because of the failure of HLI to
comply with the preceding paragraph, interest shall be paid on the unpaid
principal from the redemption date until such principal is paid, and to the
extent lawful on any interest not paid on such unpaid principal, in each case at
the rate provided in the Notes and in Section 4.01.
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Section 3.06. NOTES REDEEMED IN PART.
Upon surrender of a Note that is redeemed in part, HLI shall
issue and, upon HLI's written request, the Trustee shall authenticate for the
Holder at the expense of HLI a new Note equal in principal amount to the
unredeemed portion of the Note surrendered.
Section 3.07. OPTIONAL REDEMPTION.
(a) At any time prior to June 15, 2007, HLI may redeem
all or any portion of the Notes, at once or over time, upon notice in accordance
with Section 3.03, at a redemption price equal to the greater of:
(A) 100% of the principal amount of the
Notes to be redeemed, and
(B) the sum of the present values of
(A) the redemption price of the Notes at June 15,
2007 (as set forth below) and (B) the remaining
scheduled payments of interest from the redemption
date through June 15, 2007, but excluding accrued and
unpaid interest through the redemption date,
discounted to the redemption date (assuming a 360-day
year consisting of twelve 30-day months), at the
Treasury Rate plus 75 basis points,
plus, in either case, accrued and unpaid interest, including Special Interest,
if any, to the redemption date (subject to the right of holders of record on the
relevant record date to receive interest due on the relevant Interest Payment
Date).
(b) At any time and from time to time prior to June 15,
2006, HLI may redeem up to a maximum of 35% of the aggregate principal amount of
the Notes (including any Additional Notes) with the proceeds of one or more
Public Equity Offerings at a redemption price equal to 110.50% of the principal
amount thereof, plus accrued and unpaid interest, including Special Interest, if
any, to the redemption date (subject to the right of holders of record on the
relevant record date to receive interest due on the relevant interest payment
date); provided, however, that after giving effect to any such redemption, at
least 65% of the aggregate principal amount of the Notes (including any
Additional Notes) remains outstanding. Any such redemption shall be made within
75 days of such Public Equity Offering upon not less than 30 nor more than 60
days' prior notice.
(c) At any time on or after on or after June 15, 2007,
HLI may redeem all or a part of the Notes upon notice in accordance with Section
3.03, at the redemption prices set forth below, plus accrued and unpaid
interest, including Special Interest, if any, to but excluding the redemption
date (subject to the right of holders of record on the relevant record date to
receive interest due on the relevant interest payment date). The following
prices are for Notes redeemed during the 12-month period commencing on June 15
of the years set forth below, and are expressed as percentages of principal
amount:
Year Percentage
2007............................................................ 105.250%
2008............................................................ 102.625%
2009 and thereafter............................................. 100.000%
(d) Any prepayment pursuant to this Section 3.07 shall be
made pursuant to the provisions of Sections 3.01 through 3.06.
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Section 3.08. MANDATORY REDEMPTION.
Except as set forth in Sections 4.13 and 4.18, HLI shall not
be required to make mandatory redemption or sinking fund payments with respect
to, or offers to purchase, the Notes.
Section 3.09. OFFERS TO PURCHASE.
(a) In the event that, pursuant to Section 4.13 or 4.18,
HLI shall be required to commence a Prepayment Offer or Change of Control Offer
(each, an "Offer to Purchase"), it shall follow the procedures specified below.
(b) HLI shall cause a notice of the Offer to Purchase to
be sent at least once to the Dow Xxxxx News Service or similar business news
service in the United States; and
(c) HLI shall commence the Offer to Purchase by sending,
by first-class mail, with a copy to the Trustee, to each Holder, at such
Holder's address appearing in the Security Register a notice, the terms of which
shall govern the Offer to Purchase, stating:
(i) that the Offer to Purchase is being made
pursuant to this Section 3.09 and Section 4.13 or 4.18, as the case may
be, and, in the case of a Change of Control Offer, that a Change of
Control has occurred, the circumstances and relevant facts regarding
the Change of Control, and that a Change of Control Offer is being made
pursuant to Section 4.18;
(ii) the principal amount of Notes required to be
purchased pursuant to Section 4.13 or 4.18 (the "Offer Amount"), the
purchase price, the Offer Period and the Purchase Date (each as defined
below);
(iii) except as provided in clause (ix), that all
Notes timely tendered and not withdrawn shall be accepted for payment;
(iv) that any Note not tendered or accepted for
payment shall continue to accrue interest;
(v) that, unless HLI defaults in making such
payment, any Note accepted for payment pursuant to the Offer to
Purchase shall cease to accrue interest after the Purchase Date;
(vi) that Holders electing to have a Note
purchased pursuant to the Offer to Purchase may elect to have Notes
purchased in integral multiples of $1,000 only;
(vii) that Holders electing to have a Note
purchased pursuant to the Offer to Purchase shall be required to
surrender the Note, with the form entitled "Option of Holder to Elect
Purchase" on the reverse of the Note completed, or transfer by
book-entry transfer, to HLI, a Depositary, if appointed by HLI, or a
Paying Agent, if any, at the address specified in the notice before the
close of business on the third Business Day before the Purchase Date;
(viii) that Holders shall be entitled to withdraw
their election if HLI, the Depositary or the Paying Agent, as the case
may be, receives, not later than the expiration of the Offer Period, a
telegram, facsimile transmission or letter setting forth the name of
the Holder, the principal amount of the Note (or portions thereof) the
Holder delivered for purchase and a statement that such Holder is
withdrawing his election to have such Note purchased;
(ix) that, in the case of an Prepayment Offer, if
the aggregate principal amount of Notes surrendered by Holders exceeds
the Offer Amount, HLI shall select the Notes to
49
be purchased on a pro rata basis (with such adjustments as may be
deemed appropriate by HLI so that only Notes in denominations of $1,000
or integral multiples thereof shall be purchased);
(x) that Holders whose Notes were purchased in
part shall be issued new Notes equal in principal amount to the
unpurchased portion of the Notes surrendered (or transferred by
book-entry transfer); and
(xi) any other procedures that Holders must
follow in order to tender their Notes (or portions thereof) for payment
and the procedures that Holders must follow in order to withdraw an
election to tender Notes (or portions thereof) for payment.
(d) The Offer to Purchase shall remain open for a period
of at least 30 days but no more than 60 days following its commencement, except
to the extent that a longer period is required by applicable law (the "Offer
Period"). No later than five (5) Business Days after the termination of the
Offer Period (the "Purchase Date"), HLI shall purchase the Offer Amount or, if
less than the Offer Amount has been tendered, all Notes tendered in response to
the Offer to Purchase. Payment for any Notes so purchased shall be made in the
same manner as interest payments are made.
(e) On or prior to the Purchase Date, HLI shall, to the
extent lawful:
(i) accept for payment (on a pro rata basis to
the extent necessary in connection with an Prepayment Offer) the Offer
Amount of Notes or portions of Notes properly tendered pursuant to the
Offer to Purchase, or if less than the Offer Amount has been tendered,
all Notes tendered;
(ii) deposit with the Paying Agent an amount
equal to the Offer Amount in respect of all Notes or portions of Notes
properly tendered; and
(iii) deliver or cause to be delivered to the
Trustee the Notes so accepted together with an Officers' Certificate
stating the aggregate principal amount of Notes or portions of Notes
being purchased by HLI and that such Notes or portions thereof were
accepted for payment by HLI in accordance with the terms of this
Section 3.09.
(f) HLI, the Depositary or the Paying Agent, as the case
may be, shall promptly (but in any event not later than five (5) Business Days
after the Purchase Date) deliver to each tendering Holder of Notes properly
tendered and accepted by HLI for purchase the Purchase Amount for such Notes,
and HLI shall promptly execute and issue a new Note, and the Trustee, upon
receipt of an Authentication Order shall authenticate and deliver (or cause to
be transferred by book-entry) such new Note to such Holder, in a principal
amount equal to any unpurchased portion of the Note surrendered; provided,
however, that each such new Note shall be in a principal amount of $1,000 or an
integral multiple of $1,000. Any Note not so accepted shall be promptly mailed
or delivered by HLI to the Holder thereof. HLI shall publicly announce the
results of the Offer to Purchase on the Purchase Date.
(g) If the Purchase Date is on or after a Regular Record
Date and on or before the related Interest Payment Date, any accrued and unpaid
interest shall be paid to the Person in whose name a Note is registered at the
close of business on such Regular Record Date, and no additional interest shall
be payable to Holders who tender Notes pursuant to the Offer to Purchase.
(h) HLI shall comply, to the extent applicable, with the
requirements of Rule 14e-1 under the Exchange Act and any other securities laws
and regulations thereunder to the extent those laws and regulations are
applicable in connection with the Offer to Purchase. To the extent that the
provisions of any securities laws or regulations conflict with Section 4.13 or
4.18, as applicable, this Section 3.09 or other provisions of this Indenture,
HLI shall comply with the applicable securities laws and regulations and
50
shall not be deemed to have breached its obligations under Section 4.13 or 4.18,
as applicable, this Section 3.09 or such other provision by virtue of such
compliance.
(i) Other than as specifically provided in this Section
3.09, any purchase pursuant to this Section 3.09 shall be made in accordance
with the provisions of Section 3.01 through 3.06.
ARTICLE 4.
COVENANTS
For the purposes of determining compliance with any covenant, the U.S.
Dollar Equivalent will be used, if and to the extent relevant.
Section 4.01. PAYMENT OF NOTES.
(a) HLI 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 this Indenture and the Notes. Principal, premium, if any, and
interest shall be considered paid on the date due if the Paying Agent, if other
than Holdco or a Subsidiary thereof, holds as of 11:00 a.m. Eastern Time on the
due date money deposited by HLI in immediately available funds and designated
for and sufficient to pay all principal, premium, if any, and interest then due.
Such Paying Agent shall return to HLI promptly, and in any event, no later than
five (5) Business Days following the date of payment, any money (including
accrued interest) that exceeds such amount of principal, premium, if any, and
interest paid on the Notes. HLI shall pay Special Interest, if any, in the same
manner, on the dates and in the amounts set forth in a Registration Rights
Agreement, the Notes and this Indenture. If a payment date is a Legal Holiday at
a place of payment, payment may be made at that place on the next succeeding day
that is not a Legal Holiday, and no interest shall accrue on such payment for
the intervening period.
(b) HLI shall pay interest (including post-petition
interest in any proceeding under any Bankruptcy Law) on overdue principal and
premium, if any, from time to time on demand at a rate that is 1% per annum in
excess of the rate then in effect; it shall pay interest (including
post-petition interest in any proceeding under any Bankruptcy Law) on overdue
installments of interest (without regard to any applicable grace periods), from
time to time on demand at the same rate to the extent lawful.
(c) Interest shall be computed on the basis of a 360-day
year of twelve 30-day months.
Section 4.02. MAINTENANCE OF OFFICE OR AGENCY.
(a) HLI shall maintain in the Borough of Manhattan, The
City of New York, an office or agency (which may be an office or drop facility
of the Trustee or an affiliate of the Trustee, Registrar or co-registrar) where
Notes may be presented or surrendered for registration of transfer or for
exchange and where notices and demands to or upon HLI in respect of the Notes
and this Indenture may be served. HLI shall give prompt written notice to the
Trustee of any change in the location of such office or agency. If at any time
HLI 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, and HLI hereby appoints the Trustee as its agent to receive all such
presentations, surrenders, notices and demands.
(b) HLI 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.
HLI shall give prompt written notice to the Trustee of any such designation or
rescission and of any change in the location of any such other office or agency.
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(c) HLI hereby designates the Corporate Trust Office of
the Trustee, as one such office, drop facility or agency of HLI in accordance
with Section 2.03.
Section 4.03. REPORTS.
(a) Notwithstanding that HLI may not be subject to the
reporting requirements of Section 13 or 15(d) of the Exchange Act, HLI shall
file with the SEC and provide the Trustee and Holders with such annual reports
and such information, documents and other reports as are specified in Section 13
and 15(d) of the Exchange Act and applicable to a U.S. corporation subject to
such Sections, such information, documents and reports to be so filed with the
SEC and provided at the times specified for the filing of such information,
documents and reports under such Sections; provided, however, that HLI shall not
be so obligated to file such information, documents and reports with the SEC if
the SEC does not permit such filings.
(b) HLI shall furnish to Holders and to prospective
investors, upon the request of such Holders, any information required to be
delivered pursuant to Rule 144A(d)(4) under the Securities Act so long as the
Notes are "restricted securities" within the meaning of Rule 144(a)(3) under the
Securities Act.
Section 4.04. COMPLIANCE CERTIFICATE.
(a) HLI shall deliver to the Trustee, within 90 days
after the end of each fiscal year, an Officers' Certificate stating that a
review of the activities of HLI, the Guarantors and their respective
Subsidiaries during the preceding fiscal year has been made under the
supervision of the signing Officers with a view to determining whether HLI, the
Guarantors and their respective Subsidiaries have kept, observed, performed and
fulfilled their obligations under this Indenture, and further stating, as to
each such Officer signing such certificate, that to the best of his or her
knowledge, HLI, the Guarantors and their Subsidiaries have kept, observed,
performed and fulfilled each and every covenant contained in this Indenture and
are not in default in the performance or observance of any of the terms,
provisions and conditions of this Indenture (or, if a Default or Event of
Default shall have occurred, describing all such Defaults or Events of Default
of which he or she may have knowledge and what action HLI is taking or proposes
to take with respect thereto) and that to the best of his or her knowledge no
event has occurred and remains in existence by reason of which payments on
account of the principal of, premium, if any, or interest on the Notes is
prohibited or if such event has occurred, a description of the event and what
action HLI is taking or proposes to take with respect thereto.
(b) HLI shall otherwise comply with TIA
Section 314(a)(2).
(c) HLI shall deliver to the Trustee, within 30 days
after the occurrence thereof, written notice in the form of an Officers'
Certificate of any Default or Event of Default, its status and what action HLI
is taking or proposes to take with respect thereto.
Section 4.05. TAXES.
HLI and Holdco shall pay, and shall cause each of their
respective Subsidiaries to pay, prior to delinquency, all material taxes,
assessments, and governmental levies, except such as are being contested in good
faith and by appropriate proceedings or where the failure to effect such payment
is not adverse in any material respect to the Holders.
Section 4.06. STAY, EXTENSION AND USURY LAWS.
HLI and Holdco covenants (to the extent that it may lawfully
do so) that it shall not at any time insist upon, plead, or in any manner
whatsoever claim or take the benefit or advantage of, any stay, extension or
usury law wherever enacted, now or at any time hereafter in force, that may
affect the
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covenants or the performance of this Indenture; and each of HLI and Holdco (to
the extent that it may lawfully do so) hereby expressly waives all benefit or
advantage of any such law, and covenants that it shall not, by resort to any
such law, hinder, delay or impede the execution of any power herein granted to
the Trustee, but shall suffer and permit the execution of every such power as
though no such law has been enacted.
Section 4.07. CORPORATE EXISTENCE.
Subject to Article 5, each of HLI and Holdco shall do or cause
to be done all things necessary to preserve and keep in full force and effect
its corporate existence, and the corporate, partnership or other existence of
each Restricted Subsidiary, in accordance with the respective organizational
documents (as the same may be amended from time to time) of HLI, Holdco or any
such Restricted Subsidiary; provided, however, that HLI and Holdco shall not be
required to preserve the corporate, partnership or other existence of any
Restricted Subsidiary, if the board of directors of each of HLI and Holdco shall
determine that the preservation thereof is no longer desirable in the conduct of
the business of HLI, Holdco and the Restricted Subsidiaries, taken as a whole,
and that the loss thereof is not adverse in any material respect to the Holders,
or that such preservation is not necessary in connection with any transaction
not prohibited by this Indenture.
Section 4.08. PAYMENTS FOR CONSENT.
Holdco and HLI will not, and shall not permit any of their
respective Subsidiaries to, directly or indirectly, pay or cause to be paid any
consideration, whether by way of interest, fee or otherwise, to any Holder of
any Notes for or as an inducement to any consent, waiver or amendment of any of
the terms or provisions of this Indenture or the Notes or the guarantees unless
such consideration is offered to be paid or is paid to all Holders that consent,
waive or agree to amend in the time frame set forth in the solicitation
documents relating to such consent, waiver or agreement.
Section 4.09. INCURRENCE OF DEBT.
(a) Holdco and HLI shall not, and shall not permit any of
their respective Restricted Subsidiaries to, Incur, directly or indirectly, any
Debt unless, after giving effect to the application of the proceeds thereof, no
Default or Event of Default would occur as a consequence of such Incurrence or
be continuing following such Incurrence and either:
(i) such Debt is Debt of HLI or a Guarantor and
after giving effect to the Incurrence of such Debt and the application
of the proceeds thereof, the Consolidated Interest Coverage Ratio would
be greater than 2.25 to 1.00, or
(ii) such Debt is Permitted Debt.
(b) The term "Permitted Debt" is defined to include the
following:
(i) (1) Debt of HLI evidenced by the Initial
Notes issued pursuant to this Indenture and the Exchange Notes issued
in exchange for such Initial Notes and in exchange for any Additional
Notes and (2) Debt of the Guarantors evidenced by Note Guaranties
relating to the Initial Notes issued pursuant to this Indenture and the
Exchange Notes issued in exchange for such Initial Notes and in
exchange for any Additional Notes;
(ii) Debt of HLI or a Guarantor under Credit
Facilities or Debt Incurred by a Securitization Entity in a Qualified
Securitization Transaction that is nonrecourse to Holdco or any
Restricted Subsidiary (except for Standard Securitization
Undertakings), provided that the aggregate principal amount of all such
Debt under this clause (ii) at any one time outstanding shall not
exceed the greater of:
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(1) $625 million, which amount shall be permanently
reduced by the amount of proceeds from Asset Sales used to
Repay Debt under the New Credit Facility, and not subsequently
reinvested in Additional Assets or used to purchase Notes or
Repay other Debt, pursuant to Section 4.13 and
(2) the sum of the amounts equal to:
(A) 80% of the book value of the
accounts receivable of Holdco and the Restricted
Subsidiaries, and
(B) 50% of the book value of the
inventory of Holdco and the Restricted Subsidiaries,
less, in the case of clauses (1) and (2) of this
clause (ii), the amount of Debt Incurred pursuant to
clause (x) below then outstanding in excess of $75
million.
(iii) Debt of HLI or a Guarantor in respect of
Capital Lease Obligations and Purchase Money Debt, provided that:
(1) the aggregate principal amount of such Debt
does not exceed the fair market value (on the date of the
Incurrence thereof) of the Property acquired, constructed or
leased, and
(2) the aggregate principal amount of all Debt
Incurred and then outstanding pursuant to this clause (iii)
(together with all Permitted Refinancing Debt Incurred and
then outstanding in respect of Debt previously Incurred
pursuant to this clause (iii)) does not exceed $50 million
aggregate principal amount outstanding at any one time;
(iv) Debt of Holdco owing to and held by any
Wholly Owned Restricted Subsidiary and Debt of a Restricted Subsidiary owing to
and held by Holdco or any Wholly Owned Restricted Subsidiary, provided, however,
that any subsequent issue or transfer of Capital Stock or other event that
results in any such Wholly Owned Restricted Subsidiary ceasing to be a Wholly
Owned Subsidiary or any subsequent transfer of any such Debt (except to Holdco
or a Wholly Owned Restricted Subsidiary) shall be deemed, in each case, to
constitute the Incurrence of such Debt by the obligor thereof, provided further,
however, if HLI or any Guarantor is the obligor on any such Debt, such Debt must
be expressly subordinated in right of payment to the prior payment in full of
all obligations with respect to the Notes and the Guarantees, as the case may
be;
(v) Debt of a Restricted Subsidiary outstanding
on the date on which such Restricted Subsidiary is acquired by Holdco or a
Restricted Subsidiary or otherwise becomes a Restricted Subsidiary (other than
Debt Incurred as consideration in, or to provide all or any portion of the funds
or credit support utilized to consummate, the transaction or series of
transactions pursuant to which such Restricted Subsidiary became a Subsidiary of
Holdco or was otherwise acquired by Holdco), provided that at the time such
Restricted Subsidiary is acquired by Holdco or a Restricted Subsidiary or
otherwise becomes a Restricted Subsidiary and after giving effect to the
Incurrence of such Debt, Holdco would have been able to Incur $1.00 of
additional Debt pursuant to clause (a)(i) of this Section 4.09;
(vi) Debt of Holdco or any Restricted Subsidiary
under Interest Rate Agreements entered into for the purpose of limiting interest
rate risks in the ordinary course of the financial management of Holdco or such
Restricted Subsidiary and not for speculative purposes, provided that the
obligations under such agreements are, at the time of Incurrence thereof,
directly related to payment obligations on Debt otherwise permitted by the terms
of this Section 4.09;
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(vii) Debt of Holdco or any Restricted Subsidiary
under Currency Exchange Protection Agreements entered into for the purpose of
limiting currency exchange rate risks in the ordinary course of the financial
management of Holdco or such Restricted Subsidiary and not for speculative
purposes;
(viii) Debt of Holdco or any Restricted Subsidiary
under Commodity Price Protection Agreements entered into in the ordinary course
of the financial management of Holdco or such Restricted Subsidiary and not for
speculative purposes;
(ix) Debt in connection with one or more standby
letters of credit or performance bonds issued by Holdco or any Restricted
Subsidiary in the ordinary course of business or pursuant to self-insurance
obligations and not in connection with the borrowing of money or the obtaining
of advances or credit;
(x) Debt of Foreign Restricted Subsidiaries in
an aggregate principal amount outstanding at any one time not to exceed the
greater of
(1) $125 million, and
(2) 10% of the consolidated total assets of the
Foreign Restricted Subsidiaries;
(xi) Debt of Holdco or any Restricted Subsidiary
outstanding on the Issue Date, after giving effect to the Transactions not
otherwise described in clauses (i) through (ix) above, provided that the Debt of
Foreign Restricted Subsidiaries under this clause (xi) shall not exceed $25
million;
(xii) Debt of HLI or a Restricted Subsidiary in an
aggregate principal amount outstanding at any one time not to exceed $50
million; and
(xiii) Permitted Refinancing Debt Incurred in
respect of Debt Incurred pursuant to clause (a)(i) of this Section 4.09 and
clauses (b)(i), (iii), (v) and (xi) of this Section 4.09.
(c) Notwithstanding anything to the contrary contained in
this Section 4.09,
(i) Holdco and HLI shall not, and shall not
permit any Guarantors to, Incur any Debt pursuant to this covenant if the
proceeds thereof are used, directly or indirectly, to Refinance any Subordinated
Debt unless such Debt shall be subordinated to the Notes or the applicable Note
Guaranty, as the case may be, to at least the same extent as such Subordinated
Debt;
(ii) Holdco and HLI shall not permit any of their
respective Restricted Subsidiaries that is not a Guarantor or the Issuer to
Incur any Debt pursuant to this Section 4.09 if the proceeds thereof are used,
directly or indirectly, to Refinance any Debt of HLI or any Guarantor; and
(iii) accrual of interest, accretion or
amortization of original issue discount and the payment of interest or dividends
in the form of additional Debt, will be deemed not to be an Incurrence of Debt
for purposes of this Section 4.09.
(d) For purposes of determining compliance with this
Section 4.09, in the event that an item of Debt meets the criteria of more than
one of the categories of Permitted Debt described in clauses (b)(i) through
(b)(xii) of this Section 4.09 or is entitled to be incurred pursuant to clause
(a)(i) of this
55
Section 4.09, HLI shall, in its sole discretion, classify (or later reclassify
in whole or in part, in its sole discretion) such item of Debt in any manner
that complies with this covenant.
Section 4.10. RESTRICTED PAYMENTS.
(a) Holdco and HLI shall not, and shall not permit any of
their respective Restricted Subsidiaries to, make, directly or indirectly, any
Restricted Payment if at the time of, and after giving effect to, such proposed
Restricted Payment,
(i) a Default or Event of Default shall have
occurred and be continuing,
(ii) Holdco could not Incur at least $1.00 of
additional Debt pursuant to Section 4.09(a)(i) or
(iii) the aggregate amount of such Restricted
Payment and all other Restricted Payments declared or made since the
Issue Date (the amount of any Restricted Payment, if made in Property
other than in cash, to be based upon fair market value of such Property
at the time of such Restricted Payment) would exceed an amount equal to
the sum of:
(1) 50% of the aggregate amount of Consolidated Net
Income accrued during the period (treated as one accounting
period) from the beginning of the fiscal quarter during which
the Issue Date occurs to the end of the most recent fiscal
quarter in respect of which financial statements have been
delivered in accordance with the terms of this Indenture (or
if the aggregate amount of Consolidated Net Income for such
period shall be a deficit, minus 100% of such deficit), plus
(2) 100% of Capital Stock Sale Proceeds, plus
(3) the sum of:
(A) the aggregate net cash proceeds
received by Holdco or any Restricted Subsidiary from
the issuance or sale after the Issue Date of
convertible or exchangeable Debt that has been
converted into or exchanged for Capital Stock (other
than Disqualified Stock) of Holdco, and
(B) the aggregate amount by which Debt
(other than Subordinated Debt) of Holdco or any
Restricted Subsidiary is reduced on Holdco's
consolidated balance sheet on or after the Issue Date
upon the conversion or exchange of any Debt issued or
sold on or prior to the Issue Date that is
convertible or exchangeable for Capital Stock (other
than Disqualified Stock) of Holdco, excluding, in the
case of clause (A) or (B):
(x) any such Debt issued or
sold to Holdco or a Subsidiary of Holdco or
an employee stock ownership plan or trust
established by Holdco or any such Subsidiary
for the benefit of their employees, and
(y) the aggregate amount of
any cash or other Property distributed by
Holdco or any Restricted Subsidiary upon
any such conversion or exchange, plus
(4) an amount equal to the sum of:
(A) the aggregate reduction in
Investments in any Person other than Holdco or a
Restricted Subsidiary resulting from dividends,
returns of
56
capital, repayments of loans or advances, interest or
other transfers of Property, in each case to Holdco
or any Restricted Subsidiary from such Person, and
(B) the portion (proportionate to
Holdco's equity interest in such Unrestricted
Subsidiary) of the fair market value of the net worth
of an Unrestricted Subsidiary at the time such
Unrestricted Subsidiary is designated a Restricted
Subsidiary; provided, however, that the foregoing sum
shall not exceed, in the case of any Person, the
amount of Investments previously made (and treated as
a Restricted Payment) by Holdco or any Restricted
Subsidiary in such Person, plus
(5) $20 million.
(b) Notwithstanding the foregoing limitation, Holdco may:
(i) pay dividends on its Capital Stock within 60
days of the declaration thereof if, on the declaration date, such
dividends could have been paid in compliance with this Indenture;
provided, however, that at the time of such payment of such dividend,
no other Default or Event of Default shall have occurred and be
continuing (or result therefrom); provided further, however, that such
dividend shall be included in the calculation of the amount of
Restricted Payments;
(ii) purchase, repurchase, redeem, legally
defease, acquire or retire for value Capital Stock of Holdco or
Subordinated Debt in exchange for, or out of the proceeds of the
substantially concurrent sale of, Capital Stock of Holdco (other than
Disqualified Stock and other than Capital Stock issued or sold to a
Subsidiary of Holdco or an employee stock ownership plan or trust
established by Holdco or any such Subsidiary for the benefit of their
employees); provided, however, that
(1) such purchase, repurchase, redemption, legal
defeasance, acquisition or retirement shall be excluded in the
calculation of the amount of Restricted Payments and
(2) the Capital Stock Sale Proceeds from such
exchange or sale shall be excluded from the calculation
pursuant to clause (a)(iii)(2) of this Section 4.10;
(iii) purchase, repurchase, redeem, legally
defease, acquire or retire for value any Subordinated Debt in exchange
for, or out of the proceeds of the substantially concurrent sale of,
Permitted Refinancing Debt; provided, however, that such purchase,
repurchase, redemption, legal defeasance, acquisition or retirement
shall be excluded in the calculation of the amount of Restricted
Payments; and
(iv) so long as no Default or Event of Default
has occurred and is continuing, purchase, repurchase, redeem, legally
defease, acquire or retire for value Capital Stock from any officer,
director or employee of Holdco or its Restricted Subsidiaries in an
amount not to exceed $1 million per year.
Section 4.11. LIENS.
Holdco and HLI shall not, and shall not permit any of their
respective Restricted Subsidiaries to, directly or indirectly, Incur or suffer
to exist, any Lien (other than Permitted Liens) upon any of their Property
(including Capital Stock of a Restricted Subsidiary), whether owned at the Issue
Date or thereafter acquired, or any interest therein or any income or profits
therefrom, unless it has made or will make effective provision whereby the Notes
or the applicable Note Guaranty will be secured by such Lien equally and ratably
with (or, if such other Debt constitutes Subordinated Debt, prior to) all other
Debt of
57
Holdco or any Restricted Subsidiary secured by such Lien for so long as such
other Debt is secured by such Lien.
Section 4.12. ISSUANCE OR SALE OF STOCK OF RESTRICTED SUBSIDIARIES.
(a) Holdco and HLI shall not (directly or indirectly):
(i) sell, pledge, hypothecate or otherwise
dispose of any shares of Capital Stock of any of their respective
Restricted Subsidiaries other than a pledge of stock constituting a
Permitted Lien under clause (1) of the definition thereof, or
(ii) permit any Restricted Subsidiary to,
directly or indirectly, issue or sell or otherwise dispose of any
shares of its Capital Stock,
other than, in the case of either (i) or (ii):
(1) directors' qualifying shares (or other de
minimis amounts of shares required to be issued to third
parties pursuant to local law requirements, including the
Preferred Shares),
(2) to Holdco or a Wholly Owned Restricted
Subsidiary, or
(3) a disposition of 100% of the shares of
Capital Stock of a Restricted Subsidiary (excluding HLI
Parent and HLI); provided, however, that, in the case of
this clause (3),
(A) such disposition is effected in
compliance with Section 4.13, and
(B) upon consummation of such
disposition and execution and delivery of a
supplemental indenture in form satisfactory to the
Trustee in its reasonable judgment, such Restricted
Subsidiary shall be released from any Note Guaranty
previously made by such Restricted Subsidiary.
In addition, HLI shall not, directly or indirectly, issue or sell any of its
Capital Stock to any Person other than HLI Parent, and HLI Parent shall not,
directly or indirectly, issue or sell any of its Capital Stock to any Person
other than Holdco.
Section 4.13. ASSET SALES.
(a) Holdco and HLI shall not, and shall not permit any of
their respective Restricted Subsidiaries to, directly or indirectly, consummate
any Asset Sale unless:
(i) Holdco, HLI or such Restricted Subsidiary
receives consideration at the time of such Asset Sale at least equal to
the fair market value of the Property subject to such Asset Sale; and
(ii) at least 75% of the consideration paid to
Holdco, HLI or their respective Restricted Subsidiaries in connection
with such Asset Sale is in the form of cash or Cash Equivalents or the
assumption by the purchaser of liabilities of Holdco, HLI or any of
their respective Restricted Subsidiaries (other than contingent
liabilities or liabilities that are by their terms subordinated to the
Notes or the applicable Note Guaranty) as a result of which Holdco, HLI
and the Restricted Subsidiaries are no longer obligated with respect to
such liabilities.
58
(b) The Net Available Cash (or any portion thereof) from
Asset Sales may be applied by Holdco or a Restricted Subsidiary, to the extent
Holdco or a Restricted Subsidiary elects (or is required by the terms of any
Debt):
(i) to Repay Senior Debt of HLI or any Guarantor
(excluding, in any such case, any Debt owed to Holdco, HLI or an
Affiliate of Holdco or HLI) or, in the case of Net Available Cash from
Asset Sales by a Foreign Restricted Subsidiary, to Repay Debt of such
Foreign Restricted Subsidiary; or
(ii) to reinvest in Additional Assets (including
by means of an Investment in Additional Assets by a Restricted
Subsidiary with Net Available Cash received by Holdco or another
Restricted Subsidiary).
(c) Any Net Available Cash from an Asset Sale not applied
in accordance with the preceding paragraph within 270 days from the date of the
receipt of such Net Available Cash or that is not segregated from the general
funds of HLI for investment in identified Additional Assets in respect of a
project that shall have been commenced, and for which binding contractual
commitments have been entered into, prior to the end of such 270-day period and
that shall not have been completed or abandoned shall constitute "Excess
Proceeds"; provided, however, that the amount of any Net Available Cash that
ceases to be so segregated as contemplated above and any Net Available Cash that
is segregated in respect of a project that is abandoned or completed shall also
constitute "Excess Proceeds" at the time any such Net Available Cash ceases to
be so segregated or at the time the relevant project is so abandoned or
completed, as applicable; provided further, however, that the amount of any Net
Available Cash that continues to be segregated for investment and that is not
actually reinvested within twenty-four months from the date of the receipt of
such Net Available Cash shall also constitute "Excess Proceeds."
(d) When the aggregate amount of Excess Proceeds exceeds
$20 million (taking into account income earned on such Excess Proceeds, if any),
HLI will be required to make an offer to repurchase (the "Prepayment Offer") the
Notes, which offer shall be in the amount of the Allocable Excess Proceeds
(rounded to the nearest $1,000), on a pro rata basis according to principal
amount, at a purchase price equal to 100% of the principal amount thereof, plus
accrued and unpaid interest, including Special Interest, if any, to the
repurchase date (subject to the right of holders of record on the relevant
record date to receive interest due on the relevant interest payment date), in
accordance with the procedures (including prorating in the event of
oversubscription) set forth in Section 3.09. To the extent that any portion of
the amount of Net Available Cash remains after compliance with the preceding
sentence and provided that all Holders have been given the opportunity to tender
their Notes for repurchase in accordance with Section 3.09, Holdco or such
Restricted Subsidiary may use such remaining amount for any purpose permitted by
the Indenture, and the amount of Excess Proceeds will be reset to zero.
(e) The term "Allocable Excess Proceeds" shall mean the
product of:
(i) the Excess Proceeds and
(ii) a fraction,
(1) the numerator of which is the aggregate
principal amount of the Notes outstanding on the date of the
Prepayment Offer, and
(2) the denominator of which is the sum of the
aggregate principal amount of the Notes outstanding on the
date of the Prepayment Offer and the aggregate principal
amount of other Debt of HLI outstanding on the date of the
Prepayment Offer that is pari passu in right of payment with
the Notes and subject to terms and conditions in respect of
Asset Sales similar in all material respects to this covenant
and requiring HLI to make an offer to repurchase such Debt at
substantially the same time as the Prepayment Offer.
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(f) Within 30 Business Days after HLI is obligated to
make a Prepayment Offer as described in the preceding paragraph, HLI shall send
a written notice, by first-class mail, to the Holders, accompanied by such
information regarding the Asset Sale as HLI in good faith believes will enable
such Holders to make an informed decision with respect to such Prepayment Offer.
Such notice shall state, among other things, the purchase price and the
repurchase date, which shall be, subject to any contrary requirements of
applicable law, a Business Day no earlier than 30 days nor later than 60 days
from the date such notice is mailed.
(g) HLI will comply, to the extent applicable, with the
requirements of Section 14(e) of the Exchange Act and any other securities laws
or regulations in connection with the repurchase of Notes pursuant to this
Section 4.13. To the extent that the provisions of any securities laws or
regulations conflict with provisions of this Section 4.13, HLI will comply with
the applicable securities laws and regulations and will not be deemed to have
breached its obligations under this Section 4.13 by virtue thereof.
Section 4.14. RESTRICTIONS ON DISTRIBUTIONS FROM RESTRICTED SUBSIDIARIES.
(a) Holdco and HLI shall not, and shall not permit any of
their respective Restricted Subsidiaries to, directly or indirectly, create or
otherwise cause or suffer to exist any consensual restriction on the right of
any of their respective Restricted Subsidiaries to:
(i) pay dividends, in cash or otherwise, or make
any other distributions on or in respect of its Capital Stock, or pay
any Debt or other obligation owed, to Holdco or any Restricted
Subsidiary,
(ii) make any loans or advances to Holdco or any
Restricted Subsidiary, or
(iii) transfer any of its Property to Holdco or
any Restricted Subsidiary.
(b) The foregoing limitations will not apply:
(i) to restrictions:
(1) in effect on the Issue Date (including
restrictions pursuant to the Notes, the Indenture and the New
Credit Facility),
(2) arising under Debt of a Restricted Subsidiary
and existing at the time it became a Restricted Subsidiary if
such restriction was not created in connection with or in
anticipation of the transaction or series of transactions
pursuant to which such Restricted Subsidiary became a
Restricted Subsidiary or was acquired by Holdco or HLI,
(3) that result from the Refinancing of Debt
Incurred pursuant to an agreement referred to in clause
(b)(i)(1) or (2) above or in clause (b)(ii)(1) or (2) of this
Section 4.14, provided such restrictions are not less
favorable, taken as a whole, to the Holders than those under
the agreement evidencing the Debt so Refinanced, or
(4) arising under Debt or other contractual
requirements of a Securitization Entity in connection with a
Qualified Securitization Transaction; provided that such
restrictions apply only to such Securitization Entity; and
(ii) with respect to (a)(iii) of this Section
4.14 only, to restrictions:
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(1) relating to Debt that is permitted to be
Incurred and secured without also securing the Notes or the
applicable Note Guaranty pursuant to Sections 4.09 and 4.11
that limit the right of the debtor to dispose of or transfer
the Property securing such Debt,
(2) encumbering Property at the time such Property
was acquired by Holdco or any Restricted Subsidiary, so long
as such restrictions relate solely to the Property so acquired
and were not created in connection with or in anticipation of
such acquisition,
(3) resulting from customary provisions restricting
subletting or assignment of leases or customary provisions in
other agreements that restrict assignment of such agreements
or rights thereunder,
(4) customary restrictions contained in asset sale
agreements limiting the transfer of such Property pending the
closing of such sale, or
(5) customary restrictions contained in joint
venture agreements entered into in the ordinary course of
business and in good faith.
Section 4.15. TRANSACTIONS WITH AFFILIATES.
(a) Holdco and HLI shall not, and shall not permit any of
their respective Restricted Subsidiaries to, directly or indirectly, conduct any
business or enter into or suffer to exist any transaction or series of
transactions (including the purchase, sale, transfer, assignment, lease,
conveyance or exchange of any Property or the rendering of any service) with, or
for the benefit of, any Affiliate of Holdco or HLI (an "Affiliate Transaction"),
unless:
(i) the terms of such Affiliate Transaction are:
(1) set forth in writing, and
(2) no less favorable to Holdco, HLI or such
Restricted Subsidiary, as the case may be, than those that
could be obtained in a comparable arm's-length transaction
with a Person that is not an Affiliate of Holdco, HLI or such
Restricted Subsidiary,
(ii) if such Affiliate Transaction involves
aggregate payments or value in excess of $5 million, the Board of
Directors (including at least a majority of the disinterested members
of the Board of Directors) approves such Affiliate Transaction and, in
its good faith judgment, concludes that such Affiliate Transaction
complies with clause (a)(i)(2) of this Section 4.15 as evidenced by a
Board Resolution promptly delivered to the Trustee, and
(iii) if such Affiliate Transaction involves
aggregate payments or value in excess of $25 million, Holdco or HLI
obtains a written opinion from an Independent Financial Advisor to the
effect that the consideration to be paid or received in connection with
such Affiliate Transaction is fair, from a financial point of view, to
Holdco, HLI and the Restricted Subsidiaries.
(b) Notwithstanding the foregoing limitation, Holdco, HLI
or any of their respective Restricted Subsidiaries may enter into or suffer to
exist the following:
(i) any transaction or series of transactions
between Holdco and one or more Restricted Subsidiaries or between two
or more Restricted Subsidiaries in the ordinary course of business,
including the making of secured or unsecured intercompany loans not
otherwise prohibited by the terms of this Indenture, provided that no
more than 5% of the total voting power of the Voting Stock (on a fully
diluted basis) of any such Restricted Subsidiary is owned by an
Affiliate of Holdco or HLI (other than Holdco, HLI or a Restricted
Subsidiary);
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(ii) any Restricted Payment permitted to be made
pursuant to Section 4.10 or any Permitted Investment;
(iii) the payment of compensation (including
amounts paid pursuant to employee benefit plans) for the personal
services of officers, directors and employees of Holdco, HLI or any of
their respective Restricted Subsidiaries, so long as the Board of
Directors in good faith shall have approved the terms thereof and
deemed the services theretofore or thereafter to be performed for such
compensation to be fair consideration therefor;
(iv) agreements in effect on the Issue Date and
described in the final offering memorandum regarding the Initial Notes,
dated as of May 22, 2003, and any modifications, extensions or renewals
thereto that are no less favorable to Holdco, HLI or any Restricted
Subsidiary than such agreements as in effect on the Issue Date;
(v) any customary transactions between or among
any of Holdco, HLI, any Restricted Subsidiary and any Securitization
Entity in connection with a Qualified Securitization Transaction, in
each case provided that such transactions are not otherwise prohibited
by terms of this Indenture;
(vi) any transaction or series of transactions
pursuant to supply or similar agreements entered into in the ordinary
course of business and consistent with past practice on customary
terms, as determined by HLI in its good faith judgment; and
(vii) any transaction or series of transactions
between Holdco, HLI or any of their Restricted Subsidiaries with any
joint venture that constitutes an Affiliate solely by virtue of
Holdco's, HLI's or any Restricted Subsidiary's control of such joint
venture.
Section 4.16. SALE AND LEASEBACK TRANSACTIONS.
(a) Holdco and HLI shall not, and shall not permit any of
their respective Restricted Subsidiaries to, enter into any Sale and Leaseback
Transaction with respect to any Property unless:
(i) Holdco, HLI or such Restricted Subsidiary
would be entitled to:
(1) Incur Debt in an amount equal to the
Attributable Debt with respect to such Sale and Leaseback
Transaction pursuant to Section 4.09, and
(2) create a Lien on such Property securing such
Attributable Debt without also securing the Notes or the
applicable Note Guaranty pursuant to Section 4.11, and
(ii) such Sale and Leaseback Transaction is
effected in compliance with Section 4.13.
Section 4.17. DESIGNATION OF RESTRICTED AND UNRESTRICTED SUBSIDIARIES.
(a) The Board of Directors may designate any Subsidiary
of Holdco other than HLI Parent or HLI to be an Unrestricted Subsidiary if such
Subsidiary:
(i) does not own any Capital Stock or Debt of,
or own or hold any Lien on any Property of, Holdco or any Restricted
Subsidiary;
(ii) has no Debt other than Debt:
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(1) as to which neither Holdco nor any of its
Restricted Subsidiaries (A) provides credit support of any
kind (including any undertaking, agreement or instrument that
would constitute Debt), (B) is directly or indirectly liable
as a Guarantor or otherwise, or (C) constitutes the lender,
provided, however, that Holdco or a Restricted Subsidiary may
loan, advance or extend credit to, or Guarantee the Debt of,
an Unrestricted Subsidiary at any time at or after such
Subsidiary is designated as an Unrestricted Subsidiary in
accordance with Section 4.10,
(2) no default with respect to which (including
any rights that the holders thereof may have to take
enforcement action against an Unrestricted Subsidiary) would
permit upon notice, lapse of time or both any holder of any
Debt (other than any Guarantee permitted by the proviso to the
preceding clause (a)(ii)(1)) of Holdco or any Restricted
Subsidiaries to declare a default on such Debt or cause the
payment thereof to be accelerated or payable prior to its
Stated Maturity, and
(3) as to which the lenders have been notified
in writing that they will not have any recourse to the stock
or other Property of Holdco or any Restricted Subsidiaries,
except for Debt that has been Guaranteed as permitted by the
proviso to the preceding clause (a)(ii)(1);
(iii) is not party to any agreement, contract,
arrangement or understanding with Holdco or any Restricted Subsidiary
unless the terms of any such agreement, contract, arrangement or
understanding are no less favorable to Holdco or such Restricted
Subsidiary than those that might be obtained at the time from Persons
who are not Affiliates of Holdco;
(iv) is a Person with respect to which neither
Holdco nor any Restricted Subsidiaries has any direct or indirect
obligation (1) to subscribe for additional Capital Stock or (2) to
maintain or preserve such Person's financial condition or to cause such
Person to achieve any specified levels of operating results; and
(v) has not Guaranteed or otherwise directly or
indirectly provided credit support for any Debt of Holdco or any
Restricted Subsidiaries.
Unless so designated as an Unrestricted Subsidiary, any Person that becomes a
Subsidiary of Holdco will be classified as a Restricted Subsidiary; provided,
however, that such Subsidiary shall not be designated a Restricted Subsidiary
and shall be automatically classified as an Unrestricted Subsidiary if either of
the requirements set forth in clauses (c)(i) and (ii) of this Section 4.17 will
not be satisfied after giving pro forma effect to such classification or if such
Person is a Subsidiary of an Unrestricted Subsidiary.
(b) Except as provided in the first sentence of clause
(a), no Restricted Subsidiary may be redesignated as an Unrestricted Subsidiary,
and none of Holdco, HLI nor any Restricted Subsidiary shall at any time be
directly or indirectly liable for any Debt that provides that the holder thereof
may (with the passage of time or notice or both) declare a default thereon or
cause the payment thereof to be accelerated or payable prior to its Stated
Maturity upon the occurrence of a default with respect to any Debt, Lien or
other obligation of any Unrestricted Subsidiary (including any right to take
enforcement action against such Unrestricted Subsidiary). Upon designation of a
Restricted Subsidiary as an Unrestricted Subsidiary in compliance with this
Section 4.17, such Restricted Subsidiary shall, by execution and delivery of a
supplemental indenture in form satisfactory to the Trustee in its reasonable
judgment, be released from any Note Guaranty previously made by such Restricted
Subsidiary.
(c) The Board of Directors may designate any Unrestricted
Subsidiary to be a Restricted Subsidiary if, immediately after giving pro forma
effect to such designation,
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(i) Holdco could Incur at least $1.00 of
additional Debt pursuant to Section 4.09(a)(i),and
(ii) no Default or Event of Default shall have
occurred and be continuing or would result therefrom.
(d) Any such designation or redesignation by the Board of
Directors will be evidenced to the Trustee by filing with the Trustee a Board
Resolution giving effect to such designation or redesignation and an Officers'
Certificate of HLI that:
(i) certifies that such designation or
redesignation complies with the foregoing provisions, and
(ii) gives the effective date of such designation
or redesignation,
such filing with the Trustee to occur within 45 days after the end of the fiscal
quarter of HLI in which such designation or redesignation is made (or, in the
case of a designation or redesignation made during the last fiscal quarter of
Holdco's fiscal year, within 90 days after the end of such fiscal year).
Section 4.18. REPURCHASE AT THE OPTION OF HOLDERS UPON A CHANGE OF CONTROL.
(a) Upon the occurrence of a Change of Control, HLI
shall, within 30 days of a Change of Control, make an offer (the "Change of
Control Offer") pursuant to the procedures set forth in Section 3.09. Each
Holder shall have the right to accept such offer and require HLI to repurchase
all or any portion (equal to $1,000 or an integral multiple of $1,000) of such
Holder's Notes pursuant to the Change of Control Offer at a purchase price, in
cash (the "Change of Control Amount"), equal to 101% of the aggregate principal
amount of Notes repurchased, plus accrued and unpaid interest, including Special
Interest, if any, on the Notes repurchased to the Purchase Date.
(b) HLI shall not be required to make a Change of Control
Offer upon a Change of Control if a third party makes a Change of Control Offer
in the manner, at the times and otherwise in compliance with the requirements
set forth in this Indenture applicable to a Change of Control Offer made by HLI
and purchases all Notes or portions of Notes validly tendered and not withdrawn
under the Change of Control Offer.
Section 4.19. FUTURE GUARANTORS.
(a) Holdco and HLI shall cause each Person that becomes a
Domestic Restricted Subsidiary following the Issue Date, other than any Captive
Insurance Subsidiaries or Securitization Entities, to execute and deliver to the
Trustee a Note Guaranty at the time such Person becomes a Domestic Restricted
Subsidiary. In addition, Holdco and HLI will cause each of their existing
non-Guarantor Subsidiaries and each of their Foreign Restricted Subsidiaries
created or acquired after the Issue Date which has Guaranteed or which
Guarantees any Debt of Holdco or any Domestic Restricted Subsidiary, to execute
and deliver to the Trustee a Guarantee agreement pursuant to which such
non-Guarantor or Foreign Restricted Subsidiary will Guarantee payment of HLI's
obligations under the Notes on the same terms and conditions as set forth in the
Guarantee of such other Debt of Holdco or any Restricted Subsidiary given by
such non-Guarantor or Restricted Foreign Subsidiary.
(b) Holdco and HLI shall use their best efforts to cause,
as promptly as practical, the dismissal of the bankruptcy cases pending on the
Issue Date relating to CMI-Quaker Alloy, Inc., HLI Netherlands Holdings, Inc.,
Xxxxx Lemmerz Funding Company, LLC, Xxxxx Lemmerz Funding Corporation and Xxxxx
Lemmerz International Import, Inc. Within five Business Days of the dismissal of
any such bankruptcy case relating to any such company, Holdco and HLI shall
cause such company to execute and deliver to the Trustee a Note Guaranty. Prior
to the dismissal of the bankruptcy case relating to
64
any such company, such company shall not Incur any Debt (including
intercompany Debt) or Lien and neither Holdco nor any of its Restricted
Subsidiaries shall make any Investment (in excess of $1.0 million in the
aggregate) in such company, other than extensions of credit to Restricted
Subsidiaries in the ordinary course of business that are recorded as accounts
receivable on the balance sheet of such company.
ARTICLE 5.
SUCCESSORS
Section 5.01. MERGER, CONSOLIDATION OR SALE OF ASSETS OF HLI AND GUARANTORS.
(a) HLI shall not merge, consolidate or amalgamate with
or into any other Person (other than a merger of a Wholly Owned Restricted
Subsidiary into HLI) or sell, transfer, assign, lease, convey or otherwise
dispose of all or substantially all of its Property in any one transaction or
series of transactions unless:
(i) HLI shall be the Surviving Person in such
merger, consolidation or amalgamation, or the Surviving Person (if
other than HLI) formed by such merger, consolidation or amalgamation or
to which such sale, transfer, assignment, lease, conveyance or
disposition is made shall be a corporation organized and existing under
the laws of the United States of America, any State thereof or the
District of Columbia;
(ii) the Surviving Person (if other than HLI)
expressly assumes, by supplemental indenture in form satisfactory to
the Trustee in its reasonable judgment, executed and delivered to the
Trustee by such Surviving Person, the due and punctual payment of the
principal of, and premium, if any, and interest on, all the Notes,
according to their tenor, and the due and punctual performance and
observance of all the covenants and conditions of this Indenture to be
performed by HLI;
(iii) in the case of a sale, transfer, assignment,
lease, conveyance or other disposition of all or substantially all the
Property of HLI, such Property shall have been transferred as an
entirety or virtually as an entirety to one Person or a group of
related persons;
(iv) immediately before and after giving effect
to such transaction or series of transactions on a pro forma basis (and
treating, for purposes of this clause (iv) and clause (v) below, any
Debt that becomes, or is anticipated to become, an obligation of the
Surviving Person or any Restricted Subsidiary as a result of such
transaction or series of transactions as having been Incurred by the
Surviving Person or such Restricted Subsidiary at the time of such
transaction or series of transactions), no Default or Event of Default
shall have occurred and be continuing;
(v) immediately after giving effect to such
transaction or series of transactions on a pro forma basis, HLI or the
Surviving Person, as the case may be, would be able to Incur at least
$1.00 of additional Debt under Section 4.09(a)(i); and
(vi) HLI shall deliver, or cause to be delivered,
to the Trustee, in form and substance satisfactory to the Trustee in
its reasonable judgment, an Officers' Certificate and an Opinion of
Counsel, each stating that such transaction or series of transactions
and the supplemental indenture, if any, in respect thereto comply with
this covenant and that all conditions precedent herein provided for
relating to such transaction or series of transactions have been
satisfied.
(b) Holdco shall not, and Holdco and HLI shall not permit
any other Guarantor to, merge, consolidate or amalgamate with or into any other
Person (other than a merger of a Wholly Owned
65
Restricted Subsidiary into HLI or a Guarantor) or sell, transfer, assign, lease,
convey or otherwise dispose of all or substantially all of its Property in any
one transaction or series of transactions unless:
(i) the Surviving Person (if other than such
Guarantor) formed by such merger, consolidation or amalgamation or to
which such sale, transfer, assignment, lease, conveyance or disposition
is made shall be a corporation, limited liability company or
partnership organized and existing under the laws of the United States
of America, any State thereof or the District of Columbia;
(ii) the Surviving Person (if other than such
Guarantor) expressly assumes, by supplemental indenture in form
satisfactory to the Trustee in its reasonable judgment, executed and
delivered to the Trustee by such Surviving Person, the due and punctual
performance and observance of all the obligations of such Guarantor
under its Note Guaranty and, in the case of Holdco, due and punctual
performance and observance of all the covenants and conditions of this
Indenture to be performed by Holdco;
(iii) in the case of a sale, transfer, assignment,
lease, conveyance or other disposition of all or substantially all the
Property of such Guarantor, such Property shall have been transferred
as an entirety or virtually as an entirety to one Person;
(iv) immediately before and after giving effect
to such transaction or series of transactions on a pro forma basis (and
treating, for purposes of this clause (iv) and clause (v) below, any
Debt that becomes, or is anticipated to become, an obligation of the
Surviving Person, HLI or any Guarantor as a result of such transaction
or series of transactions as having been Incurred by the Surviving
Person, HLI or such Guarantor at the time of such transaction or series
of transactions), no Default or Event of Default shall have occurred
and be continuing;
(v) immediately after giving effect to such
transaction or series of transactions on a pro forma basis, Holdco
would be able to Incur at least $1.00 of additional Debt under Section
4.09(a)(i); and
(vi) HLI shall deliver, or cause to be delivered,
to the Trustee, in form and substance satisfactory to the Trustee in
its reasonable judgment, an Officers' Certificate and an Opinion of
Counsel of HLI, each stating that such transaction or series of
transactions and such Note Guaranty, if any, in respect thereto comply
with this covenant and that all conditions precedent herein provided
for relating to such transaction or series of transactions have been
satisfied.
The foregoing provisions (other than clause (iv)) shall not
apply to any transaction or series of transactions which constitute an Asset
Sale if Holdco has complied with Section 4.13.
Section 5.02. SUCCESSOR CORPORATION SUBSTITUTED.
The Surviving Person shall succeed to, and be substituted for,
and may exercise every right and power of Holdco and HLI under the Indenture (or
of the Guarantor under the Note Guaranty, as the case may be), but the
predecessor of Holdco and HLI in the case of:
(a) a sale, transfer, assignment, conveyance or other
disposition (unless such sale, transfer, assignment, conveyance or other
disposition is of all the assets of Holdco or HLI as an entirety or virtually as
an entirety), or
(b) a lease,
66
shall not be released from any of the obligations or covenants under this
Indenture, including with respect to the payment of the Notes and obligations
under the Note Guarantees.
ARTICLE 6.
DEFAULTS AND REMEDIES
Section 6.01. EVENTS OF DEFAULT.
(a) Each of the following constitutes an "Event of
Default" with respect to the Notes:
(i) failure to make the payment of any interest,
including Special Interest, if any, on the Notes when the same becomes
due and payable, and such failure continues for a period of 30 days;
(ii) failure to make the payment of any principal
of, or premium, if any, on, any of the Notes when the same becomes due
and payable at its Stated Maturity, upon acceleration, redemption,
optional redemption, required repurchase or otherwise;
(iii) failure to comply with Section 5.01;
(iv) failure to comply with any other covenant or
agreement in the Notes or in this Indenture (other than a failure that
is the subject of the foregoing clause (a) (i), (ii) or (iii)), and
such failure continues for 30 days after written notice is given to HLI
as provided below;
(v) a default under any Debt in an aggregate
amount in excess of $20.0 million by Holdco or any Restricted
Subsidiary that results in acceleration of the maturity of such Debt,
or failure to pay any such Debt at maturity (the "cross acceleration
provisions");
(vi) any judgment or judgments for the payment of
money in an aggregate amount in excess of $20.0 million (net of
applicable insurance, if any, that is not subject to any reservation of
rights by the insurer) that shall be rendered against Holdco or any
Restricted Subsidiaries and that shall not be waived, satisfied or
discharged for any period of 30 consecutive days during which a stay of
enforcement shall not be in effect (the "judgment default provisions");
(vii) any Note Guaranty ceases to be in full force
and effect (other than in accordance with the terms of such Note
Guaranty) or any Guarantor denies or disaffirms its obligations under
its Note Guaranty (the "guaranty provisions");
(viii) any security interest shall, at any time,
cease to be in full force and effect for any reason other than the
satisfaction in full of all obligations under the Indenture and
discharge of the Indenture or the release thereof in accordance with
its terms, or any security interest created thereunder shall be
declared invalid or unenforceable or HLI or any Guarantor shall assert,
in any pleading in any court of competent jurisdiction, that any such
security interest is invalid or unenforceable (the "security default
provisions");
(ix) Holdco, HLI Parent, HLI or any Significant
Subsidiary, or any group of Holdco's Subsidiaries that, when taken
together, would constitute a Significant Subsidiary, pursuant to or
within the meaning of any Bankruptcy Law:
(1) commences a voluntary case or gives notice of
intention to make a proposal under any Bankruptcy Law;
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(2) consents to the entry of an order for relief
against it in an involuntary case or consents to its
dissolution or winding up;
(3) consents to the appointment of a receiver,
interim receiver, receiver and manager, liquidator, trustee or
custodian of it or for all or substantially all of its
property;
(4) makes a general assignment for the benefit of
its creditors;
(5) admits in writing its inability to pay its
debts as they become due or otherwise admits its insolvency;
or
(6) seeks a stay of proceedings against it or
proposes or gives notice or intention to propose a compromise,
arrangement or reorganization of any of its debts or
obligations under any Bankruptcy Law; provided, however, in
the case of Chapter 11 bankruptcy cases relating to CMI-Quaker
Alloy, Inc., HLI Netherlands Holdings, Inc., Xxxxx Lemmerz
Funding Company, LLC, Xxxxx Lemmerz Funding Corporation and
Xxxxx Lemmerz International Import, Inc., each pending on the
Issue Date, no Event of Default shall arise under this clause
(ix)(6) in the event such compromise, arrangement or
reorganization involves payments of not more than $1.0 million
in the aggregate to creditors of such Subsidiary or group of
Subsidiaries; and
(x) a court of competent jurisdiction enters an
order or decree under any Bankruptcy Law that:
(1) is for relief against Holdco, HLI Parent, HLI
or any Significant Subsidiary, or any group of Holdco's
Subsidiaries that, when taken together, would constitute a
Significant Subsidiary, in an involuntary case; or
(2) appoints a receiver, interim receiver, receiver
and manager, liquidator, trustee or custodian of Holdco, HLI
Parent, HLI or any Significant Subsidiary, any group of
Holdco's Subsidiaries that, when taken together, would
constitute a Significant Subsidiary, or for all or
substantially all of the property of Holdco, HLI Parent, HLI
or any Significant Subsidiaries, any group of Holdco's
Subsidiaries that, when taken together, would constitute a
Significant Subsidiary;
(3) orders the liquidation of Holdco, HLI Parent,
HLI or any of Holdco's Significant Subsidiaries, any group of
Holdco's Subsidiaries that, when taken together, would
constitute a Significant Subsidiary; or
(4) orders the presentation of any plan or
arrangement, compromise or reorganization of Holdco, HLI
Parent, HLI or any Significant Subsidiaries or any group of
Holdco's Subsidiaries that, when taken together, would
constitute a Significant Subsidiary;
and such order or decree remains unstayed and in effect for 60
consecutive days.
(b) A Default under clause (a)(iv) is not an Event of
Default until the Trustee or the Holders of not less than 25% in aggregate
principal amount of the Notes then outstanding notify HLI of the Default and HLI
does not cause such Default to be cured within the time specified after receipt
of such notice. Such notice must specify the Default, demand that it be remedied
and state that such notice is a "Notice of Default."
(c) HLI shall deliver to the Trustee, within 30 days
after the occurrence thereof, written notice in the form of an Officers'
Certificate of any event that with the giving of notice or the lapse
68
of time or both would become an Event of Default, its status and what action HLI
is taking or proposes to take with respect thereto.
Section 6.02. ACCELERATION.
If any Event of Default (other than those of the type
described in Section 6.01(ix) or (x)) occurs and is continuing, the Trustee or
the Holders of at least 25% in aggregate principal amount of outstanding Notes
may, declare the principal of all the Notes, together with all accrued and
unpaid interest, and premium, if any, to be due and payable by notice in writing
to HLI and the Trustee specifying the respective Event of Default and that such
notice is a notice of acceleration (the "Acceleration Notice"), and the same
shall become immediately due and payable.
In the case of an Event of Default specified in Section
6.01(a)(ix) or (x), all outstanding Notes shall become due and payable
immediately without declaration or other act on the part of the Trustee or the
Holders. Holders may not enforce this Indenture or the Notes except as provided
in this Indenture.
At any time after a declaration of acceleration with respect
to the Notes, the Holders of a majority in principal amount of the Notes then
outstanding (by notice to the Trustee) may rescind and cancel such declaration
and its consequences if:
(a) the rescission would not conflict with any judgment
or decree of a court of competent jurisdiction;
(b) all existing Events of Default have been cured or
waived except nonpayment of principal of or interest on the Notes that has
become due solely by reason of such declaration of acceleration;
(c) to the extent the payment of such interest is lawful,
interest (at the same rate specified in the Notes) on overdue installments of
interest and overdue payments of principal which has become due otherwise than
by such declaration of acceleration has been paid;
(d) HLI has paid the Trustee its reasonable compensation
and reimbursed the Trustee for its reasonable expenses, disbursements and
advances; and
(e) in the event of the cure or waiver of an Event of
Default of the type described in Section 6.01(a)(ix) or (x), the Trustee has
received an Officers' Certificate and Opinion of Counsel that such Event of
Default has been cured or waived.
In the case of an Event of Default with respect to the Notes
occurring by reason of any willful action or inaction taken or not taken by HLI
or on HLI's behalf with the intention of avoiding payment of the premium that
HLI would have been required to pay if HLI had then elected to redeem the Notes
pursuant to Section 3.07, an equivalent premium shall also become and be
immediately due and payable to the extent permitted by law upon the acceleration
of the Notes. If an Event of Default occurs by reason of any willful action or
inaction taken or not taken by HLI or on HLI's behalf with the intention of
avoiding the premium required upon a redemption of the Notes under Section
3.07(a) or Section 3.07(c), then the premium specified in Section 3.07(a) or
Section 3.07(c), as applicable, shall also become immediately due and payable to
the extent permitted by law upon acceleration of the Notes.
Section 6.03. OTHER REMEDIES.
If an Event of Default occurs and is continuing, the Trustee
may pursue any available remedy to collect the payment of principal, premium, if
any, and interest on the Notes or to enforce the performance of any provision of
the Notes or this Indenture.
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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 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
shall be cumulative to the extent permitted by law.
Section 6.04. WAIVER OF PAST DEFAULTS.
The Holders of at least 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, except a continuing Default or Event of Default (i) in the
payment of the principal of, premium, if any, or interest on, the Notes and (ii)
in respect of a covenant or provision which under this Indenture cannot be
modified or amended without the consent of the Holder of each Note affected by
such modification or amendment. Upon any waiver of a Default or Event of Default
such Default shall cease to exist, and any Event of Default arising therefrom
shall be deemed 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 6.05. CONTROL BY MAJORITY.
Subject to Section 7.01, Section 7.02(f) (including the
Trustee's receipt of the security or indemnification described therein) and
Section 7.07, in case an Event of Default shall occur and be continuing, the
Holders of a majority in aggregate principal amount of the Notes then
outstanding shall 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 with respect to the Notes.
Section 6.06. LIMITATION ON SUITS.
No Holder shall have any right to institute any proceeding
with respect to this Indenture, or for the appointment of a receiver or trustee,
or for any remedy thereunder, unless:
(a) such Holder has previously given to the Trustee
written notice of a continuing Event of Default or the Trustee receives the
notice from HLI;
(b) Holders of at least 25% in aggregate principal amount
of the Notes then outstanding have made written request to the Trustee to pursue
a remedy;
(c) A Holder or Holders offer, and, if requested, provide
to the Trustee indemnity reasonably satisfactory to the Trustee against any
loss, liability or expense;
(d) the Trustee shall have failed to 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 the 60-day period the Holders of a majority in
principal amount of the Notes then outstanding shall not have given the Trustee
a direction inconsistent with the request.
The preceding limitations shall not apply to a suit instituted
by a Holder for enforcement of payment of principal of, and premium, if any, or
interest on, a Note on or after the respective due dates for such payments set
forth in such Note.
A Holder may not use this Indenture to affect, disturb or
prejudice the rights of another Holder or to obtain a preference or priority
over another Holder.
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Section 6.07. RIGHTS OF HOLDERS TO RECEIVE PAYMENT.
Notwithstanding any other provision of this Indenture
(including Section 6.06), the right of any Holder to receive payment of
principal, premium, if any, and interest on the Notes held by such Holder, on or
after the respective due dates expressed in the Notes (including in connection
with an offer to purchase), or to bring suit for the enforcement of any such
payment on or after such respective dates, shall not be impaired or affected
without the consent of such Holder.
Section 6.08. COLLECTION SUIT BY TRUSTEE.
If an Event of Default specified in Section 6.01 (a)(i) or
(ii) occurs and is continuing, the Trustee is authorized to recover judgment in
its own name and as trustee of an express trust against HLI for the whole amount
of principal of, premium, if any, and interest then due and owing (together with
interest on overdue principal and, to the extent lawful, interest) and such
further amount as shall be sufficient to cover the costs and expenses of
collection, including the reasonable compensation, expenses, disbursements and
advances of the Trustee, its agents and counsel.
Section 6.09. TRUSTEE MAY FILE PROOFS OF CLAIM.
The Trustee shall be 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 allowed in any judicial proceedings relative to HLI (or any other
obligor upon the Notes), its creditors or its property and shall be entitled and
empowered to collect, receive and distribute any money or other property payable
or deliverable on any such claims and any custodian in any such judicial
proceeding is hereby authorized by each Holder to make such payments to the
Trustee, and in the event that the Trustee shall consent to the making of such
payments directly to the Holders, to pay to the Trustee any amount due to it for
the reasonable compensation, expenses, disbursements and advances of the
Trustee, its agents and counsel, and any other amounts due the Trustee under
Section 7.07. To the extent that the payment of any such compensation, expenses,
disbursements and advances of the Trustee and its agents and counsel, and any
other amounts due the Trustee under Section 7.07 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, moneys,
securities and any other properties that the Holders may be entitled to receive
in such proceeding whether in liquidation or under any plan of reorganization or
arrangement or otherwise. Nothing herein contained shall be deemed to authorize
the Trustee to authorize or consent to or accept or adopt on behalf of any
Holder any plan of reorganization, arrangement, adjustment or composition
affecting the Notes or the rights of any Holder, or to authorize the Trustee to
vote in respect of the claim of any Holder in any such proceeding.
Section 6.10. PRIORITIES.
If the Trustee collects any money pursuant to this Article 6,
it shall pay out the money in the following order:
First: to the Trustee, its agents and attorneys for amounts
due under Section 7.07, including payment of all compensation, expenses and
liabilities incurred, and all advances made, by the Trustee and the costs and
expenses of collection;
Second: to Holders 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
Third: to HLI or to such party as a court of competent
jurisdiction shall direct.
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The Trustee may fix a record date and payment date for any
payment to Holders 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 such suit of an undertaking to pay the costs of such suit,
and the court in its discretion may assess reasonable costs, including
reasonable attorneys' fees, against any party litigant in such suit, having due
regard to the merits and good faith of the claims or defenses made by the party
litigant. This Section 6.11 shall not apply to a suit by the Trustee, a suit by
a Holder pursuant to Section 6.07, or a suit by Holders of more than 10% in
principal amount of the then outstanding Notes.
ARTICLE 7.
TRUSTEE
Section 7.01. DUTIES OF TRUSTEE.
(a) If an Event of Default has occurred and is
continuing, the Trustee shall exercise such of the rights and powers vested in
it by this Indenture, and use the same degree of care and skill in its exercise,
as a prudent Person would exercise or use under the circumstances in the conduct
of such Person's own affairs.
(b) Except during the continuance of an Event of Default:
(i) the duties of the Trustee shall be
determined solely by the express provisions of this Indenture and the
Trustee need perform only those duties that are specifically set forth
in this Indenture and no others, and no implied covenants or
obligations shall be read into this Indenture against the Trustee; and
(ii) in the absence of bad faith on its part, the
Trustee may conclusively rely, as to the truth of the 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, 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:
(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 6.05.
(d) Whether or not therein expressly so provided, every
provision of this Indenture that in any way relates to the Trustee is subject to
paragraphs (a), (b) and (c) of this Section 7.01.
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(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 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 HLI. Money
held in trust by the Trustee need not be segregated from other funds except to
the extent required by law.
Section 7.02. RIGHTS OF TRUSTEE.
Subject to TIA Section 315:
(a) The Trustee may conclusively rely upon any document
believed by it to be genuine and to have been signed or presented by the proper
Person. The Trustee need not investigate any fact or matter stated in any such
document.
(b) Before the Trustee acts or refrains from acting, it
may require an Officers' Certificate or an Opinion of Counsel or both. The
Trustee shall not be liable for any action it takes or omits to take in good
faith in reliance on such Officers' Certificate or Opinion of Counsel. The
Trustee may consult with counsel and the written advice of such counsel or any
Opinion of Counsel shall be full and complete authorization and protection from
liability in respect of any action taken, suffered or omitted by it hereunder in
good faith and in reliance thereon.
(c) The Trustee 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.
(d) Unless otherwise specifically provided in this
Indenture, any demand, request, direction or notice from HLI shall be sufficient
if signed by an Officer of HLI.
(e) The Trustee shall be under no obligation to exercise
any of the rights or powers vested in it by this Indenture at the request or
direction of any of the Holders unless such Holders shall have offered to the
Trustee reasonable security or indemnity against the costs, expenses and
liabilities that might be incurred by it in compliance with such request or
direction.
(f) 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 or Event of Default is received by a Responsible Officer of the
Trustee at the Corporate Trust Office of the Trustee from HLI or the Holders of
25% in aggregate principal amount of the outstanding Notes, and such notice
references the specific Default or Event of Default, the Notes and this
Indenture.
(g) The Trustee shall not be required to give any bond or
surety in respect of the performance of its power and duties hereunder.
(h) The Trustee shall have no duty to inquire as to the
performance of HLI's covenants herein.
(i) The Trustee may execute any of the trusts or powers
hereunder or perform any duties hereunder either directly or by or through
agents or attorneys and the Trustee shall not be responsible for any misconduct
or negligence on the part of any agent or attorney appointed with due care by it
hereunder.
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Section 7.03. INDIVIDUAL RIGHTS OF TRUSTEE.
The Trustee in its individual or any other capacity may become
the owner or pledgee of Notes and may otherwise deal with HLI or any Affiliate
of HLI 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 shall also be subject to Sections 7.10 and 7.11.
Section 7.04. TRUSTEE'S DISCLAIMER.
The Trustee shall not be responsible for and makes no
representation as to the validity or adequacy of this Indenture or the Notes, it
shall not be accountable for HLI's use of the proceeds from the Notes or any
money paid to HLI or upon the HLI's direction under any provision of this
Indenture, it shall not be responsible for the use or application of any money
received by any Paying Agent other than the Trustee, and it shall not be
responsible for any statement or recital herein or any statement in the Notes or
any other document in connection with the sale of the Notes or pursuant to this
Indenture other than its certificate of authentication.
Section 7.05. NOTICE OF DEFAULTS.
If a Default or Event of Default occurs and is continuing and
if it is known to the Trustee, the Trustee shall mail to Holders a notice of the
Default or Event of Default within 90 days after it occurs. Except in the case
of a Default or Event of Default in payment of principal of, premium, if any, or
interest on any Note, the Trustee may withhold the notice if and so long as a
committee of its Responsible Officers in good faith determines that withholding
the notice is in the interests of the Holders.
Section 7.06. REPORTS BY TRUSTEE TO HOLDERS.
Within 60 days after each May 15 beginning with the May 15
following the date of this Indenture, and for so long as Notes remain
outstanding, the Trustee shall mail to the Holders 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 shall be mailed to HLI and filed with the SEC and each stock exchange on
which the Notes are listed in accordance with TIA Section 313(d). HLI shall
promptly notify the Trustee when the Notes are listed on any stock exchange and
any delisting thereof.
Section 7.07. COMPENSATION AND INDEMNITY.
HLI shall pay to the Trustee from time to time reasonable
compensation for its acceptance of this Indenture and services hereunder. The
Trustee's compensation shall not be limited by any law on compensation of a
trustee of an express trust. HLI 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.
HLI shall indemnify the Trustee (in its capacity as Trustee)
or any predecessor Trustee (in its capacity as Trustee) against any and all
losses, claims, damages, penalties, fines, liabilities or expenses, including
incidental and out-of-pocket expenses and reasonable attorneys fees (for
purposes of this Article 7, "losses") 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
HLI
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(including this Section 7.07) and defending itself against any claim (whether
asserted by HLI 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 such losses may be attributable to its negligence or bad
faith. The Trustee shall notify HLI promptly of any claim for which it may seek
indemnity. Failure by the Trustee to so notify HLI shall not relieve HLI of its
obligations under this Section 7.07, to the extent HLI has been prejudiced
thereby. HLI shall defend the claim, and the Trustee shall cooperate in the
defense. The Trustee may have separate counsel if the Trustee has been
reasonably advised by counsel that there may be one or more legal defenses
available to it that are different from or additional to those available to HLI
and in the reasonable judgment of such counsel it is advisable for the Trustee
to engage separate counsel, and HLI shall pay the reasonable fees and expenses
of such counsel. HLI need not pay for any settlement made without its consent,
which consent shall not be unreasonably withheld. HLI need not reimburse any
expense or indemnify against any loss incurred by the Trustee through the
Trustee's own negligence or bad faith.
The obligations of HLI under this Section 7.07 shall survive
the satisfaction and discharge of this Indenture, the resignation or removal of
the Trustee and payment in full of the Notes through the expiration of the
applicable statute of limitations.
To secure HLI's payment obligations in this Section, the
Trustee shall have a Lien prior to the Notes on all money or property held or
collected by the Trustee, except that held in trust to pay principal, premium,
if any, and interest on particular Notes. Such Lien shall survive the
satisfaction and discharge of this Indenture.
When the Trustee incurs expenses or renders services after an
Event of Default specified in Section 6.01(a)(ix) or (x) occurs, the expenses
and the compensation for the services (including the fees and expenses of its
agents and counsel) are intended to constitute expenses of administration under
any Bankruptcy Law.
Section 7.08. REPLACEMENT OF TRUSTEE.
A resignation or removal of the Trustee and appointment of a
successor Trustee shall become effective only upon the successor Trustee's
acceptance of appointment as provided in this Section 7.08.
The Trustee may resign in writing at any time upon 30 days'
prior notice to HLI and be discharged from the trust hereby created by so
notifying HLI. The Holders of a majority in aggregate principal amount of the
then outstanding Notes may remove the Trustee by so notifying the Trustee and
HLI in writing. HLI may remove the Trustee if:
(a) the Trustee fails to comply with Section 7.10;
(b) the Trustee is adjudged bankrupt or insolvent or an
order for relief is entered with respect to the Trustee under any Bankruptcy
Law;
(c) a custodian or public officer takes charge of the
Trustee or its property; or
(d) the Trustee becomes incapable of acting.
If the Trustee resigns or is removed or if a vacancy exists in
the office of Trustee for any reason (the Trustee in such event being referred
to herein as the retiring Trustee), HLI 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 HLI.
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If a successor Trustee does not take office within 30 days
after the retiring Trustee resigns or is removed, the retiring Trustee, HLI, or
the Holders of at least 10% in aggregate principal amount of the then
outstanding Notes may petition any court of competent jurisdiction for the
appointment of a successor Trustee.
If the Trustee, after written request by any Holder who has
been a Holder for at least six months, fails to comply with Section 7.10, such
Holder may petition any court of competent jurisdiction for the removal of the
Trustee and the appointment of a successor Trustee.
A successor Trustee shall deliver a written acceptance of its
appointment to the retiring Trustee and to HLI. Thereupon, the resignation or
removal of the retiring Trustee shall become effective, and the successor
Trustee shall have all the rights, powers and duties of the Trustee under this
Indenture. The successor Trustee shall mail a notice of its succession to
Holders. Subject to the Lien provided for in Section 7.07, the retiring Trustee
shall promptly transfer all property held by it as Trustee to the successor
Trustee provided, however; that all sums owing to the Trustee hereunder shall
have been paid. Notwithstanding replacement of the Trustee pursuant to this
Section 7.08, HLI's obligations under Section 7.07 shall continue for the
benefit of the retiring Trustee.
In the case of an appointment hereunder of a separate or
successor Trustee with respect to the Notes, HLI, the Guarantors, any retiring
Trustee and each successor or separate Trustee with respect to the Notes shall
execute and deliver an Indenture supplemental hereto (1) which shall contain
such provisions as shall be deemed necessary or desirable to confirm that all
the rights, powers, trusts and duties of any retiring Trustee with respect to
the Notes as to which any such retiring Trustee is not retiring shall continue
to be vested in such retiring Trustee and (2) that shall add to or change any of
the provisions of this Indenture as shall be necessary to provide for or
facilitate the administration of the trusts hereunder by more than one Trustee,
it being understood that nothing herein or in such supplemental indenture shall
constitute such Trustee co-trustees of the same trust and that each such
separate, retiring or successor Trustee shall be Trustee of a trust or trusts
hereunder separate and apart from any trust or trusts hereunder administered by
any such other Trustee.
Section 7.09. SUCCESSOR TRUSTEE BY MERGER, ETC.
If the Trustee consolidates, merges or converts into, or
transfers all or substantially all of its corporate trust business to, another
corporation or banking association, the successor corporation or banking
association without any further act shall, if such successor corporation or
banking association is otherwise eligible hereunder, be the successor Trustee.
Section 7.10. ELIGIBILITY; DISQUALIFICATION.
There shall at all times be a Trustee hereunder that is a
Person organized and doing business under the laws of the United States of
America or of any state thereof that is authorized under such laws to exercise
corporate trustee power, that is subject to supervision or examination by
federal or state authorities and that has a combined capital and surplus of at
least $50.0 million (or a wholly-owned Subsidiary of a bank or trust company, or
of a bank holding company, the principal Subsidiary of which is a bank or trust
company having a combined capital and surplus of at least $50.0 million) as set
forth in its most recent published annual report of condition.
This Indenture shall always have a Trustee who satisfies the
requirements of TIA Section 310(a)(1), (2) and (5). The Trustee is subject to
TIA Section 310(b).
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Section 7.11. PREFERENTIAL COLLECTION OF CLAIMS AGAINST COMPANY.
The Trustee is subject to TIA Section 311(a), excluding any
creditor relationship listed in TIA Section 311(b). A Trustee who has resigned
or been removed shall be subject to TIA Section 311(a) to the extent indicated
therein.
ARTICLE 8.
LEGAL DEFEASANCE AND COVENANT DEFEASANCE
Section 8.01. OPTION TO EFFECT LEGAL DEFEASANCE OR COVENANT DEFEASANCE.
HLI may, at its option and at any time, elect to have either
Section 8.02 or 8.03 be applied to all outstanding Notes upon compliance with
the conditions set forth below in this Article 8.
Section 8.02. LEGAL DEFEASANCE AND DISCHARGE.
Upon HLI's exercise under Section 8.01 of the option
applicable to this Section 8.02, Holdco and HLI shall, subject to the
satisfaction of the conditions set forth in Section 8.04, be deemed to have been
discharged from their obligations with respect to all outstanding Notes on the
date the conditions set forth below are satisfied (hereinafter, "Legal
Defeasance") and each Guarantor shall be released from all of its obligations
under its guarantee. For this purpose, Legal Defeasance means that Holdco and
HLI shall be deemed to have paid and discharged the entire Debt represented by
the outstanding Notes, which shall thereafter be deemed to be "outstanding" only
for the purposes of Section 8.05 and the other Sections of this Indenture
referred to in (a) and (b) below, and to have satisfied all its other
obligations under such Notes and this Indenture (and the Trustee, on demand of
and at the expense of HLI, shall execute proper instruments acknowledging the
same), except for the following provisions which shall survive until otherwise
terminated or discharged hereunder: (a) the rights of Holders of outstanding
Notes to receive solely from the trust fund described in Section 8.04, and as
more fully set forth in such Section, payments in respect of the principal of,
premium, if any, and interest and Special Interest, if any, on such Notes when
such payments are due, (b) Holdco and HLI's obligations with respect to such
Notes under Article 2 and Section 4.01 and Section 4.02, (c) the rights, powers,
trusts, duties and immunities of the Trustee hereunder and HLI's obligations in
connection therewith and (d) this Article 8. If HLI exercises under Section 8.01
the option applicable to this Section 8.02, subject to the satisfaction of the
conditions set forth in Section 8.04, payment of the Notes may not be
accelerated because of an Event of Default. Subject to compliance with this
Article 8, HLI may exercise its option under this Section 8.02 notwithstanding
the prior exercise of its option under Section 8.03.
Section 8.03. COVENANT DEFEASANCE.
Upon HLI's exercise under Section 8.01 of the option
applicable to this Section 8.03, Holdco and HLI shall, subject to the
satisfaction of the conditions set forth in Section 8.04 hereof, be released
from its obligations under the covenants contained in Sections 4.05, 4.06 and
4.08 through 4.19, and the operation of Section 5.01(a)(v) and 5.01(b)(v), with
respect to the outstanding Notes on and after the date the conditions set forth
in Section 8.04 are satisfied (hereinafter, "Covenant Defeasance") and each
Guarantor shall be released from all of its obligations under its guarantee with
respect to such covenants in connection with such outstanding Notes, and the
Notes shall thereafter be deemed not "outstanding" for the purposes of any
direction, waiver, consent or declaration or act of Holders (and the
consequences of any thereof) in connection with such covenants, but shall
continue to be deemed "outstanding" for all other purposes hereunder (it being
understood that such Notes shall not be deemed outstanding for accounting
purposes). For this purpose, Covenant Defeasance means that, with respect to the
outstanding Notes, Holdco, HLI and the Guarantors may omit to comply with and
shall have no liability in respect of any term, condition or limitation set
forth in any such covenant, whether directly or indirectly, by reason of any
reference elsewhere herein to any such covenant or by reason of any reference in
any such
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covenant to any other provision herein or in any other document and such
omission to comply shall not constitute a Default or an Event of Default under
Section 6.01, but, except as specified above, the remainder of this Indenture
and such Notes shall be unaffected thereby. If HLI exercises under Section 8.01
the option applicable to this Section 8.03, subject to the satisfaction of the
conditions set forth in Section 8.04, payment of the Notes may not be
accelerated because of an Event of Default specified in clauses (a)(iv) (with
respect to the covenants contained in Sections 4.05, 4.06 and 4.08 through
4.19), (v), (vi), (vii), (viii), (ix) and (x) (but in the case of clauses (ix)
and (x) of Section 6.01, with respect to Significant Subsidiaries only or
because of a failure of HLI to comply with Section 5.01(a)(v)).
Section 8.04. CONDITIONS TO LEGAL OR COVENANT DEFEASANCE.
The following shall be the conditions to the application of
either Section 8.02 or 8.03 hereof to the outstanding Notes.
The Legal Defeasance or Covenant Defeasance may be exercised
only if:
(a) HLI irrevocably deposits in trust with the Trustee
money or U.S. Government Obligations for the payment of principal of,
premium, if any, and interest, including Special Interest, if any, on,
the Notes to maturity or redemption, as the case may be;
(b) HLI delivers to the Trustee a certificate from a
nationally recognized firm of independent certified public accountants
expressing their opinion that the payments of principal, premium, if
any, and interest, including Special Interest, if any, when due and
without reinvestment on the deposited U.S. Government Obligations plus
any deposited money without investment will provide cash at such times
and in such amounts as will be sufficient to pay principal, premium, if
any, and interest, including Special Interest, if any, when due on all
the Notes to be defeased to maturity or redemption, as the case may be;
(c) 123 days pass after the deposit is made and during
the 123-day period no Default described in clauses (a) (ix) or (x)
under Section 6.01 occurs with respect to HLI or any other Person
making such deposit which is continuing at the end of the period;
(d) no Default or Event of Default has occurred and is
continuing on the date of such deposit and after giving effect thereto;
(e) such deposit does not constitute a default under any
other agreement or instrument binding on HLI;
(f) HLI delivers to the Trustee an Opinion of Counsel to
the effect that the trust resulting from the deposit does not
constitute, or is qualified as, a regulated investment company under
the Investment Company Act of 1940;
(g) in the case of the Legal Defeasance option, HLI
delivers to the Trustee an Opinion of Counsel stating that:
(i) HLI has received from the Internal Revenue
Service a ruling, or
(ii) since the date of this Indenture there has
been a change in the applicable Federal income tax law, to the
effect, in either case, that, and based thereon such Opinion
of Counsel shall confirm that, the Holders will not recognize
income, gain or loss for Federal income tax purposes as a
result of such Legal Defeasance and will be subject to Federal
income tax on the same amounts, in the same manner and at the
same time as would have been the case if such Legal Defeasance
has not occurred;
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(h) in the case of the Covenant Defeasance option, HLI
delivers to the Trustee an Opinion of Counsel to the effect that the
Holders will not recognize income, gain or loss for Federal income tax
purposes as a result of such Covenant Defeasance and will be subject to
Federal income tax on the same amounts, in the same manner and at the
same times as would have been the case if such Covenant Defeasance had
not occurred; and
(i) HLI delivers to the Trustee an Officers' Certificate
and an Opinion of Counsel, each stating that all conditions precedent
to the defeasance and discharge of the Notes have been complied with as
required by this Indenture.
Section 8.05. DEPOSITED CASH AND GOVERNMENT SECURITIES TO BE HELD IN TRUST;
OTHER MISCELLANEOUS PROVISIONS.
Subject to Section 8.06, all cash and non-callable Government
Securities (including the proceeds thereof) deposited with the Trustee (or other
qualifying Trustee, collectively for purposes of this Section 8.05, the
"Trustee") pursuant to Section 8.04 in respect of the outstanding Notes shall be
held in trust and applied by the Trustee, in accordance with the provisions of
such Notes and this Indenture, to the payment, either directly or through any
Paying Agent (including HLI acting as Paying Agent) as the Trustee may
determine, to the Holders of all sums due and to become due thereon in respect
of principal, premium, if any, and interest but such cash and securities need
not be segregated from other funds except to the extent required by law.
HLI shall pay and indemnify the Trustee against any tax, fee
or other charge imposed on or assessed against the cash or non-callable
Government Securities deposited pursuant to Section 8.04 or the principal and
interest received in respect thereof other than any such tax, fee or other
charge which by law is for the account of the Holders of the outstanding Notes.
Anything in this Article 8 to the contrary notwithstanding,
the Trustee shall deliver or pay to HLI from time to time upon the request of
HLI any cash or non-callable Government Securities held by it as provided in
Section 8.04 which, in the opinion of a nationally recognized firm of
independent certified public accountants of recognized international standing
expressed in a written certification thereof delivered to the Trustee (which may
be the certification delivered under Section 8.04(a)), are in excess of the
amount thereof that would then be required to be deposited to effect an
equivalent Legal Defeasance or Covenant Defeasance.
Section 8.06. REPAYMENT TO COMPANY.
The Trustee shall promptly, and in any event, no later than
five (5) Business Days, pay to HLI after request therefor any excess money held
with respect to the Notes at such time in excess of amounts required to pay any
of the HLI's Obligations then owing with respect to the Notes.
Any cash or non-callable Government Securities deposited with
the Trustee or any Paying Agent, or then held by HLI, in trust for the payment
of the principal, premium, if any, or interest on any Note and remaining
unclaimed for one year after such principal, premium, if any, or interest has
become due and payable shall be paid to HLI on its request or (if then held by
HLI) shall be discharged from such trust; and the Holder shall thereafter, as an
unsecured creditor, look only to HLI for payment thereof, and all liability of
the Trustee or such Paying Agent with respect to such cash and securities, and
all liability of HLI as Trustee thereof, shall thereupon cease; provided,
however, that the Trustee or such Paying Agent, before being required to make
any such repayment, may at the expense of HLI cause to be published once, in The
New York Times and The Wall Street Journal (national edition), notice that such
cash and securities 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 cash and securities then remaining
shall be repaid to HLI.
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Section 8.07. REINSTATEMENT.
If the Trustee or Paying Agent is unable to apply any cash or
non-callable Government Securities in accordance with Section 8.02 or 8.03, 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
HLI's obligations under this Indenture and the Notes shall be revived and
reinstated as though no deposit had occurred pursuant to Section 8.02 or 8.03
until such time as the Trustee or Paying Agent is permitted to apply all such
cash and securities in accordance with Section 8.02 or 8.03, as the case may be;
provided, however, that, if HLI makes any payment of principal of, premium, if
any, or interest on any Note following the reinstatement of its obligations, HLI
shall be subrogated to the rights of the Holders to receive such payment from
the cash and securities held by the Trustee or Paying Agent.
ARTICLE 9.
AMENDMENT, SUPPLEMENT AND WAIVER
Section 9.01. WITHOUT CONSENT OF HOLDERS OF NOTES.
Notwithstanding Section 9.02 of this Indenture, HLI, the
Guarantors and the Trustee may amend or supplement this Indenture or the Notes
without the consent of any Holder to:
(a) cure any ambiguity, omission, defect or
inconsistency;
(b) provide for the assumption by a Surviving Person of
the obligations of Holdco and HLI under this Indenture;
(c) provide for uncertificated Notes in addition to or in
place of certificated Notes (provided that the uncertificated Notes are issued
in registered form for purposes of Section 163(f) of the Code, or in a manner
such that the uncertificated Notes are described in Section 163(f)(2)(B) of the
Code);
(d) add additional Guarantors with respect to the Notes
or release Guarantors from Note Guaranties as provided or permitted by the terms
of this Indenture;
(e) secure the Notes, release all or any portion of any
security interest, add to the covenants of Holdco or HLI for the benefit of the
Holders or surrender any right or power conferred upon Holdco or HLI;
(f) make any change that does not adversely affect the
rights of any Holder;
(g) comply with any requirement of the SEC in connection
with the qualification of this Indenture under the Trust Indenture Act; or
(h) provide for the issuance of additional Notes in
accordance with this Indenture.
Section 9.02. WITH CONSENT OF HOLDERS OF NOTES.
Except as provided below in this Section 9.02, HLI and the
Trustee may amend or supplement this Indenture and the Notes with the consent of
the Holders of at least a majority in aggregate principal amount of the Notes,
including Additional Notes, if any, then outstanding voting as a single class
(including consents obtained in connection with a purchase of or tender offer or
exchange offer for the Notes), and, subject to Sections 6.04 and 6.07, any
existing Default or Event of Default (except a continuing Default or Event of
Default (i) in the payment of principal, premium, if any, interest, if any, on
the Notes and (ii) in respect of a covenant or provision which under this
Indenture cannot be modified or amended without the consent of the Holder of
each Note affected by such modification or amendment) or
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compliance with any provision of this Indenture or the Notes may be waived with
the consent of the Holders of at least a majority in aggregate principal amount
of the Notes, including Additional Notes, if any, then outstanding voting as a
single class (including consents obtained in connection with a purchase of or
tender offer or exchange offer for the Notes).
Without the consent of each Holder, an amendment or waiver
under this Section 9.02 may not (with respect to any Notes held by a
non-consenting Holder):
(a) reduce the amount of Notes whose Holders must consent
to an amendment or waiver;
(b) reduce the rate of, or extend the time for payment
of, interest, including Special Interest, if any, on, any Note;
(c) reduce the principal of, or extend the Stated
Maturity of, any Note;
(d) make any Note payable in money other than that stated
in the Note;
(e) impair the right of any Holder to receive payment of
principal of, premium, if any, and interest, including Special Interest, if any,
on, such Holder's Notes on or after the due dates therefor or to institute suit
for the enforcement of any payment on or with respect to such Holder's Notes or
any Note Guaranty;
(f) subordinate the Notes or any Note Guaranty to any
other obligation of HLI or the applicable Guarantor;
(g) release any security interest that may have been
granted in favor of the Holders other than pursuant to the terms of such
security interest;
(h) reduce the premium payable upon the redemption of any
Note or change the time at which any Note may be redeemed, as described under
Section 3.07;
(i) reduce the premium payable upon a Change of Control
or, at any time after a Change of Control has occurred, change the time at which
the Change of Control Offer relating thereto must be made or at which the Notes
must be repurchased pursuant to such Change of Control Offer;
(j) at any time after HLI is obligated to make a
Prepayment Offer with the Excess Proceeds from Asset Sales, change the time at
which such Prepayment Offer must be made or at which the Notes must be
repurchased pursuant thereto; or
(k) make any change in any Note Guaranty that would
adversely affect the Holders.
HLI may, but shall not be obligated to, fix a record date for
the purpose of determining the Persons entitled to consent to any supplemental
indenture. If a record date is fixed, the Holders on such record date, or their
duly designated proxies, and only such Persons, shall be entitled to consent to
such supplemental indenture, whether or not such Holders remain Holders after
such record date; provided that unless such consent shall have become effective
by virtue of the requisite percentage having been obtained prior to the date
which is 120 days after such record date, any such consent previously given
shall automatically and without further action by any Holder be cancelled and of
no further effect.
It shall not be necessary for the consent of the Holders under
this Section 9.02 to approve the particular form of any proposed amendment or
waiver, but it shall be sufficient if such consent approves the substance
thereof.
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After an amendment, supplement or waiver under this Section
9.02 becomes effective, HLI shall mail to the Holder of each Note affected
thereby to such Holder's address appearing in the Security Register a notice
briefly describing the amendment, supplement or waiver. Any failure of HLI 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.
Section 9.03. COMPLIANCE WITH TRUST INDENTURE ACT.
Every amendment or supplement to this Indenture or the Notes
shall be set forth in an amended or supplemental indenture that complies with
the TIA as then in effect.
Section 9.04. REVOCATION AND EFFECT OF CONSENTS.
Until an amendment, supplement or waiver becomes effective, a
consent to it by a Holder is a continuing consent by the Holder of a Note and
every subsequent Holder of a Note or portion thereof 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 or subsequent Holder may revoke the
consent as to its Note or portion thereof if the Trustee receives written notice
of revocation before the date the waiver, supplement or amendment becomes
effective. An amendment, supplement or waiver shall become effective in
accordance with its terms and thereafter shall bind every Holder.
Section 9.05. NOTATION ON OR EXCHANGE OF NOTES.
The Trustee may place an appropriate notation about an
amendment, supplement or waiver on any Note thereafter authenticated. HLI in
exchange for all Notes may issue and the Trustee shall, upon receipt of an
Authentication Order, authenticate new Notes that reflect the amendment,
supplement or waiver.
Failure to make the appropriate notation or issue a new Note
shall not affect the validity and effect of such amendment, supplement or
waiver.
Section 9.06. TRUSTEE TO SIGN AMENDMENTS, ETC.
The Trustee shall sign any amended or supplemental indenture
authorized pursuant to this Article 9 if the amendment or supplement does not
adversely affect the rights, duties, liabilities or immunities of the Trustee.
None of HLI nor any Guarantor may sign an amendment or supplemental indenture
until its board of directors (or committee serving a similar function) approves
it. In executing any amended or supplemental indenture, the Trustee shall be
entitled to receive and (subject to Section 7.01) shall be fully protected in
relying upon an Officers' Certificate and an Opinion of Counsel stating that the
execution of such amended or supplemental indenture is authorized or permitted
by this Indenture and that such amended or supplemental indenture is the legal,
valid and binding obligations of HLI enforceable against it in accordance with
its terms, subject to customary exceptions and that such amended or supplemental
indenture complies with the provisions hereof (including Section 9.03).
ARTICLE 10.
GUARANTEES
Section 10.01. GUARANTEE.
Subject to this Article 10, the Guarantors hereby
unconditionally guarantee to each Holder of a Note authenticated and delivered
by the Trustee and to the Trustee and its successors and assigns (a) the due and
punctual payment of the principal of, premium, if any, and interest on the
Notes, subject to any applicable grace period, whether at Stated Maturity, by
acceleration, redemption or
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otherwise, the due and punctual payment of interest on the overdue principal and
premium, if any, and to the extent permitted by law, interest, and the due and
punctual performance of all other obligations of HLI to the Holders or the
Trustee under this Indenture, the Registration Rights Agreement or any other
agreement with or for the benefit of the Holder or the Trustee, all in
accordance with the terms hereof and thereof; and (b) in case of any extension
of time of payment or renewal of any Notes or any of such other obligations,
that same shall be promptly paid in full when due or performed in accordance
with the terms of the extension or renewal, whether at Stated Maturity, by
acceleration pursuant to Section 6.02, redemption or otherwise. Failing payment
when due of any amount so guaranteed or any performance so guaranteed for
whatever reason, the Guarantors shall be jointly and severally obligated to pay
the same immediately. Each Guarantor agrees that this is a guarantee of payment
and not a guarantee of collection.
Each Guarantor hereby agrees that its obligations with regard
to its guarantee shall be joint and several, unconditional, irrespective of the
validity or enforceability of the Notes or the obligations of HLI under this
Indenture, the absence of any action to enforce the same, the recovery of any
judgment against HLI or any other obligor with respect to this Indenture, the
Notes or the Obligations of HLI under this Indenture or the Notes, any action to
enforce the same or any other circumstances (other than complete performance)
which might otherwise constitute a legal or equitable discharge or defense of a
Guarantor. Each Guarantor further, to the extent permitted by law, waives and
relinquishes all claims, rights and remedies accorded by applicable law to
guarantors and agrees not to assert or take advantage of any such claims, rights
or remedies, including, but not limited to: (a) any right to require any of the
Trustee, the Holders or HLI (each a "Benefited Party"), as a condition of
payment or performance by such Guarantor, to (1) proceed against HLI, any other
guarantor (including any other Guarantor) of the Obligations under the
guarantees or any other Person, (2) proceed against or exhaust any security held
from HLI, any such other guarantor or any other Person, (3) proceed against or
have resort to any balance of any deposit account or credit on the books of any
Benefited Party in favor of HLI or any other Person, or (4) pursue any other
remedy in the power of any Benefited Party whatsoever; (b) any defense arising
by reason of the incapacity, lack of authority or any disability or other
defense of HLI including any defense based on or arising out of the lack of
validity or the unenforceability of the Obligations under the guarantees or any
agreement or instrument relating thereto or by reason of the cessation of the
liability of HLI from any cause other than payment in full of the Obligations
under the guarantees; (c) any defense based upon any statute or rule of law
which provides that the obligation of a surety must be neither larger in amount
nor in other respects more burdensome than that of the principal; (d) any
defense based upon any Benefited Party's errors or omissions in the
administration of the Obligations under the guarantees, except behavior which
amounts to bad faith; (e)(1) any principles or provisions of law, statutory or
otherwise, which are or might be in conflict with the terms of the guarantees
and any legal or equitable discharge of such Guarantor's obligations hereunder,
(2) the benefit of any statute of limitations affecting such Guarantor's
liability hereunder or the enforcement hereof, (3) any rights to set-offs,
recoupments and counterclaims and (4) promptness, diligence and any requirement
that any Benefited Party protect, secure, perfect or insure any security
interest or lien or any property subject thereto; (f) notices, demands,
presentations, protests, notices of protest, notices of dishonor and notices of
any action or inaction, including acceptance of the guarantees, notices of
Default under the Notes or any agreement or instrument related thereto, notices
of any renewal, extension or modification of the Obligations under the
guarantees or any agreement related thereto, and notices of any extension of
credit to HLI and any right to consent to any thereof; (g) to the extent
permitted under applicable law, the benefits of any "One Action" rule and (h)
any defenses or benefits that may be derived from or afforded by law which limit
the liability of or exonerate guarantors or sureties, or which may conflict with
the terms of the guarantees. Except to the extent expressly provided herein,
including Sections 8.02, 8.03 and 10.05, each Guarantor hereby covenants that
its guarantee shall not be discharged except by complete performance of the
obligations contained in its guarantee and this Indenture.
If any Holder or the Trustee is required by any court or
otherwise to return to HLI, the Guarantors or any custodian, trustee, liquidator
or other similar official acting in relation to either HLI or the Guarantors,
any amount paid by either to the Trustee or such Holder, this guarantee, to the
extent theretofore discharged, shall be reinstated in full force and effect.
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Each Guarantor agrees that it shall not be entitled to any
right of subrogation in relation to the Holders in respect of any obligations
guaranteed hereby until payment in full of all obligations guaranteed hereby.
Each Guarantor further agrees that, as between the Guarantors, on the one hand,
and the Holders and the Trustee, on the other hand, (x) the maturity of the
obligations guaranteed hereby may be accelerated as provided in Section 6.02 for
the purposes of this guarantee, notwithstanding any stay, injunction or other
prohibition preventing such acceleration in respect of the obligations
guaranteed hereby and (y) in the event of any declaration of acceleration of
such obligations as provided in Section 6.02, such obligations (whether or not
due and payable) shall forthwith become due and payable by the Guarantors for
the purpose of this guarantee. The Guarantors shall have the right to seek
contribution from any non-paying Guarantor so long as the exercise of such right
does not impair the rights of the Holders under the guarantee.
Section 10.02. LIMITATION ON GUARANTOR LIABILITY.
(a) Each Guarantor, and by its acceptance of Notes, each
Holder, hereby confirms that it is the intention of all such parties that the
guarantee of such Guarantor not constitute a fraudulent transfer or conveyance
for purposes of Bankruptcy Law, the Uniform Fraudulent Conveyance Act, the
Uniform Fraudulent Transfer Act or any similar federal or state law to the
extent applicable to any guarantee. To effectuate the foregoing intention, the
Trustee, the Holders and the Guarantors hereby irrevocably agree that each
Guarantor's liability shall be that amount from time to time equal to the
aggregate liability of such Guarantor under the guarantee, but shall be limited
to the lesser of (a) the aggregate amount of HLI's obligations under the Notes
and this Indenture or (b) the amount, if any, which would not have (1) rendered
the Guarantor "insolvent" (as such term is defined in the Federal Bankruptcy
Code and in the Debtor and Creditor Law of the State of New York) or (2) left it
with unreasonably small capital at the time its guarantee with respect to the
Notes was entered into, after giving effect to the incurrence of existing Debt
immediately before such time; provided, however, it shall be a presumption in
any lawsuit or proceeding in which a Guarantor is a party that the amount
guaranteed pursuant to the guarantee with respect to the Notes is the amount
described in clause (a) above unless any creditor, or representative of
creditors of the Guarantor, or debtor in possession or Trustee in bankruptcy of
the Guarantor, otherwise proves in a lawsuit that the aggregate liability of the
Guarantor is limited to the amount described in clause (b).
(b) In making any determination as to the solvency or
sufficiency of capital of a Guarantor in accordance with the proviso of Section
10.2(a), the right of each Guarantor to contribution from other Guarantors and
any other rights such Guarantor may have, contractual or otherwise, shall be
taken into account.
Section 10.03. EXECUTION AND DELIVERY OF GUARANTEE.
To evidence its guarantee set forth in Section 10.01, each
Guarantor hereby agrees that a notation of such guarantee in substantially the
form included in Exhibit E attached hereto shall be endorsed by an Officer of
such Guarantor on each Note authenticated and delivered by the Trustee and that
this Indenture shall be executed on behalf of such Guarantor by its President or
one of its Vice Presidents.
Each Guarantor hereby agrees that its guarantee set forth in
Section 10.01 shall remain in full force and effect notwithstanding any failure
to endorse on each Note a notation of such guarantee.
If an Officer whose signature is on this Indenture or on the
guarantee no longer holds that office at the time the Trustee authenticates the
Note on which a guarantee is endorsed, the guarantee shall be valid
nevertheless.
The delivery of any Note by the Trustee, after the
authentication thereof hereunder, shall constitute due delivery of the guarantee
set forth in this Indenture on behalf of each Guarantor.
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Section 10.04. GUARANTORS MAY CONSOLIDATE, ETC., ON CERTAIN TERMS.
Except as otherwise provided in Section 10.05, no Guarantor
may consolidate with or merge with or into (whether or not such Guarantor is the
surviving person) another Person whether or not affiliated with such Guarantor
unless:
(a) subject to Section 10.05, the Person formed by or
surviving any such consolidation or merger (if other than a Guarantor or HLI)
unconditionally assumes all the obligations of such Guarantor, pursuant to a
supplemental indenture in form and substance reasonably satisfactory to the
Trustee, under this Indenture, the guarantee and any Registration Rights
Agreements on the terms set forth herein or therein; and
(b) Guarantor complies with the requirements of Article
5.
In case of any such consolidation, merger, sale or conveyance
and upon the assumption by the successor Person, by supplemental indenture,
executed and delivered to the Trustee and satisfactory in form to the Trustee,
of the guarantee endorsed upon the Notes and the due and punctual performance of
all of the covenants and conditions of this Indenture to be performed by
Guarantor, such successor Person shall succeed to and be substituted for
Guarantor with the same effect as if it had been named herein as a Guarantor.
Such successor Person thereupon may cause to be signed any or all of the
guarantees to be endorsed upon all of the Notes issuable hereunder which
theretofore shall not have been signed by HLI and delivered to the Trustee. All
the guarantees so issued shall in all respects have the same legal rank and
benefit under this Indenture as the guarantees theretofore and thereafter issued
in accordance with the terms of this Indenture as though all of such guarantees
had been issued at the date of the execution hereof.
Except as set forth in Articles 4 and 5, and notwithstanding
clauses (a) and (b) above, nothing contained in this Indenture or in any of the
Notes shall prevent any consolidation or merger of a Guarantor with or into HLI
or another Guarantor, or shall prevent any sale or conveyance of the property of
a Guarantor as an entirety or substantially as an entirety to HLI or another
Guarantor.
Section 10.05. Releases Following Sale of Assets.
In the event of a sale or other disposition of all or
substantially all of the assets of any Guarantor, by way of merger,
consolidation or otherwise, or a sale or other disposition of all of the Capital
Stock of any Guarantor, in each case to a Person that is not (either before or
after giving effect to such transactions) a Subsidiary or a parent of HLI, then
such Guarantor (in the event of a sale or other disposition, by way of merger,
consolidation or otherwise, of all of the Capital Stock of such Guarantor) or
the corporation acquiring the property (in the event of a sale or other
disposition of all or substantially all of the assets of such Guarantor) shall
be released and relieved of any obligations under its guarantee; provided that
the net proceeds of such sale or other disposition shall be subject to all
applicable provisions of this Indenture, including Section 4.13. If a Restricted
Subsidiary which is a Guarantor is designated as an Unrestricted Subsidiary in
accordance with the provisions of Section 4.17, such Guarantor shall be released
and relieved of any obligations under its guarantee. Upon delivery by HLI to the
Trustee of an Officers' Certificate and an Opinion of Counsel to the effect that
such sale or other disposition or designation was made by HLI in accordance with
the provisions of this Indenture, including Section 4.13, the Trustee shall
execute any documents reasonably required in order to evidence the release of
any Guarantor from its obligations under its guarantee.
Any guarantor not released from its obligations under its
guarantee shall remain liable for the full amount of principal of and interest
on the Notes and for the other obligations of any Guarantor under this
Indenture.
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ARTICLE 11.
SATISFACTION AND DISCHARGE
Section 11.01. SATISFACTION AND DISCHARGE.
This Indenture shall be discharged and shall cease to be of
further effect, except as to surviving rights of registration of transfer or
exchange of the Notes, as to all Notes issued hereunder, when either:
(a) all Notes that have been previously authenticated and
delivered (except lost, stolen or destroyed Notes that have been replaced or
paid and Notes for whose payment money has previously been deposited in trust or
segregated and held in trust by HLI and is thereafter repaid to HLI or
discharged from the trust) have been delivered to the Trustee for cancellation;
or
(b) (i) all Notes that have not been previously delivered
to the Trustee for cancellation have become due and payable by their terms or
have been called for redemption and HLI has irrevocably deposited or caused to
be deposited with the Trustee as trust funds solely in trust for the benefit of
the Holders, cash in U.S. dollars, U.S. Government Obligations, or a combination
thereof, in such amounts as shall be sufficient without consideration of any
reinvestment of interest, to pay and discharge the entire Debt on the Notes not
previously delivered to the Trustee for cancellation or redemption, for
principal, premium, if any, and interest and Special Interest, if any, on the
Notes to the date of deposit, in the case of Notes that have become due and
payable, or to the Stated Maturity or redemption date, as the case may be; (ii)
HLI has paid all other sums payable by HLI with respect to the Notes under this
Indenture; and (iii) HLI has delivered irrevocable instructions to the Trustee
to apply the deposited money toward the payment of the Notes at Stated Maturity
or on the redemption date, as the case may be.
and, in the case of clause (a) or (b):
(x) no Default or Event of Default shall have occurred
and be continuing on the date of such deposit or shall occur as a
result of such deposit and such deposit shall not result in a breach or
violation of, or constitute a Default under, any other instrument to
which HLI is a party or by which HLI is bound; and
(y) HLI shall have delivered to the Trustee an Officers'
Certificate and Opinion of Counsel stating that all conditions
precedent relating to the satisfaction and discharge of this Indenture
have been satisfied.
Section 11.02. DEPOSITED CASH AND GOVERNMENT SECURITIES TO BE HELD IN TRUST;
OTHER MISCELLANEOUS PROVISIONS.
Subject to Section 11.03, all cash and U.S. Government
Obligations (including the proceeds thereof) deposited with the Trustee (or
other qualifying Trustee, collectively for purposes of this Section 11.02, the
"Trustee") pursuant to Section 11.01 in respect of the outstanding Notes shall
be held in trust and applied by the Trustee, in accordance with the provisions
of such Notes and this Indenture, to the payment, either directly or through any
Paying Agent (including HLI acting as Paying Agent) as the Trustee may
determine, to the Holders of such Notes of all sums due and to become due
thereon in respect of principal, premium, if any, and interest but such cash and
securities need not be segregated from other funds except to the extent required
by law.
Section 11.03. REPAYMENT TO HLI.
Any cash or U.S. Government Obligations deposited with the
Trustee or any Paying Agent, or then held by HLI, in trust for the payment of
the principal of, premium, if any, or interest on, any
86
Note and remaining unclaimed for two years after such principal, and premium, if
any, or interest has become due and payable shall be paid to HLI on its request
or (if then held by HLI) shall be discharged from such trust; and the Holder
shall thereafter, as an unsecured creditor, look only to HLI for payment
thereof, and all liability of the Trustee or such Paying Agent with respect to
such cash and securities, and all liability of HLI as Trustee thereof, shall
thereupon cease; provided, however, that the Trustee or such Paying Agent,
before being required to make any such repayment, may at the expense of HLI
cause to be published once, in The New York Times and The Wall Street Journal
(national edition), notice that such cash and securities 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 cash
and securities then remaining shall be repaid to HLI.
ARTICLE 12.
MISCELLANEOUS
Section 12.01. TRUST INDENTURE ACT CONTROLS.
If any provision of this Indenture limits, qualifies or
conflicts with another provision which is required to be included in this
Indenture by the TIA, the provision required by the TIA shall control.
Section 12.02. NOTICES.
Any notice or communication by HLI and/or a Guarantor 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),
facsimile transmission or overnight air courier guaranteeing next-day delivery,
to the other's address:
If to HLI or a Guarantor:
HLI Operating Company, Inc.
00000 Xxxxxxxxxx Xxxxx
Xxxxxxxxxx, Xxxxxxxx 00000
Attention: General Counsel
Facsimile No.: (000) 000-0000
If to the Trustee:
U.S. Bank National Association
000 Xxxxxxxx
Xxxxx 000
Xxxxxxx, Xxxxxxxx, 00000-0000
Attention: Xxxxx Xxxxxxxx, Vice President
Facsimile No. (000) 000-0000
HLI or the Trustee, by notice to the other, may designate
additional or different addresses for subsequent notices or communications.
All notices and communications (other than those sent to the
Trustee or Holder) 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
sent by facsimile transmission; and the next Business Day after timely delivery
to the courier, if sent by overnight air courier guaranteeing next-day delivery.
All notices and communications to the Trustee or Holder shall be deemed duly
given and effective only upon receipt.
87
Any notice or communication to a Holder shall be mailed by
first class mail, certified or registered, return receipt requested, or by
overnight air courier guaranteeing next-day delivery to its address shown on the
Security Register. 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 HLI mails a notice or communication to Holders, it shall
mail a copy to the Trustee and each Agent at the same time.
Section 12.03. COMMUNICATION BY HOLDERS OF NOTES WITH OTHER HOLDERS OF NOTES.
Holders may communicate pursuant to TIA Section 312(b) with
other Holders with respect to their rights under this Indenture or the Notes.
HLI, the Trustee, the Registrar and anyone else shall have the protection of TIA
Section 312(c).
Section 12.04. CERTIFICATE AND OPINION AS TO CONDITIONS PRECEDENT.
Upon any request or application by HLI to the Trustee to take
any action under any provision of this Indenture, HLI 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 12.05) 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 complied with; and
(b) an Opinion of Counsel in form and substance
reasonably satisfactory to the Trustee (which shall include the statements set
forth in Section 12.05) stating that, in the opinion of such counsel, all such
conditions precedent and covenants have been complied with.
Section 12.05. STATEMENTS REQUIRED IN CERTIFICATE OR OPINION.
Each certificate or opinion with respect to compliance with a
condition or covenant provided for in this Indenture (other than a certificate
provided pursuant to TIA Section 314(a)(4)) 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 such
Person to express an informed opinion as to whether or not such covenant or
condition has been complied with; and
(d) a statement as to whether or not, in the opinion of
such Person, such condition or covenant has been complied with.
With respect to matters of fact, an Opinion of Counsel may rely on an Officers'
Certificate, certificates of public officials or reports or opinions of experts.
88
Section 12.06. RULES BY TRUSTEE AND AGENTS.
The Trustee may make reasonable rules for action by or at a
meeting of Holders. The Registrar or Paying Agent may make reasonable rules and
set reasonable requirements for its functions.
Section 12.07. NO PERSONAL LIABILITY OF DIRECTORS, OFFICERS, EMPLOYEES AND
SHAREHOLDERS.
No past, present or future director, officer, employee,
incorporator or stockholder of HLI, any successor Person or any Guarantor, as
such, shall have any liability for any obligations of HLI or of the Guarantors
under the Notes, this Indenture, the guarantees 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. The waiver and release
may not be effective to waive or release liabilities under the federal
securities laws.
Section 12.08. GOVERNING LAW.
THE INTERNAL LAW OF THE STATE OF NEW YORK SHALL GOVERN AND BE
USED TO CONSTRUE THIS INDENTURE AND THE NOTES WITHOUT GIVING EFFECT TO
APPLICABLE PRINCIPLES OF CONFLICTS OF LAW TO THE EXTENT THAT THE APPLICATION OF
THE LAWS OF ANOTHER JURISDICTION WOULD BE REQUIRED THEREBY.
Section 12.09. NO ADVERSE INTERPRETATION OF OTHER AGREEMENTS.
This Indenture may not be used to interpret any other
indenture, loan or debt agreement of HLI, a Guarantor, or any of their
respective Subsidiaries or of any other Person. Any such indenture, loan or debt
agreement may not be used to interpret this Indenture.
Section 12.10. SUCCESSORS.
All covenants and agreements of HLI and the Guarantors in this
Indenture and the Notes shall bind their successors. All covenants and
agreements of the Trustee in this Indenture shall bind its successors.
Section 12.11. 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 12.12. 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 12.13. TABLE OF CONTENTS, HEADINGS, ETC.
The Table of Contents, Cross-Reference Table and Headings in
this Indenture have been inserted for convenience of reference only, are not to
be considered a part of this Indenture and shall in no way modify or restrict
any of the terms or provisions hereof.
Section 12.14. QUALIFICATION OF THIS INDENTURE.
HLI shall qualify this Indenture under the TIA in accordance
with the terms and conditions of any Registration Rights Agreements and shall
pay all reasonable costs and expenses
89
(including attorneys' fees and expenses for HLI, the Trustee and the Holders)
incurred in connection therewith, including, but not limited to, costs and
expenses of qualification of this Indenture and the Notes and printing this
Indenture and the Notes. The Trustee shall be entitled to receive from HLI any
such Officers' Certificates, Opinions of Counsel or other documentation as it
may reasonably request in connection with any such qualification of this
Indenture under the TIA.
[Signatures on following page]
90
SIGNATURES
Dated as of June 3, 2003.
HLI OPERATING COMPANY, INC.
By: _______________________________
Name: Xxxxx X. Xxxx
Title: Chief Financial Officer
HLI HOLDING COMPANY, INC., TO BE
RENAMED XXXXX LEMMERZ
INTERNATIONAL, INC.
By: _______________________________
Name: Xxxxx X. Xxxx
Title: Vice President, Finance and
Chief Financial Officer
HLI PARENT COMPANY, INC.
By: _______________________________
Name: Xxxxx X. Xxxx
Title: Vice President, Finance
HLI WHEELS HOLDING COMPANY, INC.
By: _______________________________
Name: Xxxxxxx X. Xxxxxx
Title: Secretary
HLI POWERTRAIN HOLDING COMPANY, INC.
By: _______________________________
Name: Xxxxxxx X. Xxxxxx
Title: Secretary
HLI COMMERCIAL HIGHWAY HOLDING
COMPANY, INC.
By: _______________________________
Name: Xxxxxxx X. Xxxxxx
Title: Secretary
HLI BRAKES HOLDING COMPANY, INC.
By: _______________________________
Name: Xxxxxxx X. Xxxxxx
Title: Secretary
HLI SERVICES HOLDING COMPANY, INC.
By: _______________________________
Name: Xxxxxxx X. Xxxxxx
Title: Secretary
XXXXX LEMMERZ INTERNATIONAL--LA
MIRADA, INC.
By:________________________________
Name: Xxxxxxx X. Xxxxxx
Title: Secretary
XXXXX LEMMERZ INTERNATIONAL--SEDALIA,
INC.
By:________________________________
Name: Xxxxxxx X. Xxxxxx
Title: Secretary
XXXXX LEMMERZ INTERNATIONAL--BOWLING
GREEN, INC.
By:________________________________
Name: Xxxxxxx X. Xxxxxx
Title: Secretary
XXXXX LEMMERZ INTERNATIONAL--
COMMERCIAL HIGHWAY, INC.
By:________________________________
Name: Xxxxxxx X. Xxxxxx
Title: Secretary
XXXXX LEMMERZ INTERNATIONAL--
CALIFORNIA, INC.
By:________________________________
Name: Xxxxxxx X. Xxxxxx
Title: Secretary
XXXXX LEMMERZ INTERNATIONAL--
GEORGIA, INC.
By:_________________________________
Name: Xxxxxxx X. Xxxxxx
Title: Secretary
XXXXX LEMMERZ INTERNATIONAL--
XXXXX, INC
By:_________________________________
Name: Xxxxxxx X. Xxxxxx
Title: Secretary
XXXXX LEMMERZ INTERNATIONAL--
XXXXXX, INC.
By:_________________________________
Name: Xxxxxxx X. Xxxxxx
Title: Secretary
XXXXX LEMMERZ INTERNATIONAL--
HUNTINGTON, INC.
By:_________________________________
Name: Xxxxxxx X. Xxxxxx
Title: Secretary
XXXXX LEMMERZ INTERNATIONAL--
KENTUCKY, INC.
By:_________________________________
Name: Xxxxxxx X. Xxxxxx
Title: Secretary
XXXXX LEMMERZ INTERNATIONAL--
MEXICO, INC.
By:_________________________________
Name: Xxxxxxx X. Xxxxxx
Title: Secretary
XXXXX LEMMERZ INTERNATIONAL--
OHIO, INC.
By:_________________________________
Name: Xxxxxxx X. Xxxxxx
Title: Secretary
XXXXX LEMMERZ INTERNATIONAL--
TEXAS, INC.
By:_________________________________
Name: Xxxxxxx X. Xxxxxx
Title: Secretary
XXXXX LEMMERZ INTERNATIONAL--
CMI, INC.
By:_________________________________
Name: Xxxxxxx X. Xxxxxx
Title: Secretary
XXXXX LEMMERZ INTERNATIONAL--
BRISTOL, INC.
By:_________________________________
Name: Xxxxxxx X. Xxxxxx
Title: Secretary
XXXXX LEMMERZ INTERNATIONAL--
CADILLAC, INC.
By:_________________________________
Name: Xxxxxxx X. Xxxxxx
Title: Secretary
XXXXX LEMMERZ INTERNATIONAL--
EQUIPMENT & ENGINEERING, INC.
By:_________________________________
Name: Xxxxxxx X. Xxxxxx
Title: Secretary
XXXXX LEMMERZ INTERNATIONAL--
LAREDO, INC.
By:_________________________________
Name: Xxxxxxx X. Xxxxxx
Title: Secretary
XXXXX LEMMERZ INTERNATIONAL--
MONTAGUE, INC.
By:_________________________________
Name: Xxxxxxx X. Xxxxxx
Title: Secretary
XXXXX LEMMERZ INTERNATIONAL--
PCA, INC.
By:_________________________________
Name: Xxxxxxx X. Xxxxxx
Title: Secretary
XXXXX LEMMERZ INTERNATIONAL--
PETERSBURG, INC.
By:_________________________________
Name: Xxxxxxx X. Xxxxxx
Title: Secretary
XXXXX LEMMERZ INTERNATIONAL--
SOUTHFIELD, INC.
By:_________________________________
Name: Xxxxxxx X. Xxxxxx
Title: Secretary
XXXXX LEMMERZ INTERNATIONAL--
TECHNICAL CENTER, INC.
By:_________________________________
Name: Xxxxxxx X. Xxxxxx
Title: Secretary
XXXXX LEMMERZ INTERNATIONAL--
TRANSPORTATION, INC.
By:_________________________________
Name: Xxxxxxx X. Xxxxxx
Title: Secretary
XXXXX LEMMERZ INTERNATIONAL--
WABASH, INC.
By:_________________________________
Name: Xxxxxxx X. Xxxxxx
Title: Secretary
HLI -- SUMMERFIELD REALTY CORP.
By:_________________________________
Name: Xxxxxxx X. Xxxxxx
Title: Secretary
HLI REALTY, INC.
By:_________________________________
Name: Xxxxxxx X. Xxxxxx
Title: Secretary
HLI -- VENTURES, INC.
By:________________________________
Name: Xxxxxxx X. Xxxxxx
Title: Secretary
U.S. BANK NATIONAL ASSOCIATION, AS
TRUSTEE
By:_________________________________
Name: Xxxxxx X. Xxxxxxxx
Title: Trust Officer
TABLE OF CONTENTS
Page
ARTICLE 1 DEFINITIONS AND INCORPORATION BY REFERENCE..................................... 1
Section 1.01. Definitions................................................................ 1
Section 1.02. Other Definitions.......................................................... 28
Section 1.03. Incorporation by Reference of Trust Indenture Act.......................... 29
Section 1.04. Rules of Construction...................................................... 29
ARTICLE 2 THE NOTES...................................................................... 30
Section 2.01. Form and Dating............................................................ 30
Section 2.02. Execution and Authentication............................................... 30
Section 2.03. Registrar and Paying Agent................................................. 31
Section 2.04. Paying Agent to Hold Money in Trust........................................ 31
Section 2.05. Holder Lists............................................................... 32
Section 2.06. Transfer and Exchange...................................................... 32
Section 2.07. Replacement Notes.......................................................... 43
Section 2.08. Outstanding Notes.......................................................... 43
Section 2.09. Treasury Notes............................................................. 44
Section 2.10. Temporary Notes............................................................ 44
Section 2.11. Cancellation............................................................... 44
Section 2.12. Defaulted Interest......................................................... 44
Section 2.13. CUSIP or ISIN Numbers...................................................... 44
Section 2.14. Special Interest........................................................... 45
Section 2.15. Issuance of Additional Notes............................................... 45
Section 2.16. Record Date................................................................ 45
ARTICLE 3 REDEMPTION AND PREPAYMENT...................................................... 45
Section 3.01. Notices to Trustee......................................................... 45
Section 3.02. Selection of Notes to Be Redeemed.......................................... 46
Section 3.03. Notice of Redemption....................................................... 46
Section 3.04. Effect of Notice of Redemption............................................. 47
Section 3.05. Deposit of Redemption Price................................................ 47
Section 3.06. Notes Redeemed in Part..................................................... 47
Section 3.07. Optional Redemption........................................................ 47
Section 3.08. Mandatory Redemption....................................................... 48
Section 3.09. Offers To Purchase......................................................... 48
ARTICLE 4 COVENANTS...................................................................... 50
Section 4.01. Payment of Notes........................................................... 50
Section 4.02. Maintenance of Office or Agency............................................ 51
Section 4.03. Reports.................................................................... 51
Section 4.04. Compliance Certificate..................................................... 52
Section 4.05. Taxes...................................................................... 52
Section 4.06. Stay, Extension and Usury Laws............................................. 52
Section 4.07. Corporate Existence........................................................ 53
Section 4.08. Payments for Consent....................................................... 53
Section 4.09. Incurrence of Debt......................................................... 53
Section 4.10. Restricted Payments........................................................ 55
Section 4.11. Liens...................................................................... 57
Section 4.12. Issuance or Sale of Stock of Restricted Subsidiaries....................... 57
Section 4.13. Asset Sales................................................................ 58
Section 4.14. Restrictions on Distributions from Restricted Subsidiaries................. 60
Section 4.15. Transactions with Affiliates............................................... 61
i
TABLE OF CONTENTS
Page
Section 4.16. Sale and Leaseback Transactions............................................ 62
Section 4.17. Designation of Restricted and Unrestricted Subsidiaries.................... 62
Section 4.18. Repurchase at the Option of Holders Upon a Change of Control............... 64
Section 4.19. Future Guarantors.......................................................... 64
ARTICLE 5 SUCCESSORS..................................................................... 64
Section 5.01. Merger, Consolidation or Sale of Assets of HLI and Guarantors.............. 64
Section 5.02. Successor Corporation Substituted.......................................... 66
ARTICLE 6 DEFAULTS AND REMEDIES.......................................................... 66
Section 6.01. Events of Default.......................................................... 66
Section 6.02. Acceleration............................................................... 68
Section 6.03. Other Remedies............................................................. 69
Section 6.04. Waiver of Past Defaults.................................................... 69
Section 6.05. Control by Majority........................................................ 69
Section 6.06. Limitation on Suits........................................................ 69
Section 6.07. Rights of Holders to Receive Payment....................................... 70
Section 6.08. Collection Suit by Trustee................................................. 70
Section 6.09. Trustee May File Proofs of Claim........................................... 70
Section 6.10. Priorities................................................................. 71
Section 6.11. Undertaking for Costs...................................................... 71
ARTICLE 7 TRUSTEE........................................................................ 71
Section 7.01. Duties of Trustee.......................................................... 71
Section 7.02. Rights of Trustee.......................................................... 72
Section 7.03. Individual Rights of Trustee............................................... 73
Section 7.04. Trustee's Disclaimer....................................................... 73
Section 7.05. Notice of Defaults......................................................... 73
Section 7.06. Reports by Trustee to Holders.............................................. 73
Section 7.07. Compensation and Indemnity................................................. 74
Section 7.08. Replacement of Trustee..................................................... 74
Section 7.09. Successor Trustee by Merger, etc........................................... 76
Section 7.10. Eligibility; Disqualification.............................................. 76
Section 7.11. Preferential Collection of Claims Against Company.......................... 76
ARTICLE 8 LEGAL DEFEASANCE AND COVENANT DEFEASANCE....................................... 76
Section 8.01. Option to Effect Legal Defeasance or Covenant Defeasance................... 76
Section 8.02. Legal Defeasance and Discharge............................................. 76
Section 8.03. Covenant Defeasance........................................................ 77
Section 8.04. Conditions to Legal or Covenant Defeasance................................. 77
Section 8.05. Deposited Cash and Government Securities to be Held in Trust;
Other Miscellaneous Provisions............................................. 78
Section 8.06. Repayment to Company....................................................... 79
Section 8.07. Reinstatement.............................................................. 79
ARTICLE 9 AMENDMENT, SUPPLEMENT AND WAIVER............................................... 79
Section 9.01. Without Consent of Holders of Notes........................................ 79
Section 9.02. With Consent of Holders of Notes........................................... 80
Section 9.03. Compliance with Trust Indenture Act........................................ 81
Section 9.04. Revocation and Effect of Consents.......................................... 81
Section 9.05. Notation on or Exchange of Notes........................................... 81
ii
TABLE OF CONTENTS
Page
Section 9.06. Trustee to Sign Amendments, etc............................................ 82
ARTICLE 10 GUARANTEES..................................................................... 82
Section 10.01. Guarantee.................................................................. 82
Section 10.02. Limitation on Guarantor Liability.......................................... 83
Section 10.03. Execution and Delivery of Guarantee........................................ 84
Section 10.04. Guarantors May Consolidate, etc., on Certain Terms......................... 84
Section 10.05. Releases Following Sale of Assets.......................................... 84
ARTICLE 11 SATISFACTION AND DISCHARGE..................................................... 85
Section 11.01. Satisfaction and Discharge................................................. 86
Section 11.02. Deposited Cash and Government Securities to be Held in Trust;
Other Miscellaneous Provisions............................................. 86
Section 11.03. Repayment to HLI........................................................... 86
ARTICLE 12 MISCELLANEOUS.................................................................. 86
Section 12.01. Trust Indenture Act Controls............................................... 86
Section 12.02. Notices.................................................................... 86
Section 12.03. Communication by Holders of Notes with Other Holders of Notes.............. 87
Section 12.04. Certificate and Opinion as to Conditions Precedent......................... 87
Section 12.05. Statements Required in Certificate or Opinion.............................. 88
Section 12.06. Rules by Trustee and Agents................................................ 88
Section 12.07. No Personal Liability of Directors, Officers, Employees and Shareholders... 88
Section 12.08. Governing Law.............................................................. 88
Section 12.09. No Adverse Interpretation of Other Agreements.............................. 88
Section 12.10. Successors................................................................. 88
Section 12.11. Severability............................................................... 89
Section 12.12. Counterpart Originals...................................................... 89
Section 12.13. Table of Contents, Headings, etc........................................... 89
Section 12.14. Qualification of this Indenture............................................ 89
iii
CROSS-REFERENCE TABLE
TIA Section Indenture
Reference Section
310(a)(1)............................................................................... 7.10
(a)(2).................................................................................. 7.10
(a)(3).................................................................................. N.A.
(a)(4).................................................................................. N.A.
(a)(5).................................................................................. 7.10
(b)..................................................................................... 7.08, 7.10
(c)..................................................................................... N.A.
311(a).................................................................................. 7.11
(b)..................................................................................... 7.11
(c)..................................................................................... N.A.
312(a).................................................................................. 2.05
(b)..................................................................................... 12.03
(c)..................................................................................... 12.03
313(a).................................................................................. 7.06
(b)(1).................................................................................. N.A.
(b)(2).................................................................................. 7.06, 7.07
(c)..................................................................................... 7.06,
(d)..................................................................................... 12.02
314(a).................................................................................. 4.03, 4.04,
12.02
(b)..................................................................................... N.A.
(c)(1).................................................................................. 12.04
(c)(2).................................................................................. 12.04
(c)(3).................................................................................. N.A.
(d)..................................................................................... N.A.
(e)..................................................................................... 12.05
315(a).................................................................................. 7.01
(b)..................................................................................... 7.05,
12.02
(c)..................................................................................... 7.01
(d)..................................................................................... 7.01
(e)..................................................................................... 6.11
316(a) (last sentence).................................................................. 2.09
(a)(1)(A)............................................................................... 6.05
(a)(1)(B)............................................................................... 6.04
(a)(2).................................................................................. N.A.
(b)..................................................................................... 6.07
317(a)(1)............................................................................... 6.08
(a)(2).................................................................................. 6.09
(b)..................................................................................... 2.04
318(a).................................................................................. 12.01
N.A. means Not Applicable.
Note: This Cross-Reference Table shall not, for any purpose, be deemed to be
part of this Indenture.
EXHIBIT A
================================================================================
(Face of Note)
10 1/2% SENIOR NOTES DUE 2010
No.______ CUSIP
_____________
US$_____ ISIN:
$_____________
HLI OPERATING COMPANY, INC.
promises to pay to CEDE & CO., INC. or its registered assigns, the principal sum
of _________________ Dollars ($______________) on June 15, 2010.
Interest Payment Dates: June 15 and December 15, commencing December 15, 2003.
Record Dates: June 1 and December 1.
A-1
IN WITNESS WHEREOF, the Company has caused this Note to be
signed by its duly authorized officer.
HLI OPERATING COMPANY, INC.
By:_______________________
Name:
Title:
This is one of the Global
Notes referred to in the
within-mentioned Indenture:
U.S. BANK NATIONAL ASSOCIATION
as Trustee
By:______________________________________
Authorized Signatory
Dated:
A-2
(Back of Note)
10 1/2% SENIOR NOTES DUE 2010
[THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES
ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR THE SECURITIES LAWS OF ANY
STATE OR OTHER JURISDICTION. 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, SUCH REGISTRATION.
THE HOLDER OF THIS SECURITY BY ITS ACCEPTANCE HEREOF AGREES TO OFFER, SELL OR
OTHERWISE TRANSFER SUCH SECURITY, PRIOR TO THE DATE (THE "RESALE RESTRICTION
TERMINATION DATE") WHICH IS TWO YEARS AFTER THE LATER OF THE ORIGINAL ISSUE DATE
HEREOF AND THE LAST DATE ON WHICH THE COMPANY OR ANY AFFILIATE OF THE COMPANY
WAS THE OWNER OF THIS SECURITY (OR ANY PREDECESSOR OF SUCH SECURITY), ONLY: (A)
TO THE COMPANY OR ANY OF ITS SUBSIDIARIES; (B) PURSUANT TO A REGISTRATION
STATEMENT THAT HAS BEEN DECLARED EFFECTIVE UNDER THE SECURITIES ACT; (C) FOR SO
LONG AS THE SECURITIES ARE 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 PURCHASES 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) PURSUANT TO OFFERS
AND SALES TO NON-U.S. PERSONS THAT OCCUR OUTSIDE THE UNITED STATES WITHIN THE
MEANING OF REGULATION S UNDER THE SECURITIES ACT; (E) TO AN "ACCREDITED
INVESTOR" WITHIN THE MEANING OF RULE 501(a)(1), (2), (3) OR (7) UNDER THE
SECURITIES ACT THAT IS AN INSTITUTIONAL ACCREDITED INVESTOR ACQUIRING THE
SECURITY FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF SUCH AN INSTITUTIONAL
ACCREDITED INVESTOR, IN EACH CASE IN A MINIMUM PRINCIPAL AMOUNT OF THE
SECURITIES OF $250,000, FOR INVESTMENT PURPOSES AND NOT WITH A VIEW TO OR FOR
OFFER OR SALE IN CONNECTION WITH ANY DISTRIBUTION IN VIOLATION OF THE SECURITIES
ACT; OR (F) PURSUANT TO ANY OTHER AVAILABLE EXEMPTION FROM THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT, SUBJECT TO THE COMPANY'S AND THE TRUSTEE'S
RIGHT PRIOR TO ANY SUCH OFFER, SALE OR TRANSFER PURSUANT TO CLAUSES (D), (E) OR
(F) TO REQUIRE THE DELIVERY OF AN OPINION OF COUNSEL, CERTIFICATION AND/OR OTHER
INFORMATION SATISFACTORY TO EACH OF THEM. THIS LEGEND WILL BE REMOVED UPON THE
REQUEST OF THE HOLDER AFTER THE RESALE RESTRICTION TERMINATION DATE.]
[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 SECTION 2.06 OF THE INDENTURE, (II) THIS
GLOBAL NOTE MAY BE EXCHANGED IN WHOLE BUT NOT IN PART PURSUANT TO SECTION
2.06(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.
A-3
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 NOTE IS PRESENTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY (55 XXXXX XXXXXX, XXX XXXX, XXX
XXXX) ("XXX"), TO THE COMPANY OR ITS AGENT FOR REGISTRATION OF TRANSFER,
EXCHANGE OR PAYMENT, AND ANY NOTE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO.
OR IN SUCH OTHER NAME AS MAY BE REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC
(AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS MAY BE
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER
USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS
THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.]
Capitalized terms used herein shall have the meanings assigned
to them in the Indenture referred to below unless otherwise indicated.
1. INTEREST. HLI Operating Company, Inc., a Delaware corporation
(the "Company"), promises to pay interest (as defined in the Indenture) on the
principal amount of this Note at 10 1/2% per annum until maturity and shall pay
Special Interest, if any, as provided in the Registration Rights Agreement
relating to these Notes. The Company shall pay interest semi-annually in arrears
in cash on June 15 and December 15 of each year, or if any such day is not a
Business Day, on the next succeeding Business Day (each an "Interest Payment
Date"). Interest on the Notes shall accrue from the most recent date to which
interest has been paid or, if no interest has been paid, from June 3, 2003;
provided, however, that if there is no existing Default in the payment of
interest, and if this Note is authenticated between a record date referred to on
the face hereof and the next succeeding Interest Payment Date, interest shall
accrue from such next succeeding Interest Payment Date; provided, further, that
the first Interest Payment Date shall be December 15, 2003. The Company shall
pay interest (including post-petition interest in any proceeding under any
Bankruptcy Law) on overdue principal and premium, if any, from time to time at a
rate that is 1% per annum in excess of the interest rate then in effect under
the Indenture and this Note; it shall pay interest (including post-petition
interest in any proceeding under any Bankruptcy Law) on overdue installments of
interest (without regard to any applicable grace periods), from time to time at
the same rate to the extent lawful. Interest shall be computed on the basis of a
360-day year of twelve 30-day months.
2. METHOD OF PAYMENT. The Company shall pay interest on the Notes
(except defaulted interest) to the Persons in whose name this Note (or one or
more Predecessor Notes) is registered at the close of business on June 1 or
December 1 preceding the Interest Payment Date, even if such Notes are cancelled
after such record date and on or before such Interest Payment Date, except as
provided in Section 2.12 of the Indenture with respect to defaulted interest.
The Notes shall be payable as to principal, premium, if any, and interest at the
office or agency of the Company maintained for such purpose, 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 Security Register; provided, however, that
payment by wire transfer of immediately available funds shall 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, U.S. Bank National
Association, the Trustee under the Indenture, shall act as Paying Agent and
Registrar. The Company may change any Paying Agent or
A-4
Registrar without notice to any Holder. The Company, any Guarantor or any of
their Subsidiaries may act in any such capacity.
4. INDENTURE. The Company issued the Notes under an Indenture,
dated as of June 3, 2003 ("Indenture"), among the Company, Guarantors and the
Trustee. The terms of the Notes include those stated in the Indenture and those
made part of the Indenture by reference to the Trust Indenture Act of 1939, as
amended (15 U.S. Code Sections 77aaa-77bbbb). The Notes are subject to all such
terms, and Holders are referred to the Indenture and such Act for a statement of
such terms. To the extent any provision of this Note conflicts with the express
provisions of the Indenture, the provisions of the Indenture shall govern and be
controlling.
5. OPTIONAL REDEMPTION.
(a) At any time prior to June 15, 2007, the Company may
redeem all or any portion of the Notes, at once or over time, upon required
notice under the Indenture at a redemption price equal to the greater of (i)
100% of the principal amount of the Notes to be redeemed, and (ii) the sum of
the present values of (1) the redemption price of the Notes at June 15, 2007 (as
set forth below) and (2) the remaining scheduled payments of interest from the
redemption date through June 15, 2007, but excluding accrued and unpaid interest
through the redemption date, discounted to the redemption date (assuming a
360-day year consisting of twelve 30-day months), at the Treasury Rate plus 75
basis points, plus, in the case of either clause (i) or (ii), accrued and unpaid
interest, if any, to the redemption date (subject to the right of Holders of
record on the relevant record date to receive interest due on the relevant
Interest Payment Date).
(b) At any time and from time to time prior to June 15,
2006, the Company may redeem up to a maximum of 35% of the aggregate principal
amount of the Notes (including any Additional Notes) with the proceeds of one or
more Public Equity Offerings at a redemption price equal to 110.50% of the
principal amount hereof, plus accrued and unpaid interest, including Special
Interest, if any, to the redemption date (subject to the right of holders of
record on the relevant record date to receive interest due on the relevant
Interest Payment Date); provided, however, that after giving effect to any such
redemption, at least 65% of the aggregate principal amount of the Notes
(including any Additional Notes) remains outstanding. Any such redemption shall
be made within 75 days of such Public Equity Offering upon not less than 30 nor
more than 60 days' prior notice.
(c) At any time or after June 15, 2007, the Company may
redeem all or a part of the Notes upon notice in accordance with Section 3.03 of
the Indenture, at the redemption prices set forth below, plus accrued and unpaid
interest, including Special Interest, if any, to but excluding the redemption
date (subject to the rights of holders of record on the relevant record date to
receive interest due on the relevant interest payment date). The following
prices are for Notes redeemed during the 12-month period commencing on June 15
of the years set forth below, and are expressed as percentages of principal
amount:
Year Percentage
2007..................................................................................... 105.250%
2008..................................................................................... 102.625%
2009 and thereafter...................................................................... 100.000%
(d) Any prepayment pursuant to this paragraph shall be
made pursuant to the provisions of Sections 3.01 through 3.06 of the Indenture.
6. MANDATORY REDEMPTION. Except as set forth in Sections 4.13 and
4.18 of the Indenture, the Company shall not be required to make mandatory
redemption or sinking fund payments with respect to the Notes.
X-0
0. XXXXXXXXXX AT OPTION OF HOLDER.
(a) Upon the occurrence of a Change of Control, the
Company shall, within 30 days of a change of control, make an offer, pursuant to
Section 4.18 and the procedures set forth in Section 3.09 of the Indenture, to
all Holders to repurchase all or any portion (equal to $1,000 or an integral
multiple of $1,000) of such Holder's Notes at a purchase price, in cash, equal
to 101% of the aggregate principal amount of the Notes repurchased, plus accrued
and unpaid interest on the Notes repurchased to the Purchase Date.
(b) When the aggregate amount of Excess Proceeds from
Asset Sales consummated by Holdco or a Restricted Subsidiary exceeds $20 million
(taking into account income earned on such Excess Proceeds, if any), the Company
shall make an offer to repurchase (the "Prepayment Offer") the Notes, which
offer shall be in the amount of the Allocable Excess Proceeds (rounded to the
nearest $1,000), on a pro rata basis according to principal amount, at a
purchase price equal to 100% of the principal amount thereof, plus accrued and
unpaid interest, including Special Interest, if any, to the repurchase date
(subject to the right of holders of record on the relevant record date to
receive interest due on the relevant interest payment date), in accordance with
Section 4.13 and the procedures (including prorating in the event of
oversubscription) set forth in Section 3.09 of the Indenture. To the extent that
any portion of the amount of Net Available Cash remains after compliance with
the preceding sentence and provided that all Holders have been given the
opportunity to tender their Notes for repurchase in accordance with Section 3.09
of the Indenture, Holdco or such Restricted Subsidiary may use such remaining
amount for any purpose permitted by the Indenture, and the amount of Excess
Proceeds will be reset to zero.
8. NOTICE OF REDEMPTION. Notices of redemption shall 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 integral
multiples of $1,000, unless all of the Notes held by a Holder are to be
redeemed. On and after the redemption date interest shall cease to accrue on
Notes or portions thereof called for redemption.
9. DENOMINATIONS, TRANSFER, EXCHANGE. The Notes are in registered
form without coupons in denominations of $1,000 and integral multiples of
$1,000. This Note shall represent the aggregate principal amount of outstanding
Notes from time to time endorsed hereon and the aggregate principal amount of
Notes represented hereby may from time to time be reduced or increased, as
appropriate, to reflect exchanges and redemptions. The transfer of Notes may be
registered and Notes may be exchanged as provided in the Indenture. The
Registrar and the Trustee may require a Holder, among other things, to furnish
appropriate endorsements and transfer documents and the Company may require a
Holder to pay any taxes and fees required by law or permitted by the Indenture.
The Company need not exchange or register the transfer of any Note or portion of
a Note selected for redemption, except for the unredeemed portion of any Note
being redeemed in part. Also, the Company need not exchange or register the
transfer of any Notes for a period of 15 days before a selection of Notes to be
redeemed or during the period between a record date and the corresponding
Interest Payment Date.
10. PERSONS DEEMED OWNERS. The registered Holder of a Note may be
treated as its owner for all purposes.
11. AMENDMENT, SUPPLEMENT AND WAIVER. Subject to certain
exceptions, the Company and the Trustee may amend or supplement the Indenture or
the Notes with the consent of the Holders of at least a majority in principal
amount of the Notes, including Additional Notes, if any then outstanding, voting
as a single class (including consents obtained in connection with a purchase of
or tender offer or exchange offer for the Notes), and, subject to Sections 6.04
and 6.07 of the Indenture, any existing Default or Event of Default (except a
continuing Default or Event of Default (i) in the payment of principal, premium,
if any, interest, if any, on the Notes and (ii) in respect of a covenant or
provision which under the Indenture cannot be modified or amended without the
consent of the Holder of each Note affected by such modification or amendment)
or compliance with any provision of the Indenture or the Notes may be waived
with the consent of the Holders of at least a majority in principal amount of
the Notes, including Additional Notes, if any, then outstanding voting as a
single class (including consents obtained in connection with a purchase of or
tender offer or exchange offer for the Notes). Without the consent of
A-6
any Holder, the Company and the Trustee may amend or supplement the Indenture or
the Notes to (i) cure any ambiguity, omission, defect or inconsistency; (ii)
provide for the assumption by a Surviving Person of the obligations of Holdco
and the Company under the Indenture; (iii) provide for uncertificated Notes in
addition to or in place of certificated Notes (provided that the uncertificated
Notes are issued in registered form for purposes of Section 163(f) of the Code,
or in a manner such that the uncertificated Notes are described in Section
163(f)(2)(B) of the Code); (iv) add additional Guarantors with respect to the
Notes or release Guarantors from Note Guaranties as provided or permitted by the
terms of the Indenture; (v) secure the Notes, release all or any portion of any
security interest, add to the covenants of Holdco or the Company for the benefit
of the Holders or surrender any right or power conferred upon Holdco or the
Company; (vi) make any change that does not adversely affect the rights of any
Holder; (vii) comply with any requirement of the SEC in connection with the
qualification of the Indenture under the Trust Indenture Act; or (viii) provide
for the issuance of additional Notes in accordance with the Indenture.
12. DEFAULTS AND REMEDIES. Each of the following constitutes an
Event of Default with respect to the Notes: (i) failure to make the payment of
any interest, including Special Interest, if any, on the Notes when the same
becomes due and payable, and such failure continues for a period of 30 days;
(ii) failure to make the payment of any principal of, or premium, if any, on,
any of the Notes when the same becomes due and payable at its Stated Maturity,
upon acceleration, redemption, optional redemption, required repurchase or
otherwise; (iii) failure to comply with Section 5.01 of the Indenture; (iv)
failure to comply with any other covenant or agreement in the Notes or in this
Indenture (other than a failure that is the subject of the foregoing clause (i),
(ii) or (iii)), and such failure continues for 30 days after written notice is
given to the Company as provided below; (v) a default under any Debt in an
aggregate amount in excess of $20.0 million by Holdco or any Restricted
Subsidiary that results in acceleration of the maturity of such Debt, or failure
to pay any such Debt at maturity (the "cross acceleration provisions"); (vi) any
judgment or judgments for the payment of money in an aggregate amount in excess
of $20.0 million (net of applicable insurance, if any, that is not subject to
any reservation of rights by the insurer) that shall be rendered against Holdco
or any Restricted Subsidiaries and that shall not be waived, satisfied or
discharged for any period of 30 consecutive days during which a stay of
enforcement shall not be in effect (the "judgment default provisions"); (vii)
any Note Guaranty ceases to be in full force and effect (other than in
accordance with the terms of such Note Guaranty) or any Guarantor denies or
disaffirms its obligations under its Note Guaranty (the "guaranty provisions");
(viii) any security interest shall, at any time, cease to be in full force and
effect for any reason other than the satisfaction in full of all obligations
under the Indenture and discharge of the Indenture or the release thereof in
accordance with its terms, or any security interest created thereunder shall be
declared invalid or unenforceable or the Company or any Guarantor shall assert,
in any pleading in any court of competent jurisdiction, that any such security
interest is invalid or unenforceable (the "security default provisions"); or
(ix) certain events of bankruptcy, insolvency or reorganization affecting the
Company, the Guarantors or any of their Significant Subsidiaries.
If any Event of Default (other the Events of Default arising from
certain events of bankruptcy or insolvency) occurs and is continuing, the
Trustee or the Holders of at least 25% in aggregate principal amount of the then
outstanding Notes may declare all the Notes to be due and payable.
Notwithstanding the foregoing, in the case of an Event of Default arising from
certain events of bankruptcy or insolvency described in the Indenture, all
outstanding Notes shall become due and payable immediately 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 aggregate principal amount of the then outstanding Notes may direct the
Trustee in its exercise of any trust or power. 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 or (i) in the payment of the principal
of, premium, if any, or interest on, the Notes and (ii) in respect of a covenant
or provision which under the Indenture cannot be modified or amended without the
consent of the Holder of each Note affected by such modification or amendment).
The Company is required to deliver to the Trustee annually a statement regarding
compliance with the Indenture, and the Company is required upon becoming aware
of any Default or Event of Default, to deliver to the Trustee a statement
specifying such Default or Event of Default.
13. TRUSTEE DEALINGS WITH COMPANY. Subject to certain limitations,
the Trustee in its individual or any other capacity may become the owner or
pledgee of Notes and may otherwise deal with the Company or any Affiliate of the
Company with the same rights it would have if it were not Trustee.
A-7
14. NO RECOURSE AGAINST OTHERS. No past, present or future
director, officer, employee, incorporator or stockholder of the Company or of
any Guarantor, as such, shall have any liability for any obligations of the
Company or any Guarantor under the Indenture, the Notes, the guarantees 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.
15. AUTHENTICATION. This Note shall not be valid until
authenticated by the manual signature of the Trustee or an authenticating agent.
16. 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).
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 that are Initial Notes shall have all the rights set forth in
the Registration Rights Agreement, dated as of June 3, 2003, among the Company,
the Guarantors and the parties named on the signature pages thereto or, in the
case of Additional Notes, Holders of Restricted Global Notes and Restricted
Definitive Notes shall have the rights set forth in one or more Registration
Rights Agreements, if any, among the Company and the other parties thereto,
relating to rights given by the Company to the purchasers of such Additional
Notes.
18. 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 has directed the Trustee to use
CUSIP numbers in notices of redemption or notices of Offers to Purchase as a
convenience to Holders. No representation is made as to the correctness of such
numbers either as printed on the Notes or as contained in any notice of
redemption or notice of an Offer to Purchase and reliance may be placed only on
the other identification numbers printed thereon and any such redemption or
Offer to Purchase shall not be affected by any defect in or omission of such
numbers.
19. COPY OF INDENTURE. The Company shall furnish to any
Holder upon written request and without charge a copy of the Indenture. Requests
may be made to: Xxxxx Lemmerz International, Inc. 00000 Xxxxxxxxxx Xxxxx,
Xxxxxxxxxx, Xxxxxxxx 00000, Attention: Corporate Counsel.
19. GOVERNING LAW. The internal law of the State of New York shall
govern and be used to construe this Note without giving effect to applicable
principals of conflicts of law to the extent that the application of the laws of
another jurisdiction would be required thereby.
A-8
Option of Holder to Elect Purchase
If you want to elect to have this Note purchased by the Company pursuant to
Section 4.13 or 4.18 of the Indenture, check the box below:
[ ] Section 4.13
[ ] Section 4.18
If you want to elect to have only part of this Note purchased by the Company
pursuant to Section 4.13 or Section 4.18 of the Indenture, state the amount you
elect to have purchased: $_____________________
Date:__________________ Your Signature:_________________________
(Sign exactly as your name appears on the
face of this Note)
Tax Identification No.:
________________________________________
SIGNATURE GUARANTEE:
_______________________________________
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.
A-9
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 other tax I.D. no.)
_______________________________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
(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.
A-10
SCHEDULE OF EXCHANGES OF INTERESTS IN THE GLOBAL NOTE
The following exchanges of a part of this Global Note for an
interest in another Global Note or for a Definitive Note, or exchanges of a part
of another Global Note or Definitive Note for an interest in this Global Note,
have been made:
Principal Amount
Amount of of this Global Note Signature of
decrease in Amount of increase following such authorized signatory
Principal Amount in Principal Amount decrease (or of Trustee or
Date of Exchange of this Global Note of this Global Note increase) Note Custodian
A-11
EXHIBIT B
FORM OF CERTIFICATE OF TRANSFER
Xxxxx Lemmerz International, Inc.
00000 Xxxxxxxxxx Xxxxx
Xxxxxxxxxx, Xxxxxxxx 00000
Attention: General Counsel
U.S. Bank National Association
000 Xxxx Xxxxxx, Xxxxx 0000
Xxx Xxxx, XX 00000
Attention: Corporate Trust Services
Facsimile No.: (000) 000-0000
Re: 10 1/2% Senior Notes due 2010
Reference is hereby made to the Indenture, dated as of June 3,
2003 (the "Indenture"), among Xxxxx Lemmerz International, Inc., as issuer (the
"Company"), the Guarantors party thereto and U.S. Bank National Association, as
Trustee. Capitalized terms used but not defined herein shall have the meanings
given to them in the Indenture.
___________________, (the "Transferor") owns and proposes to
transfer the Note[s] or interest in such Note[s] specified in Annex A hereto, in
the principal amount of $___________ in such Note[s] or interests (the
"Transfer"), to ___________________________ (the "Transferee"), as further
specified in Annex A hereto. In connection with the Transfer, the Transferor
hereby certifies that:
[CHECK ALL THAT APPLY]
1. [ ] CHECK IF TRANSFEREE WILL TAKE DELIVERY OF A
BENEFICIAL INTEREST IN THE 144A GLOBAL NOTE OR A DEFINITIVE NOTE PURSUANT TO
RULE 144A. The Transfer is being effected pursuant to and in accordance with
Rule 144A under the 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 144A Global
Note and/or the Definitive Note and in the Indenture and the Securities Act.
2. [ ] CHECK IF TRANSFEREE WILL TAKE DELIVERY OF A
BENEFICIAL INTEREST IN THE REGULATION S GLOBAL NOTE OR A DEFINITIVE NOTE
PURSUANT TO REGULATION S. The Transfer is being effected pursuant to and in
accordance with Rule 903 or Rule 904 under the Securities Act and, accordingly,
the Transferor hereby further certifies that (i) the Transfer is not being made
to a Person in the United States and (x) at the time the buy order was
originated, the Transferee was outside the United States or such Transferor and
any Person acting on its behalf reasonably believed and believes that the
Transferee was outside the United States or (y) the transaction was executed in,
on or through the facilities of a designated offshore securities market and
neither such Transferor nor any Person acting on its behalf knows that the
transaction was prearranged with a buyer in the United States, (ii) no directed
selling efforts have been made in contravention of the requirements of Rule
903(b) or 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 Distribution Compliance Period, the transfer
is not being made to a U.S. Person or for the account or benefit of a U.S.
Person (other than an Initial Purchaser). Upon consummation of the proposed
transfer in accordance with the
B-1
terms of the Indenture, the transferred beneficial interest or Definitive Note
will be subject to the restrictions on Transfer enumerated in the Private
Placement Legend printed on the Regulation S Global Note, the Temporary
Regulation S Global Note and/or the Definitive Note and in the Indenture and the
Securities Act.
3. [ ] CHECK AND COMPLETE IF TRANSFEREE WILL TAKE
DELIVERY OF A BENEFICIAL INTEREST IN THE IAI GLOBAL NOTE OR A DEFINITIVE NOTE
PURSUANT TO ANY PROVISION OF THE SECURITIES ACT OTHER THAN RULE 144A OR
REGULATION S. The Transfer is being effected in compliance with the transfer
restrictions applicable to beneficial interests in Restricted Global Notes and
Restricted Definitive Notes and pursuant to and in accordance with the
Securities Act and any applicable blue sky securities laws of any state of the
United States, and accordingly the Transferor hereby further certifies that
(check one):
(a) [ ] such Transfer is being effected pursuant to and
in accordance with Rule 144 under the Securities Act;
or
(b) [ ] such Transfer is being effected to the Company or
a subsidiary thereof;
or
(c) [ ] such Transfer is being effected pursuant to an
effective registration statement under the Securities Act and in
compliance with the prospectus delivery requirements of the Securities
Act;
or
(d) [ ] such Transfer is being effected to an
Institutional Accredited Investor and pursuant to an exemption from the
registration requirements of the Securities Act other than Rule 144A,
Rule 144 or Rule 904, and the Transferor hereby further certifies that
it has not engaged in any general solicitation within the meaning of
Regulation D under the Securities Act and the Transfer complies with
the transfer restrictions applicable to beneficial interests in a
Restricted Global Note or Restricted Definitive Notes and the
requirements of the exemption claimed, which certification is supported
by (1) a certificate executed by the Transferee in the form of Exhibit
D to the Indenture and (2) an Opinion of Counsel provided by the
Transferor or the Transferee (a copy of which the Transferor has
attached to this certification), to the effect that such Transfer is in
compliance with the Securities Act. Upon consummation of the proposed
transfer in accordance with the terms of the Indenture, the transferred
beneficial interest or Definitive Note will be subject to the
restrictions on transfer enumerated in the Private Placement Legend
printed on the IAI Global Note and/or the Definitive Notes and in the
Indenture and the Securities Act.
4. [ ] CHECK IF TRANSFEREE WILL TAKE DELIVERY OF A BENEFICIAL
INTEREST IN AN UNRESTRICTED GLOBAL NOTE OR OF AN UNRESTRICTED
DEFINITIVE NOTE.
(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
B-2
sky securities laws of any state of the United States and (ii) the
restrictions on transfer contained in the Indenture and the Private
Placement Legend are not required in order to maintain compliance with
the Securities Act. Upon consummation of the proposed Transfer in
accordance with the terms of the Indenture, the transferred beneficial
interest or Definitive Note will no longer be subject to the
restrictions on transfer enumerated in the Private Placement Legend
printed on the Restricted Global Notes, on Restricted Definitive Notes
and in the Indenture.
(c) [ ] CHECK IF TRANSFER IS PURSUANT TO OTHER
EXEMPTION. (i) The Transfer is being effected pursuant to and in
compliance with an exemption from the registration requirements of the
Securities Act other than Rule 144, Rule 903 or Rule 904 and in
compliance with the transfer restrictions contained in the Indenture
and any applicable blue sky securities laws of any State of the United
States and (ii) the restrictions on transfer contained in the Indenture
and the Private Placement Legend are not required in order to maintain
compliance with the Securities Act. Upon consummation of the proposed
Transfer in accordance with the terms of the Indenture, the transferred
beneficial interest or Definitive Note will not be subject to the
restrictions on transfer enumerated in the Private Placement Legend
printed on the Restricted Global Notes or Restricted Definitive Notes
and in the Indenture.
This certificate and the statements contained herein are made
for your benefit and the benefit of the Company.
____________________________________
[Insert Name of Transferor]
By:_________________________________
Name:
Title:
Dated: ______________________
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ANNEX A TO CERTIFICATE OF TRANSFER
1. The Transferor owns and proposes to transfer the
following:
[CHECK ONE OF (a) OR (b)]
(a) [ ] a beneficial interest in the:
(i) [ ] 144A Global Note (CUSIP _________), or
(ii) [ ] Regulation S Global Note (CUSIP _________), or
(iii) [ ] IAI Global Note (CUSIP _________); or
(b) [ ] a Restricted Definitive Note.
2. After the Transfer the Transferee will hold:
[CHECK ONE OF (a), (b) OR (c)]
(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; or
(c) [ ] an Unrestricted Definitive Note,
in accordance with the terms of the Indenture.
B-4
EXHIBIT C
FORM OF CERTIFICATE OF EXCHANGE
Xxxxx Lemmerz International, Inc.
00000 Xxxxxxxxxx Xxxxx
Xxxxxxxxxx, Xxxxxxxx 00000
Attention: General Counsel
U.S. Bank National Association
000 Xxxx Xxxxxx, Xxxxx 0000
Xxx Xxxx, XX 00000
Attention: Corporate Trust Services
Facsimile No.: (000) 000-0000
Re: 10 1/2% Senior Notes due 2010
Reference is hereby made to the Indenture, dated as of June 3,
2003 (the "Indenture"), among Xxxxx Lemmerz International, Inc., as issuer (the
"Company"), the Guarantors party thereto and U.S. Bank National Association, as
Trustee. Capitalized terms used but not defined herein shall have the meanings
given to them in the Indenture.
__________________________, (the "Owner") owns and proposes to
exchange the Note[s] or interest in such Note[s] specified herein, in the
principal amount of $____________ in such Note[s] or interests (the "Exchange").
In connection with the Exchange, the Owner hereby certifies that:
1. Exchange of Restricted Definitive Notes or Beneficial
Interests in a Restricted Global Note for Unrestricted Definitive Notes or
Beneficial Interests in an Unrestricted Global Note
(a) [ ] CHECK IF EXCHANGE IS FROM BENEFICIAL
INTEREST IN A RESTRICTED GLOBAL NOTE TO BENEFICIAL INTEREST IN AN
UNRESTRICTED GLOBAL NOTE. In connection with the Exchange of the
Owner's beneficial interest in a Restricted Global Note for a
beneficial interest in an Unrestricted Global Note in an equal
principal amount, the Owner hereby certifies (i) the beneficial
interest is being acquired for the Owner's own account without
transfer, (ii) such Exchange has been effected in compliance with the
transfer restrictions applicable to the Restricted Global Note 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 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 the Restricted Global Note 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.
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(c) [ ] CHECK IF EXCHANGE IS FROM RESTRICTED
DEFINITIVE NOTE TO BENEFICIAL INTEREST IN AN UNRESTRICTED GLOBAL NOTE.
In connection with the Owner's Exchange of a Restricted Definitive Note
for a beneficial interest in an Unrestricted Global Note, the Owner
hereby certifies (i) the beneficial interest is being acquired for the
Owner's own account without transfer, (ii) such Exchange has been
effected in compliance with the transfer restrictions applicable to
Restricted Definitive Notes and pursuant to and in accordance with the
Securities Act, (iii) the restrictions on transfer contained in the
Indenture and the Private Placement Legend are not required in order to
maintain compliance with the Securities Act and (iv) the beneficial
interest is being acquired in compliance with any applicable blue sky
securities laws of any state of the United States.
(d) [ ] CHECK IF EXCHANGE IS FROM RESTRICTED
DEFINITIVE NOTE TO UNRESTRICTED DEFINITIVE NOTE. In connection with the
Owner's Exchange of a Restricted Definitive Note for an Unrestricted
Definitive Note, the Owner hereby certifies (i) the Unrestricted
Definitive Note is being acquired for the Owner's own account without
transfer, (ii) such Exchange has been effected in compliance with the
transfer restrictions applicable to Restricted Definitive Notes and
pursuant to and in accordance with the Securities Act, (iii) the
restrictions on transfer contained in the Indenture and the Private
Placement Legend are not required in order to maintain compliance with
the Securities Act and (iv) the Unrestricted Definitive Note is being
acquired in compliance with any applicable blue sky securities laws of
any state of the United States.
2. Exchange of Restricted Definitive Notes or Beneficial
Interests in Restricted Global Notes for Restricted Definitive Notes or
Beneficial Interests in Restricted Global Notes
(a) [ ] CHECK IF EXCHANGE IS FROM BENEFICIAL
INTEREST IN A RESTRICTED GLOBAL NOTE TO RESTRICTED DEFINITIVE NOTE. In
connection with the Exchange of the Owner's beneficial interest in a
Restricted Global Note for a Restricted Definitive Note with an equal
principal amount, the Owner hereby certifies that the Restricted
Definitive Note is being acquired for the Owner's own account without
transfer. Upon consummation of the proposed Exchange in accordance with
the terms of the Indenture, the Restricted Definitive Note issued will
continue to be subject to the restrictions on transfer enumerated in
the Private Placement Legend printed on the Restricted Definitive Note
and in the Indenture and the Securities Act.
(b) [ ] CHECK IF EXCHANGE IS FROM RESTRICTED
DEFINITIVE NOTE TO BENEFICIAL INTEREST IN A RESTRICTED GLOBAL NOTE. In
connection with the Exchange of the Owner's Restricted Definitive Note
for a beneficial interest in the [CIRCLE ONE] 144A Global Note,
Regulation S Global Note, IAI Global Note with an equal principal
amount, the Owner hereby certifies (i) the beneficial interest is being
acquired for the Owner's own account without transfer and (ii) such
Exchange has been effected in compliance with the transfer restrictions
applicable to the Restricted Definitive Note 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.
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This certificate and the statements contained herein are made
for your benefit and the benefit of the Company.
____________________________________
[Insert Name of Transferor]
By:____________________________
Name:
Title:
Dated: ______________________
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EXHIBIT D
FORM OF CERTIFICATE FROM
ACQUIRING INSTITUTIONAL ACCREDITED INVESTOR
Xxxxx Lemmerz International, Inc.
00000 Xxxxxxxxxx Xxxxx
Xxxxxxxxxx, Xxxxxxxx 00000
Attention: General Counsel
U.S. Bank National Association
000 Xxxx Xxxxxx, Xxxxx 0000
Xxx Xxxx, XX 00000
Attention: Corporate Trust Services
Facsimile No.: (000) 000-0000
Re: 101/2% Senior Notes due 2010
Reference is hereby made to the Indenture, dated as of June 3,
2003 (the "Indenture"), among HLI Operating Company, Inc., as issuer (the
"Company"), the Guarantors party thereto and U.S. Bank National Association, 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 [$_________ (must
be at least $250,000)] aggregate principal amount of:
(a) [ ] a beneficial interest in a Global Note, or
(b) [ ] a Definitive Note,
we confirm that:
1. We understand that any subsequent transfer of the
Notes or any interest therein is subject to certain restrictions and conditions
set forth in the Indenture and the undersigned agrees to be bound by, and not to
resell, pledge or otherwise transfer the Notes or any interest therein except in
compliance with, such restrictions and conditions and the United States
Securities Act of 1933, as amended (the "Securities Act").
2. We understand that the offer and sale of the Notes
have not been registered under the Securities Act, and that the Notes and any
interest therein may not be offered or sold except as permitted in the following
sentence. We agree, on our own behalf and on behalf of any accounts for which we
are acting as hereinafter stated, that if we should sell the Notes or any
interest therein, we will do so only (A) to the Company or any subsidiary
thereof, (B) in accordance with Rule 144A under the Securities Act to a
"qualified institutional buyer" (as defined therein), (C) to an institutional
"accredited investor" (as defined below) that, prior to such transfer, furnishes
(or has furnished on its behalf by a U.S. broker-dealer) to you and to the
Company a signed letter substantially in the form of this letter and an Opinion
of Counsel in form reasonably acceptable to the Company to the effect that such
transfer is in compliance with the Securities Act, (D) outside the United States
in accordance with Rule 904 of Regulation S under the Securities Act, (E)
pursuant to the provisions of Rule 144(k) under the Securities Act or (F)
pursuant to an effective registration statement under the Securities Act, and we
further agree to provide to any Person purchasing the Definitive Note or
beneficial interest in a Global Note from us in a transaction meeting the
requirements of clauses (A) through (E) of this paragraph a notice advising such
purchaser that resales thereof are restricted as stated herein.
3. We understand that, on any proposed resale of the
Notes or beneficial interest therein, we will be required to furnish to you and
the Company such certifications, legal opinions and other information as you
and the Company may reasonably require to confirm that the proposed sale
complies with the foregoing restrictions. We further understand that the Notes
purchased by us will bear a legend to the foregoing effect.
4. We are an institutional "accredited investor" (as
defined in Rule 501(a)(1), (2), (3) or (7) of Regulation D under the Securities
Act) and have such knowledge and experience in financial and business matters as
to be capable of evaluating the merits and risks of our investment in the Notes,
and we and any accounts for which we are acting are each able to bear the
economic risk of our or its investment. 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.
5. We are acquiring the Notes or beneficial interest
therein purchased by us for our own account or for one or more accounts (each of
which is an institutional "accredited investor") as to each of which we exercise
sole investment discretion and are not acquiring the Notes with a view to any
distribution thereof in a transaction that would violate the Securities Act of
the securities laws of any state of the United States or any other applicable
jurisdiction.
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. This letter shall be governed by,
and construed in accordance with, the laws of the State of New York.
_________________________________________
[Insert Name of Accredited Investor]
By:_____________________________________
Name:
Title:
Dated: _______________________
EXHIBIT E
FORM OF NOTATION OF GUARANTEE
For value received, each Guarantor (which term includes any
successor Person under the Indenture), jointly and severally, hereby
unconditionally guarantees, to the extent set forth in the Indenture and subject
to the provisions in the Indenture, dated as of June 3, 2003 (the "Indenture"),
among HLI Operating Company, Inc., as issuer (the "Company"), the Guarantors
listed on the signature pages thereto and U.S. Bank National Association, as
trustee (the "Trustee"), (a) the due and punctual payment of the principal of,
premium, if any, and interest, if any, on the Notes, whether at maturity, by
acceleration, redemption or otherwise, the due and punctual payment of interest
on overdue principal and premium, if any, and, to the extent permitted by law,
interest, if any, and the due and punctual performance of all other obligations
of the Company to the Holders or the Trustee under the Notes and the Indenture,
all in accordance with the terms of the Notes and the Indenture; and (b) in case
of any extension of time of payment or renewal of any Notes or any of such other
obligations, that the same shall be promptly paid in full when due or performed
in accordance with the terms of the extension or renewal, whether at maturity,
by acceleration pursuant to Section 6.02 of the Indenture, redemption or
otherwise. The obligations of the Guarantors to the Holders of Notes and to the
Trustee pursuant to the guarantee and the Indenture are expressly set forth in
Article 10 of the Indenture and reference is hereby made to the Indenture for
the precise terms of the guarantee. Except to the extent provided in the
Indenture, including Sections 8.02, 8.03 and 10.05 thereof, this guarantee shall
not be discharged except by complete performance of the obligations contained
herein and in the Indenture. Each Holder of a Note, by accepting the same agrees
to and shall be bound by such provisions. Capitalized terms used herein and not
defined are used herein as so defined in the Indenture.
[Signature page follows]
[GUARANTORS]
By:_______________________
Name:
Title:
