Document:

Exhibit 4.2

 

CINTAS CORPORATION NO. 2

 

OFFICERS’ CERTIFICATE

 

Pursuant to Sections 3.1 and 3.3 of the Indenture, dated as of May 28, 2002 (the “Base Indenture”), by and among Cintas Corporation No. 2, a Nevada corporation (the “Company”), Cintas Corporation, a Washington corporation (the “Parent Guarantor”), Cintas Corporation No. 3, a Nevada corporation (“Cintas 3”), Cintas Corp. No. 8, Inc., a Nevada corporation (“Cintas 8”), Cintas Corp. No. 15, Inc., a Nevada corporation (“Cintas 15”), Cintas-RUS, L.P., a Texas limited partnership (“Cintas-RUS”), the additional subsidiary guarantors party thereto and U.S. Bank National Association (as successor trustee to Wachovia Bank, National Association), as trustee (the “Trustee”), as amended and supplemented by a first supplemental indenture, dated as of November 8, 2010 (the “First Supplemental Indenture” and, together with the Base Indenture, the “Indenture”), by and among the Company, Cintas Corporate Services, Inc., an Ohio corporation (“Cintas Services” and, collectively with the Parent Guarantor, Cintas 3, Cintas 8, Cintas 15 and Cintas-RUS, the “Guarantors”), and the Trustee, the undersigned Senior Vice President and Chief Financial Officer of the Company and the undersigned Vice President and Treasurer of the Company hereby certify as follows:

 

1.                                       The issuance of a series of Securities designated as 4.30% Senior Notes due 2021, in an initial aggregate principal amount of $250,000,000 (the “Notes”), has been approved and authorized in accordance with the provisions of the Indenture pursuant to resolutions adopted by the Pricing Committee of the Board of Directors of the Company pursuant to an Action Taken in Writing by the Pricing Committee of the Board of Directors of the Company dated May 18, 2011 and by this Officers’ Certificate dated May 23, 2011 relating to the Notes.

 

2.                                       All covenants and conditions precedent provided for in the Indenture relating to the establishment of series of Securities and the terms of such series have been complied with.

 

3.                                       To the best of the knowledge of the undersigned, no event which is, or after notice or lapse of time would become, an Event of Default with respect to any of the Securities shall have occurred and be continuing.

 

4.                                       The terms of the Notes shall be as follows:

 

	
(i)
    	
The title of the   Notes shall be “4.30% Senior Notes due 2021.”
    
	
 
    	
 
    
	
(ii)
    	
The Notes are to be   issued in registered form. The Notes are to be issued initially in an   aggregate principal amount of $250,000,000; provided, however, that the   aggregate principal amount of the Notes which may be outstanding may be   increased by the Company upon the terms and subject to the conditions set   forth in the Indenture and the Notes. The Notes are to be issued initially in   global form. Beneficial owners of interests in the Notes may exchange such   interests in accordance with the Indenture and the terms of the Notes.
    
	
 
    	
 
    
	
(iii)
    	
The Notes will   mature on June 1, 2021.
    

 

 

	
(iv)
    	
The Notes will bear   interest at a rate of 4.30% per annum.
    
	
 
    	
 
    
	
(v)
    	
The date from which   interest shall accrue, the Interest Payment Dates on which interest shall be   payable and the Regular Record Date for the interest payable on any Interest   Payment Date will be as set forth in the Specimen Note annexed hereto as Exhibit A   (the “Specimen Note”).
    
	
 
    	
 
    
	
(vi)
    	
Principal and   interest on the Notes are payable at the corporate trust office of the   Trustee in The City of New York, except as otherwise provided in the Specimen   Note.
    
	
 
    	
 
    
	
(vii)
    	
The Notes are   issuable in minimum denominations of $1,000 and integral multiples thereof.
    
	
 
    	
 
    
	
(viii)
    	
The Notes are   subject to redemption at the option of the Company, as set forth in the   Specimen Note.
    
	
 
    	
 
    
	
(ix)
    	
The Notes will not   be subject to any sinking fund.
    
	
 
    	
 
    
	
(x)
    	
The provisions   relating to defeasance shall apply to the Notes.
    
	
 
    	
 
    
	
(xi)
    	
Clause (5) of   Section 5.1 of the Indenture shall not apply to the Notes, and the   occurrence of the events described in clause (5) of Section 5.1 of   the Indenture shall not be deemed an “Event of Default” with respect to the   Notes.
    
	
 
    	
 
    
	
(xii)
    	
If a Change of   Control Repurchase Event (as defined in the Specimen Note) occurs, the   Company shall make an offer to purchase all of the Notes at a repurchase   price in cash equal to 101% of the aggregate principal amount of Notes   repurchased plus accrued and unpaid interest, if any, on the Notes   repurchased to the date of purchase, as set forth in the Specimen Note.
    
	
 
    	
 
    
	
(xiii)
    	
The “Depository”   with respect to the Notes will initially be The Depository Trust Company   (“DTC”).
    
	
 
    	
 
    
	
(xiv)
    	
Interest on the   Notes will be computed and paid on the basis of a 360-day year of twelve   30-day months.
    
	
 
    	
 
    
	
(xv)
    	
The due and   punctual payment of principal of, premium, if any, and interest on, the Notes   shall be fully and unconditionally guaranteed, subject to the terms of the   Indenture, jointly and severally, by the Parent Guarantor, Cintas 3,   Cintas 8, Cintas 15, Cintas—RUS and Cintas Services.
    

 

Capitalized terms used herein and not otherwise defined herein have the meanings specified in the Indenture or the Specimen Note.  The foregoing terms of the Notes are qualified by the complete text of the Specimen Note, which is attached hereto and incorporated herein by this reference.

 

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Each of the undersigned, for himself, states that he has read and is familiar with the provisions of the Indenture, including Article 3 relating to the issuance of Securities thereunder and the definitions relating thereto and Article 1; that he is generally familiar with the affairs of the Company and the Guarantors and their respective corporate acts and proceedings; and that, in his opinion, he has made such examination or investigation as is necessary to enable him to express an informed opinion as to whether or not the covenants and conditions referred to above have been complied with, and, in his opinion, such provisions have been complied with.

 

Insofar as this certificate relates to legal matters, it is based, as provided for in Section 1.3 of the Indenture, upon the Opinion of Counsel delivered to the Trustee contemporaneously herewith pursuant to Section 3.3 of the Indenture and relating to the Notes.

 

[THE REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK]

 

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IN WITNESS WHEREOF, we have hereunto signed our names by and on behalf of the Company.

 

 

	
Cincinnati,   Ohio
    	
 
    
	
Dated:   May 23, 2011
    	
 
    
	
 
    	
 
    
	
 
    	
CINTAS   CORPORATION NO. 2
    
	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/ William   C. Gale
    
	
 
    	
 
    	
Name: William   C. Gale
    
	
 
    	
 
    	
Title:   Senior Vice President and Chief Financial   Officer
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/ Michael   Hansen
    
	
 
    	
 
    	
Name: Michael   Hansen
    
	
 
    	
 
    	
Title:   Vice President and Treasurer
    

 

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EXHIBIT A

 

SPECIMEN NOTE

 

 

THIS NOTE IS A GLOBAL NOTE WITHIN THE MEANING OF THE INDENTURE HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF A DEPOSITORY (AS DEFINED IN THE INDENTURE) OR A NOMINEE THEREOF. THIS GLOBAL NOTE IS EXCHANGEABLE FOR SECURITIES REGISTERED IN THE NAME OF A PERSON OTHER THAN THE DEPOSITORY OR ITS NOMINEE ONLY IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE INDENTURE AND, UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR SECURITIES IN DEFINITIVE FORM, THIS GLOBAL NOTE MAY NOT BE TRANSFERRED EXCEPT AS A WHOLE BY THE DEPOSITORY TO A NOMINEE OF THE DEPOSITORY, OR BY A NOMINEE OF THE DEPOSITORY TO THE DEPOSITORY OR ANOTHER NOMINEE OF THE DEPOSITORY, OR BY THE DEPOSITORY OR ANY SUCH NOMINEE TO A SUCCESSOR DEPOSITORY OR A NOMINEE OF SUCH SUCCESSOR DEPOSITORY.

 

UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION (“DTC”), TO THE COMPANY (AS DEFINED BELOW) OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS 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.

 

 

	
No. 1
    CUSIP No. 17252MAK6
    	
 
    	
Principal Amount $250,000,000 as revised by the Schedule of Increases   and Decreases in Global Security attached hereto
    

 

Cintas Corporation No. 2 
 4.30% Senior Notes due 2021 
 Payment of Principal, Premium, if any, and Interest 
 Unconditionally Guaranteed, Jointly and Severally, 
 by Cintas Corporation and 
 Certain Subsidiaries of Cintas Corporation

 

Cintas Corporation No. 2, a corporation duly organized and existing under the laws of Nevada (hereinafter called the “Company”, which term includes any successor Person under the Indenture referred to below), for value received, hereby promises to pay to Cede & Co., c/o The Depository Trust Company, 55 Water Street, New York, New York 10041, or registered assigns, the principal sum of Two Hundred Fifty Million Dollars ($250,000,000), as revised by the Schedule of Increases and Decreases in Global Security attached hereto, on June 1, 2021, and to pay interest thereon from May 23, 2011 or from the most recent date to which interest has been. paid or duly provided for, semiannually on June 1 and December 1 in each year (each, an “Interest Payment Date”), commencing on December 1, 2011, at the rate of 4.30% per annum, until the principal hereof and premium, if any, hereon is paid or duly made available for payment, and on any overdue principal or premium, if any, and (to the extent that payment of such interest is lawful) on any overdue installment of interest at the same rate per annum during the period in which such principal or premium, if any, or interest remains unpaid. The interest so payable and punctually paid or duly provided for on any Interest Payment Date will, as provided in such Indenture, be paid to the Person in whose name this Note (or one or more Predecessor Securities) is registered at the close of business on the Regular Record Date for such interest, which shall be the May 15 or November 15 (whether or not a Business Day (as defined below)), as the case may be, next preceding such Interest Payment Date. Except as otherwise provided in the Indenture, any such interest which is payable, but is not punctually paid or duly provided for, on any Interest Payment Date shall forthwith cease to be payable to the Holder hereof on such Regular Record Date and may either be paid to the Person in whose name this Note (or one or more Predecessor Securities) is registered at the close of business on a Special Record Date for the payment of such Defaulted Interest to be fixed by the Company, notice whereof shall be given to Holders of Notes of this series not less than 10 days prior to such Special Record Date, or be paid at any time in any other lawful manner not inconsistent with the requirements of any securities exchange on which the Notes of this series may be listed, and upon such notice as may be required by such exchange, all as more fully provided in such Indenture. Payment of the principal of (and premium, if any) and interest on this Note will be made at the office or agency of the Company or, if applicable, the Guarantor maintained for that purpose in The Borough of Manhattan, The City of New York, 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; provided, however, that, at the option of the Company, payment of interest may be made by United States dollar check mailed to the address of the Person entitled thereto as such address shall appear in the Security Register; provided, further, that payment to The Depository Trust Company or any

 

 

successor depository (“DTC”) may be made by wire transfer to the account designated by DTC or such successor depository in writing.

 

If any Interest Payment Date or Maturity Date falls on a day that is not a Business Day, the related payment of principal, premium, if any, and interest on the Notes will be made on the next succeeding Business Day with the same force and effect as if it were made on the date such payment was due and no interest shall accrue on the amount so payable for the period from and after such Interest Payment Date or Maturity Date, as the case may be, to the next succeeding Business Day. “Business Day” means any day other than a Saturday, Sunday or other day on which banking institutions are authorized or obligated by law, regulation or executive order to close.

 

Payments of interest hereon with respect to any Interest Payment Date will include interest accrued to but excluding such Interest Payment Date. Interest on this Note shall be calculated on the basis of a 360-day year consisting of twelve 30-day months.

 

This Note is one of a duly authorized series of Securities of the Company (herein called the “Notes”) issued or to be issued under an Indenture dated as of May 28, 2002 (the “Base Indenture”) by and among the Company, Cintas Corporation (the “Parent Guarantor”), Cintas Corporation No. 3, a Nevada corporation (“Cintas 3”), Cintas Corp. No. 8, Inc., a Nevada corporation (“Cintas 8”), Cintas Corp. No. 15, Inc., a Nevada corporation (“Cintas 15”), Cintas-RUS, L.P., a Texas limited partnership (“Cintas-RUS”), the additional subsidiary guarantors party thereto and U.S. Bank National Association (as successor trustee to Wachovia Bank, National Association), as Trustee (herein called the “Trustee”, which term includes any successor trustee under the Indenture with respect to the Notes), as amended and supplemented by a first supplemental indenture, dated as of November 8, 2010 (herein called, collectively with the Base Indenture and all indentures supplemental thereto, the “Indenture”), by and among the Company, Cintas Corporate Services, Inc., an Ohio corporation (“Cintas Services” and, collectively with the Parent Guarantor, Cintas 3, Cintas 8, Cintas 15 and Cintas RUS, the “Initial Subsidiary Guarantors” and, together with the Parent Guarantor and each other subsidiary of the Company that pursuant to the terms of the Indenture guarantees the Company’s obligations under such Indenture, in each case in such entity’s capacity as guarantor, the “Guarantors”) to which Indenture and all indentures supplemental thereto reference is hereby made for a statement of the respective rights, limitations of rights, duties and immunities thereunder of the Company, the Guarantors, the Trustee and the Holders of the Notes, and of the terms upon which the Notes are, and are to be, authenticated and delivered. This Note is one of the series designated on the face hereof, initially limited (subject to exceptions provided in the Indenture) to the aggregate principal amount specified in the Officers’ Certificate dated May 23, 2011 establishing the terms of the Notes pursuant to the Indenture; provided that the Company may, without the consent of Holders, reopen this series of Securities and issue additional Notes, so as to increase the aggregate principal amount of the Notes Outstanding upon the terms and subject to the conditions set forth in the Indenture so long as any such additional Notes have the same tenor and terms (including, without limitation, rights to receive accrued and unpaid interest as the Notes then Outstanding). The Notes are issuable only in registered form without coupons in the denominations specified in the Officers’ Certificate dated May 23, 2011 establishing the terms of the Notes, all as more fully provided in the Indenture and such Officers’ Certificate. As provided

 

 

in the Indenture and in such Officers’ Certificate, and subject to certain limitations set forth in the Indenture, such Officers’ Certificate and in this Note, the Notes of this series are exchangeable for a like aggregate principal amount of Notes of this series in different denominations, as requested by the Holders surrendering the same.

 

The Notes are unconditionally guaranteed as to the due and punctual payment of principal, premium, if any, and interest in respect thereof by the Guarantors as evidenced by their guarantees (the “Guarantees”) included in the Indenture and set forth hereon. The Guarantees are direct and unconditional obligations of such Guarantors and rank and will rank equally in priority of payment and in all other respects with all other unsecured and unsubordinated obligations of such Guarantors now or hereafter outstanding.

 

This Note is redeemable at the option of the Company, in whole or in part at any time, at a redemption price equal to the greater of (i) 100% of the principal amount of this Note to be redeemed and (ii) the sum, as determined by the Independent Investment Banker (as defined below), of the present values of the remaining scheduled payments of principal and interest on this Note to be redeemed (exclusive of interest accrued to the date of redemption) discounted to the date of redemption on a semiannual basis (assuming a 360-day year consisting of twelve 30-day months) at the Treasury Rate (as defined below) plus 20 basis points, and in each case accrued but unpaid interest thereon to the redemption date.

 

“Treasury Rate” means, with respect to any redemption date for the Notes, (i) the yield, under the heading which represents the average for the immediately preceding week, appearing in the most recently published statistical release designated “H.15(519)” or any successor publication which is published weekly 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,” for the maturity corresponding to the Comparable Treasury Issue (if no maturity is within three months before or after the maturity date of the Notes, yields for the two published maturities most closely corresponding to the Comparable Treasury Issuer will be determined and the Treasury Rate shall be interpolated or extrapolated from those yields on a straight line basis, rounding to the nearest month) or (ii) if the release referred to in clause (i) (or any successor release) is not published during the week preceding the calculation date or does not contain the yields referred to above, the rate per annum equal to the semi-annual equivalent yield to maturity of the Comparable Treasury Issue, calculated using a price for the Comparable Treasury Issue (expressed as a percentage of its principal amount) equal to the Comparable Treasury Price for that redemption date. The Treasury Rate will be calculated on the third Business Day preceding the redemption date.

 

“Comparable Treasury Issue” means the United States Treasury security selected by the 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 the Notes.

 

 

“Comparable Treasury Price” means, with respect to any redemption date, the average of the Reference Treasury Dealer Quotations obtained by the Trustee for such redemption date, after excluding the highest and lowest of four such Reference Treasury Dealer Quotations, or if the Trustee is unable to obtain at least four such Reference Treasury Dealer Quotations, the average of all Reference Treasury Dealer Quotations obtained by the Trustee.

 

“Independent Investment Banker” means KeyBanc Capital Markets Inc. (and its successors), or, if such firm is unwilling or unable to select the applicable Comparable Treasury Issue, an independent investment banking institution of national standing appointed by the Trustee and reasonably acceptable to the Company or, if applicable, the Guarantor.

 

“Reference Treasury Dealer” means J.P. Morgan Securities LLC and its successors, and three other primary U.S. government securities dealers in New York City selected by the Independent Investment Banker (each, a “Primary Treasury Dealer”); provided, however, that if any of the foregoing shall cease to be a Primary Treasury Dealer, the Company shall substitute therefor another Primary Treasury Dealer.

 

“Reference Treasury Dealer Quotations” means, with respect to each Reference Treasury Dealer and any redemption date for the Notes, an average, as determined by the Trustee, of the bid and asked prices for the Comparable Treasury Issue for the Notes (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., New York City time, on the third Business Day preceding such redemption date.

 

Notice of any redemption will be mailed at least 30 days but not more than 60 days before the redemption date to the Holder hereof at its address as such address shall appear in the Security Register of the Company. Unless the Company defaults in payment of the redemption price and accrued interest on and after the redemption date, interest will cease to accrue on the principal amount of this Note called for redemption.

 

Except as provided above, this Note is not redeemable by the Company prior to maturity and is not subject to any sinking fund.

 

If a Change of Control Repurchase Event (defined below) occurs, unless the Company has otherwise exercised its right to redeem the Notes, it will make an offer (a “Change of Control Repurchase Event Offer”) to each Holder of Notes to repurchase all or any part (equal to $1,000 or an integral multiple of $1,000) of that Holder’s Notes at a repurchase price in cash equal to 101% of the aggregate principal amount of Notes repurchased plus accrued and unpaid interest, if any, on the Notes repurchased to the date of purchase, subject to the rights of Holders on the relevant record date to receive interest due on the relevant interest payment date (the “Change of Control Repurchase Event Payment”). Within 30 days following any Change of Control Repurchase Event, the Company will mail a notice to each Holder describing the transaction or transactions that constitute the Change of Control Repurchase Event and stating:

 

 

(1)                                that the Change of Control Repurchase Event Offer is being made pursuant to the Change of Control Repurchase Event provisions of the Notes and that all Notes tendered will be accepted for payment;

 

(2)                                the purchase price and the purchase date, which shall be no earlier than 30 days and no later than 60 days from the date such notice is mailed (the “Change of Control Repurchase Event Payment Date”);

 

(3)                                that any Note not tendered will continue to accrue interest;

 

(4)                                that, unless the Company defaults in the payment of the Change of Control Repurchase Event Payment, all Notes accepted for payment pursuant to the Change of Control Repurchase Event Offer will cease to accrue interest after the Change of Control Repurchase Event Payment Date;

 

(5)                                that Holders electing to have any Notes purchased pursuant to a Change of Control Repurchase Event Offer will be required to surrender the Notes, with the form entitled “Option of Holder to Elect Purchase” attached to the Notes completed, or transfer by book-entry transfer, to the Paying Agent at the address specified in the notice prior to the close of business on the third Business Day preceding the Change of Control Repurchase Event Payment Date;

 

(6)                                that Holders will be entitled to withdraw their election if the Paying Agent receives, not later than the close of business on the second Business Day preceding the Change of Control Repurchase Event Payment Date, a telegram, telex, facsimile transmission or letter setting forth the name of the Holder, the principal amount of Notes delivered for purchase, and a statement that such Holder is withdrawing his election to have the Notes purchased; and

 

(7)                                that Holders whose Notes are being purchased only in part will be issued new Notes equal in principal amount to the unpurchased portion of the Notes surrendered, which unpurchased portion must be equal to $1,000 in principal amount or an integral multiple thereof.

 

The Company will comply with the requirements of Rule 14e-1 under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and any other securities laws and regulations thereunder to the extent those laws and regulations are applicable in connection with the repurchase of the Notes as a result of a Change of Control Repurchase Event. To the extent that the provisions of any securities laws or regulations conflict with the Change of Control Repurchase Event provisions of the Notes, the Company will comply with the applicable securities laws and regulations and will not be deemed to have breached its obligations under the Change of Control Repurchase Event provisions of the Notes by virtue of such conflict.

 

On the Change of Control Repurchase Event Payment Date, the Company will, to the extent lawful:

 

 

(1)                                accept for payment all Notes or portions of Notes properly tendered pursuant to the Change of Control Repurchase Event Offer;

 

(2)                                deposit with the Paying Agent an amount equal to the Change of Control Repurchase Event Payment in respect of all Notes or portions of Notes properly tendered; and

 

(3)                                deliver or cause to be delivered to the trustee the Notes properly accepted, together with an Officers’ Certificate stating the aggregate principal amount of Notes being purchased by the Company.

 

Upon receiving the Change of Control Repurchase Event Payment, the Paying Agent will promptly mail to each Holder of Notes properly tendered the purchase price for such Notes, and the Trustee will promptly authenticate and mail (or cause to be transferred by book entry) to each Holder a new Note equal in the principal amount to any unpurchased portion of the Notes surrendered, if any; provided, that each new Note will be in a principal amount of $1,000 or an integral multiple of $1,000. The Company will announce the results of the Change of Control Repurchase Event Offer on or as soon as practicable after the Change of Control Repurchase Event Payment Date.

 

The Company will not be required to make a Change of Control Repurchase Event Offer upon a Change of Control Repurchase Event if a third party makes an offer in the manner, at the times and otherwise in compliance with the requirements for a Change of Control Repurchase Event Offer made by the Company, and such third party purchases all Notes properly tendered and not withdrawn under its offer.

 

“Below Investment Grade Rating Event” means the Notes are rated below an Investment Grade Rating by each of the Rating Agencies on any date from the date of the public notice of an arrangement that could result in a Change of Control until the end of the 60-day period following public notice of the occurrence of the Change of Control (which 60-day period shall be extended so long as the rating of the Notes is under publicly announced consideration for possible downgrade by any of the Rating Agencies).

 

“Capital Stock” means, with respect to any Person, any and all shares, interests, participations or other equivalents (however designated) in the equity interests of such Person, including without limitation, (i) with respect to a corporation, common stock, preferred stock and any other capital stock, (ii) with respect to a partnership, partnership interests (whether general or limited), and (iii) with respect to a limited liability company, limited liability company interests.

 

“Change of Control” means the occurrence of any of the following:

 

(1)                                the direct or indirect sale, transfer, conveyance or other disposition (other than by way of merger or consolidation), in one or a series of related transactions, of all or substantially all of the Company’s and its subsidiaries’ properties or assets taken as a whole or all or substantially all of the Parent Guarantor’s and its subsidiaries properties or assets taken as a whole to any “person” (as that term is used in

 

 

Section 13(d)(3) of the Exchange Act) other than to the Parent Guarantor, the Company or a Subsidiary Guarantor, as the case may be;

 

(2)                                the adoption of a plan relating to the liquidation or dissolution of the Company or the Parent Guarantor;

 

(3)                                the consummation of any transaction (including, without limitation, any merger or consolidation) the result of which is that any “person” (as defined above), other than the Company or a Subsidiary Guarantor, as the case may be, becomes the beneficial owner, directly or indirectly, of 50% or more of the total voting power of the Voting Stock of the Company or the Parent Guarantor (for purposes of this clause (3), a Person shall be deemed to beneficially own the Voting Stock of a corporation that is beneficially owned (as defined above) by another corporation (a “parent corporation”) if such Person beneficially owns (as defined above) at least 50% of the aggregate voting power of all classes of Voting Stock of such parent corporation); or

 

(4)                                the first day on which a majority of the members of the board of directors of the Parent Guarantor are not Continuing Directors;

 

provided, that in connection with (a) the direct or indirect sale, transfer, conveyance or other disposition described in clause (1) above to the Parent Guarantor, the Company or a Subsidiary Guarantor or (b) the consummation of any transaction described in clause (3) above with the Company or a Subsidiary Guarantor, all references in clauses (1) and (3) above to the “Company” and the “Parent Guarantor,” as applicable, shall henceforth be deemed to refer to the entity that acquires such properties or assets or the surviving entity of such merger or consolidation, as applicable.

 

“Change of Control Repurchase Event” means the occurrence of both a Change of Control and a Below Investment Grade Rating Event.

 

“Continuing Director” means, as of any date of determination, any member of the Parent Guarantor’s Board of Directors who:

 

(1)                                was a member of the Parent Guarantor’s Board of Directors on the first date that any of the Notes were issued; or

 

(2)                                was nominated for election or elected to the Parent Guarantor’s Board of Directors with the approval of a majority of the directors in office at the time of such nomination or election (a) who were either members of the Parent Guarantor’s Board of Directors on the first date that any of the Notes were issued or (b) whose nomination or election was so previously approved.

 

“Investment Grade Rating” means a rating equal to or higher than Baa3 (or the equivalent) by Moody’s and BBB- (or the equivalent) by S&P.

 

“Moody’s” means Moody’s Investors Service, Inc.

 

 

“Person” means any individual, corporation, partnership, association, joint venture, trust or any other entity or organization, including a government or political subdivision or an agency or instrumentality thereof.

 

“Rating Agency” means each of S&P and Moody’s, or if S&P or Moody’s or both shall not make a rating on the Notes publicly available, a nationally recognized statistical rating agency or agencies, as the case may be, selected by the Company (as certified by Board Resolutions) which shall be substituted for S&P or Moody’s, or both, as the case may be.

 

“S&P” means Standard & Poor’s Ratings Services, a division of The McGraw-Hill Companies, Inc.

 

“Voting Stock” means, with respect to any Person, the Capital Stock of such Person that is at the time entitled to vote generally in the election of the board of directors (or the equivalent) of such Person.

 

If an Event of Default with respect to the Notes shall occur and be continuing, the principal amount of all the Notes may be declared due and payable in the manner and with the effect provided in the Indenture.

 

The Indenture permits, with certain exceptions as therein provided, the amendment thereof and the modification of the rights and obligations of the Company and, if applicable, the Guarantors and the rights of the Holders of the Securities of each series issued under the Indenture at any time by the Company and, if applicable, the Guarantors, and the Trustee with the consent of the Holders of not less than a majority in aggregate principal amount of the Securities at the time Outstanding of each series affected thereby. The Indenture also contains provisions permitting the Holders of specified percentages in aggregate principal amount of the Securities of any series at the time Outstanding, on behalf of the Holders of all Securities of such series, to waive compliance by the Company and, if applicable, the Guarantors with certain provisions of the Indenture and certain past defaults under the Indenture and their consequences. Any such consent or waiver by the Holder of this Note shall be conclusive and binding upon such Holder and upon all future Holders of this Note and of any Notes issued upon the registration of transfer hereof or in exchange herefor or in lieu hereof; whether or not notation of such consent or waiver is made upon this Note.

 

No reference herein to the Indenture and no provision of this Note or of the Indenture shall alter or impair the obligations of the Company and the Guarantors, which are absolute and unconditional, to pay the principal of, premium, if any, and interest on this Note, at the times, place and rate, and in the coin or currency, herein and in the Indenture prescribed.

 

As provided in the Indenture and subject to certain limitations set forth therein and in this Note, the transfer of this Note is registerable on the Security Register of the Company, upon surrender of this Note for registration of transfer at the office or agency of the Company or the Guarantors in any place where the principal of (and premium, if any) and interest on this Note are payable, duly endorsed by, or accompanied by a written instrument of transfer in form satisfactory to the Company and the Security Registrar duly executed by the Holder hereof or

 

 

such Holder’s attorney duly authorized in writing, and thereupon one or more new Notes of this series and of like tenor, of authorized denominations and for the same aggregate principal amount, will be issued to the designated transferee or transferees.

 

No service charge shall be made for any such registration of transfer or exchange, but the Company may require payment of a sum sufficient to cover any tax or other governmental charge payable in connection therewith, other than in certain cases provided in the Indenture.

 

Prior to due presentment of this Note for registration of transfer, the Company, the Guarantors, the Trustee and any agent of the Company, the Guarantors or the Trustee may treat the Person in whose name this Note is registered as the owner hereof for all purposes, whether or not this Note is overdue, and none of the Company, the Guarantors, the Trustee or any such agent shall be affected by notice to the contrary.

 

The Indenture contains provisions whereby (i) the Company or the Guarantors may be discharged from their obligations with respect to the Notes (subject to certain exceptions) or (ii) the Company or the Guarantors may be released from their obligations under specified covenants and agreements in the Indenture, in each case if the Company or any Guarantor irrevocably deposits with the Trustee money or U.S. Government Obligations sufficient to pay and discharge the entire indebtedness on all Notes of this series, and satisfies certain other conditions, all as more fully provided in the Indenture.

 

This Note shall be governed by and construed in accordance with the laws of the State of New York.

 

All terms used in this Note which are defined in the Indenture shall have the meanings assigned to them in the Indenture.

 

Unless the certificate of authentication hereon has been duly executed by the Trustee referred to below, directly or through an Authenticating Agent, by manual signature of an authorized signatory, this Note shall not be entitled to any benefit under the Indenture or be valid or obligatory for any purpose.

 

 

IN WITNESS WHEREOF, the Company has caused this instrument to be duly executed, manually or by facsimile by an authorized signatory.

 

	
Dated:
    	
 
    	
 
    
	
[SEAL]
    	
 
    	
CINTAS CORPORATION   NO. 2
    
	
 
    	
 
    	
as Issuer
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
By: 
    	
 
    
	
 
    	
 
    	
 
    	
Name:
    
	
 
    	
 
    	
 
    	
Title:
    
	
 
    	
 
    	
 
    
	
Attest:
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    
	
By: 
    	
 
    	
 
    	
 
    
	
 
    	
Name:
    	
 
    	
 
    
	
 
    	
Title:
    	
 
    	
 
    

 

TRUSTEE’S CERTIFICATE OF AUTHENTICATION

 

This is one of the Securities of the series designated therein referred to in the within-mentioned Indenture.

 

	
 
    	
U.S. BANK NATIONAL   ASSOCIATION
    
	
 
    	
as Trustee
    
	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
 
    	
Authorized Signatory
    
	
 
    	
 
    

 

 

GUARANTEE

 

For value received, each of the undersigned hereby irrevocably and unconditionally guarantees (subject to release, if applicable, upon the terms set forth in the Indenture), jointly and severally, on a senior basis to the Holder of this Note and to the Trustee, on behalf of the Holder, (i) due and punctual payment of principal, premium, if any, and interest on this Note, when and as the same shall become due and payable, whether at Stated Maturity, by declaration of acceleration or otherwise, the due and punctual payment of interest on the overdue principal of (and premium, if any) and interest, if any, on this Note, to the extent lawful, and the due and punctual performance of all other obligations of the Company to the Holder of this Note or the Trustee all in accordance with the terms of this Note and the Indenture and (ii) in the case of any extension of time of payment or renewal of this Note or any of such other obligations, that the same will be promptly paid in full when due or performed in accordance with the terms of the extension or renewal, at Stated Maturity, by declaration of acceleration or otherwise. This Guarantee will not be valid or obligatory for any purpose until the Trustee duly executes the certificate of authentication on the Note upon which this Guarantee is endorsed.

 

	
Dated:
    	
 
    
	
 
    	
Cintas   Corporation,
    
	
 
    	
a Washington   corporation;
    
	
 
    	
 
    
	
 
    	
Cintas Corporate   Services, Inc.,
    
	
 
    	
an Ohio   corporation;
    
	
 
    	
 
    
	
 
    	
Cintas Corporation   No. 3,
    
	
 
    	
a Nevada   corporation;
    
	
 
    	
 
    
	
 
    	
Cintas Corp. No. 8, Inc.,
    
	
 
    	
a Nevada   corporation;
    
	
 
    	
 
    
	
 
    	
Cintas Corp.   No. 15, Inc.,
    
	
 
    	
a Nevada   corporation;
    
	
 
    	
 
    
	
 
    	
Cintas—RUS, LP.,
    
	
 
    	
a Texas limited   partnership
    
	
 
    	
 
    
	
 
    	
(by Cintas   No. 8, its General Partner);
    
	
 
    	
 
    	
 
    
	
 
    	
By: 
    	
 
    
	
 
    	
 
    	
Authorized   Signatory for each of the Guarantors
    
	
 
    	
 
    
	
 
    	
Attest:
    
	
 
    	
 
    	
 
    
	
 
    	
By: 
    	
 
    
	
 
    	
 
    	
Authorized   Signatory for each of the Guarantors
    

 

 

ABBREVIATIONS

 

The following abbreviations, when used in the inscription on the face of this instrument, shall be construed as though they were written out in full according to applicable laws or regulations:

 

	
TEN COM — 
    	
as tenants in   common UNIF GIFT MN ACT—                Custodian           
    
	
 
    	
 
    
	
TEN ENT — 
    	
as tenants by the   entireties (Cust)      (Minor)
    
	
 
    	
 
    
	
JT TEN —
    	
as joint tenants   with right of survivorship Under Uniform Gifts to Minors
    
	
 
    	
 
    
	
 
    	
and not as tenants   in   common                Act                         
    
	
 
    	
 
    
	
(State)
    

 

Additional abbreviations may also be used though not in the above list.

 

FOR VALUE RECEIVED, the undersigned registered holder hereby sell(s), assign(s) and transfer(s) unto

 

PLEASE INSERT SOCIAL SECURITY OR OTHER IDENTIFYING NUMBER OF ASSIGNEE

 

 

 

PLEASE PRINT OR TYPEWRITE NAME AND ADDRESS OF ASSIGNEE

 

 

the within Note and all rights thereunder, hereby irrevocably constituting and appointing

 

 

to transfer said Note on the books of the Company with full power of substitution in the premises.

 

	
Dated:
    	
 
    	
 
    

 

Notice: The signature to this assignment must correspond with the name as it appears upon the face of the within Note in every particular, without alteration or enlargement or any change whatever.

 

 

	
Signature   Guarantee:
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
(Signature must be   guaranteed)
    	
 
    	
Signature
    

 

The signature(s) should be guarantees by an eligible guarantor institution (banks, stockbrokers, savings and loan associations and credit unions with membership in an approved signature guarantee medallion program), pursuant to S.E.C. Rule l7Ad-15.

 

 

OPTION OF HOLDER TO ELECT PURCHASE

 

To elect to have this Note purchased by the Company pursuant to the Change of Control Repurchase Event provisions of the Notes, check the box below:

 

o Purchase pursuant to Change of Control Repurchase Event

 

If you want to elect to have only part of the Note purchased by the Company pursuant to pursuant to the Change of Control Repurchase Event provisions of the Notes, state the amount you elect to have purchased:

 

$

	
Dated:
    	
 
    	
 
    	
 
    

 

Notice: The signature to this election must correspond with the name as it appears upon the face of the within Note in every particular, without alteration or enlargement or any change whatever.

 

	
Signature Guarantee:
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
(Signature must be guaranteed)
    	
 
    	
Signature
    

 

The signature(s) should be guarantees by an eligible guarantor institution (banks, stockbrokers, savings and loan associations and credit unions with membership in an approved signature guarantee medallion program), pursuant to S.E.C. Rule l7Ad-15.

 

 

SCHEDULE OF INCREASES OR DECREASES IN GLOBAL NOTE

 

The following increases or decreases in this Global Note have been made

 

	
Date of Exchange
    	
 
    	
Amount of increase
   in Principal Amount
   of this Global Note
    	
 
    	
Amount of decrease
   in Principal Amount
   of this Global Note
    	
 
    	
Principal Amount of
   this Global Note
   following each
   decrease or increase
    	
 
    	
Signature of
    Authorized signatory
   of
    TrusteeExhibit 10.1

 

This STANDSTILL AGREEMENT (this “Agreement”) is dated as of the 20th day of May, 2011 by and between Level 3 Communications, Inc., a Delaware corporation (the “Company”), and Southeastern Asset Management, Inc., a Tennessee corporation (“Southeastern”).  This Agreement will only become effective as provided in Section 5.11 below.

 

W I T N E S S E T H:

 

WHEREAS, Southeastern is the Beneficial Owner (as defined below) of shares of common stock, $.01 par value per share (“Common Stock”), of the Company; and

 

WHEREAS, the Company and Southeastern are parties to a Standstill Agreement (the “Original Agreement”), dated as of October 26, 2009; and

 

WHEREAS, The Company and Southeastern desire to amend and restate the terms of the Original Agreement as set forth in this Agreement to become effective as provided in Section 5.11 below; and

 

WHEREAS, pursuant to Section 4.1(a)(i)(B) of the Original Agreement, during the Standstill Period (as defined in the Original Agreement), Southeastern has agreed not to, without the prior written consent of the majority of the entire Board of Directors (excluding any representatives or designees of Southeastern), alone or in concert with others, acquire any Common Stock, Voting Securities or Derivative Securities (as those terms are defined in the Original Agreement) of the Company, other than in open market transactions that do not involve the issuance of Common Stock by the Company and unless after giving effect to such acquisition Southeastern would Beneficially Own less than 557,300,000 shares of Common Stock;

 

WHEREAS, on April 10, 2011, the Company entered into an Agreement and Plan of Amalgamation (the “Amalgamation Agreement”) with Apollo Amalgamation Sub, Ltd., a Bermuda exempted limited liability company and a direct wholly owned subsidiary of the Company, and Global Crossing Limited, a Bermuda exempted limited liability company (“Global Crossing”);

 

WHEREAS, the Amalgamation Agreement provides that, among other things and subject to the satisfaction of certain closing conditions set forth therein, (1) Apollo Amalgamation Sub, Ltd. and Global Crossing will amalgamate pursuant to Bermuda law (the “Amalgamation”) and continue as a Bermuda exempted limited liability company, (2) each issued and outstanding common share of Global Crossing, other than dissenting shares or shares held by the Company or Global Crossing, will be exchanged for 16 shares of the Company’s Common Stock (the “Amalgamation Consideration”), and (3) each issued and outstanding share of Global Crossing’s convertible preferred stock will be exchanged for the Amalgamation Consideration, plus an amount equal to the aggregate accrued and unpaid dividends thereon;

 

WHEREAS, subject to, and conditioned upon, the consummation of the transactions contemplated by the Amalgamation Agreement, the Company and Southeastern desire to increase the maximum number of shares of Common Stock that Southeastern is permitted to beneficially own pursuant to the terms of the Original Agreement, including, without limitation, shares of Common Stock that Southeastern would beneficially own upon the consummation of the Amalgamation as a result of the conversion of any shares of Global

 

 

Crossing common shares that may then be beneficially owned by Southeastern into shares of the Company’s Common Stock;

 

WHEREAS, Southeastern and the Company desire to extend the term of the Original Agreement by two additional years;

 

WHEREAS, the Company and Southeastern intend that this Agreement will have effect automatically upon the consummation of the Amalgamation, that the Original Agreement shall remain in full force and effect until the consummation of the Amalgamation and that if the Amalgamation Agreement is terminated, this Agreement will automatically terminate and the Original Agreement will remain in full force and effect;

 

WHEREAS, the Company (by action of a majority of the entire Board of Directors of the Company) has approved this Agreement; and

 

WHEREAS, the Company and Southeastern hereby agree to enter into this Agreement providing for standstill and transfer restrictions, which shall supercede the Original Agreement.

 

NOW THEREFORE, in consideration of the mutual agreements, representations, warranties and covenants herein contained, the parties hereto agree as follows:

 

1.             Definitions.  As used in this Agreement, the following terms shall have the following respective meanings:

 

(a)           “Advisory Clients” shall mean those institutional investment clients of Southeastern on whose behalf Southeastern Beneficially Owns and may acquire shares of Common Stock.

 

(b)           “Affiliate” shall mean, with respect to any Person, any other Person controlling, controlled by or under direct or indirect common control with such Person.  For the purposes of this definition “control,” when used with respect to any specified Person, shall mean the power to direct the management and policies of such Person, directly or indirectly, whether through ownership of voting securities, by contract or otherwise; and the terms “controlling” and “controlled” shall have meanings correlative to the foregoing.

 

(c)           “Beneficially Own” with respect to any securities means having “beneficial ownership” of such securities (as determined pursuant to Rule 13d-3 under the Exchange Act, as in effect on the date hereof); provided, however, that a Person will be deemed to beneficially own (and have beneficial ownership of) all securities that such Person has the right to acquire, whether such right is exercisable immediately or with the passage of time or the satisfaction of conditions.  The terms “Beneficial Ownership” and “Beneficial Owner” have correlative meanings.

 

(d)           “Board of Directors” shall mean the board of directors of the Company.

 

(e)           “Derivative Security” shall mean any subscription, option, conversion right, warrant, phantom stock right or other agreement, security or commitment of any kind

 

2

 

obligating the Company or any of its subsidiaries to issue, grant, deliver or sell, or cause to be issued, granted, delivered or sold, (i) any Voting Securities or any other equity security of the Company, (ii) any securities convertible into, or exchangeable or exercisable for, any Voting Securities or other equity security of the Company or (iii) any obligations measured by the price or value of any shares of capital stock of the Company.

 

(f)            “Exchange Act” shall mean the Securities Exchange Act of 1934 and all of the rules and regulations promulgated thereunder.

 

(g)           “Group” shall mean any group of Persons who, with respect to those acquiring, holding, voting or disposing of Voting Securities would, assuming ownership of the requisite percentage thereof, be required under Section 13(d) of the Exchange Act to file a statement on Schedule 13D with the SEC as a “person” within the meaning of Section 13(d)(3) of the Exchange Act, or who would be considered a “person” for purposes of Section 13(g)(3) of the Exchange Act.

 

(h)           “Person” shall mean an individual, partnership, corporation, limited liability company, business trust, joint stock company, trust, unincorporated association or joint venture.

 

(i)            “SEC” shall mean the Securities and Exchange Commission.

 

(j)            “Securities Act” shall mean the Securities Act of 1933, as amended, and all of the rules and regulations promulgated thereunder.

 

(k)           “Voting Securities” shall mean the shares of the Common Stock and any other capital stock or equity securities of the Company having the general voting power under ordinary circumstances to elect members of the Board of Directors, and any other securities which are convertible into, or exchangeable or exercisable for, Voting Securities.

 

2.             Representations and Warranties of the Company.  The Company hereby represents and warrants to Southeastern as follows:

 

2.1.          Authorization.  All corporate action on the part of the Company, its officers, directors and stockholders necessary for the authorization, execution, delivery and performance of this Agreement has been taken.  When executed and delivered by the Company, this Agreement shall constitute the legal, valid and binding obligation of the Company, enforceable against the Company in accordance with its terms, except as may be limited by bankruptcy, insolvency, reorganization or other laws affecting creditors’ rights generally and by general equitable principles.  The Company has all requisite corporate power to enter into this Agreement and to carry out and perform its obligations under the terms of this Agreement.

 

2.2.          Consents.  All consents, approvals, orders and authorizations required on the part of the Company in connection with the execution, delivery or performance of this Agreement and the consummation of the transactions contemplated herein, other than (i) such filings required to be made after the Closing under applicable federal and state securities laws and (ii) any of the foregoing, the failure to make or obtain would not, individually or in the aggregate, be reasonably expected to have a material adverse effect (a) on the Company and its

 

3

 

subsidiaries, taken as a whole, or (b) on the ability of the Company to perform its obligations under this Agreement.

 

2.3.          No Conflict.  The execution and delivery of this Agreement by the Company will not conflict with or result in any violation of or default (with or without notice or lapse of time, or both) under, or give rise to a right of termination, cancellation or acceleration of any obligation or to a loss of a material benefit under (i) any provision of the Certificate of Incorporation or By-laws of the Company or (ii) any agreement or instrument, permit, franchise, license, judgment, order, statute, law, ordinance, rule or regulations, applicable to the Company or its properties or assets, except, in the case of clause (ii), as would not, individually or in the aggregate, be reasonably expected to have a material adverse effect (a) on the Company and its subsidiaries, taken as a whole, or (b) on the ability of the Company to perform its obligations under this Agreement.

 

3.             Representations and Warranties of Southeastern.  Southeastern, for itself (unless otherwise indicated), represents and warrants to the Company as follows:

 

3.1.          Authorization.  All action on the part of Southeastern and on the part of its Advisory Clients necessary for the authorization, execution, delivery and performance of this Agreement has been taken.  This Agreement constitutes the legal, valid and binding obligation of Southeastern, enforceable against Southeastern in accordance with its terms, except as such may be limited by bankruptcy, insolvency, reorganization or other laws affecting creditors’ rights generally and by general equitable principles.  Southeastern has all requisite power to enter into this Agreement and to carry out and perform its obligations under the terms of this Agreement.

 

3.2.          No Conflict.  The execution and delivery of this Agreement by Southeastern will not conflict with or result in any violation of or default by Southeastern (with or without notice or lapse of time, or both) under, or give rise to a right of termination, cancellation or acceleration of any obligation or to a loss of a material benefit under (i) any provision of the organizational documents of Southeastern or (ii) any agreement or instrument, permit, franchise, license, judgment, order, statute, law, ordinance, rule or regulations, applicable to Southeastern or its respective properties or assets, except, in the case of clause (ii), as would not, individually or in the aggregate, be reasonably expected to have a material adverse effect (a) on Southeastern or (b) on the ability of Southeastern to perform its obligations under this Agreement.

 

3.3.          Consents.  All consents, approvals, orders and authorizations required on the part of Southeastern and, to its knowledge, on the part of its Advisory Clients, in connection with the execution, delivery or performance of this Agreement have been obtained and are effective.

 

3.4.          Beneficial Ownership.  As of the date hereof, Southeastern Beneficially Owns approximately 31.2% of the Common Stock, such percentage including certain shares of Common Stock issuable upon conversion of convertible senior notes issued by the Company.  Southeastern has not formed a Group with any other Person or Persons and is not a member of a Group.  Southeastern shall not take any actions such that it and any other Person or Persons may

 

4

 

be deemed to be a Group, based upon the reported shares of the Company’s Common Stock outstanding on the Company’s Form 10-Q for the three months ended March 31, 2011.

 

3.5.          Investment Company Act.  Southeastern is not a “participant in a joint enterprise”, within the meaning of Section 17(d) of the Investment Company Act of 1940, as amended (the “1940 Act”) and Rule 17d-1 thereunder, with Longleaf Partners Fund (the “Fund”) as a consequence of the transactions contemplated by this Agreement, and the Board of Directors of the Fund, including a majority of the directors who are not “interested persons” (as that term is defined in the 1940 Act) of the Fund, have found that any interest of Southeastern in a participant in the transactions contemplated by this Agreement is not “material” within the meaning of Rule 17d-1(d)(5) under the 1940 Act, and have recorded or shall record the basis for that finding in the minutes of the meeting of its Board of Directors, and to the best of Southeastern’s knowledge no other Person is a party to the transactions contemplated by this Agreement or has a direct or indirect Financial Interest (as defined in 17d-1(d)(5)) in a party to such transactions other than the Fund that would cause the exemption afforded by 17d-1(d)(5) in respect of the Fund’s participation to be unavailable.

 

4.             Covenants.

 

4.1.          Standstill.

 

(a)           During the Standstill Period (as defined below), Southeastern shall not, without the prior written consent of the majority of the entire Board of Directors (excluding any representatives or designees of Southeastern), either directly or indirectly (including in a manner willfully designed to circumvent the following provisions), alone or in concert with others:

 

(i)            in any manner acquire, agree to acquire or make any public proposal to acquire (whether directly or indirectly, by purchase, tender or exchange offer):

 

A.            any material assets of the Company or any subsidiary of the Company; or

 

B.                                     any Common Stock, Voting Securities or Derivative Securities of the Company (x) other than in open market transactions that do not involve the issuance of Common Stock by the Company and (y) unless after giving effect to such acquisition Southeastern would Beneficially Own less than 690,000,000 shares of Common Stock (subject to appropriate adjustment to take into account any stock splits, subdivisions, stock dividends, combinations, reclassifications or similar events occurring after the date hereof); provided that Southeastern shall in no event make any such acquisition for its own account or on behalf of any Advisory Client if it or such Advisory Client is on the date of such purchase or would become, as a result of such purchase, a “5-percent shareholder” of the Company within the meaning of Section 382 of the Internal Revenue Code of 1986, as amended, and the regulations promulgated thereunder (including all applicable attribution rules) (the “Code”);

 

(ii)           enter into any arrangements, understandings or agreements (whether written or oral) with any Person or take any action, that would cause, or have the effect of

 

5

 

causing, directly or indirectly, (1) a “change of control” as defined in the indentures, supplemental indentures or credit agreements, as the case may be, relating to any indebtedness for borrowed money of the Company or any of its subsidiaries or (2) the Company to undergo an “ownership change” within the meaning of the Code;

 

(iii)          form, join or participate in a Group in connection with any of the foregoing; or

 

(iv)          make or cause the Company to make a public announcement regarding any intention of Southeastern to take an action which would be prohibited by any of the foregoing.

 

(b)           The term “Standstill Period” shall mean the period beginning on February 18, 2005 and ending on February 18, 2015.

 

4.2.          Transfer Restrictions.

 

(a)           During the Standstill Period, Southeastern shall not sell, assign, pledge, transfer or otherwise dispose or encumber (“Transfer”) to any Person or Persons any shares of Common Stock that it Beneficially Owns (x) in negotiated transactions (including in accordance with Rule 144A under the Securities Act) if such Person (together with its Affiliates) would Beneficially Own, after giving effect to such Transfer (or series of Transfers), twenty percent (20%) or more of the Common Stock; provided that a sale of Common Stock by Southeastern in an open market broker sale transaction complying with Rules 144(f) and (g)(1) and (g)(2) under the Securities Act without knowledge by Southeastern of the identity of the acquiror at the time of the sale transaction shall not constitute a negotiated transaction, or (y) if the price paid in such transaction is at a premium to the then-current market price of the Common Stock during regular trading hours on the national securities exchange on which the Common Stock is then traded.

 

(b)           Notwithstanding the foregoing, Southeastern shall be permitted to tender any shares of Common Stock it Beneficially Owns pursuant to a tender offer by a third party for shares of Common Stock that is open to all stockholders of the Company, so long as a majority of the entire Board of Directors (excluding any representatives or designees of Southeastern) has recommended to the stockholders of the Company that such stockholders accept such tender offer and tender their shares in such tender offer.

 

5.             Miscellaneous Provisions.

 

5.1.          Public Statements or Releases.  Neither the Company nor Southeastern shall make any public announcement with respect to the existence or terms of this Agreement or the transactions provided for herein without the prior approval of the other party, which shall not be unreasonably withheld or delayed.  Notwithstanding the foregoing, nothing in this Section 5.1 shall prevent either party from making any public announcement it considers necessary in order to satisfy its obligations under the law or the rules of any national securities exchange or market, provided such party, to the extent practicable, provides the other party with an opportunity to review and comment on any proposed public announcement before it is made.

 

6

 

5.2.                              Pronouns.  All pronouns or any variation thereof shall be deemed to refer to the masculine, feminine or neuter, singular or plural, as the identity of the person, persons, entity or entities may require.

 

5.3.                              Notices.

 

(a)                                  Any notices, reports or other correspondence (hereinafter collectively referred to as “correspondence”) required or permitted to be given hereunder shall be sent by postage prepaid first class mail, courier or delivered by hand to the party to whom such correspondence is required or permitted to be given hereunder.  The date of giving any notice shall be the date of its actual receipt.

 

(b)                                 All correspondence to the Company shall be addressed as follows:

 

Level 3 Communications, Inc.

1025 Eldorado Boulevard

Broomfield, CO 80021

Attention:  John M. Ryan, Esq.

 

with a copy to:

 

Willkie Farr & Gallagher LLP
 787 Seventh Avenue
 New York, NY 10019
 Attention:  David K. Boston

 

(c)                                  All correspondence to Southeastern shall be addressed as follows:

 

Southeastern Asset Management, Inc.
 6410 Poplar Avenue, Suite 900
 Memphis, TN 38119

Attention:  Andrew R. McCarroll, Vice President and General Counsel

 

(d)                                 Any Person may change the address to which correspondence to it is to be addressed by notification as provided for herein.

 

5.4.                              Captions.  The captions and paragraph headings of this Agreement are solely for the convenience of reference and shall not affect its interpretation.

 

5.5.                              Severability.  Should any part or provision of this Agreement be held unenforceable or in conflict with the applicable laws or regulations of any jurisdiction, the invalid or unenforceable part or provisions shall be replaced with a provision which accomplishes, to the extent possible, the original business purpose of such part or provision in a valid and enforceable manner, and the remainder of this Agreement shall remain binding upon the parties hereto.

 

7

 

5.6.          Governing Law.  This Agreement shall be governed by, and construed in accordance with, the laws of the State of New York, without giving effect to conflict of law principles thereof.

 

5.7.          Waiver.  No waiver of any term, provision or condition of this Agreement, whether by conduct or otherwise, in any one or more instances, shall be deemed to be, or be construed as, a further or continuing waiver of any such term, provision or condition or as a waiver of any other term, provision or condition of this Agreement.

 

5.8.          Assignment.  The rights and obligations of the parties hereto shall inure to the benefit of and shall be binding upon the authorized successors and permitted assigns of each party.  None of the parties may assign its rights or obligations under this Agreement or designate another person (i) to perform all or part of its obligations under this Agreement or (ii) to have all or part of its rights and benefits under this Agreement, in each case without the prior written consent of the other party.  In the event of any assignment in accordance with the terms of this Agreement, the assignee shall specifically assume and be bound by the provisions of the Agreement by executing and agreeing to an assumption agreement reasonably acceptable to the Company.

 

5.9.          Counterparts.  This Agreement may be signed in one or more counterparts, each of which shall be an original, but all of which together shall constitute one instrument

 

5.10.        Entire Agreement.  Upon effectiveness in accordance with Section 5.11, this Agreement shall constitute the entire agreement between the parties hereto respecting the subject matter hereof and shall supersede all prior agreements, negotiations, understandings, representations and statements respecting the subject matter hereof, whether written or oral, including, without limitation, the Original Agreement.  Except as expressly provided in Section 4.1, no modification, alteration, waiver or change in any of the terms of this Agreement shall be valid or binding upon the parties hereto unless made in writing and duly executed by the Company and Southeastern.

 

5.11.        Effectiveness.  This Agreement will become effective automatically without any additional action required by either Southeastern or the Company upon the consummation of the Amalgamation contemplated by the Amalgamation Agreement.  Prior to the consummation of the Amalgamation, the Original Agreement shall remain in full force and effect.  In the event that the Amalgamation Agreement is terminated for any reason whatsoever, this Agreement shall automatically terminate and the Original Agreement shall remain in full force and effect.

 

 [Signature page follows]

 

8

 

IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the day and year first above written.

 

 

	
 
    	
LEVEL 3 COMMUNICATIONS, INC.
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/   John M. Ryan
    
	
 
    	
 
    	
Name:
    	
John   M. Ryan
    
	
 
    	
 
    	
Title:
    	
Executive   Vice President and
    
	
 
    	
 
    	
 
    	
Chief Legal Officer
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
SOUTHEASTERN ASSET MANAGEMENT, INC.,
    
	
 
    	
 
    	
on behalf of certain institutional clients
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/   Andrew R. McCarroll
    
	
 
    	
Name:
    	
Andrew   R. McCarroll
    
	
 
    	
Title:
    	
Vice President and General Counsel

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