Security. The Notes and the guarantees will be secured, subject to permitted liens, by first-priority liens on substantially all of the Company’s and the subsidiary guarantors’ assets (including certain of the Company’s real estate assets), whether now owned or hereafter acquired, other than certain excluded property, which liens will secure permitted additional first lien obligations on a pari passu basis, subject to the Collateral Trust Agreement and will rank senior to those that secure the 2024 Notes (the “Collateral”). Under certain circumstances, the Collateral may be released without action by, or the consent of, the holders of the Notes. The Notes and the guarantees will not be secured by the assets of non-guarantor subsidiaries, which include the unrestricted subsidiaries to whom certain of the Company’s accounts receivables are and may in the future be sold to support borrowing under the Receivables Securitization Facility. No appraisal of the value of the Collateral has been made in connection with the offering, and the value of the Collateral in the event of liquidation may be materially different from the book value. Some of the Company’s assets are excluded from the Collateral.
Intercreditor Agreement. Pursuant to an intercreditor agreement (the “Intercreditor Agreement”) between Wilmington Trust, National Association, in its capacity as the collateral trustee (the “Collateral Trustee”) and U.S. Bank National Association, in its capacity as second lien collateral agent for the 2024 Notes, the liens on the Collateral securing the Notes and all future first lien obligations will be made expressly senior to the liens securing the 2024 Notes.
Collateral Trust Agreement. A collateral trust agreement (the “Collateral Trust Agreement”) among the Company, the subsidiary guarantors, the Collateral Trustee and U.S. Bank National Association, in its capacity as the trustee for the Notes, will set forth therein the relative rights with respect to the Collateral as among the trustee for the Notes and certain subsequent holders of first lien obligations and covering certain other matters relating to the administration of security interests. The Collateral Trust Agreement will generally control substantially all matters related to the Collateral, including with respect to decisions, distribution of proceeds or enforcement, and the Collateral Trustee may take actions that the holders of the Notes may disagree with or that may be contrary to the interests of the holders of the Notes. Pursuant to the Collateral Trust Agreement, on the issue date of the Notes the Collateral Trustee will control certain matters related to the Collateral that the Collateral Trust Agreement specifies are in its discretion. If the Company incurs certain types of additional first lien obligations, the Controlling First Lien Holders (as defined in the Collateral Trust Agreement) will have the right to control decisions relating to the Collateral that are outside the Collateral Trustee’s discretion under the Collateral Trust Agreement and the Note holders may no longer be in control of such decisions.
Optional Redemption. The Company may redeem the Notes, in whole or in part, at any time or from time to time on or after February 1, 2023, at specified redemption prices, plus accrued and unpaid interest, if any, to the redemption date. At any time or from time to time prior to February 1, 2023, the Company may redeem the Notes, in whole or in part, at a redemption price equal to 100% of their principal amount plus a make whole premium, together with accrued and unpaid interest, if any, to the redemption date. In addition, the Company may redeem up to 40% of the aggregate principal amount of the outstanding Notes prior to June 1, 2023, with the net cash proceeds from certain equity offerings at a redemption price equal to 108.875% of their principal amount, together with accrued and unpaid interest, if any, to the redemption date.
Change of Control. If the Company experiences specific kinds of changes of control, the Company is required to offer to purchase all of the Notes at a purchase price of 101% of their principal amount, plus accrued and unpaid interest, if any, to the date of purchase.
Certain Covenants. The Indenture contains covenants that, among other things, limit the ability of the Company and its restricted subsidiaries to: (i) incur additional indebtedness; (ii) pay dividends or make other distributions; (iii) make other restricted payments and investments; (iv) create liens; (v) incur restrictions on the ability of restricted subsidiaries to pay dividends or make certain other payments; (vi) sell assets, including capital stock of restricted subsidiaries; (vii) enter into sale and leaseback transactions; (viii) merge or consolidate with other entities; and (ix) enter into transactions with affiliates. In addition, the Indenture requires, among other things, the Company to provide financial and current reports to holders of the Notes or file such reports electronically with the U.S. Securities and Exchange Commission. Furthermore, the future net proceeds from asset sales will be required to repay the Notes at a premium of 106.656%, until the aggregate principal amount of Notes outstanding is $350.0 million or less, provided that the first $100.0 million of such net proceeds may remain on the balance sheet (subject to compliance with the asset sale covenants in the Company’s other outstanding indentures) or be used for other permitted purposes. These covenants are subject to a number of exceptions, limitations and qualifications set forth in the Indenture, as well as suspension periods in certain circumstances.
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