MINERALS TECHNOLOGIES INC.
Note Purchase Agreement
Dated as of July 24, 1996
$50,000,000 7.49% Guaranteed Senior Notes
Due July 24, 2006
TABLE OF CONTENTS
PAGE
1. PURCHASE AND SALE OF NOTES 1
1.1 Issue of Notes 1
1.2 The Closing 2
1.3 Representations of the Purchaser 3
1.4 Failure To Deliver, Failure of Conditions 4
1.5 Expenses 4
2. REPRESENTATIONS AND WARRANTIES 5
2.1 Nature of Business 5
2.2 Financial Statements; Debt; Material
Adverse Change 6
2.3 Subsidiaries and Affiliates 6
2.4 Pending Litigation 7
2.5 Properties; Insurance 8
2.6 Patents, Trademarks, Licenses, etc. 8
2.7 Taxes 8
2.8 Full Disclosure 9
2.9 Corporate Organization and Authority 9
2.10 Restrictions on the Company, Guarantors
and Subsidiaries of the Company 10
2.11 Compliance with Law 11
2.12 ERISA 11
2.13 Certain Laws 14
2.14 Environmental Compliance 15
2.15 Sale is Legal and Authorized; Obligations
are Enforceable 16
2.16 Governmental Consent 17
2.17 Private Offering 17
2.18 No Defaults 18
2.19 Use of Proceeds 18
2.20 Relationship of Company, Subsidiaries
and Guarantors 19
3. CLOSING CONDITIONS 19
3.1 Opinions of Counsel 19
3.2 Representations and Warranties True;
No Prohibited Action 20
3.3 Officers' Certificates 20
3.4 Legality 21
3.5 Private Placement Number 21
3.6 Expenses 21
3.7 Proceedings Satisfactory 21
3.8 Compliance with this Agreement 22
3.9 No Dissolution, Merger or Change in Control 22
4. SPECIAL RIGHTS OF INSTITUTIONS 22
4.1 Direct Payment 22
4.2 Delivery Expenses 23
4.3 Issue Taxes 23
5. PREPAYMENTS 24
5.1 Offer to Prepay upon Change in Control 24
5.2 Optional Prepayments 25
5.3 Notice of Optional Prepayment 25
5.4 Partial Prepayment Pro Rata 26
5.5 Notation of Notes on Prepayment 27
5.6 No Other Optional Prepayments 27
6. REGISTRATION; SUBSTITUTION OF NOTES 28
6.1 Registration of Notes 28
6.2 Exchange of Notes 28
6.3 Replacement of Notes 29
6.4 Guarantors' Responsibility in respect
of New Notes 29
7. COMPANY BUSINESS COVENANTS 29
7.1 Payment of Taxes and Claims 29
7.2 Maintenance of Properties and
Corporate Existence 30
7.3 Payment of Notes and Maintenance of Office 31
7.4 Merger; Acquisition; Sale of Assets 31
7.5 Restricted Payments and Restricted
Investments 34
7.6 Subsidiary Debt 35
7.7 Consolidated Funded Debt to Consolidated
Total Capitalization 35
7.8 Consolidated Net Worth 36
7.9 Liens 36
7.10 ERISA 40
7.11 Transactions with Affiliates 41
7.12 Pro-Rata Offers 42
7.13 Private Offering 42
7.14 Environmental Compliance 42
7.15 Sales of Subsidiary Stock 43
7.16 Pari Passu Ranking of Notes 45
8. INFORMATION AS TO COMPANY 45
8.1 Financial and Business Information 45
8.2 Officers' Certificates 50
8.3 Accountants' Certificates 50
8.4 Inspection 51
8.5 Report to NAIC 51
9. EVENTS OF DEFAULT 51
9.1 Nature of Events 51
9.2 Default Remedies 54
9.3 Annulment of Acceleration of Notes 57
9.4 Application of Acceleration Payments 57
10. GUARANTY AND OTHER RIGHTS AND UNDERTAKINGS
OF GUARANTORS 58
10.1 Guaranteed Obligations 58
10.2 Performance by Guarantors 59
10.3 Waivers; Subrogation; Offsets 59
10.4 Releases 60
10.5 Marshaling; Revival of Obligations 61
10.6 Subordination 62
10.7 No Election 62
10.8 Severability 63
10.9 Other Enforcement Rights 63
10.10 Delay or Omission; No Waiver 63
10.11 Restoration of Rights and Remedies 64
10.12 Cumulative Remedies 64
10.13 Miscellaneous 64
10.14 Continuing Guaranty 65
10.15 Inspection 65
10.16 Maintenance of Properties and
Corporate Existence 66
10.17 Merger; Acquisition 66
10.18 Pro-Rata Offers 67
10.19 Private Offering 67
10.20 Pari Passu Ranking of Guaranty 67
11. INTERPRETATION OF THIS AGREEMENT 68
11.1 Terms Defined 68
11.2 Directly or Indirectly 88
11.3 Section Headings; Table of Contents;
Construction 88
11.4 Governing Law 88
12. MISCELLANEOUS 88
12.1 Communications 88
12.2 Reproduction of Documents 90
12.3 Survival 90
12.4 Successors and Assigns 91
12.5 Amendment and Waiver 91
12.6 Payments, When Received 93
12.7 Entire Agreement 94
12.8 Duplicate Originals, Execution in
Counterpart 94
12.9 Confidentiality 94
MINERALS TECHNOLOGIES INC.
NOTE PURCHASE AGREEMENT
$50,000,000 7.49% GUARANTEED SENIOR NOTES
DUE JULY 24, 2006
Dated as of July 24, 1996
Metropolitan Life Insurance Company
One Madison Avenue
New York, New York 10010
Ladies and Gentlemen:
Each of MINERALS TECHNOLOGIES INC. (together with its
successors and assigns, the "Company"), a Delaware corporation,
and SPECIALTY MINERALS INC., a Delaware corporation, MINTEQ
INTERNATIONAL INC., a Delaware corporation and BARRETTS MINERALS
INC., a Delaware corporation (the last three together with their
respective successors and assigns, being referred to collectively
herein as the "Guarantors" and individually as a "Guarantor"),
hereby agrees with you as follows:
1. PURCHASE AND SALE OF NOTES
1.1 Issue of Notes.
The Company has authorized the issuance of Fifty Million
Dollars ($50,000,000) in aggregate principal amount of its seven
and forty-nine one-hundredths percent (7.49%) Guaranteed Senior
Notes due July 24, 2006(the "Notes"). Each Note shall:
(a) bear interest (computed on the basis of a 360-day year
of twelve 30-day months) on the unpaid principal balance thereof
from the date of such Note at the rate of
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seven and forty-nine one-hundredths percent (7.49%) per annum,
payable semi-annually on the 24th day of each July and the 24th
day of each January in each year commencing on January 24, 1997,
until the principal amount thereof shall be due and payable, and
(b) bear interest, payable on demand, on any overdue
principal (including any overdue prepayment of principal) and
Make-Whole Amount, if any, and (to the extent permitted by
applicable law) on any overdue installment of interest, at a rate
equal to the lesser of
(i) the highest rate allowed by applicable law or
(ii) eight and forty-nine one-hundredths percent
(8.49%) per annum,
(c) mature on July 24, 2006 and
(d) otherwise be in the form of the Note set out in Exhibit
A hereto.
1.2 The Closing.
(a) Purchase and Sale of Notes. The Company hereby
agrees to sell to you and you hereby agree to purchase from the
Company, on the Closing Date, in accordance with the provisions
hereof, the principal amount of Notes set forth opposite your
name on Annex 1.2 hereto (in the amount or amounts set forth
therein) at one hundred percent (100%) of the principal amount
thereof.
(b) The Closing. The closing (the "Closing") of the
Company's sale of Notes shall be held on July 24, 1996 (the
"Closing Date"), at 10:00 a.m., at the offices of Skadden, Arps,
Slate, Meagher & Flom, your special counsel, or at such other
time and place as you and the Company shall agree in writing. At
the Closing, the Company shall deliver to you one or more Notes
(as set forth opposite your name on Annex 1.2 hereto), in the
denominations indicated on Annex 1.2 hereto, in the aggregate
principal amount of your purchase, dated the Closing Date and
payable to you or payable as indicated on Annex 1.2 hereto,
against payment by federal funds wire transfer in immediately
available funds of the
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purchase price thereof, as directed by the Company on Annex 1.2
hereto.
1.3 Representations of the Purchaser.
(a) Purchase Other Than For Resale. You represent to the
Company that you are purchasing the Notes listed on Annex 1.2
hereto opposite your name for your own account or for the account
of one or more separate accounts maintained by you, with no
present intention of distributing the Notes or any part thereof,
but without prejudice to your right at all times to
(i) sell or otherwise dispose of all or any part of
the Notes in a transaction which complies with the
registration requirements, if any, of the Securities Act,
or in a transaction exempt from the registration
requirements of the Securities Act, and
(ii) have control over the disposition of all of your
assets and sell or otherwise dispose of assets to the
fullest extent required by any applicable insurance law.
It is understood that, in making the representations set out in
Section 2.16 and Section 2.17 hereof, the Company is relying, to
the extent applicable, upon your representation as aforesaid.
(b) ERISA. You further represent (and each subsequent
transferee, by acceptance of a replacement Note, shall be deemed
to represent) that either
(i) you are acquiring the Notes for your own account
with your general corporate assets and that no part of such
assets constitutes assets of an "employee benefit plan" (as
defined in this Section 1.3(b)) or a "plan" (as defined in
this Section 1.3(b)), or
(ii) you are acquiring the Notes for your own account
with general corporate assets and the purchase will be
exempt under the provisions of the Department of Labor
Prohibited Transaction Class Exemption 95-60, issued July
12, 1995 (60 FR 35925).
3
As used in this Section 1.3(b), the term "employee benefit
plan" has the meaning specified in section 3(3) of ERISA, and the
term "plan" has the meaning specified in section 4975(e)(1) of
the IRC.
1.4 Failure To Deliver, Failure of Conditions.
If at the Closing the Company fails to tender to you the
Notes to be purchased by you thereat, or if the conditions
specified in Section 3 hereof to be fulfilled prior to or at such
Closing have not been fulfilled, you may thereupon elect to be
relieved of all further obligations hereunder. Nothing in this
Section 1.4 shall operate to relieve the Company or any of the
Guarantors from any of their obligations hereunder or to waive
any of your rights against the Company or the Guarantors.
1.5 Expenses.
(a) Generally. Whether or not the Notes are sold,
the Company shall promptly (and in any event within
thirty (30) days of receiving any statement or invoice
therefor) pay all fees, expenses and costs relating
hereto, including but not limited to:
(I) the cost of reproducing this Agreement and
the Notes;
(ii) the reasonable fees and disbursements of
your special counsel in an amount not to exceed
$25,000;
(iii) the cost of delivering to your home office
or custodian bank, insured to your satisfaction,
the Notes purchased by you at the Closing;
(iv) the fees, expenses, costs and disbursements
incurred complying with each of the conditions to
closing set forth in Section 3 hereof without
duplication of any fees or disbursements included
in Section 1.5(a)(ii) above; and
(v) the fees, expenses, costs and disbursements
relating to the consideration, negotiation,
preparation or execution of any amend-
4
ments, waivers or consents requested by the
Company or occasioned by the occurrence of a
Default or Event of Default pursuant to the provi-
sions hereof (including, without limitation, the
reasonable fees and disbursements of your special
counsel and the allocated cost of your counsel who
are your employees or your affiliates' employees),
whether or not any such amendments, waivers or
consents are executed.
(b) Counsel. Without limiting the generality of
the foregoing, it is agreed and understood that the Company
will pay, at the Closing, the reasonable fees and dis-
bursements of your special counsel, in an amount not to
exceed $25,000, pursuant to an estimate thereof presented at
least three days prior to such Closing, and the Company will
also pay upon receipt of any statement thereof, any
additional reasonable fees and additional disbursements of
your special counsel pursuant to a statement thereof
rendered after the Closing.
(c) Survival. The obligations of the Company
under this Section 1.5 (and the Guarantors under Section 10
hereof in respect of this Section 1.5) shall survive the
payment or prepayment of the Notes and the termination here-
of.
2. REPRESENTATIONS AND WARRANTIES
To induce you to enter into this Agreement and to purchase
the Notes designated to be purchased by you on Annex 1.2, the
Company and the Guarantors jointly and severally warrant and
represent, as of the date hereof, as follows:
2.1 Nature of Business.
The Company has delivered to you complete and correct copies
of its annual report on Form 10-K for the fiscal year ended
December 31, 1994 and 1995 (the "Forms 10-K"). The Forms 10-K
correctly describe the general nature of the business and
principal Properties of the Company, such Guarantors and the
Subsidiaries of the Company as of their respective dates.
5
2.2 Financial Statements; Debt; Material Adverse Change.
(a) Financial Statements. The Consolidated Balance
Sheet of the Company and Subsidiary Companies as of December
31, 1995 and 1994, and the related Consolidated Statements
of Income, Shareholders' Equity and Cash Flows for each of
the years in the three-year period ended December 31, 1995,
all accompanied by the opinion thereon by KPMG Peat Marwick,
independent certified public accountants, have been deliv
ered to you, were prepared in accordance with generally
accepted accounting principles consistently applied, and
present fairly, in all material respects, the consolidated
financial position of the Company and its Subsidiary
Companies as of such dates and the results of their
operations and their cash flows for such periods. All such
financial statements include the accounts of the Company,
the Guarantors and all Subsidiaries of the Company for the
respective periods during which a subsidiary relationship
has existed.
(b) Neither the Company nor any Guarantors nor any
Subsidiary is liable for the repayment of any Debt other
than the Debt listed on Annex 2.2 as being outstanding on
the date hereof nor in an amount, as to any item or class
of Debt in excess of the amount set forth in Annex 2.2.
(c) Material Adverse Change. Since December 31, 1995,
there has been no change in the business, prospects,
profits, Properties or condition (financial or otherwise) of
the Company, any of the Guarantors or any of their
respective Subsidiaries except changes in the ordinary
course of business that, individually and in the aggregate,
have not had a Material Adverse Effect; on the date hereof
the fair saleable value of the assets of the Company exceeds
its liabilities and the Company is meeting current
obligations as they mature in the ordinary course of
business.
2.3 Subsidiaries and Affiliates.
Annex 2.3 hereto completely and accurately states,
6
(a) the name of each of the Subsidiaries of the
Company, its jurisdiction of incorporation and the
percentage of its Voting Stock owned by the Company
and/or each of the other Subsidiaries of the Company,
and
(b) the name of each of the Affiliates that are corpo-
rations, partnerships or joint ventures (other than Subsid-
iaries of the Company), the percentage of its Voting Stock
or other voting Securities owned by the Company, such
Guarantors and/or the other Subsidiaries of the Company, if
any, and the nature of the affiliation.
Each of the Company and the Subsidiaries of the Company has
good and marketable title to (i) all of the shares it purports to
own of the Capital Stock of each of their respective
Subsi-diaries, free and clear in each case of any Lien, and (ii)
the Securities of any Affiliate it purports to own, free and
clear in each case of any Lien. Except as set forth in Annex
2.3, all such shares and/or Securities have been duly issued and
are fully paid and nonassessable. Except as set forth in Annex
2.3, fair saleable value of the assets of each Subsidiary exceeds
its liabilities and each Subsidiary is meeting current
liabilities as they mature in the ordinary course of business.
2.4 Pending Litigation.
There are no proceedings, actions or investigations pending
or, to the knowledge of the Company or any of the Guarantors,
threatened against or affecting the Company, any Guarantor or any
of the Subsidiaries of the Company in any court or before any
Governmental Authority or arbitration board or tribunal that,
individually or in the aggregate, could have a Material Adverse
Effect and the Company has no knowledge of any basis for any of
the foregoing. Neither the Company, any Guarantor nor any of the
Subsidiaries of the Company is in default with respect to any
judgment, order, writ, injunction, or decree of any court,
Governmental Authority or arbitration board or tribunal that,
individually or in the aggregate, could have a Material Adverse
Effect.
7
2.5 Properties; Insurance.
Individually or collectively, each of the Company, the
Guarantors and the Subsidiaries of the Company has good and
marketable title in fee simple to all real Property, and good
title to all of the other Property which is material to the
business or operations of the Company and its Subsidiaries,
reflected in the most recent audited balance sheet referred to in
Section 2.2 hereof or purported to have been acquired since that
date (except as sold or otherwise disposed of in the ordinary
course of business), free from Liens not otherwise permitted by
Section 7.9 hereof.
The Company, each Guarantor and each Subsidiary maintains or
causes to be maintained with financially sound and reputable
insurers, insurance with respect to its Property and business
against such casualties and contingencies, of such types
includ-ing, without limitation, insurance with respect to losses
arising out of Property loss or damage, public liability,
workers' compensation, business interruption, larceny,
embezzlement or other criminal misappropriation) and in such
amounts as is customary in the case of corporations of
established reputation engaged in the same or a similar business
and similarly situated.
2.6 Patents, Trademarks, Licenses, etc.
Each of the Company and the Subsidiaries of the Company,
owns, possesses or has the unrestricted right to use all of the
patents, trademarks, service marks, trade names, copyrights,
licenses, and rights with respect thereto, necessary for the
conduct of its business as presently conducted or presently
proposed to be conducted, without any known conflict with the
rights of others.
2.7 Taxes.
(a) Returns Filed; Taxes Paid. All tax returns
required to be filed by each of the Company, each Guarantor
and each of the Subsidiaries of the Company or any other
Person insofar as such Person is a Person with which the
Company, any Guarantor or any such Subsidiary files or has
filed a consolidated return in any jurisdiction have in fact
been filed on a timely basis, and all taxes, assessments,
8
fees and other governmental charges upon each of the
Company, each Guarantor, each such Subsidiary and any such
Person, and upon any of their respective Properties, income
or franchises, that are due and payable (i) have been paid
or (ii) are being contested in good faith through
appropriate proceedings and no judgment has been entered or
lien filed in respect thereof. Neither the Company nor any
Guarantor knows of any material proposed additional tax
assessment against it or any such Person.
(b) Book Provisions Adequate. The amount of the
liability for taxes reflected in the consolidated balance
sheet of the Company as of December 31, 1995 referred to in
Section 2.2 hereof is an adequate provision for taxes
(including without limitation, any payment due pursuant to
any tax sharing agreement) as are or may become payable by
any one or more of the Company, the Guarantors and their
respective consolidated Subsidiaries in respect of all tax
periods ending on or prior to such date.
2.8 Full Disclosure.
Except as set forth in Annex 2.8, the Company has timely
filed all reports required to be filed by it pursuant to the
Securities Exchange Act of 1934. Such reports and the financial
statements referred to in Section 2.2 hereof do not, nor does
this Agreement or any written statement furnished by or on behalf
of the Company or the Guarantors to you in connection with the
negotiation of the sale of the Notes, contain any untrue
statement of a material fact or omit a material fact necessary to
make the statements contained therein or herein not misleading.
There is no fact that the Company or any Guarantor has not
disclosed to you in writing that has had or, so far as the
Company or such Guarantors can now reasonably foresee, will have
a Material Adverse Effect.
2.9 Corporate Organization and Authority.
Each of the Company, the Guarantors and the Subsidiaries of
the Company,
9
(a) is a corporation duly incorporated, validly
existing and in good standing under the laws of its
jurisdiction of incorporation,
(b) has all legal and corporate power and authority to
own and operate its Properties and to carry on its business
as now conducted and as presently proposed to be conducted,
(c) has all licenses, certificates, permits,
franchises and other governmental authorizations necessary
to own and operate its Properties and to carry on its
business as now conducted and as presently proposed to be
conducted, except where the failure to have such licenses,
certificates, permits, franchises and other governmental
authorizations, individually or in the aggregate, would not
have a Material Adverse Effect, and
(d) has duly qualified or has been duly licensed, and
is authorized to do business and is in good standing, as a
foreign corporation, in each state where such qualification,
licensing and authorization is required by law, except where
the failure to be so qualified, licensed or authorized,
individually or in the aggregate, would not have a Material
Adverse Effect.
2.10 Restrictions on the Company, Guarantors and
Subsidiaries of the Company.
Neither the Company, any Guarantor nor any of the
Subsidiaries of the Company:
(a) is a party to any contract or agreement, or
subject to any charter or other corporate restriction that
could have a Material Adverse Effect,
(b) is a party to any contract or agreement, other
than this Agreement and the agreements listed on Annex 2.10
hereto, that restricts the right or ability of such
corporation to incur Debt, and no contract or agreement to
which the Company or any of its Subsidiaries is a party is
violated by the issuance of the Notes by the Company or the
execution and delivery of, or compliance with, this
Agreement by the Company and the Guarantors, or
10
(c) has agreed or consented to cause or permit in the
future (upon the happening of a contingency or otherwise)
any of its Property, whether now owned or hereafter
acquired, to be subject to a Lien not permitted by Section
7.9 hereof.
2.11 Compliance with Law.
Neither the Company, any Guarantor nor any of the
Subsidiaries of the Company is in violation of any law,
ordinance, governmental rule or regulation to which it is
subject, which violations, individually or in the aggregate,
could have a Material Adverse Effect.
2.12 ERISA.
(a) Relationship of Vested Benefits to Pension Plan
Assets. Except as described in Annex 2.12,
(i) the present value of all benefits, determined
as of the most recent valuation date for such benefits as
provided in Section 7.10 hereof, vested under each Pension
Plan does not exceed the value of the assets of such Pension
Plan allocable to such vested benefits, determined as of
such date as provided in Section 7.10 hereof, and
(ii) no Welfare Plan provides benefits, including
without limitation death or medical benefits (whether or not
insured), with respect to current or former employees after
retirement or other termination of service (other than
(i) coverage mandated by applicable law, (ii) death benefits
or retirement benefits under any "employee pension plan," as
that term is defined in section 3 of ERISA, (iii) benefits
accrued as liabilities on the books of the Company or any
ERISA Affiliate, or (iv)benefits, the full cost of which is
borne by the current or former employee (or such employee's
beneficiary).
(b) ERISA Requirements. Each of the Company, the
Guarantors and the ERISA Affiliates
11
(i) has fulfilled all obligations under the
minimum funding standards of ERISA and the IRC with
respect to each Pension Plan,
(ii) has satisfied all of its respective obli-
gations under the minimum funding standards of ERISA
and the IRC in respect of, and all of its other
respective contribution obligations provided for in,
each Multiemployer Plan,
(iii) is in compliance in all material respects
with all other applicable provisions of ERISA and the
IRC with respect to each Pension Plan, Welfare Plan and
each Multiemployer Plan, and
(iv) has not incurred any liability under Title
IV of ERISA to the PBGC (other than in respect of
required insurance premiums, all of which that are due
having been paid), with respect to any Pension Plan,
any Multiemployer Plan or any trust established
thereunder.
No Pension Plan, or trust created thereunder, has incurred
any "accumulated funding deficiency" (as such term is
defined in section 302 of ERISA), whether or not waived, as
of the last day of the most recently ended plan year of such
Pension Plan.
(c) Prohibited Transactions.
(i) The purchase of the Notes by you will not
constitute a "prohibited transaction" (as such term is
defined in section 406 of ERISA or section 4975 of the
IRC)that could subject any Person to the penalty or tax
on prohibited transactions imposed by section 502 of
ERISA or section 4975 of the IRC, and neither the
Company, nor any Guarantor nor any ERISA Affiliate, nor
any "employee benefit plan" (as such term is defined in
this Section 2.12(c)) of the Company, any Guarantor or
any ERISA Affiliate or any trust created thereunder or
any trustee or administrator thereof, has engaged in
any "prohibited transaction" that could subject any
such Person, or any other party dealing with such
employee benefit plan or trust, to any
12
material penalty or tax. The representation by the
Company and the Guarantors in the preceding sentence is
made in reliance upon and subject to the accuracy of
the representations in Section 1.3(b) hereof as to the
source of funds used by you.
(ii) Annex 2.12 hereto completely lists, as of the
Closing Date, all ERISA Affiliates and all employee
benefit plans, other than those which are of the type
described in Section 4(b)(4) of ERISA, with respect
to which the Company, any Guarantor or any "affiliate"
of either (as such term is defined in this Section
2.12(c)) is a "party-in-interest" (as such term is
defined in this Section 2.12(c)) or in respect of which
the Notes could constitute an "employer security" (as
such term is defined in this Section 2.12(c)).
As used in this Section, the terms "employee benefit plan"
and "party-in-interest" have the meanings specified in section 3
of ERISA and "affiliate" and "employer security" have the
meanings specified in section 407(d) of ERISA.
(d) Reportable Events. No Pension Plan or trust
created thereunder has been terminated, and there have been
no "reportable events" (as such term is defined in section
4043 of ERISA), with respect to any Pension Plan or trust
created thereunder, which reportable event or events will or
could result in the termination of such Pension Plan or give
rise to a liability of the Company, any Guarantor or any
ERISA Affiliate in respect thereof.
(e) Multiemployer Plans. Neither the Company nor any
Guarantor nor any ERISA Affiliate is, or has ever been, an
employer required to contribute to any Multiemployer Plan.
(f) Multiple Employer Pension Plans. Except as set
forth in Annex 2.12 to this Agreement, neither the Company
nor any Guarantor nor any ERISA Affiliate is a "contributing
sponsor" (as such term is defined in section 4001 of ERISA)
in any Multiple Employer Pension Plan and neither the
Company nor
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any Guarantor nor any ERISA Affiliate has incurred (without
fully satisfying the same), or reasonably expects to incur,
withdrawal liability in respect of any such Multiple
Employer Pension Plan listed in Annex 2.12 to this
Agreement, which withdrawal liability could have a Material
Adverse Effect.
(g) Foreign Pension Plan. Except as set forth in
Annex 2.12 hereof, the present value of all benefits vested
under each Japanese Foreign Pension Plan and each other
material Foreign Pension Plan, determined as of the most
recent valuation date in respect thereof does not exceed the
value of the assets of such Foreign Pension Plan, and all
required payments in respect of funding such Foreign Pension
Plan have been made.
2.13 Certain Laws.
(a) Investment Company Act. Neither the Company nor
any Guarantor nor any of the Subsidiaries of the Company
is, or is directly or indirectly controlled by, or acting on
behalf of any Person which is, an "investment company"
within the meaning of the Investment Company Act of 1940, as
amended.
(b) Holding Company Status. Neither the Company nor
any Guarantor nor any of the Subsidiaries of the Company is
a "holding company" or an "affiliate" of a "holding
company," or a "subsidiary company" of a "holding company,"
or a "public utility" within the meaning of the Public
Utility Holding Company Act of 1935, as amended.
(c) Absence of Foreign or Enemy Status. Neither the
Company nor any Guarantor nor any Subsidiary of the Company
is an "enemy" or an "ally of the enemy" within the meaning
of section 2 of the Trading with the Enemy Act (50 U.S.C.
App. Sections 1 et seq.), as amended. Neither the Company
nor any Guarantor nor any Subsidiary of the Company is in
violation of, and neither the issue and sale of the Notes by
the Company nor its use of the proceeds thereof as
contemplated by this Agreement, will violate, the Trading
with the Enemy Act, as amended, or any executive orders,
proclamations or regulations issued pursuant thereto,
including, without limitation, regulations administered by
the Office of Foreign Asset Control
14
of the Department of the Treasury (31 C.F.R., Subtitle B,
Chapter V).
2.14 Environmental Compliance.
Except as set forth in Annex 2.14 hereto:
(a) Compliance -- each of the Company, the Guarantors
and the Subsidiaries of the Company is in compliance with
all Environmental Protection Laws in effect in each
jurisdiction where each is presently doing business, and in
which the failure so to comply could be reasonably expected
to have a Material Adverse Effect.
(b) Liability -- neither the Company nor any Guarantor
nor any of the Subsidiaries of the Company is subject to any
liability under any Environmental Protection Laws that,
individually or in the aggregate, could be reasonably
expected to have a Material Adverse Effect; and
(c) Notices -- neither the Company nor any Guarantor
nor any of the Subsidiaries of the Company has received any
(i) notice from any Governmental Authority by
which any real Property presently or previously owned
or leased by it has been designated, listed, or identi-
fied in any manner by any Governmental Authority
charged with administering or enforcing any
Environmental Protection Law as a Hazardous Substance
disposal or removal site, "Super Fund" clean-up site,
or candidate for removal or closure pursuant to any
Environmental Protection Law,
(ii) notice of any Lien arising under or in
connection with any Environmental Protection Law that
has attached to any revenues of, or to, any of its
owned or leased real Properties, or
(iii) summons, citation, notice, directive,
letter, or other communication, written or oral,
from any Governmental Authority concerning any
intentional or unintentional action
15
or omission by the Company, any Guarantor or any
Subsidiary in connection with its ownership or
leasing of any real Property and involving the
releasing, spilling, leaking, pumping, pouring,
emitting, emptying, dumping, or other use, storage
or disposition of any Hazardous Substance
resulting in violation of any Environmental
Protection Law, if the effect thereof could be
reasonably expected to have a Material Adverse
Effect.
2.15 Sale is Legal and Authorized; Obligations are
Enforceable.
(a) Sale is Legal and Authorized. Each of the
issuance, sale and delivery of the Notes by the Company, the
issuance, execution and delivery of the Guaranty of each
Guarantor herein and in the Notes, the execution and
delivery of this Agreement by the Company and the
Guarantors, the compliance by the Company and each Guarantor
with all of the provisions hereof and the compliance by the
Company and each Guarantor with all the provisions of the
Notes:
(i) is within the corporate powers of each of the
Company and such Guarantors, as the case may be; and
(ii) is legal and does not conflict with, result
in any breach in any of the provisions of, constitute a
default under, or result in the creation of any Lien
upon any Property of the Company, any Guarantor or any
of the Subsidiaries of the Company under the provisions
of, any agreement, charter instrument, bylaw or other
instrument to which any of the Company, any Guarantor
or any such Subsidiary is a party or by which any of
the Company, the Guarantors or such Subsidiaries or any
of their respective Property, may be bound.
(b) Obligations are Enforceable. This Agreement has
been duly authorized by all necessary action on the part of
each of the Company and the Guarantors, has been executed
and delivered by duly authorized officers of each of the
Company and the Guarantors, and constitutes a legal, valid
and binding obligation of the Company and of each Guarantor,
enforceable in accordance with its terms, and the Notes and
the Guaranty have been duly authorized by all necessary
action on the part of the Company and the Guarantors, as the
case may be, have been executed and delivered by duly
authorized officers of the Company, and constitute a legal,
valid and binding obligation of the Company, enforceable in
accordance with their terms, except, in each case, that the
enforceability of this Agreement and of the Notes may be:
(i) limited by applicable bankruptcy,
reorganization, arrangement, insolvency, moratorium, or
other similar laws affecting the enforceability of
creditors' rights generally; and
(ii) subject to the availability of equitable
remedies.
2.16 Governmental Consent.
Neither the legal nature of the Company, any Guarantor or
any of the Subsidiaries of the Company, or of any of their
respective businesses or Properties, nor any relationship between
the Company, any Guarantor or any of the Subsidiaries of the
Company and any other Person, nor any circumstance in connection
with the offer, issue, sale or delivery of the Notes, the
issuance, execution and delivery of the Guaranty of each
Guarantor herein and in the Notes, and the execution and delivery
of this Agreement, is such as to require a consent, approval or
authorization of, or filing, registration or qualification with,
any Governmental Authority on the part of the Company or any
Guarantor as a condition to the execution and delivery of this
Agreement or the offer, issue, sale or delivery of the Notes.
2.17 Private Offering.
Neither the Company nor any Guarantor has offered any of the
Notes or the guaranties of any Guarantors or any similar Security
of the Company or any Guarantor for sale to, or solicited offers
to buy any thereof from, or otherwise approached or negotiated
with respect thereto with, any prospective purchaser, other than
you.
17
2.18 No Defaults.
(a) The Notes. No event has occurred and no condition
exists that, upon the execution and delivery of this
Agreement and the issuance and delivery of the Notes
pursuant hereto and the Guaranty of each Guarantor herein
and in the Notes, would constitute a Default or an Event of
Default.
(b) Charter Instruments, Other Agreements. Neither
the Company nor any Guarantor nor any of the Subsidiaries of
the Company is in violation in any respect of any term of
any charter instrument or bylaw and neither the Company nor
any Guarantor nor any such Subsidiary is in violation in any
material respect of any term in any material agreement or
other instrument to which it is a party or by which it or
any of its Property may be bound. Except as set forth in
Annex 2.18, all agreements relating to the ownership or
operation of satellite precipitated calcium carbonate
facilities of the Company and its Subsidiaries (the "PCC
Agreements") are in full force and effect and no default by
the Company or any Subsidiary has occurred and is continuing
under any thereof. Since October 30, 1992 neither the
Company nor any Subsidiary has requested or received any
material waiver or consent (other than consents delivered to
you in connection with the execution and delivery of this
Agreement) in respect of any PCC agreement or any agreement
pursuant to which any Debt of the Company or a Subsidiary
was issued.
2.19 Use of Proceeds.
(a) Use of Proceeds. The Company shall apply the
proceeds from the sale of the Notes to refinance commercial
bank debt outstanding and the balance for capital
expenditures and for general corporate purposes of the
Company and the Guarantors.
(b) Margin Securities. None of the transactions
contemplated herein and in the Notes (including, without
limitation, the use of the proceeds from the sale of the
Notes) violates, will violate or will result in a violation
of section 7 of the Exchange Act, including, without
limitation, Regulations G, T, U and X of the Board of
Governors of the
18
Federal Reserve System, 12 C.F.R., Chapter
II. Neither the Company nor any Guarantor nor any of the
Subsidiaries of the Company owns, or with the proceeds of
the sale of the Notes intends to own, carry or purchase, or
refinance borrowings that were used to own, carry or
purchase, any Margin Security, including Margin Securities
originally issued by the Company, any Guarantor or any such
Subsidiary. The obligations of the Guarantors under this
Agreement and their respective Guaranties and the Company
under this Agreement and the Notes are not and will not be
secured by any Margin Security, and no Notes are being sold
on the basis of any such collateral.
2.20 Relationship of Company, Subsidiaries and Guarantors.
The Guarantors acknowledge that they will receive a direct
economic and financial benefit from the transactions contemplated
by this Agreement, and such transactions are in the best interest
of the Company, the Guarantors and the Subsidiaries of the
Company. In recognition and confirmation thereof, each
Guarantor, by specific resolution of its Board of Directors, has
caused itself to become obligated in the manner set forth in
Section 10 hereof. Neither the Company nor any of its
Subsidiaries is bound or affected by any contract other than this
Agreement which prohibits, or upon the occurrence of an event or
the passage of time or both would prohibit the declaration or
payment of dividends or the return of capital by a Subsidiary to
the Company.
3. CLOSING CONDITIONS
Your obligation to purchase and pay for the Notes to be
delivered to you at the Closing is subject to the following
conditions precedent:
3.1 Opinions of Counsel.
You shall have received from
(a) S. Garrett Gray, Esq., General Counsel for the
Company and counsel for the Guarantors, and
(b) Skadden, Arps, Slate, Meagher & Flom, your special
counsel,
19
closing opinions, each dated as of the Closing Date, and in
the case of the opinion of S. Garrett Gray, Esq.,
substantially in the form set forth in Annex 3.1 hereto, and
as to such other matters as you may reasonably request.
This Section 3.1 shall constitute direction by the Company
and each Guarantor to such counsel named in the foregoing
clause (a) to deliver such closing opinion to you.
3.2 Representations and Warranties True; No Prohibited
Action.
(a) Representations and Warranties True. The
representations and warranties contained herein shall be
true on the Closing Date with the same effect as though made
on and as of that date.
(b) No Prohibited Action. On and as of the Closing
Date, neither the Company nor any Guarantor nor any of the
Subsidiaries of the Company shall have taken any action or
permitted any condition to exist that would have been
prohibited by Section 7.5 through Section 7.16, inclusive,
hereof, had such Sections been binding and effective at all
times during the period from December 31, 1995 to and
including the Closing Date.
3.3 Officers' Certificates.
You shall have received
(a) a certificate dated the Closing Date and signed by
the President or a Vice-President and the Treasurer or an
Assistant Treasurer of the Company, substantially in the
form of Exhibit B1 hereto certifying, among other things,
that the conditions specified in Sections 3.2 and 3.9 hereof
have been fulfilled,
(b) certificates dated the Closing Date and signed by
the President or a Vice-President and the VicePresident
Finance of each Guarantor substantially in the form of
Exhibit B2 hereto certifying, among other things, that the
conditions specified in Sections 3.2 and 3.9 hereof have
been fulfilled,
20
(c) a certificate dated the Closing Date and signed by
the Secretary or an Assistant Secretary of the Company,
substantially in the form of Exhibit C1 hereto, with respect
to the matters therein set forth, and
(d) certificates dated the Closing Date and signed by
the Secretary or an Assistant Secretary of each Guarantor,
substantially in the form of Exhibit C2 hereto, with
respect to the matters therein set forth.
3.4 Legality.
The Notes shall on the Closing Date qualify as a legal
investment for you under applicable insurance law (without regard
to any "basket" or "leeway" provisions) and you shall have
received such evidence as you may reasonably request to establish
compliance with this condition.
3.5 Private Placement Number.
The Company shall have obtained or caused to be obtained a
private placement number for the Notes from the CUSIP Service
Bureau of Standard & Poor's and you shall have been informed of
such private placement number.
3.6 Expenses.
All fees and disbursements required to be paid pursuant to
Section 1.5 hereof shall have been paid in full.
3.7 Proceedings Satisfactory
All proceedings taken in connection with the issuance and
sale of the Notes and all documents and papers relating thereto
shall be satisfactory to you and your special counsel. You and
your special counsel shall have received copies of such documents
and papers as you or they may reasonably request in connection
therewith or in connection with your special counsel's closing
opinion, all in form and substance satisfactory to you and your
special counsel.
21
3.8 Compliance with this Agreement.
Each of the Company, the Guarantors and the Subsidiaries of
the Company shall have performed and complied with all agreements
and conditions contained herein that are required to be performed
or complied with by the Company, such Guarantor or any Subsidiary
on or prior to the Closing Date, and such performance and
compliance shall remain in effect on the Closing Date.
3.9 No Dissolution, Merger or Change in Control.
After the date hereof and through the Closing Date, (a)
neither the Company nor any Guarantor shall have dissolved, nor
shall any of them have consolidated or merged with, or sold,
leased, transferred or otherwise disposed of all or substantially
all of its properties and assets to, any Person, whether or not
permitted by Section 7.4, and (b) no Change in Control with
respect to the Company shall have occurred; and you shall have
received on the Closing Date a certificate dated the Closing Date
and signed by the President of the Company to such effect and to
the effect that no corporate action shall have been taken to
initiate or to carry out any of the foregoing.
3.10 [Reserved].
4. SPECIAL RIGHTS OF INSTITUTIONS
4.1 Direct Payment.
Notwithstanding anything to the contrary herein or in the
Notes, the Company shall pay all amounts payable with respect to
each Note held by an Institutional Investor (without any
presentment of such Notes and without any notation of such
payment having been made thereon) by crediting, by federal funds
bank wire transfer of immediately available funds, the account of
such Institutional Investor in any bank in the United States of
America as may be designated in writing by such Institutional
Investor, or in such other manner as may be reasonably directed
or to such other address in the United States of America as may
be reasonably designated in writing by such Institutional
Investor. Your address on Annex 1.2 hereto shall be deemed to
constitute notice, direction or designation (as appropriate) to
the Company with respect
22
to direct payments as aforesaid. In all other cases, all amounts
payable with respect to each Note shall be made by check mailed
and addressed to the registered holder of each Note at the
address shown in the register maintained by the Company pursuant
to Section 6.1 hereof.
Each holder of Notes agrees that in the event it shall sell
or transfer any Note
(a) it shall, prior to the delivery of such Note
(unless it shall have already done so), make a notation
thereon of all principal, if any, prepaid on such Note and
shall also note thereon the date to which interest shall
have been paid on such Note, and
(b) it shall promptly notify the Company of the name
and address of the transferee of any such Note so
transferred and the effective date of such transfer.
4.2 Delivery Expenses.
If any holder of Notes surrenders any Note to the Company
pursuant hereto, the Company shall pay the cost of delivering to
or from such holder's home office or custodian bank from or to
the Company, insured to the reasonable satisfaction of such
holder, the surrendered Note and any Note issued in substitution
or replacement for the surrendered Note.
4.3 Issue Taxes.
The Company and the Guarantors shall pay all taxes in
connection with the issuance and sale of the Notes, the execution
and delivery of the Guaranties of the Notes pursuant to Section
10 hereof and in connection with any modification of this
Agreement, the Notes or the Guaranty of the Notes pursuant to
Section 10 hereof, and shall save each holder of Notes harmless
without limitation as to time against any and all liabilities
with respect to all such taxes. The obligations of the Company
and such Guarantors under this Section 4.3 shall survive the
payment or prepayment of the Notes and the termination hereof.
23
5. PREPAYMENTS
5.1 Offer to Prepay upon Change in Control.
(i) Notice and Offer. In the event of a Change in
Control, and whether pursuant to Section 7.4 or otherwise as
permitted by this Agreement, then the Company and each
Guarantor having knowledge of such Change in Control will,
within three (3) Business Days of such Change in Control
give written notice of such Change in Control to each holder
of Notes by registered mail (with a copy thereof sent via an
overnight courier of national reputation) and,
simultaneously with the sending of such written notice, give
telephonic advice of such Change in Control to an investment
officer or other similar representative or agent of each
such holder specified on Annex 1.2 to this Agreement at the
telephone number specified thereon, or to such other Person
at such other telephone number as any holder of a Note may
specify to the Company and the Guarantors in writing. Such
notice shall be dated the date on which it is given. In the
event of a Change in Control, such written notice shall
contain, and such written notice shall constitute, an
irrevocable offer to prepay all, but not less than all, of
the Notes held by such holder on a date specified in such
notice (the "Control Prepayment Date") that is not less than
fifteen (15) days and not more than forty-five (45) days
after the date of such notice. (If the Control Prepayment
Date shall not be specified in such notice, the Control
Prepayment Date shall be the fifteenth (15th) day after the
date of such notice.) If the Company shall not have received
a written response to such notice from each holder of Notes
within ten (10) days after the date of posting of such
notice to such holder of Notes, then a second written notice
shall be immediately sent (via an overnight courier of
national reputation) to each such holder of Notes who shall
have not previously responded to the Company.
(b) Acceptance and Payment. To accept such offered
prepayment, a holder of Notes shall cause a notice of such
acceptance to be delivered to the Company not later than one
day prior to the Control Prepayment Date and shall designate
in such notice the principal amount of its Notes that it has
elected to
24
have prepaid. If so accepted by such holder, such
offered prepayment in respect of such principal amount of
such Notes shall be due and payable on the Control
Prepayment Date. Such offered prepayment shall be made at
one hundred percent (100%) of the principal amount of such
Notes so elected to be prepaid, together with interest on
the Notes then being prepaid accrued to the Control
Prepayment Date.
(c) Officer's Certificate. Each offer to prepay the
Notes pursuant to this Section 5.1 will be accompanied by an
officer's certificate, executed by the President or a Vice
President of the Company and dated the date of such offer,
specifying:
(i) the Control Prepayment Date;
(ii) the principal amount of each Note offered to
be prepaid;
(iii) the interest to be paid on each such Note,
accrued to the Control Prepayment Date; and
(iv) in reasonable detail, the nature of the
Change in Control.
5.2 Optional Prepayments. The Company may prepay the
principal amount of the Notes in whole or in part at any time in
multiples of One Million Dollars ($1,000,000) (or, if the
aggregate outstanding principal amount of the Notes is less than
One Million Dollars ($1,000,000) at such time, then such
principal amount), together with
(i) an amount equal to the Make-Whole Amount in
respect of the principal amount of the Notes being so
prepaid, and
(ii) interest on such principal amount then being
prepaid accrued to the prepayment date.
5.3 Notice of Optional Prepayment.
The Company will give notice of any optional prepayment of
the Notes to each holder of the Notes not less than thirty (30)
days or more than sixty (60) days before the date fixed for
prepayment, specifying:
25
(a) such prepayment date;
(b) that the prepayment is being made pursuant to
Section 5.2 hereof;
(c) the principal amount of each Note to be prepaid on
such date;
(d) the interest to be paid on each such Note,
accrued to the date fixed for prepayment; and
(e) the Company's calculation of an estimated
Make-Whole Amount, if any, (assuming the date of prepayment
was the date of such notice) due in connection with such
prepayment, accompanied by a copy of any applicable
documentation used in connection with determining the
Make-Whole Discount Rate in respect thereof.
Such notice of prepayment shall also certify all facts that are
conditions precedent to any such prepayment. Notice of
prepayment having been so given, the aggregate principal
amount of the Notes specified in such notice, together with
the Make-Whole Amount, if any, and accrued interest thereon
shall become due and payable on the specified prepayment date.
Contemporaneously with such prepayment, the Company shall deliver
to each holder of Notes, as of the specified prepayment date,
the determination of the Make-Whole Amount referred to in the
definition of "Make-Whole Amount" in Section 11.1 hereof (and
previously delivered to the Company as provided for in such
definition), accompanied by a copy of any applicable documentation
likewise previously delivered to the Company and used in
connection with determining the Make-Whole Discount Rate in
respect of such prepayment. Interest on any overdue prepayment
and on any "Make-Whole Amount" to be paid in connection
therewith, shall be due to the date of payment, at the rate
set forth in Section 1.1(b).
5.4 Partial Prepayment Pro Rata.
If at the time any optional prepayment is due under Section
5.2 hereof and there is more than one Note outstanding
immediately prior to, as well as after giving effect to, such
prepayment, the aggregate principal amount of each optional
partial prepayment of the Notes shall be allocated among the
holders of the Notes at the time
26
outstanding in proportion, as nearly as practicable, to the
respective unpaid principal amounts of the Notes outstanding
immediately prior to such prepayment, with adjustments, to the
extent practicable, to equalize for any prepayments not in such
proportion.
5.5 Notation of Notes on Prepayment.
Upon any partial prepayment of a Note, the holder thereof
may (but such holder shall not be compelled to) require that such
Note be
(a) surrendered to the Company pursuant to Section 6.2
hereof in exchange for a new Note in a principal amount
equal to the principal amount remaining unpaid on the
surrendered Note,
(b) made available to the Company for notation
thereon of the portion of the principal so prepaid, or
(c) marked by such holder with a notation thereon of
the portion of the principal so prepaid.
If any Note is surrendered to the Company pursuant to this
Section 5.5 or otherwise hereunder, such Note shall be cancelled
and shall not be reissued and no new Note shall be reissued in
respect of any principal amount of a surrendered Note that shall
have been previously paid. This Section 5.5 shall not limit or
restrict the Company's obligation to effect payment of any
partial prepayment of Notes in accordance with requirements of
Section 4.1 hereof.
5.6 No Other Optional Prepayments.
Except as provided in Section 5.2 hereof or in accordance
with an offer made in compliance with Section 5.1 or pursuant to
Section 7.4(c) or Section 7.15(c)(ii) hereof, the Company may not
make, without the prior written consent of all holders of Notes,
any optional prepayment (whether directly or indirectly by
purchase or other acquisition) in respect of the Notes.
27
6. REGISTRATION; SUBSTITUTION OF NOTES
6.1 Registration of Notes.
The Company shall cause to be kept at its office, maintained
pursuant to Section 7.3 hereof, a register for the registration
and transfer of Notes. The name and address of each holder of
one or more Notes, each transfer thereof and the name and address
of each transferee of one or more Notes shall be registered in
the register. The Person in whose name any Note shall be
registered shall be deemed and treated as the owner and holder
thereof for all purposes hereof, and neither the Company nor any
Guarantor shall be affected by any notice or knowledge to the
contrary. The Company shall deem such subsequent holder to have
made the representations and warranties set forth in Section 1.3
hereof and will promptly furnish to any such subsequent holder,
upon request made prior to or subsequent to a transfer, the type
of information described in Section 2.12(c)(ii) hereof.
6.2 Exchange of Notes.
Upon surrender of any Note at the office of the Company
maintained pursuant to Section 7.3 hereof duly endorsed or
accompanied by a written instrument of transfer duly executed by
the registered holder of such Note or such holder's attorney duly
authorized in writing, the Company shall execute and deliver, at
the Company's expense (except as provided below), new Notes in
exchange therefor, in denominations of at least Fifty Thousand
Dollars ($50,000) (except as may be necessary to reflect any
principal amount not evenly divisible by Fifty Thousand Dollars
($50,000)), in an aggregate principal amount equal to the unpaid
principal amount of the surrendered Note. Each such new Note
shall be payable to such Person as such holder may request and
shall be substantially in the form of Exhibit A hereto. Each
such new Note shall be dated and bear interest from the date to
which interest shall have been paid on the surrendered Note or
dated the date of the surrendered Note if no interest shall have
been paid thereon. The Company may require payment of a sum
sufficient to cover any stamp tax or governmental charge imposed
in respect of any such transfer of Notes.
28
6.3 Replacement of Notes.
Upon receipt by the Company of evidence reasonably
satisfactory to it of the ownership of and the loss, theft,
destruction or mutilation of any Note and
(a) in the case of loss, theft or destruction, of
indemnity reasonably satisfactory to it (provided that if
the holder of such Note is an Institutional Investor, such
holder's own unsecured agreement of indemnity shall be
deemed to be satisfactory), or
(b) in the case of mutilation, upon surrender and
cancellation thereof,
the Company at its own expense shall execute and deliver, in lieu
thereof, a new Note, dated and bearing interest from the date to
which interest shall have been paid on such lost, stolen,
destroyed or mutilated Note or dated the date of such lost,
stolen, destroyed or mutilated Note if no interest shall have
been paid thereon.
6.4 Guarantors' Responsibility in respect of New Notes.
Each Guarantor agrees to execute each new Note, as provided
for in the form thereof attached hereto as Exhibit A, being
exchanged or delivered in accordance with Section 6.2 and Section
6.3 hereof.
7. COMPANY BUSINESS COVENANTS
The Company covenants that on and after the Closing Date and
so long as any of the Notes shall be outstanding:
7.1 Payment of Taxes and Claims.
The Company will, and will cause each of its Subsidiaries
to, pay before they become delinquent,
(a) all taxes, assessments and governmental charges or
levies imposed upon it or its Property, and
(b) all claims or demands of materialmen, mechanics,
carriers, warehousemen, landlords and other like Persons
that, if unpaid, might result in the creation of a Lien upon
its Property,
29
provided, that items in clause (a) and clause (b) above need not
be paid
(x) while being contested in good faith and by
appropriate proceedings as long as adequate book
reserves (as required by GAAP) have been established
and maintained and exist with respect thereto, and
(y) so long as the title of the Company or any of
its Subsidiaries (as the case may be) to, and its right
to use, such Property, is not materially adversely
affected thereby.
7.2 Maintenance of Properties and Corporate Existence.
The Company will, and will cause each of its Subsidiaries
to,
(a) Property -- maintain its Property in good
condition, ordinary wear and tear excepted, and make all
necessary renewals, replacements, additions, betterments
and improvements thereto;
(b) Insurance -- maintain, with financially sound and
reputable insurers, insurance with respect to its Property
and business against such casualties and contingencies, of
such types (including, without limitation, insurance with
respect to losses arising out of Property loss or damage,
public liability, workers' compensation, business
interruption, larceny, embezzlement or other criminal
misappropriation) and in such amounts as is customary in
the case of corporations of established reputation engaged
in the same or a similar business and similarly situated;
(c) Financial Records -- keep true books of records
and accounts in which full and correct entries shall be made
of all its business transactions and which will permit the
preparation of accurate and complete consolidated financial
statements in accordance with GAAP;
(d) Corporate Existence and Rights -- do or cause to
be done all things necessary to preserve and keep in full
force and effect its corporate existence, rights (charter
and statutory) and franchises, subject
30
to Section 7.4 hereof, except where the failure to do so
could not reasonably be expected to have a Material Adverse
Effect;
(e) Compliance with Law -- not be in violation of any
law, ordinance or governmental rule or regulation to which
it is subject and not fail to obtain any license,
certificate, permit, franchise or other governmental
authorization necessary to the ownership of its Properties
or to the conduct of its business if such violation or
failure to obtain could be reasonably expected to have a
Material Adverse Effect; and
(f) Rule 144A Eligibility -- not take or omit to take
any action which would cause the Notes not to be eligible
for resale pursuant to Rule 144A(d)(3) and (4) as the same
may be amended from time to time.
7.3 Payment of Notes and Maintenance of Office.
The Company will punctually pay, or cause to be paid, the
principal of and interest (and Make-Whole Amount, if any) on, the
Notes, as and when the same shall become due according to the
terms hereof and of the Notes, and will maintain an office at the
address of the Company set forth in Section 12.1 hereof where
notices, presentations and demands in respect hereof or of the
Notes may be made upon it. Such office will be maintained at
such address until such time as the Company will notify the
holders of the Notes of any change of location of such office,
which will in any event be located within the United States of
America.
7.4 Merger; Acquisition; Sale of Assets.
(a) Merger and Consolidation. The Company will not,
and will not permit any of its Subsidiaries to, merge with
or into, consolidate with, or sell, lease as lessor,
transfer or otherwise dispose of all or substantially all
of its Property to, any other Person or permit any other
Person to merge with or into or consolidate with it (except
that a Subsidiary of the Company may merge with or into,
consolidate with, or sell, lease, transfer or otherwise
dispose of all or substantially all of its assets to, the
Company or a Wholly-Owned Subsidiary); provided that the
foregoing restriction does not apply to the merger or
consolidation
31
of the Company with or into, or the sale, lease, transfer or
other disposition by the Company of all or substantially all
of its Property to, another corporation, if:
(i) the corporation that results from such merger
or consolidation or that purchases, leases, or acquires
all or substantially all of such Property (the
"Surviving Corporation") shall be organized under the
laws of, and have substantially all of its Property
located in, the United States of America or any
jurisdiction thereof;
(ii) the due and punctual payment of the principal
of and Make-Whole Amount, if any, and interest on all
of the Notes, according to their tenor, and the due and
punctual performance and observance of all the
covenants contained herein and in the Notes to be
performed and observed by the Company, shall be
expressly assumed by the Surviving Corporation pursuant
to such agreements or instruments as shall be
satisfactory to the Required Holders;
(iii) each Guarantor shall have reconfirmed its
obligations hereunder in writing;
(iv) the Company shall have caused to be
delivered to each holder of Notes an opinion of
independent counsel (which opinion and counsel are
satisfactory in form and substance to the Required
Holders) to the effect that (i) such agreements,
reconfirmations and instruments are enforceable in
accordance with their terms, (ii) no taxable event
or consequence will result to any holder of Notes
solely by virtue of such merger, consolidation,
purchase, lease or acquisition and the assumption
by the Surviving Corporation of the obligations of
he Company hereunder and under the Notes, and (iii)
the obligations of the Guarantors are in full force
and effect; and
(v) immediately prior to, and immediately after
the consummation of such transaction, and after giving
effect thereto,
32
(A) no Default or Event of Default shall exist,
and
(B) the Surviving Corporation would be permitted
to incur at least One Dollar ($1.00) of additional
Funded Debt pursuant to Section 7.7 hereof.
(b) Acquisition of Stock. The Company will not, and
will not permit any of its Subsidiaries to, acquire any
stock of any corporation if upon completion of such
acquisition such corporation would be a Subsidiary of the
Company, or acquire all of the assets of, or such of the
assets as would permit the transferee to continue any one or
more integral business operations of, any Person unless,
immediately after the consummation of such acquisition, and
after giving effect thereto, no Default or Event of Default
exists or would exist and the Company would be permitted to
incur at least One Dollar ($1.00) of additional Funded Debt
pursuant to Section 7.7 hereof and a Subsidiary of the
Company would be permitted to incur at least One Dollar
($1.00) of additional Debt pursuant to Section 7.6 hereof.
Upon any corporation becoming a Subsidiary of the Company,
all of its then existing Debt and Liens securing such Debt
shall be deemed incurred for purposes of Section 7.6,
Section 7.7 and Section 7.9 hereof.
(c) Sale of Assets. The Company will not, and will
not permit any of its Subsidiaries to, sell, lease, abandon
or otherwise dispose of any of its assets (except for sales
and leases in the ordinary course of business, including
sales and leases to customers and dispositions of plant and
equipment in connection with normal closures) unless,
immediately after giving effect to such proposed
disposition, the assets so disposed of by the Company and
its Subsidiaries during the then current fiscal year of the
Company shall have an aggregate net book value (determined
as to particular assets as of the end of the immediately
preceding fiscal year), not in excess of ten percent (10%)
of Consolidated Net Worth at the end of the immediately
preceding fiscal year. In determining such aggregate value,
there shall be included the value of any assets disposed of
through dispositions of shares pursuant to Section 7.4(a) or
33
Section 7.15 but there shall be excluded the value of assets
disposed of to the extent that, after giving effect to such
sale or lease no Default or Event of Default shall exist and
either (i) the Company or such Subsidiary at the time of
such disposition either has previously acquired or is
simultaneously acquiring, in contemplation of such
disposition, substantially similar assets, or has
previously entered into, or is simultaneously entering
into, a binding purchase or lease agreement or agreements
to acquire or lease substantially similar assets, which
assets are acquired or leased within one hundred eighty
(180) days of such disposition or (ii) the Company or such
Subsidiary shall, within such period of one hundred eighty
(180) days, use the proceeds from the disposition to repay
Debt of the Company or such Subsidiary, in which event the
Company shall offer to prepay, at par and in the manner
provided in Section 5.5 hereof, a principal amount of Notes
which bears the same ratio to the aggregate outstanding
amount of all Notes outstanding as other Debt to be repaid
bears to the aggregate outstanding amount of such issues
or series of Debt.
7.5 Restricted Payments and Restricted Investments.
(a) Limitation on Restricted Payments. The Company
will not make or incur and will not suffer or permit any of
its Subsidiaries to make or incur (i) any liability to
declare or make any Restricted Payment in respect of its
Capital Stock or the Capital Stock of any of its
Subsidiaries or any Guarantor or (ii) any Restricted
Investment or any undertaking or agreement to make a
Restricted Investment unless immediately after giving
effect to any proposed Restricted Payment or
Restricted Investment,
(A) the aggregate amount of all Restricted
Investments and Restricted Payments declared, made
or authorized after December 31, 1992 does not
exceed the sum of
(I) seventy-five percent (75%) of the
aggregate Consolidated Net Income (or, in case
such aggregate Consolidated Net Income shall be a
34
deficit, minus 100% of such deficit) for the
period commencing on January 1, 1993 and ending
on the date of such proposed transaction; plus
(II) Twenty-Five Million Dollars
($25,000,000);
(B) no Default or Event of Default exists or
would, after giving effect to such Restricted Payment
or Restricted Investment, as the case may be, exist;
and
(C) the Company would be permitted to incur
at least One Dollar ($1.00) of additional Funded Debt
pursuant to Section 7.7 hereof and a Subsidiary
of the Company would be permitted to incur at
least One Dollar ($1.00) of additional Debt pursuant
to Section 7.6 hereof.
(b) Time of Payment. The Company will not authorize
a Distribution on its Capital Stock that is not payable
within sixty (60) days of authorization.
7.6 Subsidiary Debt.
The Company will not at any time permit any of its
Subsidiaries to create, incur, issue, assume, guarantee or
otherwise become liable in respect of any Debt, other than Debt
owing to the Company or a Wholly-Owned Subsidiary, unless, (i)
immediately after giving effect thereto, Total Subsidiary Debt
does not exceed ten percent (10%) of Consolidated Net Worth at
such time, and (ii) immediately prior to, and immediately after
the consummation of such transaction, and after giving effect
thereto, no Default or Event of Default exists or would exist
and the Company would be permitted to incur at least One Dollar
($1.00) of additional Funded Debt pursuant to Section 7.7.
7.7 Consolidated Funded Debt to Consolidated Total
Capitalization.
The Company will not, and will not permit any of its
Subsidiaries to, create, incur, issue, assume, guarantee or
otherwise become liable in respect of any Funded Debt (other than
the Notes) at any time, unless, (i) immediately
35
after giving effect thereto, Consolidated Funded Debt does not
exceed forty percent (40%) of Consolidated Total Capitalization
at such time, and (ii) immediately prior to, and immediately
after the consummation of such transaction, and after giving
effect thereto, no Default or Event of Default exists or would
exist.
7.8 Consolidated Net Worth.
The Company will not permit Consolidated Net Worth at the
end of any fiscal quarter of the Company to be less than the sum
of (i) Three Hundred Twenty-five Million Dollars ($325,000,000)
and (ii) twenty-five percent (25%) of Consolidated Net Income
earned after December 31, 1995.
7.9 Liens.
(a) Negative Pledge. The Company will not, nor will
it permit any of its Subsidiaries to, grant, incur, assume,
create or cause or permit to exist, or agree or consent to
grant, incur, assume, create or cause or permit to exist in
the future (upon the happening of a contingency or
otherwise), a Lien upon any of its Property (including,
without limitation, any Capital Stock of the Subsidiaries
of the Company owned by the Company or any other Subsidiary
of the Company), whether now owned or hereafter acquired,
except:
(i) Liens securing the claims or demands of
materialmen, mechanics, carriers, warehousemen,
landlords and other like Persons, provided that the payment
thereof is not at the time required by Section 7.1 hereof;
(ii) Liens incurred or deposits made in the
ordinary course of business
(A) in connection with workers'
compensation, unemployment insurance, social
security and other like laws, and
(B) to secure the performance of letters of
credit, bids, tenders, sales contracts, leases,
statutory obligations, surety and performance
bonds (of a type other than set forth in Section
7.9(a)(iii)
36
hereof) and other similar obligations not incurred
in connection with the borrowing of money, the
obtaining of advances or the payment of the
deferred purchase price of Property;
(iii) Liens
(A) arising from judicial attachments and
judgments,
(B) securing appeal bonds or supersedeas
bonds, and
(C) arising in connection with court
proceedings (including, without limitation, surety
bonds and letters of credit or any other
instrument serving a similar purpose),
provided that (1) the execution or other enforcement of such
Liens is effectively stayed, (2) the claims secured thereby are
being actively contested in good faith and by appropriate
proceedings, (3) adequate reserves (in accordance with GAAP)
have been established and maintained in respect thereof and (4)
the existence of the judgment or attachment giving rise to the
Lien shall not constitute an Event of Default;
(iv) Liens on Property of a Subsidiary of the
Company, provided that such Liens secure only
obligations owing to the Company;
(v) Liens in the nature of reservations,
exceptions, encroachments, easements, rights-of-way,
covenants, conditions, restrictions, leases and other
similar title exceptions or encumbrances affecting real
Property, provided that such Liens do not individually
or in the aggregate materially detract from the value
of said Properties or materially interfere with the use
by the Company or its Subsidiaries of such Property
in the ordinary conduct of the business of the Company
and such Subsidiaries;
(vi) Liens on Property arising in connection with
Capital Leases so long as each such
37
Lien encumbers only Property that is the subject of the
related Capital Lease and no other Property of the
Company or any of its Subsidiaries and immediately
before, and after giving effect thereto, no Default or
Event of Default exists or would exist and (A) the
Company would be permitted to incur at least One Dollar
($1.00) of additional Funded Debt pursuant to Section
7.7 hereof and (B) a Subsidiary of the Company would be
permitted to incur at least One Dollar ($1.00) of
additional Debt pursuant to Section 7.6 hereof;
(vii) Liens in existence on the Closing Date
securing Debt and listed on Annex 7.9 hereto; and
(viii) Purchase Money Liens, if, after giving
effect thereto and to any concurrent transactions:
(A) each such Purchase Money Lien secures
Debt of the Company or any of its Subsidiaries in
an amount not exceeding one hundred percent (100%)
of the cost of acquisition of the particular
Property to which such Debt relates (or, in the
case of a Lien existing on any Property of any
corporation at the time it becomes a Subsidiary
of the Company, one hundred percent (100%) of the
Fair Market Value of such Property at such time);
(B) no Default or Event of Default would
exist and (I) the Company would be permitted to
incur at least One Dollar ($1.00) of additional
Funded Debt pursuant to Section 7.7 hereof and
(II) a Subsidiary of the Company would be
permitted to incur at least One Dollar ($1.00)
of additional Debt pursuant to Section 7.6 hereof;
(ix) Liens incurred in connection with the sale by
the Company or a Subsidiary of accounts receivable of
the Company or a Subsidiary (a "receivables sale")
permitted by Section 7.4(c) or the borrowing of money
by the Company or a
38
Subsidiary permitted by Section 7.6 and
Section 7.7 and the repayment of which is secured by
accounts receivable of the Company or a Subsidiary (a
"receivables financing"), including such amount of
accounts receivable as may be in excess of the sale
price or the amount borrowed, provided that: (A) the
Property subject to such Lien shall consist solely of
accounts receivable of the Company or a Subsidiary,
he obligor of which is a Person other than the Company
or a Subsidiary; (B) the purchaser of the accounts
receivable or the lender (the repayment of whose loan
is secured by such accounts receivable, as the case may
be) shall have no recourse to the Company or any
Subsidiary or to any Property of the Company or any
Subsidiary other than such accounts receivable for any
liability arising out of the receivables financing or
receivables sale; and (C) the accounts receivable which
are subject to the Lien permitted hereby shall be
identified at the time the receivables sale or
receivables financing is consummated and additional
receivables shall not thereafter be subjected to the
Lien created at that time; and
(x) other Liens on Property of the Company or a
Subsidiary provided that the Debt or other obligations
secured by such Liens shall not at any time exceed ten
percent (10%) of Consolidated Net Worth.
(b) Equal and Ratable Lien; Equitable Lien. In case
any Property shall be subjected to a Lien in violation of
this Section 7.9, the Company will forthwith make or cause
to be made, to the fullest extent permitted by applicable
law, provision whereby the Notes will be secured equally
and ratably with all other obligations secured thereby,
pursuant to such agreements and instruments as shall be
approved by the Required Holders, and the Company will cause
to be delivered to each holder of a Note an opinion of
independent counsel (in form and substance satisfactory
to the Required Holders) to the effect that such agreements
and instruments are enforceable in accordance with their
terms, and in any such case the Notes shall have the
benefit, to the full extent that, and with such priority as,
the holders of Notes may be
39
entitled under applicable law, of an equitable Lien on such
Property securing the Notes. Such violation of this Section
7.9 constitutes an Event of Default hereunder, whether or
not any such provision is made pursuant to this Section
7.9(b).
(c) Financing Statements. The Company will not, and
will not permit any of its Subsidiaries to, sign or file a
financing statement under the Uniform Commercial Code (or
similar statute) of any jurisdiction that names the Company
or such Subsidiary as debtor, or sign any security agreement
authorizing any secured party thereunder to file any such
financing statement, except, in any such case, a financing
statement filed or to be filed to perfect or protect a
security interest that the Company or such Subsidiary is
entitled to create, assume or incur, or permit to exist,
under the foregoing provisions of this Section 7.9 or to
evidence for informational purposes a lessor's interest in
Property leased to the Company or any such Subsidiary.
7.10 ERISA.
(a) Compliance. The Company will, and will cause each
ERISA Affiliate, at all times with respect to each Pension
Plan and Multiemployer Plan, to make timely payment of
contributions required to meet the minimum funding standard
in respect of such Person set forth in ERISA or the IRC with
respect thereto, and to comply with all other applicable
provisions of ERISA.
(b) Relationship of Vested Benefits to Pension Plan
Assets. Except as, to the extent and for the period of time
described in Annex 2.12, the Company will not at any time
permit the present value of all employee benefits vested
under each Pension Plan to exceed the assets of such Pension
Plan allocable to such vested benefits at such time, in each
case determined pursuant to Section 7.10(c) hereof, except
to the extent that the Company could, at such time, incur
Debt in the amount of such excess in compliance with Section
7.6 and Section 7.7 and otherwise complies with this Section
7.10.
(c) Valuations. All assumptions and methods used to
determine the actuarial valuation of vested
40
employee benefits under Pension Plans and the present value
of assets of Pension Plans will be reasonable in the good
faith judgment of the Company and will comply with all
requirements of law.
(d) Prohibited Actions. The Company will not, and
will not permit any ERISA Affiliate to:
(i) engage in any "prohibited transaction" (as
such term is defined in section 406 of ERISA or section
4975 of the IRC) that would result in the imposition of
a tax or penalty;
(ii) incur with respect to any Pension Plan any
"accumulated funding deficiency" (as such term is
defined in section 302 of ERISA), whether or not
waived;
(iii) terminate any Pension Plan in a manner that
could result in
(A) the imposition of a Lien on the Property
of the Company or any of its Subsidiaries pursuant
to section 4068 of ERISA, or
(B) the creation of any liability under
section 4062 of ERISA;
(iv) fail to make any payment required
by section 515 of ERISA; or
(v) except as disclosed on Annex
2.12 hereto, be an "employer" (as such term
is defined in section 3 of ERISA) required to
contribute to any Multiemployer Plan or a
"substantial employer" (as such term is
defined in section 4001 of ERISA) required to
contribute to any Multiple Employer Pension
Plan.
7.11 Transactions with Affiliates.
The Company will not, and will not permit any of its
Subsidiaries to, enter into any transaction, including,
without limitation, the purchase, sale or exchange of
Property or the rendering of any service, with any
Affiliate, except in the ordinary course of and pursuant
to the
41
reasonable requirements of the Company's or such
Subsidiary's business and upon fair and reasonable terms no less
favorable to the Company or such Subsidiary than would be
obtained in a comparable arm's-length transaction with a Person
not an Affiliate.
7.12 Pro-Rata Offers.
The Company will not, nor will it permit any of its
Subsidiaries or any Affiliate to, directly or indirectly,
acquire or make any offer to acquire any Notes other than as
permitted by Section 5.7 and then only if the Company or
such Subsidiary or Affiliate shall have offered to acquire
Notes, pro rata, from all holders of the Notes and upon the
same terms. In case the Company acquires any Notes, such
Notes will thereafter be cancelled and no Notes will be
issued in substitution therefor.
7.13 Private Offering.
The Company will not, nor will it permit any Person
acting on its behalf to, offer the Notes or any part thereof
or any similar Securities for issue or sale to, or solicit
any offer to acquire any of the same from, any Person so as
to bring the issuance and sale of the Notes within the
provisions of section 5 of the Securities Act.
7.14 Environmental Compliance.
(a) Compliance. The Company will at all times be, and
will at all times cause its Subsidiaries to be, in
compliance with all Environmental Protection Laws in effect
in each jurisdiction where each such Person is doing
business, if the failure to comply with which could
reasonably be expected to have a Material Adverse Effect.
(b) Liability. The Company will not permit itself,
nor will it permit any of its Subsidiaries, to be subject
to any liability under any Environmental Protection Laws
that, individually or in the aggregate, could reasonably
be expected to have a Material Adverse Effect.
42
7.15 Sales of Subsidiary Stock.
The Company will not at any time, and will not at any
time permit any of its Subsidiaries to, sell or otherwise dispose
of any shares of Capital Stock (or any options or warrants to
purchase Capital Stock or other Securities exchangeable for or
convertible into Capital Stock) of a Subsidiary of the Company
(said Capital Stock, options, warrants and other Securities
herein called "Subsidiary Stock"), nor will any Subsidiary of the
Company issue, sell or otherwise dispose of any shares of its own
Subsidiary Stock to any Person other than the Company or a
Wholly-Owned Subsidiary; provided that the foregoing restrictions
do not apply to:
(a) the issue of directors' qualifying shares;
(b) the sale for an all cash consideration to a Person
(other than directly or indirectly to an Affiliate) of the
entire Investment (whether represented by stock, debt,
claims or otherwise) of the Company and its other
Subsidiaries in any Subsidiary, if all of the following
conditions are met:
(i) in the good faith opinion of the Board
of Directors of the Company, the sale is for Fair
Market Value and is in the best interests of the
Company;
(ii) the Subsidiary being disposed of has no
continuing Investment (x) in any other Subsidiary
not being simultaneously disposed of in a
transaction which meets the conditions set forth
in this Section 7.15(b) or (y) in the Company; and
(iii) the aggregate book value of all such
Voting Stock (or of the Property or other assets
of the Subsidiary if greater) disposed of by the
Company and its Subsidiaries during the then
current fiscal year of the Company, when added to
the aggregate net book value of assets disposed of
pursuant to Section 7.4(c) during such fiscal
year, shall not exceed ten percent (10%) of
Consolidated Net Worth and immediately after the
consummation of the transaction, and after giving
effect thereto, no Default or Event of
43
Default would exist, and (A) the Company would be
permitted to incur at least One Dollar ($1.00) of
additional Funded Debt pursuant to Section 7.7
hereof and (B) a Subsidiary of the Company would
be permitted to incur at least One Dollar ($1.00)
of additional Debt pursuant to Section 7.6 hereof;
and
(c) the sale for an all cash consideration to a Person
(other than directly or indirectly to an Affiliate) of the
entire Investment (whether represented by stock, debt,
claims or otherwise) of the Company and its other
Subsidiaries in any Subsidiary, if all of the following
conditions are met:
(i) the conditions set forth in Section
7.15(b)(i) and(ii) are met;
(ii) the entire consideration received by the
Company shall be used, within one hundred eighty (180)
days of the date of such sale (A) to acquire Property
or assets useful, in the opinion of the Board of
Directors of the Company, in the business of the
Company and being acquired, in the opinion of the Board
of Directors, at not more than the fair market value
thereof or (B) to repay Debt of the Company or its
Subsidiaries (in which event the Company shall offer
to prepay, at par and in the manner provided in Section
5.5 hereof, a principal amount of Notes which bears the
same ratio to the aggregate outstanding amount of all
Notes outstanding as the principal amount of other Debt
to be repaid bears to the aggregate outstanding
principal amount of all such other Debt); and
(iii) prior to the consummation of such sale, the
Company shall have furnished to each holder of Notes a
detailed description of the proposed action, together
with a certificate of the President of the Company
attesting to the action of the Board of Directors as
set forth above.
(d) the participation by the Company or a Subsidiary
of the Company in joint ventures or other
44
commercial endeavors, whether by creation of a minority
interest in the Voting Stock of a Subsidiary or by
contribution of Voting Stock of a Subsidiary to such venture
or endeavor provided that after giving effect to each such
transaction (i) there shall not have occurred a Default or
Event of Default, (ii) the Company shall be in compliance
with the provisions of Section 7.5 and (iii) the aggregate
bookvalue of all such Voting Stock (or of the Property or
other assets of the Subsidiary attributable to such
interest, if greater) shall not exceed ten percent (10%) of
Consolidated Net Worth.
Without limiting the foregoing, the Company will not permit
any Subsidiary to issue or have outstanding any Preferred Stock
if such Preferred Stock is to be held by a Person other than the
Company or a Wholly-Owned Subsidiary and the Company shall not
sell, or permit any Subsidiary to sell, any Preferred Stock of
any Subsidiary to any Person other than to the Company or to a
Wholly-Owned Subsidiary.
7.16 Pari Passu Ranking of Notes.
The Company warrants that its obligations under this
Agreement and the Notes do, and undertakes that the same will
continue to, rank at least pari passu with all its other present
and future unsecured senior obligations.
8. INFORMATION AS TO COMPANY
8.1 Financial and Business Information.
The Company shall deliver to each holder of Notes:
(a) Quarterly Statements -- as soon as practicable
after the end of each quarterly fiscal period in each
fiscal year of the Company (other than the last quarterly
fiscal period of each such fiscal year), and in any event
within sixty (60) days thereafter, duplicate copies of:
(i) a consolidated balance sheet of the Company
and its Subsidiaries as at the end of such quarter, and
(ii) consolidated statements of income, changes in
shareholders' equity and cash flows
45
of the Company and its Subsidiaries for such quarter
and (in the case of the second and third quarters)
for the portion of the fiscal year ending with such
quarter;
(provided that so long as the Company shall continue to file
on a timely basis required reports on Form 10-Q, such reports
may be furnished in satisfaction of the requirements
of this Sction 8.1(a)), setting forth in each case in
comparative form the figures for the corresponding periods
in the previous fiscal year, all in reasonable detail,
prepared in accordance with GAAP, and certified as complete
and correct, subject to changes resulting from year-end
adjustments, by a principal financial officer of the
Company, and accompanied by the certificate required by
Section 8.2 hereof;
(b) Annual Statements -- as soon as practicable after
the end of each fiscal year of the Company, and in any event
within ninety (90) days thereafter, duplicate copies of:
(i) a consolidated balance sheet of the Company
and its Subsidiaries, as at the end of such year, and
(ii) consolidated statements of income, changes in
shareholders' equity and cash flows of the Company and
its Subsidiaries for such year,
setting forth in comparative form the figures for the
previous year in the case of the balance sheets referred to
in clause (i) and for the previous two fiscal years in the
case of the consolidated statements referred to in clause
(ii), all in reasonable detail, prepared in accordance with
GAAP, and accompanied by
(x) in the case of such consolidated statements,
an opinion thereon of the accountants named in Section
2.2 hereof or other independent certified public
accountants of recognized national standing selected by
the Company, which opinion shall, without qualification
(including, without limitation, any
46
qualification with respect to the scope of any
audit), state that such financial statements present
fairly, in all material respects, the financial
position of the companies being reported upon and
their results of operations and cash flows and have
been prepared in conformity with GAAP, and that the
examination of such accountants in connection with
such financial statements has been made in accordance
with generally accepted auditing standards, and that
such audit provides a reasonable basis for such
opinion in the circumstances,
(y) a certification by a principal financial
officer of the Company that such consolidated
statements are complete and correct, and
(z) the certificates required by Section 8.2 and
Section 8.3 hereof;
(c) Audit Reports -- promptly upon receipt thereof, a
copy of each other report (including, without limitation,
any reports to management on internal controls) submitted
to the Company or any of its Subsidiaries by independent
accountants in connection with any annual, interim or
special audit made by them of the books of the Company or
any such Subsidiary;
(d) SEC and Other Reports -- promptly upon their
becoming available one copy of each financial statement,
report, notice or proxy statement sent by the Company or any
of its Subsidiaries to stockholders generally, and of each
regular or periodic report and any registration statement,
offering circular, prospectus or written communication
(other than transmittal letters), and each amendment
thereto, in respect thereof filed by the Company or any of
its Subsidiaries with, or received by, such Person in
connection therewith from, the National Association of
Securities Dealers, any securities exchange or the
Securities and Exchange Commission or any successor agency;
(e) ERISA -- as soon as possible, and in any event
within ten (10) Business Days after, becoming aware of the
occurrence of any
47
(i) "reportable event" (as such term is defined
in section 4043 of ERISA) as to which the 30-day notice
requirement has not been waived by the PBGC or
(ii) "prohibited transaction" (as such term is
defined in section 406 or section 4975 of the IRC)
in connection with any Pension Plan or any trust created
thereunder, a written notice specifying the nature thereof,
what action the Company is taking or proposes to take with
respect thereto, and, when known, any action taken by the
IRS, the Department of Labor or the PBGC with respect
thereto;
(f) ERISA Waivers -- prompt written notice of and a
description of any request pursuant to section 303 of ERISA
or section 412 of the IRC for, or notice of the granting
pursuant to said section 303 or said section 412 of, a
waiver in respect of all or part of the minimum funding
standard set forth in ERISA or the IRC, as the case may be,
of any Pension Plan, and, in connection with the granting of
any such waiver, the amount of any waived "funding
deficiency" (as such term is defined in said section 303 or
said section 412) and the terms of such waiver, in each of
the cases specified in this clause (f), where the effect of
such conditions or events or of events or conditions related
thereto would reasonably be expected to have a Material
Adverse Effect;
(g) Other ERISA Notices -- prompt written notice of
and, where applicable, a description of
(i) any notice from the PBGC in respect of the
commencement of any proceedings pursuant to section
4042 of ERISA to terminate any Pension Plan or for the
appointment of a trustee to administer any Pension
Plan,
(ii) any distress termination notice delivered to
the PBGC under section 4041 of ERISA in respect of any
Pension Plan, and any determination of the PBGC in
respect thereof,
48
(iii) the placement of any Multiemployer Plan in
reorganization status under Title IV of ERISA,
(iv) any Multiemployer Plan becoming "insolvent"
(as such term is defined in section 4245 of ERISA),
(v) the whole or partial withdrawal of the
Company or any ERISA Affiliate from any Multiemployer
Plan and the withdrawal liability incurred in
connection therewith, and
(vi) the withdrawal of the Company or any ERISA
Affiliate from any Multiple Employer Pension Plan and
the withdrawal liability under ERISA incurred in
connection therewith;
in each of the cases specified in the foregoing clauses (i)
through (vi), inclusive, where the effect of such conditions
or events or of events or conditions related thereto would
reasonably be expected to have a Material Adverse Effect,
(h) Notice of Default or Event of Default --
immediately upon becoming aware of the existence of any
condition or event which constitutes a Default or an Event
of Default, a written notice specifying the nature and
period of existence thereof and what action the Company is
taking or proposes to take with respect thereto;
(i) Notice of Claimed Default -- immediately upon
becoming aware that the holder of any evidence of
indebtedness or other Security of the Company or any of its
Subsidiaries shall have given notice or taken any other
action with respect to a claimed event of default or default
thereunder a written notice specifying the notice given or
action taken by such holder and the nature of the claimed
event of default or default and what action the Company is
taking or proposes to take with respect thereto;
(j) Rule 144A Information -- with reasonable
promptness,such data and information as from time to time
may be reasonably requested to comply with 17 C.F.R.
Section 230.144A, as amended from time to time; and
49
(k) Other Requested Information -- with reasonable
promptness, such other data and information as from time to
time may be reasonably requested by any Purchaser or by any
other Institutional Investor which is a holder of Notes.
8.2 Officers' Certificates.
Each set of financial statements delivered to each holder of
Notes pursuant to Section 8.1(a) or Section 8.1(b) hereof shall
be Accompanied by a certificate of the President or a
Vice-President and the Treasurer or an Assistant Treasurer of the
Company setting forth:
(a) Covenant Compliance -- the information (including
detailed calculations) required in order to establish
whether the Company was in compliance with the requirements
of Section 7.4 through Section 7.16 hereof, inclusive,
during the fiscal period covered by the income statement
then being furnished (including with respect to each such
Section, where applicable, the calculations of the maximum
or minimum amount, ratio or percentage, as the case may be,
permissible under the terms of such Sections, and the
calculation of the amounts, ratio or percentage then in
existence); and
(b) Event of Default -- a statement that the signers
have reviewed the relevant terms hereof and have made, or
caused to be made, under their supervision, a review of the
transactions and conditions of the Company and its
Subsidiaries from the beginning of the accounting period
covered by the income statements being delivered therewith
to the date of the certificate and that such review shall
not have disclosed the existence during such period of
any condition or event which constitutes a Default or an
Event of Default or, if any such condition or event existed
or exists, specifying the nature and period of existence
thereof and what action the Company shall have taken or
proposes to take with respect thereto.
8.3 Accountants' Certificates.
Each set of annual financial statements delivered pursuant
to Section 8.1(b) hereof shall be accompanied by
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a certificate of the accountants who certify such financial
statements, stating that they have reviewed this Agreement
and stating further, whether, in making their audit, such
accountants have become aware of any condition or event which
then constitutes a Default or an Event of Default, and, if
such accountants are aware that any such condition or event
then exists, specifying the nature and period of existence thereof.
8.4 Inspection.
The Company shall permit the representatives of any
Purchaser or any other Institutional Investor which is the holder
of at least One Million Dollars ($1,000,000) aggregate principal
amount of Notes (at the expense of such Person unless a Default
or Event of Default shall have occurred and be continuing and
then at the expense of the Company and without regard to the
aggregate principal amount of Notes held by such holder) upon at
least twenty-four (24) hours' prior notice to the Chief Financial
Officer of the Company, to visit and inspect any of the
Properties of the Company or any of its Subsidiaries, to examine
all their respective books of account, records, reports and other
papers, to make copies and extracts therefrom, and to discuss
their respective affairs, finances and accounts with their
respective officers, employees and independent public accountants
(and by this provision the Company authorizes said accountants so
to discuss its finances and affairs and the finances and affairs
of its Subsidiaries) all at such reasonable times and as often as
may be reasonably requested and subject to the provisions of
Section 12.9.
8.5 Report to NAIC.
Concurrently with the delivery to you of each annual
statement required by Section 8.1(b) hereof, the Company shall
deliver a copy thereof to: Securities Valuation Office, National
Association of Insurance Commissioners, 195 Broadway, New York,
New York 10007.
9. EVENTS OF DEFAULT
9.1 Nature of Events.
An "Event of Default" shall exist if any of the following
occurs and is continuing:
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(a) Principal or Make-Whole Amount Payments -- the
Company shall fail to make any payment of principal or Make-
Whole Amount on any Note on or before the date such payment
is due;
(b) Interest Payments -- the Company shall fail to
make any payment of interest on any Note on or before five
(5) Business Days after the date such payment is due;
(c) Default of Guaranty -- the Guaranty set forth in
Section 10 hereof or in the Notes or any provision thereof,
shall cease to be in full force and effect, or any Guarantor
shall deny or disaffirm all or any portion of its
obligations under such Guaranty;
(d) Other Defaults -- the Company or any of its
Subsidiaries shall (i) fail to give any notice required to
be given pursuant to Section 8.1(h) or (ii) fail to perform
or observe any other covenant or to comply with any other
provision hereof, and, in the case of clause (ii) hereof,
such failure continues for more than thirty (30) days;
(e) Warranties or Representations -- any warranty,
representation or other statement by or on behalf of the
Company or any Guarantor contained herein or in any
instrument furnished in compliance with or in reference
hereto shall have been false or misleading in any material
respect when made;
(f) Default on Indebtedness or Other Security --
(i) the Company, any Guarantor or any of the
Subsidiaries of the Company shall fail to make any
payment on any Debt when due; or
(ii) any event shall occur or any condition shall
exist in respect of any Debt or any Security of the
Company, any Guarantor or any of the Subsidiaries of
the Company, or under any agreement securing or
relating to such Debt or Security, that immediately or
with any one or more of the passage of time, the giving
of notice or the expiration of waivers or modifications
52
granted in respect of such event or condition:
(A) causes (or permits any one or more of
the holders thereof or a trustee therefor to
cause) any such Debt in excess, in the aggregate,
of Ten Million Dollars ($10,000,000) to become due
prior to its stated maturity or prior to its
regularly scheduled date or dates of payment; or
(B) permits any one or more of the holders
thereof or a trustee therefor to require the
Company, any Guarantor or any such Subsidiary to
repurchase such Debt or such Security from such
holder.
(g) Involuntary Bankruptcy Proceedings --
(iii) a receiver, liquidator, custodian or trustee
of the Company, any Guarantor or any of the
Subsidiaries of the Company, or of all or any of the
Property of any thereof, shall be appointed by court
order and such order remains in effect for more than
ninety (90) days; or an order for relief shall be
entered with respect to the Company, any Guarantor or
any of the Subsidiaries of the Company, or the Company,
any Guarantor or any of the Subsidiaries of the Company
shall be adjudicated a bankrupt or insolvent; or
(iv) any of the Property of the Company, any
Guarantor or any of the Subsidiaries of the Company
shall be sequestered by court order and such order
remains in effect for more than ninety (90) days; or
(v) a petition shall be filed against the Company,
any Guarantor or any of the Subsidiaries of the Company
under any bankruptcy, reorganization, arrangement,
insolvency, readjustment of debt, dissolution or
liquidation law of any jurisdiction, whether now or
hereafter in effect, and shall not be dismissed within
ninety (90) days after such filing;
53
(h) Voluntary Petitions -- the Company, any Guarantor
or any o the Subsidiaries of the Company shall file a
petition in voluntary bankruptcy or seeking relief under
any provision of any bankruptcy, reorganization,
arrangement, insolvency, readjustment of debt,
dissolution or liquidation law of any jurisdiction,
whether now or hereafter in effect, or shall consent to
the filing of any petition against it under any such law;
(i) Assignments for Benefit of Creditors, etc. --
the Company, any Guarantor or any of the Subsidiaries
of the Company shall make an assignment for the benefit
of its creditors, or admits in writing its inability,
or fails, to pay its debts generally as they become
due, or shall consent to the appointment of a receiver,
liquidator or trustee of the Company, any Guarantor or
any of the Subsidiaries of the Company or of all or any
part of the Property of any thereof; or
(j) Undischarged Final Judgments -- a final judgment
or final judgments for the payment of money aggregating in
excess of Twenty-Five Million Dollars ($25,000,000) is or
are outstanding against one or more of the Company, the
Guarantors and the Subsidiaries of the Company and any
one of such judgments shall have been outstanding for
more than thirty (30) days from the date of its entry and
shall not have been discharged in full or stayed.
9.2 Default Remedies.
(a) Acceleration on Event of Default.
(i) If an Event of Default specified in clause (g),
(h) or (i) of Section 9.1 hereof shall exist, all of
the Notesat the time outstanding shall automatically become
immediately due and payable together with interest
accrued thereon without presentment, demand, protest or
notice of any kind or any other action whatsoever, all of
which are hereby expressly waived, and the Company shall
forthwith pay to the holder or holders of all the Notes
then outstanding the entire principal of, and interest
accrued on, the Notes and, to the extent permitted
54
by law, the Make-Whole Amount with respect to such
principal amount of such Notes and, If an Event of
Default other than those specified in clause (g), (h) or
(i) of Section 9.1 hereof shall exist, the holder or
holders of at least twenty-five percent (25%) in
principal amount of the Notes then outstanding (exclusive
of Notes then owned by any one or more of the Company,
any Guarantor, any Subsidiary of the Company or any
Affiliate) may exercise any right, power or remedy
permitted to such holder or holders by law, and shall
have, in particular, without limiting the generality of
the foregoing, the right to declare the entire principal
of, and all interest accrued on, all the Notes then
outstanding to be, and such Notes shall thereupon become,
forthwith due and payable, without any presentment,
demand, protest or other notice of any kind or other ac
ion whatsoever, all of which are hereby expressly waived,
and the Company shall forthwith pay to the holder or
holders of all the Notes then outstanding the entire
principal of, and interest accrued on, the Notes and, to
the extent permitted by law, the Make-Whole Amount with
respect to such principal amount of such Notes.
(b) Acceleration on Payment Default. During the
existence of an Event of Default described in Section 9.1(a)
or Section 9.1(b) hereof, and irrespective of whether the
Notes then outstanding shall have been declared to be due
and payable pursuant to Section 9.2(a)(ii) hereof, and
notwithstanding any action taken by holders of the Notes
pursuant to Section 9.3 hereof, any holder of Notes who or
which shall have not consented to any waiver with respect to
such Event of Default may, at its option, by notice in
writing to the Company, declare the Notes then held by such
holder to be, and such Notes shall thereupon become,
forthwith due and payable together with all interest accrued
thereon, without any presentment, demand, protest or other
notice of any kind or any other action whatsoever, all of
which are hereby expressly waived, and the Company shall
55
forthwith pay to such holder the entire principal of and
interest accrued on such Notes and, to the extent permitted
by law, the Make-Whole Amount with respect to such principal
amount of such Notes.
(c) Valuable Rights. The Company acknowledges, and
the parties hereto agree, that the right of each holder to
maintain its investment in the Notes free from prepayment by
the Company (except as herein specifically provided for) is
a valuable right and that the provision for payment of a
Make-hole Amount by the Company in the event that the Notes
are prepaid or are accelerated as a result of an Event of
Default is intended to provide compensation for the
deprivation of such right under such circumstances.
(d) Other Remedies. During the existence of an Event
of Default and irrespective of whether the Notes then
outstanding shall have been declared to be due and payable
pursuant to Section 9.2(a)(ii) hereof and irrespective of
whether any holder of Notes then outstanding shall otherwise
have pursued or be pursuing any other rights or remedies,
any holder of Notes may proceed to protect and enforce its
rights hereunder and under such Notes by exercising such
remedies as are available to such holder in respect thereof
under applicable law, either by suit in equity or by action
at law, or both, whether for specific performance of any
agreement contained herein or in aid of the exercise of any
power granted herein, provided that the maturity of such
holder's Notes may be accelerated only in accordance with
Section 9.2(a) and Section 9.2(b) hereof.
(e) Nonwaiver and Expenses. No course of dealing on
the part of any holder of Notes nor any delay or failure on
the part of any holder of Notes to exercise any right shall
operate as a waiver of such right or otherwise prejudice
such holder's rights, powers and remedies. If the Company
or any Guarantor shall fail to pay when due any principal
of, or Make-Whole Amount or interest on, any Note, or shall
fail to comply with any other provision hereof, the Company
and each such Guarantor shall pay to each holder of Notes,
to the extent permitted by law, such further amounts as
shall be sufficient
56
to cover the costs and expenses, including but not
limited to reasonable attorneys' fees, incurred by such
holder in collecting any sums due on such Notes or in
otherwise assessing, analyzing or enforcing any rights or
remedies that are or may be available to it.
9.3 Annulment of Acceleration of Notes.
If a declaration is made pursuant to Section 9.2(a)(ii)
hereof, then and in every such case, the holders of at least
sixty-five (65%) in aggregate principal amount of the Notes then
outstanding (exclusive of Notes then owned by any one or more of
the Company, any Guarantor, any of the Subsidiaries of the
Company and any Affiliates) may, by written instrument filed with
the Company or any Guarantor, rescind and annul such declaration,
and the consequences thereof, provided that at the time such
declaration is annulled and rescinded:
(a) no judgment or decree shall have been entered for
the payment of any moneys due on or pursuant hereto or the
Notes;
(b) all arrears of interest upon all the Notes and all
other sums payable hereunder and under the Notes (except any
principal of, or interest or Make-Whole Amount on, the Notes
which shall have become due and payable by reason of such
declaration under Section 9.2(a)(ii) hereof) shall have been
duly paid; and
(c) each and every other Default and Event of Default
shall have been waived pursuant to Section 12.5 hereof or
otherwise made good or cured,
and provided further that no such rescission and annulment shall
extend to or affect any subsequent Default or Event of Default or
impair any right consequent thereon or effect any holders' rights
under Section 9.1(a) and Section 9.1(b).
9.4 Application of Acceleration Payments.
Any payments received by any holder of Notes pursuant to, or
in respect of, Section 9.2 hereof shall, at the time of the
receipt thereof, be applied by such
57
holder (i) first, to all unpaid expenses of such holder under
Section 1.5, Section 9.2(e) and Section 10.5 hereof, (ii) second,
to all accrued and unpaid interest on such holder's Notes, (iii)
third, to any Make-Whole Amount payable to such holder in respect
of its Notes and (iv) fourth, to the aggregate principal amount
of the Notes of such holder then outstanding.
10. GUARANTY AND OTHER RIGHTS AND UNDERTAKINGS OF GUARANTORS.
10.1 Guaranteed Obligations.
Each Guarantor hereby irrevocably and unconditionally
guarantees, as and for its own debt, until final and indefeasible
payment has been made, the due and punctual payment of the
principal and interest and Make-Whole Amount, if any, on all
Notes at any time outstanding and the due and punctual payment of
all moneys payable, and all other indebtedness owing, by the
Company under the Note Purchase Agreement (collectively, the
"Guaranteed Obligations") in each case when and as the same shall
become due and payable, whether at maturity, pursuant to optional
prepayment, by acceleration or otherwise, all in accordance with
the terms and provisions thereof; it being the intent of the
Guarantors that the guaranty set forth in this Section 10 shall
be a guaranty of payment and not a guaranty of collection. Each
Guarantor hereby further unconditionally guarantees the punctual
and faithful performance, keeping, observance and fulfillment by
the Company of all duties, agreements, covenants and obligations
of the Company contained in the Notes and in the Note Purchase
Agreement. In the event the Company fails to make, on or before
the due date thereof, any payment to be made of any principal
amount of, or interest or Make-Whole Amount (if any) on, or in
respect of, the Notes or of any other amounts due under the Notes
and/or the Note Purchase Agreement or if the Company shall fail
to perform, keep, observe or fulfill any such obligation as
aforesaid in the manner provided in any one or more of the Notes
and/or the Note Purchase Agreement, each Guarantor shall cause
forthwith to be paid the moneys to be paid and shall cause to be
performed, kept, observed or fulfilled the obligations to be
performed, kept, observed or fulfilled as if such payment or
performance, as the case may be, were being made under the Notes
or the Note Purchase Agreement, as appropriate.
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10.2 Performance by Guarantors.
Each Guarantor agrees that its liability under this Section
10 shall be immediate and shall not be contingent upon the
exercise or enforcement by any holder of Notes of whatever
remedies it may have against the Company or any other guarantor
or the enforcement of any Lien or realization upon any security
such holder may at any time possess or have available for its
benefit.
The Guaranty set forth in this Section 10 is a primary and
original joint and several obligation of the Guarantors and is an
absolute, unconditional, continuing and irrevocable guaranty of
payment and shall remain in full force and effect without respect
to future changes in conditions, including change of law, or any
invalidity or irregularity with respect to the issuance of any
obligations (including, without limitation, any of the Notes) of
the Company, or with respect to the execution and delivery of any
agreement (including, without limitation, any of the Note
Purchase Agreement or the Notes) between the Company and any one
or more of the holders of Notes, or with respect to the
genuineness, validity, regularity or enforceability of any of the
Guaranteed Obligations.
10.3 Waivers; Subrogation; Offsets.
Each Guarantor does hereby waive: notice of acceptance
hereof; notice of any purchase of Notes issued under the Note
Purchase Agreement or the extension of credit from time to time
given by any holder of Notes to the Company and the creation,
existence or acquisition of any of the Guaranteed Obligations;
notice of the amount of the Guaranteed Obligations, subject,
however, to such Guarantor's right to make inquiry of any holder
of Notes to ascertain the amount of the Guaranteed Obligations
held by such holder at any reasonable time; notice of adverse
change in the financial condition of the Company or of any other
fact which might increase such Guarantor's risk; notice of
presentment for payment, demand, protest and notice thereof as to
the Notes or any other instrument; notice of default (including
any Default or Event of Default hereunder); all defenses, offsets
and counterclaims which a Guarantor may at any time have to any
claim of any holder of Notes against the Company; and all other
notices and demands to which such
59
Guarantor might otherwise be entitled. Each Guarantor further
waives the rights by statute or otherwise to require any holder
of Notes to institute suit against the Company or to exhaust its
rights and remedies against the Company or any other guarantor,
such Guarantor being bound to the payment of each and all
Guaranteed Obligations in respect of each holder of Notes,
whether now existing or hereafter accruing, as fully as if such
Guaranteed Obligations were directly owing to each such holder of
Notes by such Guarantor. Each Guarantor further waives any
defense arising by reason of any disability or other defense of
the Company or by reason of the cessation from any cause
whatsoever of the liability of the Company in respect of the
Guaranteed Obligations.
Until all of the Guaranteed Obligations shall have been
indefeasibly paid in full and subject to Section 10.5 and Section
10.13 hereof, no Guarantor shall have any right of subrogation,
reimbursement or indemnity whatsoever and no right of recourse to
or with respect to any assets or Property of the Company.
Nothing shall discharge or satisfy the liability of such
Guarantor hereunder except the full and final performance and
indefeasible payment of the Guaranteed Obligations.
Each holder of Notes shall have, to the fullest extent
permitted by law, the right of set-off in respect of any and all
credits and any and all other Property of each Guarantor, now or
at any time whatsoever with, or in the possession of, such holder
for any and all obligations of such Guarantor hereunder.
10.4 Releases.
Each Guarantor consents and agrees that, without notice to
such Guarantor and without affecting or impairing the obligations
of such Guarantor hereunder, any holder of Notes may, in the
manner provided in the Notes or the Note Purchase Agreement, by
action or inaction, directly or indirectly, compromise or settle,
extend the period of duration or the time for the payment or
discharge or performance of, or may refuse to, or otherwise not,
enforce, or may, by action or inaction, release all or any one or
more parties to, any one or more of the Notes or the Note
Purchase Agreement, or may grant other indulgences to the Company
in respect thereof, or may amend or modify in any manner and at
any time (or from
60
time to time) any one or more of the Notes and the Note Purchase
Agreement, or may, by action or inaction, release or substitute
any one or more of the endorsers or guarantors of the Guaranteed
Obligations whether parties hereto or not, or may exchange,
enforce, waive or release, by action or inaction, directly or
indirectly, any security for, the guaranty in this Section 10 or
any Guaranteed Obligation. Further, no holder of Notes shall
have any obligation to, and shall have any liability for failing
to, obtain or perfect or to maintain, or cause to be obtained,
perfected or maintained, the perfection of any security interest
or other Lien on Property to secure the Guaranteed Obligations or
the obligations of any guarantor in respect thereof.
10.5 Marshaling; Revival of Obligations.
Each Guarantor consents and agrees that no holder of Notes
shall be under any obligation to marshall any assets in favor of
any Guarantor, or against or in payment of any or all of the
Guaranteed Obligations. Each Guarantor agrees to pay all
expenses incurred by each holder of Notes in connection with the
evaluation, protection, assertion or enforcement of its rights
under the Note Purchase Agreement and the guaranty set forth in
this Section 10, including, without limitation, court costs,
collection charges and reasonable attorneys' fees and
disbursements.
Each Guarantor further agrees that to the extent the Company
makes a payment or payments to any holder of Notes, which payment
or payments or any part thereof are subsequently invalidated,
declared to be fraudulent or preferential, set aside or required,
for any of the foregoing reasons or for any other reason, to be
repaid or paid over to a custodian, trustee, receiver or any
other party under any bankruptcy act, state or federal law,
common law or equitable cause, then to the extent of such payment
or repayment, the obligation or part thereof intended to be
satisfied shall be revived and continued in full force and effect
as if said payment had not been made and the Guarantors shall be
primarily, jointly and severally liable for such obligation.
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10.6 Subordination.
In the event that for any reason whatsoever, the Company is
now or hereafter becomes indebted to a Guarantor, such Guarantor
agrees that the amount of such indebtedness and all interest
thereon shall at all times be subordinate as to time of payment
and in all other respects to all the Guaranteed Obligations, and
that such Guarantor shall not be entitled to enforce or receive
payment thereof until all sums then due and owing to the holders
of Notes in respect of the Guaranteed Obligations shall have been
paid in full. If any payment shall have been made to a Guarantor
by the Company on any said indebtedness during any time that
there are Guaranteed Obligations outstanding, such Guarantor
shall hold in trust all such payments for the benefit of the
holders of Notes and shall make said payment to such holders to
be credited and applied against obligations of the Company in
accordance with the discretion of, and pursuant to instructions
from, the Required Holders.
10.7 No Election.
Each holder of Notes shall (individually or collectively
with the other holders) have the right to seek recourse against
any one or more of the Guarantors to the full extent provided for
in this Section 10, and against the Company to the full extent
provided for in the Notes and the Note Purchase Agreement. No
election to proceed in one form of action or proceeding, or
against any party, or on any obligation, shall constitute a
waiver of the right of such holder of Notes, to proceed in any
other form of action or proceeding or against other parties
unless such holder of Notes has expressly waived such right in
writing. Specifically, but without limiting the generality of
the foregoing, no action or proceeding by any holder of Notes
against the Company under any document or instrument evidencing
Guaranteed Obligations shall serve to diminish the liability of
any Guarantor under this Section 10 except to the extent that
such holder finally and unconditionally shall have realized
payment by such action or proceeding, notwithstanding the effect
of any such action or proceeding upon such Guarantor's right of
subrogation against the Company. Each Guarantor is fully aware
of the financial condition of the Company. Each Guarantor is
executing and delivering this guaranty based solely upon its own
independent
62
investigation and in no part upon any representation or statement
of any one or more of the holders of Notes with respect thereto.
Each Guarantor is in a position to obtain, and hereby assumes
full responsibility for obtaining, any additional information
concerning the financial condition of the Company as such
Guarantor may deem material to its obligations hereunder, and
such Guarantor is not relying upon, nor expecting, any holder of
Notes to furnish it any information concerning the financial
condition of the Company.
10.8 Severability.
Subject to Section 9 hereof, each of the rights and remedies
granted under this Section 10 to each holder of Notes in respect
of the Notes held by such holder may be exercised by such holder
without notice to, or the consent of or any other action by, any
other holder of Notes.
10.9 Other Enforcement Rights.
Each holder of Notes may proceed, as provided in Section
10.8 hereof, to protect and enforce the guaranty of the
Guarantors under this Section 10 by suit or suits or proceedings
in equity, at law or in bankruptcy, and whether for the specific
performance of any covenant or agreement contained herein
(including, without limitation, in this Section 10) or in
execution or aid of any power herein granted; or for the recovery
of judgment for or in respect of the Guaranteed Obligations or
for the enforcement of any other proper, legal or equitable
remedy available under applicable law.
10.10 Delay or Omission; No Waiver.
No course of dealing on the part of any holder of Notes and
no delay or failure on the part of any such Person to exercise
any right under the Note Purchase Agreement (including, without
limitation, this Section 10) shall impair such right or operate
as a waiver of such right or otherwise prejudice such Person's
rights, powers and remedies hereunder. Every right and remedy
given in or by this Section 10 or by law to any holder of Notes
may be exercised from time to time as often as may be deemed
expedient by such Person.
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10.11 Restoration of Rights and Remedies.
If any holder of Notes shall have instituted any proceeding
to enforce any right or remedy in this Section 10, otherwise than
under the Note Purchase Agreement or under any Note held by such
holder and such proceeding shall have been discontinued or
abandoned for any reason, or shall have been determined adversely
to such holder, then and in every such case each such holder, the
Company and each Guarantor shall, except as may be limited or
affected by any determination in such proceeding, be restored
severally and respectively to its respective former positions
hereunder and thereunder, and thereafter the rights and remedies
of such holder shall continue as though no such proceeding had
been instituted.
10.12 Cumulative Remedies.
No remedy under the Note Purchase Agreement (including,
without limitation, this Section 10) or the Notes is intended to
be exclusive of any other remedy, but each and every remedy shall
be cumulative and in addition to any and every other remedy given
thereunder.
10.13 Miscellaneous.
Each Guarantor (to the fullest extent that it may lawfully
do so) expressly waives any claim of any nature arising out of
any right of indemnity, contribution, reimbursement or any
similar right in respect of any payment made under this Section
10 or in connection with this Section 10, or any claim of
subrogation arising in connection with respect to any payment
made under this Section 10, against the Company or the estate of
the Company (including Liens on the Property of the Company or
the estate of the Company), in each case if, and for so long as,
the Company is the subject of any proceeding brought under Title
11 of the United States Code, or any bankruptcy, reorganization,
arrangement, insolvency, readjustment of debt, dissolution or
liquidation law of any jurisdiction, whether now or hereafter in
effect, and further agrees that it will not file any claims
against the Company or the estate of the Company in the course of
such proceeding in respect of the rights referred to in this
paragraph, and further agrees that each holder of Notes may
specifically enforce the provisions of this paragraph.
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If an Event of Default exists, then the holders of Notes (as
provided in Section 9 hereof) shall have the right to declare all
of the Guaranteed Obligations to be, and such Guaranteed
Obligations shall thereupon become, forthwith due and payable,
without any presentment, demand, protest or other notice of any
kind, all of which have been expressly waived by the Company and
each Guarantor, and notwithstanding any stay, injunction or other
prohibition preventing such declaration (or such Guaranteed
Obligations from becoming automatically due and payable) as
against the Company. In any such event, the holders of Notes
shall have immediate recourse to the Guarantors to the fullest
extent set forth herein.
10.14 Continuing Guaranty.
The Guarantors' obligations in this Section 10 are
continuing obligations and shall apply to all Guaranteed
Obligations whenever arising.
10.15 Inspection.
Each Guarantor shall permit the representatives of any
Purchaser or any other Institutional Investor which is the holder
of at least One Million Dollars ($1,000,000) aggregate principal
amount of Notes (at the expense of such Person unless a Default
or Event of Default shall have occurred and be continuing and
then at the expense of the Guarantor), upon at least twenty-four
(24) hours' prior written notice to the Guarantor in care of the
Chief Financial Officer of the Company to visit and inspect any
of the Properties of such Guarantor or any of its Subsidiaries,
to examine all their respective books of account, records,
reports and other papers, to make copies and extracts therefrom,
and to discuss their respective affairs, finances and accounts
with their respective officers, employees and independent public
accountants (and by this provision each Guarantor authorizes said
accountants to discuss its finances and affairs and the finances
and affairs of its Subsidiaries) all at such reasonable times and
as often as may be reasonably requested.
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10.16 Maintenance of Properties and Corporate Existence.
Each Guarantor will
(a) Property -- maintain its Property in good
condition, ordinary wear and tear excepted, and make all
necessary renewals, replacements, additions, betterments
and improvements thereto;
(b) Financial Records -- keep true books of records
and accounts in which full and correct entries shall be made
of all its business transactions and which will permit
the provision of accurate and complete financial
statements in accordance with GAAP;
(c) Corporate Existence and Rights -- do or cause to
be done all things necessary to preserve and keep in full
force and effect its corporate existence, rights (charter
and statutory) and franchises; and
(d) Compliance with Law -- not be in violation of any
law, ordinance or governmental rule or regulation to which
it is subject and not fail to obtain any license,
certificate, permit, franchise or other governmental
authorization necessary to the ownership of its Properties
or to the conduct of its business if such violation or
failure to obtain could be reasonably expected to have a
Material Adverse Effect.
10.17 Merger; Acquisition.
No Guarantor will merge into, consolidate with, or sell,
lease, transfer or otherwise dispose of all or substantially all
of its Property to, any other Person or permit any other Person
to consolidate with or merge into it (except that the Company may
merge with a Guarantor if the Company is the surviving
corporation); provided that the foregoing restriction does not
apply to the merger or consolidation of a Guarantor with another
corporation, if:
(a) the corporation that results from such merger or
consolidation or that purchases, leases, or
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acquires all or substantially all of such Property (the
"Guarantor Surviving Corporation") is organized under the
laws of the United States of America or any jurisdiction
thereof;
(b) the due and punctual payment of all the Guaranteed
Obligations and all other obligations of such Guarantor
hereunder and the punctual performance and observance of all
the covenants herein to be performed or observed by such
Guarantor are expressly and effectively assumed by such
Guarantor Surviving Corporation pursuant to such agreements
and instruments as shall be approved by the Required
Holders, and such Guarantor will cause to be delivered to
each holder of Notes an opinion of independent counsel to
the effect that
(i) such agreements and instruments are
enforceable in accordance with their terms and (ii) no
taxable event or consequence will result to any holder of
Notes solely by virtue of such merger, consolidation,
purchase, lease or acquisition and the assumption by such
Guarantor Surviving Corporation of the obligations of such
Guarantor hereunder; and
(c) immediately prior to, and immediately after the
consummation of the transaction, and after giving effect
thereto, no Default or Event of Default exists or would
exist under any provision hereof.
10.18 Pro-Rata Offers.
No Guarantor will, nor will it permit any of its
Subsidiaries or any Affiliate, directly or indirectly, to acquire
or make any offer to acquire any Notes other than as set forth in
Section 7.12.
10.19 Private Offering.
Each Guarantor will not, nor will it permit any Person
acting on its behalf to, take any action so as to bring the
issuance and sale of the Notes or the Guaranty within the
provisions of section 5 of the Securities Act.
10.20 Pari Passu Ranking of Guaranty.
Each Guarantor warrants that its obligations under this
Section 10 do, and undertakes that the same will continue to,
rank at least pari passu with all its other present and future
unsecured senior obligations.
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11. INTERPRETATION OF THIS AGREEMENT
11.1 Terms Defined.
As used herein, the following terms have the respective
meanings set forth below or set forth in the Section hereof
following such term:
Acceptable Bank -- means any bank or trust company
which (a) is organized under the laws of and located in the
United States of America or any State thereof, Canada, Japan or a
country which is a member of the European Common Market (b) has
capital, surplus and undivided profits aggregating at least One
Hundred Million Dollars ($100,000,000) and (c) whose long-term
unsecured debt obligations (or the long-term unsecured debt
obligations of the bank holding company owning all of the capital
stock of such bank or trust company) shall have received one of
the two highest ratings issued by Moody's Investors Service, Inc.
or by Standard & Poor's Corporation or, if neither of such rating
agencies is in existence at the time, comparable ratings issued
by any other rating agency of national standing and reputation.
Acceptance -- means, with respect to any Person (the
"Obligor"), (a) any outstanding and unpaid sight or time draft
maturing not more than three (3) years from the date of its
issuance drawn by the Obligor on a bank or trust company and
accepted by such bank or trust company, (b) any outstanding and
unpaid sight or time draft maturing not more than three (3) years
from the date of its issuance drawn by any Person selling goods
or providing services to the Obligor on a bank or trust company
which shall have issued a letter of credit to such person for the
account of the Obligor, provided that if such bank or trust
company shall have paid such sight or time draft and the Obligor
shall not have reimbursed such bank or trust company for such
payment, the obligation owing from the Obligor to such bank or
trust company in respect of such reimbursement shall be deemed to
be an Acceptance under this definition, and (c) any outstanding
and unpaid sight or time draft drawn by any Person selling goods
or providing services to the Obligor on the Obligor and accepted
by the Obligor.
Affiliate -- means, at any time, a Person (other than a
Subsidiary of the Company):
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(a) that directly or indirectly through one or more
intermediaries controls, or is controlled by, or is under
common control with, the Company,
(b) that beneficially owns or holds ten percent (10%)
or more of any class of the Voting Stock of the Company, or
(c) ten percent (10%) or more of the Voting Stock (or
in the case of a Person that is not a corporation, five
percent (5%) or more of the equity interest) of which is
beneficially owned or held by the Company or a Subsidiary of
the Company, at such time.
As used in this definition, "control" means the possession,
directly or indirectly, of the power to direct or cause the
direction of the management and policies of a Person, whether
through the ownership of voting securities, by contract or
otherwise.
Agreement, this -- means this agreement, as it may be
amended and restated from time to time.
Board of Directors -- means, at any time, with respect to
the Company or a Guarantor, the board of directors of such Person
or any committee thereof that, in the instance, shall have the
lawful power to exercise the power and authority of such board of
directors.
Business Day -- means, at any time, a day other than a
Saturday, a Sunday or, in the case of any Note with respect to
which the provisions of Section 4.1 hereof are applicable, a day
on which the bank designated (by the holder of such Note) to
receive (for such holder's account) payments on such Note is
required by law (other than a general banking moratorium or
holiday for a period exceeding four (4) consecutive days) to be
closed.
Capital Lease -- means, at any time, a lease or any
conditional sale or other title retention agreement with respect
to which the lessee or the purchaser thereof is required under
GAAP to recognize the acquisition of an asset and the incurrence
of a liability.
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Capital Stock -- means any and all shares, interests,
participations or other equivalents (however designated) of
capital stock of any corporation, including, without limitation,
Preferred Stock and Voting Stock of such corporation.
Change in Control -- means any Acquisition by any Person, or
related Persons constituting a "group" for purposes of Section
13(d) of the Securities Exchange Act of 1934, of (a) the power to
elect, appoint or cause the election or appointment of at least a
majority of the members of the Board of Directors of the Company,
or (b) beneficial ownership of thirty percent (30%) of the Voting
Stock of the Company or otherwise; provided, however, that a
Change in Control shall not be deemed to have occurred if an
Acquisition of Voting Stock is made as the result of a public
offering by the Company of its shares which is registered under
the Securities Act of 1933 and effected in accordance with the
rules of each national securities exchange on which the Voting
Stock of the Company is listed for trading. For the purposes of
this definition, "Acquisition" of the power stated in the
preceding sentence means the earlier of (i) the actual possession
thereof and (ii) the taking of any corporate or other action or
the consummation of any transaction or of the first of a series
of related actions or transactions which, with the passage of
time, will give such Person or Persons the actual possession
thereof.
Closing -- Section 1.2 hereof.
Closing Date -- Section 1.2 hereof.
Company -- introductory sentence hereof.
Consolidated Funded Debt -- means, at any time, the
aggregate amount of Funded Debt of the Company and its
Subsidiaries determined on a consolidated basis for such Persons
at such time.
Consolidated Net Income -- means, with respect to any fiscal
period, net earnings (or loss) after income taxes of the Company
and its Subsidiaries determined on a consolidated basis for such
Persons for such period in accordance with GAAP but, in any
event, excluding:
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(a) Any gains or losses (after giving effect to the
tax effect thereof) arising from the sale or other
disposition of investments or fixed or capital assets;
(b) any extraordinary or nonrecurring gains or losses
(after giving effect to the tax effect thereof);
(c) any gain resulting from any reappraisal,
revaluation or write-up of assets;
(d) net earnings and losses of any Subsidiary of the
Company accrued prior to the date it became a Subsidiary of
the Company;
(e) net earnings and losses of any Person,
substantially all the assets of which have been acquired
in any manner by the Company or any of its Subsidiaries,
realized by such other Person prior to the date of such
acquisition;
(f) net earnings of any Person (other than a
Subsidiary of the Company) in which the Company or any of
its Subsidiaries shall have an ownership interest unless
such net earnings shall have actually been received by the
Company or such Subsidiary in the form of cash
distributions;
(g) any portion of the net earnings of any Subsidiary
of the Company that, by reason of any contract or charter
restriction or applicable law or regulation (or in the good
faith judgment of the Board of Directors for any other
reason), is unavailable for payment of dividends to the
Company or any other Subsidiary of the Company;
(h) the earnings and losses of any Person to which
assets of the Company or any of its Subsidiaries shall have
been sold, transferred or disposed of, or into which the
Company or any of its Subsidiaries shall have been merged,
prior to the date of such merger or consolidation;
(i) any income resulting from the acquisition by the
Company or a Subsidiary of the Company of the equity
interests, Capital Stock or assets of another
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Person, in each case where such income is attributable to
the fact that the net book value of the equity investment of
the Company or such Subsidiary in such Person exceeds the
amount invested by the Company or such Subsidiary in such
Person;
(j) any gain or loss arising from the acquisition of
any Securities of the Company or any of its Subsidiaries;
(k) any portion of the net earnings of the Company or
any of its Subsidiaries that cannot be freely converted into
United States dollars;
(l) any gain or loss resulting from the receipt of any
proceeds of any insurance policy; and
(m) any restoration during such period to income of
any contingency reserve, except to the extent that provision
for such reserve was made during such period out of income
accrued during such period.
Consolidated Net Worth - means, at any time, the
shareholders equity in the Company and its Subsidiaries,
determined in accordance with GAAP.
Consolidated Total Capitalization - means, at any time, the
sum of
(a) Consolidated Net Worth, plus
(b) Consolidated Funded Debt, determined in each case
at such time.
Control Prepayment Date -- Section 5.2 hereof.
Current Debt -- with respect to any Person means, at any
time, without duplication
(a) its liabilities for borrowed money,
(b) liabilities secured by any Lien existing on
Property owned by such Person (whether or not such
liabilities have been assumed),
72
(c) its liabilities in respect of Capital Leases,
(d) its liabilities under any other obligations for
borrowed money (including, without limitation, any
liabilities in respect of Acceptances and so-called "take or
pay" obligations), and
(e) its liabilities under Guaranties of obligations
described above in clause (a), clause (b), clause (c) and/or
clause (d) above of other Persons,
provided that, in each such case, such liability is either
payable on demand or within one (1) year from the creation
thereof and is not renewable or extendible at the option of such
Person to a date more than one (1) year from the date of creation
thereof. Any such liability
(x) which is renewable or extendible at the option of
such Person to a date more than one (1) year from the date
of creation thereof, or
(y) which, for any reason (including any renewals or
extensions thereof), shall in fact have been outstanding for
a period ending at such time of more than three hundred
sixty-five (365) consecutive days,
shall, in each case, be deemed to be Funded Debt and not Current
Debt. If any indebtedness in respect of any of the foregoing
liabilities is expressed to mature more than one (1) year from
the date of its creation but, as of any date of determination,
has principal due and payable within one (1) year of such date of
determination, "Current Debt" shall not include such principal
payable within such one (1) year period but rather the same shall
be included in "Funded Debt." Notwithstanding the foregoing, any
Acceptance of such Person shall always be classified as Current
Debt under this Agreement.
Debt -- means, with respect to any Person, at any time,
without duplication, all Funded Debt and Current Debt of such
Person at such time.
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Default -- means an event or condition the occurrence of
which would, with the lapse of time or the giving of notice or
both, become an Event of Default.
Environmental Protection Law -- means any federal, state,
county, regional or local law, statute, or regulation (including,
without limitation, CERCLA, RCRA and SARA) enacted in connection
with or relating to the protection or regulation of the
environment, including, without limitation, those laws, statutes,
and regulations regulating the disposal, removal, production,
storing, refining, handling, transferring, processing, or
transporting of Hazardous Substances, and any regulations issued
or promulgated in connection with such statutes by any
Governmental Authority, and any orders, decrees or judgments
issued by any court of competent jurisdiction in connection with
any of the foregoing.
As used in this definition:
CERCLA -- means the Comprehensive Environmental
Response, Compensation, and Liability Act of 1980, as
amended from time to time (by SARA or otherwise), and all
rules and regulations promulgated in connection therewith;
RCRA -- means the Resource Conservation and Recovery
Act of 1976, as amended, and any rules and regulations
issued in connection therewith; and
SARA -- means the Superfund Amendments and
Reauthorization Act of 1986, as amended from time to time,
and all rules and regulations promulgated in connection
therewith.
ERISA -- means the Employee Retirement Income Security
Act of 1974, as amended from time to time.
ERISA Affiliate -- means any corporation or trade or
business that
(i) is a member of the same controlled group of
corporations (within the meaning of section 414(b) of
the IRC) as the Company or any Guarantor, or
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(ii) is under common control (within the meaning
of section 414(c) of the IRC) with the Company or any
Guarantor.
Event of Default -- Section 9.1 hereof.
Exchange Act -- means the Securities Exchange Act of 1934,
as amended, and the rules and regulations promulgated pursuant
thereto.
Fair Market Value -- means, at any time with respect to any
Property, the sale value of such Property that would be realized
in an arm's-length sale at such time between an informed and
willing buyer, and an informed and willing seller, under no
compulsion to buy or sell, respectively.
Foreign Pension Plan -- means any plan, fund or other
similar program
(a) established or maintained outside of the United
States of America by any one or more of the Company, any
Guarantor or any of the Subsidiaries of the Company
primarily for the benefit of the employees (substantially
all of whom are aliens not residing in the United States
of America) of the Company, any Guarantor or such
Subsidiaries which plan, fund or other similar program
provides for retirement income for such employees or results
in a deferral of income for such employees in contemplation
of retirement and
(b) not otherwise subject to ERISA.
Funded Debt -- means, with respect to any Person, at any
time, Without duplication,
(a) its liabilities for borrowed money, other than
Current Debt;
(b) liabilities secured by any Lien existing on
Property owned by such Person (whether or not such
liabilities have been assumed), other than Current Debt;
(c) its liabilities in respect of Capital Leases,
other than Current Debt;
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(d) its liabilities under any other obligations for
borrowed money (including, without limitation, any so-called
"take or pay" obligations), other than Current Debt; and
(e) its liabilities under Guaranties of liabilities of
the type set forth in clause (a), clause (b), clause (c)
and/or clause (d) above of other Persons.
GAAP -- means accounting principles as promulgated from time
to time in statements, opinions and pronouncements by the
American Institute of Certified Public Accountants and the
Financial Accounting Standards Board and in such statements,
opinions and pronouncements of such other entities with respect
to financial accounting of for-profit entities as shall be
accepted by a substantial segment of the accounting profession in
the United States of America.
Governmental Authority -- means
(a) the government of
(i) the United States of America and any state
or political subdivision thereof, or other
(ii) any other jurisdiction (y) in which any of
the Company, the Guarantors or any of the Subsidiaries
of the Company conducts all or any part of their
respective businesses or (z) that asserts jurisdiction
over the conduct of the affairs or Properties of any
such Person, or
(b) any entity exercising executive, legislative,
judicial, regulatory or administrative functions of, or
pertaining to, any such government.
Guaranteed Obligation -- Section 10.1 hereof.
Guarantor -- the introductory sentence hereof.
Guarantor Surviving Corporation - Section 10.17 hereof.
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Guaranty -- means with respect to any Person (for the
purposes of this definition, the "General Guarantor") any
obligation (except the endorsement in the ordinary course of
business of negotiable instruments for deposit or collection)
of the General Guarantor guaranteeing or in effect guaranteeing
any indebtedness, dividend or other obligation of any other
Person (the "Primary Obligor") in any manner, whether directly
or indirectly, including (without limitation) obligations
incurred through an agreement, contingent or otherwise, by the
General Guarantor:
(a) to purchase such indebtedness or obligation or any
Property or assets constituting security therefor;
(b) to advance or supply funds
(i) for the purpose of payment of such
indebtedness or obligation, or
(ii) to maintain working capital or other balance
sheet condition or any income statement condition of
the Primary Obligor or otherwise to advance or make
available funds for the purchase or payment of such
indebtedness or obligation;
(c) to lease Property or to purchase Securities or
other Property or services primarily for the purpose of
assuring the owner of such indebtedness or obligation of
the ability of the Primary Obligor to make payment of the
indebtedness or obligation; or
(d) otherwise to assure the owner of the indebtedness
or obligation of the Primary Obligor against loss in respect
thereof.
For purposes of computing the amount of any Guaranty in
connection with any computation of indebtedness or other
liability, it shall be assumed that the indebtedness or other
liabilities that are the subject of such Guaranty are direct
obligations of the issuer of such Guaranty.
Hazardous Substances -- means any and all pollutants,
contaminants, toxic or hazardous wastes or any
77
other substances that might pose a hazard to health or safety,
the removal of which may be required or the generation,
manufacture, refining, production, processing, treatment,
storage, handling, transportation, transfer, use, disposal,
release, discharge, spillage, seepage, or filtration of which is
or shall be restricted, prohibited or penalized by any applicable
law (including, without limitation, asbestos, urea formaldehyde
foam insulation and polychlorinated biphenyls).
Institutional Investor -- means the Purchasers, any
affiliate of any of the Purchasers, and any holder of Notes that
is a bank (including but not limited to a commercial bank or an
investment bank), trust company, insurance company, pension fund
or other similar institutional investor or an entity whose
security holders consist solely of Institutional Investors.
IRC -- means the Internal Revenue Code of 1986, together
with all rules and regulations promulgated pursuant thereto, as
amended from time to time.
IRS -- means the Internal Revenue Service and any successor
agency.
Investment -- means any investment, made in cash or by
delivery of Property, by the Company or any of its Subsidiaries
(a) in any Person, whether by acquisition of stock, indebtedness
or other obligation or Security, or by loan, Guaranty, advance or
capital contribution, or otherwise, or (b) in any Property.
Lien -- means any interest in Property securing an
obligation owed to, or a claim by, a Person other than the owner
of the Property, whether such interest is based on the common
law, statute or contract, and including but not limited to the
security interest lien arising from a mortgage, encumbrance,
pledge, conditional sale or trust receipt or a lease, consignment
or bailment for security purposes, and the filing of any
financing statement under the Uniform Commercial Code of any
jurisdiction, or an agreement to give any of the foregoing. The
term "Lien" includes reservations, exceptions, encroachments,
easements, rights-of-way, covenants, conditions, restrictions,
leases and other title exceptions and encumbrances affecting real
Property and includes, with respect to stock, stockholder
agreements, voting trust agreements,
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buy-back agreements and all similar arrangements. For the
purposes hereof, the Company and each of its Subsidiaries is
deemed to be the owner of any Property that it shall have
acquired or holds subject to a conditional sale agreement,
Capital Lease or other arrangement pursuant to which title to the
Property has been retained by or vested in some other Person for
security purposes, and such retention or vesting is deemed a
Lien. The term "Lien" does not include negative pledge clauses
in agreements relating to the borrowing of money.
Make-Whole Amount -- means, at any time, with respect to a
principal amount of Notes being prepaid (in whole or in part) or
accelerated, the greater of
(a) Zero Dollars ($O), and
(b) the remainder of
(i) the sum of the present values of the then
remaining scheduled payments of principal and interest
that would be payable but for the prepayment or
acceleration of such principal amount of Notes being
prepaid or accelerated, minus
(ii) the aggregate principal amount of the Notes
so prepaid or accelerated.
In determining such present values, a discount rate equal to the
Make-Whole Discount Rate divided by two (2), and a discount
period of six (6) months of thirty (30) days each, shall be used.
The Required Holders shall calculate the Make-Whole Amount
in respect of any prepayment under Section 5.2 hereof and shall,
immediately prior to the effecting of such prepayment, deliver a
copy of such calculation to the holder of each Note being prepaid
and to the Company and the Guarantors. Such calculation of the
Make-Whole Amount shall be made on the Business Day immediately
preceding the date of such prepayment and shall be binding upon
the Company and the Guarantors absent manifest error.
The Required Holders in respect of the acceleration of all
of the Notes under Section 9.2(a) hereof shall
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calculate the Make-Whole Amount in respect of any such
acceleration as of the Business Day immediately preceding the
date of payment of such accelerated amount and shall deliver a
copy of such calculation to each holder of Notes, the Company and
the Guarantors immediately prior to the effecting of the payment
of such accelerated amount. Each calculation referred to in this
paragraph shall be binding upon the Company and the Guarantors
absent manifest error.
Each holder of Notes accelerating its Note under Section
9.2(b) hereof shall calculate the Make-Whole Amount in respect of
any such acceleration as of the Business Day immediately
preceding the date of payment of such accelerated amount and
shall deliver a copy of such calculation to the Company and the
Guarantors immediately prior to the effecting of payment of such
accelerated amount. Each calculation referred to in this
paragraph shall be binding upon the Company and the Guarantors
absent manifest error.
The Required Holders hereby appoint the holder of Notes with
the highest aggregate principal amount outstanding, determined as
of the date on which any calculation required under this
definition is to be made, to effect such calculation on behalf of
the Required Holders and to deliver the results of such
calculation to the Company, the Guarantors and each other holder
of Notes. Each calculation referred to in this paragraph shall
be binding upon the Company, the Guarantors and each other holder
absent manifest error. If any such holder shall decline to
discharge the undertakings in this paragraph (and each such
holder may elect to so decline), the Required Holders shall, at
their option, act collectively in discharging such undertakings,
appoint another holder to effect the same or authorize the
Company to make such calculations.
Any failure for any reason whatsoever of any holder of Notes
or the Required Holders to deliver a calculation required under
this definition to the Company, the Guarantors and/or any other
holder of Notes shall not excuse, release or discharge the
Company or the Guarantors from their respective payment
obligations hereunder and under the Notes, including, without
limitation, paying any Make-Whole Amount that may be payable in
connection with any prepayment or acceleration of all or some of
the
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Notes. The Company and the Guarantors shall cooperate with the
holders of Notes in making the calculations required in this
definition and in coordinating the distribution of such
calculations and the effecting of the payments or prepayments
referred to above.
Make-Whole Discount Rate -- means, with respect to the
calculation of a Make Whole Amount in respect of any prepayment
or acceleration of the Notes the sum of (a) one half of one
percent (0.5%) plus (b) the Treasury Rate determined in respect
of such calculation.
Margin Security -- means "margin stock" within the meaning
of Regulations G, T, U and X of the Board of Governors of the
Federal Reserve System, 12 C.F.R., Chapter II, as amended from
time to time.
Material Adverse Effect -- means a material adverse effect
on the business, prospects, profits, Properties or condition
(financial or otherwise) of the Company, the Guarantors and the
Subsidiaries of the Company, taken as a whole, or the ability of
the Company or any Guarantor to perform its obligations set forth
herein or the ability of the Company to perform its obligations
set forth in the Notes.
Multiemployer Plan -- means any multiemployer plan (as
defined in section 3(37) of ERISA) in respect of which the
Company, any Guarantor or any ERISA Affiliate is an "employer"
(as such term is defined in section 3 of ERISA).
Multiple Employer Pension Plan -- means any employee benefit
plan within the meaning of section 3(3) of ERISA (other than a
Multiemployer Plan), subject to Title IV of ERISA, to which the
Company, any Guarantor or any ERISA Affiliate and an employer (as
such term is defined in section 3 of ERISA) other than the
Company, any Guarantor or an ERISA Affiliate contribute.
Notes -- Section 1.1 hereof.
Note Purchase Agreement -- Section 1.2 hereof.
PBGC -- means the Pension Benefit Guaranty Corporation and
any successor corporation or governmental agency.
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Pension Plan -- means, at any time, any "employee pension
benefit plan" (as such term is defined in section 3 of ERISA)
maintained at such time by the Company, any Guarantor or any
ERISA Affiliate for employees of the Company, any Guarantor or
such ERISA Affiliate, excluding any Multiemployer Plan, but
including, without limitation any Multiple Employer Pension Plan.
Person -- means an individual, partnership, joint venture,
corporation, trust, unincorporated organization or other form of
legal entity and shall include a government or agency or
political subdivision thereof.
Preferred Stock -- means, with respect to any corporation,
capital stock of such corporation which shall be entitled to
preference or priority over any other capital stock of such
corporation in respect of either or both of the payment of
dividends or the distribution of assets upon liquidation or
distribution.
Property -- means any interest in any kind of property or
asset, whether real, personal or mixed, and whether tangible or
intangible.
Purchase Money Lien -- means
(a) a Lien held by any Person (whether or not the
seller of such assets) on real or personal Property acquired
or constructed by the Company or any of its Subsidiaries,
which Lien secures all or a portion of the related purchase
price or construction costs of such Property and was created
not more than one hundred eighty (180) days after such
Property was acquired or its construction completed,
provided that such Purchase Money Lien
(i) encumbers only the Property being so purchased
or constructed, and
(ii) is not thereafter extended to any other
Property, and
(b) any Lien existing on real or personal Property of
any corporation at the time it becomes a Subsidiary of the
Company, provided that
82
(i) no such Lien shall extend to or cover any
Property other than the Property subject to such Lien
at the time of any such transaction, and
(ii) such Lien was not created in contemplation of
any such transaction.
For purposes of this definition and Section 7.9(a)(viii) hereof,
a Lien on real Property which also encumbers fixtures and other
items of personal Property used in connection with such real
Property shall be deemed to be a Lien on real Property.
Purchaser -- means you, Metropolitan Life Insurance Company.
Required Holders -- means, at any time, the holders of
sixty-six and two-thirds percent (66 2/3%) or more in principal
amount of the Notes at the time outstanding (exclusive of Notes
then owned by any one or more of the Company, any Guarantor any
of the Subsidiaries of the Company, any Affiliate and any officer
or director of any thereof).
Restricted Investments -- means, at any time, all
Investments except the following:
(a) Investments in one or more of the Company's
Subsidiaries or any corporation that concurrently with such
Investment becomes a Subsidiary of the Company;
(b) receivables arising from the sale of goods and
services, and Investments in Property to be used, in each
case in the ordinary course of business of the Company or
the Company's Subsidiary making such Investment;
(c) Investments in direct obligations of the United
States of America, or any agency thereof, or obligations
guaranteed by the United States of America, provided that
such obligations mature within three (3) years from the date
of acquisition thereof;
83
(d) Investments in marketable direct obligations
issued by any state of the United States of America or any
political subdivision of any such state or any public
instrumentality thereof maturing within three (3) years from
the date of acquisition thereof and having as at any date of
determination one of the two highest ratings obtainable from
either Standard & Poor's Corporation or Moody's Investors
Service, Inc. or, if neither of such rating agencies is in
existence at the time, comparable ratings issued by any
other rating agency of national standing and reputation.
(e) Investments in certificates of deposit, time
deposits or banker's Acceptances issued by Acceptable Banks,
provided that such obligations mature within three (3) years
from the date of acquisition thereof; and
(f) Investments in commercial paper rated "A-1" or
higher by Standard & Poor's Corporation or "P-1" or higher
by Moody's Investors Service, Inc. (or any future comparable
ratings issued by Moody's Investors Service, Inc. or by
Standard & Poor's Corporation), provided that such
obligations mature within two hundred seventy (270) days
from the date of creation thereof.
(g) Investments entered into prior to and existing on
the date of this Agreement, as and to the extent now
outstanding, all as described in Annex 7.5.
(h) Investments not permitted by clauses (a) through
(g) above; provided that Investments made pursuant to this
clause (h) shall not exceed, in the aggregate and valued at
the higher of cost or fair market value, 10% of Consolidated
Net Worth.
Restricted Payment -- means
(a) any dividend or other distribution, direct or
indirect, on account of Capital Stock of the Company (except
dividends payable solely in shares of such Capital Stock) or
on account of the Capital Stock of any Guarantor or any
Subsidiary of the
84
Company (except to the extent paid to the Company), and
(b) any redemption, retirement, purchase or other
acquisition, direct or indirect, of any Capital Stock of the
Company, any of its Subsidiaries or any Guarantor, or of any
warrants, rights or other options to acquire any shares of
such Capital Stock.
Securities Act -- means the Securities Act of 1933, as
amended.
Security -- means "security" as defined in section 2(l) of
the Securities Act.
Subsidiary -- means, with respect to any Person, a
corporation of which such Person owns, directly or indirectly,
more than fifty percent (50%) of the Voting Stock.
Subsidiary Stock -- Section 7.15 hereof.
Surviving Corporation -- Section 7.4 hereof.
Total Subsidiary Debt -- means, at any time, the aggregate
amount of Debt of all Subsidiaries of the Company determined at
such time other than Debt owed to the Company or any Wholly-Owned
Subsidiary.
Treasury Rate -- means, with respect to the calculation of a
Make Whole Amount in respect of any prepayment or acceleration of
the Notes (a) the yield reported as of 10:00 a.m., New York City
time, on the Business Day on which such calculation is being
made, on the display page on the Telerate Service (page five
hundred (500), Offer Side) or such other display on the Telerate
Service as shall replace such page five hundred (500) providing
the most current yields for actively traded "On The Run" United
States Treasury securities with maturities corresponding most
closely to the remaining Weighted Average Life to Maturity of the
principal amount of the Notes then being prepaid or accelerated
(such Weighted Average Life to Maturity being determined as of
the date of such calculation and rounded to the nearest month),
or (b) if and only if such Telerate Service ceases to exist or
fails to report such yield, such yield as reported on a
reasonably comparable electronic service as may be designated
85
by the Required Holders, or (c) if and only if such Telerate
Service ceases to exist or fails to report such yield and the
Required Holders shall fail to agree upon a comparable electronic
service, such yield reported under the heading "This Week" and
under the caption "Treasury Constant Maturities" of the maturity
corresponding to the remaining Weighted Average Life to Maturity
of the principal amount of the Notes then being prepaid or
accelerated (such Weighted Average Life to Maturity being
determined as of the date of such calculation and rounded to the
nearest month) as most recently published and made available to
the public in the statistical release designated "H.15(519)" or
any successor publication that is published weekly by the Federal
Reserve System and that establishes yields on actively traded
United States Treasury securities or if no such successor
publication is available, then any other source of current
information in respect of interest rates on securities of the
United States of America that is generally available and, in the
judgment of the Required Holders, provides information reasonably
comparable to the H.15(519) report. If no maturity exactly
corresponds to such rounded Weighted Average Life to Maturity,
yields for the two most closely corresponding published
maturities next above and below the rounded Weighted Average life
to Maturity of the Notes shall be calculated pursuant to the
immediately preceding sentence and the Treasury Rate shall be
interpolated from such yields on a straight-line basis, rounding
with respect to each such relevant period to
the nearest month.
As used in this definition:
Weighted Average Life to Maturity -- means, at any
time, with respect to a principal amount of Notes being
prepaid or accelerated, the number of years obtained by
dividing the then Remaining Dollar-Years of such
principal amount by such principal amount; and
Remaining Dollar-Years -- means, at any time, with
respect to a principal amount of Notes being prepaid or
accelerated the result obtained by
(a) multiplying
86
(i) an amount equal to the remainder of (1)
the amount of principal that would have become due
on each scheduled payment date and at maturity if
such prepayment or acceleration had not been made,
minus (2) the amount of principal on the Notes
scheduled to become due on each such date after
giving effect to such prepayment or acceleration
and the application thereof in accordance with the
provisions of this Agreement, by
(ii) the number of years (calculated to the
nearest one-twelfth) that will elapse between such
time and the date each such scheduled principal
payment would be due if such prepayment or
acceleration had not occurred, and
(b) calculating the summation of each of the
products obtained in the preceding subsection (a).
Voting Stock -- means capital stock of any class or
classes of a corporation the holders of which (a) are ordinarily,
in the absence of contingencies, entitled to elect corporate
directors (or Persons performing similar functions) and (b) are
not otherwise limited in the exercise of the voting rights in
respect of such capital stock.
Welfare Plan -- means, at any time, any "employee welfare
benefit plan" (as such term is defined in section 3 of ERISA)
maintained at such time by the Company, any Guarantor or any
ERISA Affiliate for employees of the Company or any Subsidiaries,
including any multiple employer welfare arrangements (as such
term is defined in section 3 of ERISA).
Wholly-Owned Subsidiary -- means, at any time, any
Subsidiary of the Company one hundred percent (100%) of all of
the Capital Stock (except directors' qualifying shares) of which
are owned by any one or more of the Company and the Company's
other Wholly-Owned Subsidiaries at such time.
87
11.2 Directly or Indirectly.
Where any provision herein refers to action to be taken by
any Person, or which such Person is prohibited from taking, such
provision shall be applicable whether such action is taken
directly or indirectly by such Person, including actions taken by
or on behalf of any partnership in which such Person is a general
partner.
11.3 Section Headings; Table of Contents; Construction.
(a) Section Headings and Table of Contents, etc. The
titles of the Sections and the Table of Contents appear as a
matter of convenience only, do not constitute a part hereof
and shall not affect the construction hereof. The words
"herein," "hereof," "hereunder" and "hereto" refer to this
Agreement as a whole and not to any particular Section or
other subdivision.
(b) Construction. Each covenant contained herein
shall be construed (absent an express contrary provision
herein) as being independent of each other covenant
contained herein, and compliance with any one covenant shall
not (absent such an express contrary provision) be deemed to
excuse compliance with one or more other covenants.
11.4 Governing Law.
THIS AGREEMENT AND THE NOTES SHALL BE GOVERNED BY, AND
CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE INTERNAL LAW OF
THE STATE OF NEW YORK.
12. MISCELLANEOUS
12.1 Communications.
(a) Method; Address. All communications hereunder or
under the Notes (i) shall be in writing, (ii) shall be both
(A) hand delivered, deposited into the United States mail
(registered or certified mail), postage prepaid, or sent by
overnight courier of national standing and (B)
electronically "telecopied" or "faxed", and (iii) shall be
addressed,
88
(i) if to the Company,
405 Lexington Avenue
Chrysler Building
20th Floor
New York, N.Y. 10174
Attn: General Counsel
Fax: (212) 878-1804
if to one or more of the Guarantors,
c/o Minerals Technologies Inc.
405 Lexington Avenue
Chrysler Building
20th Floor
New York, N.Y. 10174
Attn: General Counsel
Fax: (212) 878-1804
or at such other address as the Company and/or a Guarantor
shall have furnished in writing to all holders of the Notes
at the time outstanding, and
(ii) if to any of the holders of the Notes,
(A) if such holders are the Purchaser, at
the address set forth on Annex 1.2 hereto, and
further including any parties referred to on such
Annex 1.2 that are required to receive notices in
addition to such holders of the Notes, and
(B) if such holders are not the Purchaser,
at their respective addresses set forth in the
register for the registration and transfer of
Notes maintained pursuant to Section 7.3 hereof,
or to any such party at such other address as such party may
designate by notice duly given in accordance with this
Section 12.1 to the Company and the Guarantors (which other
address shall be entered in such register).
(b) When Given. Any communication so addressed and
deposited in the United States mail,
89
postage prepaid, by registered or certified mail (in each
case, with return receipt requested) shall be deemed to be
received on the third (3rd) succeeding Business Day after
the day of such deposit (not including the date of such
deposit). Any notice so addressed and otherwise delivered
shall be deemed to be received when actually received at the
address of the addressee.
12.1 Reproduction of Documents.
This Agreement and all documents relating thereto,
including, without limitation,
(a) consents, waivers and modifications that may
hereafter be executed,
(b) documents received by you at the Closing (except
the Notes themselves), and
(c) inancial statements, certificates and other
information previously or hereafter furnished to you or any
other holder of Notes,
may be reproduced by any holder of Notes by any photographic,
photostatic, microfilm, micro-card, miniature photographic,
digital or other similar process and each holder of Notes may
destroy any original document so reproduced. The Company and the
Guarantors agree and stipulate that any such reproduction shall
be admissible in evidence as the original itself in any judicial
or administrative proceeding (whether or not the original is in
existence and whether or not such reproduction was made by such
holder of Notes in the regular course of business) and that any
enlargement, facsimile or further reproduction of such
reproduction shall likewise be admissible in evidence. Nothing
in this Section 12.2 shall prohibit the Company, any Guarantor or
any holder of Notes from contesting the accuracy of any such
reproduction.
12.3 Survival.
All warranties, representations, certifications, statements
and covenants made by the Company and/or the Guarantors herein or
in any certificate or other instrument delivered by any of them
or on their behalf hereunder
90
or otherwise made for your benefit in connection herewith shall
be considered to have been relied upon by you and shall survive
the delivery to you of the Notes regardless of any investigation
made by you or on your behalf. All such statements shall
constitute warranties and representations by the Company and/or
such Guarantor hereunder.
12.4 Successors and Assigns.
This Agreement shall inure to the benefit of and be binding
upon the successors and assigns of each of the parties hereto.
The provisions hereof are intended to be for the benefit of all
holders, from time to time, of Notes, and shall be enforceable by
any such holder, whether or not an express assignment to such
holder of rights hereunder shall have been made by you or your
successor or assign.
12.5 Amendment and Waiver.
(a) Requirements. This Agreement may be amended, and
the observance of any term hereof may be waived, with (and
only with) the written consent of the Company, the
Guarantors and the Required Holders; provided that no such
amendment or waiver of any of the provisions of Section 1
through Section 4 hereof, inclusive, or of Section 6, or any
defined term to the extent used in any of the foregoing
Sections, shall be effective as to any holder of Notes
unless consented to by such holder in writing; and provided
further that no such amendment or waiver shall, without the
written consent of the holders of all Notes (exclusive of
Notes held by the Company, such Guarantors, any of the
Subsidiaries of the Company or any Affiliate) at the time
outstanding,
(i) subject to Section 9.3 hereof, change the
amount or time of any prepayment or payment of
principal or Make-Whole Amount or the rate or time of
payment of interest,
(ii) amend Section 5.6, Section 9 or Section 10
hereof,
91
(iii) amend the definition of "Required Holders,"
or
(iv) amend this Section 12.5.
The holder of any Note may specify that any such written consent
executed by it shall be effective only with respect to a portion
of the Notes held by it (in which case it shall specify, by
dollar amount, the aggregate principal amount of Notes with
respect to which such consent shall be effective) and in the
event of any such specification such holder shall be deemed to
have executed such written consent only with respect to the
portion of the Notes so specified.
(b) Solicitation of Noteholders.
(i) Solicitation. Neither the Company nor any
Guarantor shall, and the Company shall not permit any
of its Subsidiaries to, solicit, request or negotiate
for or with respect to any proposed waiver or amendment
of any of the provisions hereof or the Notes unless
each holder of the Notes (irrespective of the amount of
Notes then owned by it) shall be informed thereof by
the Company or such Guarantor with sufficient
information to enable it to make an informed decision
with respect thereto. Executed or true and correct
copies of any waiver or consent effected pursuant to
the provisions of this Section 12.5 shall be delivered
by the Company to each holder of outstanding Notes
forthwith following the date on which the same shall
have been executed and delivered by all holders of
outstanding Notes required to consent or agree to such
waiver or consent.
(ii) Payment. Neither the Company nor any
Guarantor shall, and the Company shall not permit any
of its Subsidiaries, directly or indirectly, to pay or
cause to be paid any remuneration, whether by way of
supplemental or additional interest, fee or otherwise,
or grant any security, to any holder of Notes as
consideration for or as an inducement to the entering
into by any holder of Notes of any waiver or amendment
of any of the terms and provisions
92
hereof unless such remuneration is concurrently paid,
or security is concurrently granted, on the same terms,
ratably to the holders of all Notes then outstanding.
(iii) Scope of Consent. Any consent made pursuant
to this Section 12.5 by a holder of Notes that has
transferred or has agreed to transfer its Notes to the
Company, a Guarantor, any of the Subsidiaries of the
Company or any Affiliate and has provided or has agreed
to provide such written consent as a condition to such
transfer shall be void and of no force and effect
except solely as to such holder, and any amendments
effected or waivers granted or to be effected or
granted that would not have been or would not be so
effected or granted but for such consent (and the
consents of all other holders of Notes that were
acquired under the same or similar conditions) shall
be void and of no force and effect, retroactive to the
date such amendment or waiver initially took or takes
effect, except solely as to such holder.
(c) Binding Effect. Except as provided in Section
12.5 hereof, any amendment or waiver consented to as
provided in this Section 12.5 shall apply equally to all
holders of Notes and shall be binding upon them and upon
each future holder of any Note and upon the Company and the
Guarantors whether or not such Note shall have been marked
to indicate such amendment or waiver. No such amendment or
waiver shall extend to or affect any obligation, covenant,
agreement, Default or Event of Default not expressly amended
or waived or impair any right consequent thereon.
12.6 Payments, When Received.
(a) Payments Due on Non-Business Days. If any payment
due on, or with respect to, any Note shall fall due on a day
other than a Business Day, then such payment shall be made
on the first Business Day following the day on which such
payment shall have so fallen due; provided that if all or
any portion of such payment shall consist of a payment of
interest, for purposes of calculating such interest, such
interest shall accrue to (but not including) the originally
93
scheduled day of its payment notwithstanding that it shall
be payable on such first following Business Day, and the
amount of the next succeeding interest payment shall be
accrued from (and including) such originally scheduled day
of payment as if all interest and principal originally
scheduled to be paid on such day had been paid thereon.
f any payment is to be made on the first Business Day
following the day on which the same shall have fallen due,
as provided in this paragraph, and is not so paid on such
first Business Day, interest shall accrue thereon (to the
extent permitted by applicable law) at the rate of eight and
forty-nine one-hundredths percent (8.49%) per annum from the
originally scheduled day of its payment.
(b) Payments, When Received. Any payment to be made
to the holders of Notes hereunder or under the Notes shall
be deemed to have been made on the Business Day such payment
actually becomes available to such holder at such holder's
bank prior to 11:00 a.m. (local time of such bank).
12.7 Entire Agreement.
This Agreement constitutes the final written expression of
all of the terms hereof and is a complete and exclusive statement
of those terms.
12.8 Duplicate Originals, Execution in Counterpart.
Two or more duplicate originals hereof may be signed by the
parties, each of which shall be an original but all of which
together shall constitute one and the same instrument. This
Agreement may be executed in two or more counterparts and shall
be effective when at least one counterpart shall have been
executed by each party hereto, and each set of counterparts
which, collectively, show execution by each party hereto shall
constitute one duplicate original.
12.9 Confidentiality.
Each holder shall use reasonable efforts to ensure that any
information concerning the Company or any of its Subsidiaries
which is designated in writing by the Company or such Subsidiary
as being proprietary and confidential and which is in good faith
disclosed to or learned by the representatives of such holder
during the course of inspections pursuant to Section 8.4 or
Section 10.15 is not (without the prior written consent of the
94
Company) disclosed to any person not a party to this Agreement
unless such information: (a) has become generally available to
the public through no action or fault of such holder, (b) is
included or referred to in good faith in a report, statement or
testimony submitted to any municipal, state, Canadian provincial
or federal regulatory body having or claiming to have
jurisdiction over any holder or submitted to the National
Association of Insurance Commissioners, the Office of the
Superintendent of Financial Institutions or similar organizations
or their successors in which case it shall continue to be subject
to any protective order or order of confidentiality which may be
imposed by such body, (c) is disclosed in response to any summons
or subpoena or in connection with any litigation in which case it
shall continue to be subject to any protective order or order of
confidentiality which may be imposed by the court in which such
litigation is pending, (d) is disclosed by any holder in good
faith to a third party who had an independent contractual right
to obtain such information, (e) is believed by any holder to be
appropriately disclosed in order to protect its investment in the
Notes (provided that in the case of confidential information with
respect to proprietary processes or formulae of the Company, this
exception shall apply only if a Default or Event of Default shall
have occurred or be threatened or if disclosure is required in
order to avoid potential liability under applicable state,
federal or Canadian provincial securities laws), or in order to
comply with any law, order regulation or ruling applicable to it,
(f) is disclosed to a prospective transferee in connection with
any contemplated transfer of the Notes if such prospective
transferee agrees to abide by confidentiality provisions
substantially the same as set forth in this Section 12.9 or (g)
was known to such holder at the time of disclosure by the Company
or any of its Subsidiaries or becomes known to such holder from a
Person (other than the Company or a Subsidiary of the Company)
not, to the knowledge of such holder, in violation of any
confidentiality agreement between such Person and the Company or
one of its Subsidiaries. Each holder shall be free to disclose
such information to and discuss it with such holder's retained or
employed accountants, attorneys and similar consultants and
experts when such disclosure is, in the holder's good faith
judgment, necessary to the performance of services being
furnished to the holder by any such Person, if such service
provider agrees to abide by confidentiality provisions
substantially the same as those set forth in this Section 12.9.
[Remainder of Page Intentionally Blank. Next page is
signature page.]
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If this Agreement is satisfactory to you, please so indicate
by signing the acceptance at the foot of a counterpart hereof and
returning such counterpart to the Company, whereupon this
Agreement shall become binding between us in accordance with its
terms.
Very truly yours,
MINERALS TECHNOLOGIES INC.
By___/s/ John R. Stack_____
Name: John R. Stack
Title: Vice President--Finance
SPECIALTY MINERALS INC., as
Guarantor
By___/s/ John R. Stack_____
Name: John R. Stack
Title: Vice President--Finance
MINTEQ INTERNATIONAL INC., as
Guarantor
By___/s/ John R. Stack_____
Name: John R. Stack
Title: Vice President--Finance
96
BARRETTS MINERALS INC., as Guarantor
By___/s/ John R. Stack_____
Name: John R. Stack
Title: Vice President--Finance
The foregoing Agreement is
hereby agreed to as of the
date hereof.
METROPOLITAN LIFE INSURANCE COMPANY
Purchaser
By: /s/ Joseph H. Augustini
Name: Joseph H. Augustini
Title: Vice President
97