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EXHIBIT 10.28
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WABASH NATIONAL CORPORATION
Re:
$8,000,000 6.99% Senior Notes, Series B, due December 17, 2001,
$22,000,000 Designated Rate Senior Notes, Series C, due March 13, 2002,
$9,000,000 7.31% Senior Notes, Series D, due December 17, 2004,
$3,000,000 Designated Rate Senior Notes, Series E, due March 13, 2005,
$13,000,000 7.47% Senior Notes, Series F, due December 17, 2006,
$20,000,000 7.53% Senior Notes, Series G, due December 30, 2008
and
$25,000,000 7.55% Senior Notes, Series H, due December 17, 2008
______________
NOTE PURCHASE AGREEMENT
_____________
Dated as of December 1, 1996
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TABLE OF CONTENTS
(Not a part of the Agreement)
SECTION HEADING PAGE
SECTION 1. AUTHORIZATION OF NOTES; DESIGNATION OF INTEREST RATE FOR SERIES C AND SERIES E NOTES ........................ 1
SECTION 2. SALE AND PURCHASE OF NOTES .................................................................................. 2
SECTION 3. CLOSINGS .................................................................................................... 3
SECTION 4. CONDITIONS TO EACH CLOSING .................................................................................. 3
Section 4.1. Representations and Warranties .......................................................................... 3
Section 4.2. Performance; No Default .................................................................................. 3
Section 4.3. Compliance Certificates .................................................................................. 4
Section 4.4. Opinions of Counsel ...................................................................................... 4
Section 4.5. Purchase Permitted By Applicable Law, etc ................................................................ 4
Section 4.6. Sale of Other Notes ..................................................................................... 4
Section 4.7. Payment of Special Counsel Fees .......................................................................... 5
Section 4.8. Private Placement Number ................................................................................. 5
Section 4.9. Changes in Corporate Structure ........................................................................... 5
Section 4.10. Proceedings and Documents ............................................................................... 5
SECTION 5. REPRESENTATIONS AND WARRANTIES OF THE COMPANY ............................................................... 5
Section 5.1. Organization; Power and Authority ........................................................................ 5
Section 5.2. Authorization, etc ....................................................................................... 5
Section 5.3. Disclosure ............................................................................................... 6
Section 5.4. Organization and Ownership of Shares of Subsidiaries; Affiliates ......................................... 6
Section 5.5. Financial Statements ..................................................................................... 7
Section 5.6. Compliance with Laws, Other Instruments, etc ............................................................. 7
Section 5.7. Governmental Authorizations, etc ......................................................................... 8
Section 5.8. Litigation; Observance of Agreements, Statutes and Orders ................................................ 8
Section 5.9. Taxes .................................................................................................... 8
Section 5.10. Title to Property; Leases ................................................................................ 8
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Section 5.11. Licenses, Permits, etc ................................................................................... 9
Section 5.12. Compliance with ERISA ................................................................................... 9
Section 5.13. Private Offering by the Company .......................................................................... 10
Section 5.14. Use of Proceeds; Margin Regulations ...................................................................... 10
Section 5.15. Existing Indebtedness; Future Liens ..................................................................... 10
Section 5.16. Foreign Assets Control Regulations, etc .................................................................. 11
Section 5.17. Status under Certain Statutes ............................................................................ 11
Section 5.18. Environmental Matters .................................................................................... 11
SECTION 6. REPRESENTATIONS OF THE PURCHASER ........................................................................... 12
Section 6.1. Purchase for Investment .................................................................................. 12
Section 6.2. Source of Funds .......................................................................................... 12
SECTION 7. INFORMATION AS TO COMPANY ................................................................................... 13
Section 7.1. Financial and Business Information ....................................................................... 13
Section 7.2. Officer's Certificate .................................................................................... 16
Section 7.3. Inspection ............................................................................................... 17
SECTION 8. PREPAYMENT OF THE NOTES ..................................................................................... 17
Section 8.1. Required Prepayments ..................................................................................... 17
Section 8.2. Optional Prepayments with Make-Whole Amount .............................................................. 18
Section 8.3. Allocation of Partial Prepayments ........................................................................ 18
Section 8.4. Maturity; Surrender, etc ................................................................................. 18
Section 8.5. Purchase of Notes ........................................................................................ 19
Section 8.6. Make-Whole Amount ........................................................................................ 19
SECTION 9. AFFIRMATIVE COVENANTS ....................................................................................... 20
Section 9.1. Compliance with Law ...................................................................................... 20
Section 9.2. Insurance ................................................................................................ 20
Section 9.3. Maintenance of Properties ................................................................................ 21
Section 9.4. Payment of Taxes and Claims .............................................................................. 21
Section 9.5. Corporate Existence, etc ................................................................................. 21
Section 9.6. Maintenance of Business .................................................................................. 21
Section 9.7. Notes to Rank Pari Passu ................................................................................ 21
SECTION 10. NEGATIVE COVENANTS .......................................................................................... 22
Section 10.1. Consolidated Tangible Net Worth .......................................................................... 22
Section 10.2. Funded Debt .............................................................................................. 22
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Section 10.3. Priority Debt ............................................................................................ 22
Section 10.4. Limitation on Liens ...................................................................................... 23
Section 10.5. Mergers, Consolidations and Sales of Assets .............................................................. 24
Section 10.6. Transactions with Affiliates ............................................................................. 26
SECTION 11. EVENTS OF DEFAULT .......................................................................................... 26
SECTION 12. REMEDIES ON DEFAULT, ETC .................................................................................... 28
Section 12.1. Acceleration ............................................................................................ 28
Section 12.2. Other Remedies ........................................................................................... 29
Section 12.3. Rescission ............................................................................................... 29
Section 12.4. No Waivers or Election of Remedies, Expenses, etc ........................................................ 29
SECTION 13. REGISTRATION; EXCHANGE; SUBSTITUTION OF NOTES ............................................................... 30
Section 13.1. Registration of Notes .................................................................................... 30
Section 13.2. Transfer and Exchange of Notes .......................................................................... 30
Section 13.3. Replacement of Notes ..................................................................................... 30
SECTION 14. PAYMENTS ON NOTES ........................................................................................... 31
Section 14.1. Place of Payment ......................................................................................... 31
Section 14.2. Home Office Payment ...................................................................................... 31
SECTION 15. EXPENSES, ETC ............................................................................................... 31
Section 15.1. Transaction Expenses ..................................................................................... 31
Section 15.2. Survival ................................................................................................. 32
SECTION 16. SURVIVAL OF REPRESENTATIONS AND WARRANTIES; ENTIRE AGREEMENT ................................................ 32
SECTION 17. AMENDMENT AND WAIVER ........................................................................................ 32
Section 17.1. Requirements ............................................................................................. 32
Section 17.2. Solicitation of Holders of Notes ......................................................................... 33
Section 17.3. Binding Effect, etc ...................................................................................... 34
Section 17.4. Notes Held by Company, etc ............................................................................... 34
SECTION 18. NOTICES ..................................................................................................... 34
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SECTION 19. REPRODUCTION OF DOCUMENTS ................................................................................... 35
SECTION 20. CONFIDENTIAL INFORMATION ................................................................................... 35
SECTION 21. SUBSTITUTION OF PURCHASER ................................................................................... 36
SECTION 22. MISCELLANEOUS ............................................................................................... 36
Section 22.1. Successors and Assigns ................................................................................... 36
Section 22.2. Payments Due on Non-Business Days ........................................................................ 36
Section 22.3. Severability ............................................................................................. 37
Section 22.4. Construction ............................................................................................. 37
Section 22.5. Counterparts ............................................................................................. 37
Section 22.6. Governing Law ............................................................................................ 37
Signature ..................................................................................................................... 38
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SCHEDULE A -- INFORMATION RELATING TO PURCHASERS
SCHEDULE B -- DEFINED TERMS
SCHEDULE 4.9 -- Changes in Corporate Structure
SCHEDULE 5.3 -- Disclosure Materials
SCHEDULE 5.4 -- Subsidiaries of the Company and Ownership of Subsidiary Stock
SCHEDULE 5.5 -- Financial Statements
SCHEDULE 5.8 -- Certain Litigation
SCHEDULE 5.11 -- Patents, etc.
SCHEDULE 5.14 -- Use of Proceeds
SCHEDULE 5.15 -- Existing Indebtedness
SCHEDULE 10.4 -- Existing Liens
EXHIBIT 1 -- Form of 6.99% Senior Note, Series B, due December 17, 2001
EXHIBIT 2 -- Form of Designated Rate Senior Note, Series C,
due March 13, 2002
EXHIBIT 3 -- Form of 7.31% Senior Note, Series D, due December 17, 2004
EXHIBIT 4 -- Form of Designated Rate Senior Note, Series E,
due March 13, 2005
EXHIBIT 5 -- Form of 7.47% Senior Note, Series F, due December 17, 2006
EXHIBIT 6 -- Form of 7.53% Senior Note, Series G, due December 30, 2008
EXHIBIT 7 -- Form of 7.55% Senior Note, Series H, due December 17, 2008
EXHIBIT 4.4(A) -- Form of Opinion of Special Counsel for the Company
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EXHIBIT 4.4(B) -- Form of Opinion of Special Indiana Counsel for the Company
EXHIBIT 4.4(C) -- Form of Opinion of Special Counsel for the Purchasers
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WABASH NATIONAL CORPORATION
1000 SAGAMORE PARKWAY SOUTH
LAFAYETTE, INDIANA 47905
Re:
$8,000,000 6.99% Senior Notes, Series B, due December 17, 2001,
$22,000,000 Designated Rate Senior Notes, Series C, due March 13, 2002,
$9,000,000 7.31% Senior Notes, Series D, due December 17, 2004,
$3,000,000 Designated Rate Senior Notes, Series E, due March 13, 2005,
$13,000,000 7.47% Senior Notes, Series F, due December 17, 2006,
$20,000,000 7.53% Senior Notes, Series G, due December 30, 2008
and
$25,000,000 7.55% Senior Notes, Series H, due December 17, 2008
Dated as of
December 1, 1996
TO EACH OF THE PURCHASERS LISTED IN
THE ATTACHED SCHEDULE A:
Ladies and Gentlemen:
WABASH NATIONAL CORPORATION, a Delaware corporation (the "Company"),
agrees with you as follows:
SECTION 1. AUTHORIZATION OF NOTES; DESIGNATION OF INTEREST RATE FOR SERIES C
AND SERIES E NOTES.
(a) The Company will authorize the issue and sale of (a) $8,000,000
aggregate principal amount of its 6.99% Senior Notes, Series B, due December
17, 2001 (the "Series B Notes"), (b) $22,000,000 aggregate principal amount of
its Designated Rate Senior Notes, Series C, due March 13, 2002 (the "Series C
Notes"), (c) $9,000,000 aggregate principal amount of its 7.31% Senior Notes,
Series D, due December 17, 2004 (the "Series D Notes"), (d) $3,000,000
aggregate principal amount of its Designated Rate Senior Notes, Series E, due
March 13, 2005 (the "Series E Notes"), (e) $13,000,000 aggregate principal
amount of its 7.47% Senior Notes, Series F, due December 17, 2006 (the "Series
F Notes"), (f) $20,000,000 aggregate principal amount of its 7.53% Senior
Notes, Series G, due December 30, 2008 (the "Series G Notes"), and (g)
$25,000,000 aggregate principal amount of its 7.55% Senior Notes, Series H, due
December 17, 2008 (the "Series H Notes"; the Series B Notes, the Series C
Notes, the Series D Notes, the Series E Notes, the Series F Notes, the Series G
Notes and the Series H
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Notes being hereinafter collectively referred to as the "Notes"), such term to
include any such notes issued in substitution therefor pursuant to SECTION 13
of this Agreement or the Other Agreements (as hereinafter defined)). The Notes
shall be substantially in the form set out in EXHIBITS 1, 2, 3, 4, 5, 6 and 7,
respectively, with such changes therefrom, if any, as may be approved by you
and the Company. Certain capitalized terms used in this Agreement are defined
in SCHEDULE B; references to a "SCHEDULE" or an "EXHIBIT" are, unless otherwise
specified, to a SCHEDULE or an EXHIBIT attached to this Agreement.
(b) The Company agrees with the Institutional Investors which are
scheduled to purchase the Series C Notes (the "Series C Institutional
Investors") and the Series E Notes (the "Series E Institutional Investors") on
the date of the third Closing as set forth opposite their respective names on
SCHEDULE A that the interest rate to be payable on and in respect of the Series
C Notes and the Series E Notes (individually, the "Series C Designated Rate"
and the "Series E Designated Rate" and collectively the "Designated Rates")
will be set and agreed upon at 10:00 A.M. (New York City time) on March 11,
1997. The Series C Designated Rate will be set and agreed upon by the Company
and the Series C Institutional Investors and the Series E Designated Rate will
be set and agreed upon by the Company and the Series E Institutional Investors.
The Series C Designated Rate will be .75% over the yield to maturity implied
by yields reported as of 10:00 A.M. (New York City time) on March 11, 1997 on
the display designated as "Page PX1" on the Bloomberg Financial Markets
Services Screen (or such other display as may replace Page PX1 on the Bloomberg
Financial Markets Services Screen) for actively traded U.S. Treasury securities
having a maturity most nearly equal to the five year maturity date of the
Series C Notes or if such yields are not reported as of such time or the yields
reported as of such time are not ascertainable, then the Series C Designated
Rate shall be such interest rate as shall otherwise be agreed upon by the
Company and the Series C Institutional Investors. The Series E Designated Rate
will be .85% over the yield to maturity implied by the yields reported as of
10:00 A.M. (New York City time) on March 11, 1997 on the display designated as
"Page PX1" on the Bloomberg Financial Markets Services Screen (or such other
display as may replace Page PX1 on the Bloomberg Financial Markets Services
Screen) for actively traded U.S. Treasury securities having a maturity most
nearly equal to the eight year maturity date of the Series E Notes or if such
yields are not reported as of such time or the yields reported as of such time
are not ascertainable, then the Series E Designated Rate shall be such interest
rate as shall otherwise be agreed upon by the Company and the Series E
Institutional Investors. Not more than ten nor less than five Business Days
prior to March 11, 1997 the Company will send a notice to the Series C
Institutional Investors and the Series E Institutional Investors confirming the
date and time at which the Designated Rates will be set. On March 11, 1997 the
Company will initiate a telephonic conference call with the Series C
Institutional Investors and the Series E Institutional Investors to set the
Designated Rates in the manner herein contemplated.
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SECTION 2. SALE AND PURCHASE OF NOTES.
Subject to the terms and conditions of this Agreement, the Company will
issue and sell to you and you will purchase from the Company, at the Closing or
Closings, as the case may be, provided for in SECTION 3, Notes in the principal
amount and of the series specified opposite your name in SCHEDULE A at the
purchase price of 100% of the principal amount thereof. Contemporaneously with
entering into this Agreement, the Company is entering into separate Note
Purchase Agreements (the "Other Agreements") identical with this Agreement with
each of the other purchasers named in SCHEDULE A (the "Other Purchasers"),
providing for the sale at such Closing or Closings, as the case may be, to each
of the Other Purchasers of Notes in the principal amount and of the series
specified opposite its name in SCHEDULE A. Your obligation hereunder, and the
obligations of the Other Purchasers under the Other Agreements, are several and
not joint obligations, and you shall have no obligation under any Other
Agreement and no liability to any Person for the performance or nonperformance
by any Other Purchaser thereunder.
SECTION 3. CLOSINGS.
The sale and purchase of the Notes to be purchased by you and the Other
Purchasers shall occur at the offices of Chapman and Cutler, 111 West Monroe
Street, Chicago, Illinois 60603, at 10:00 A.M. Chicago time, on the date or
dates set forth opposite your name on SCHEDULE A, the first of which shall
occur on December 17, 1996, the second of which shall occur on December 30,
1996 and the third of which shall occur on March 13, 1997 (individually, each
called the "Closing" and collectively the "Closings") or in the case of each
such Closing on such other Business Day thereafter on or prior to March 31,
1997 as may be agreed upon by the Company and you and the Other Purchasers. At
each Closing the Company will deliver to you the Notes of the series to be
purchased by you on the date of such Closing in the form of a single Note (or
such greater number of Notes in denominations of at least $100,000 as you may
request) dated the date of such Closing and registered in your name (or in the
name of your nominee), against delivery by you to the Company or its order of
immediately available funds in the amount of the purchase price therefor by
wire transfer of immediately available funds for the account of the Company to
account number 56-90021 for the account of Wabash National Corporation at First
Chicago NBD Bank, Chicago, Illinois, ABA No. 071000013. If at any Closing on
which you are scheduled to purchase Notes, the Company shall fail to tender
such Notes to you as provided above in this SECTION 3, or any of the conditions
specified in SECTION 4 shall not have been fulfilled to your satisfaction, you
shall, at your election, be relieved of all further obligations under this
Agreement, without thereby waiving any rights you may have by reason of such
failure or such nonfulfillment.
SECTION 4. CONDITIONS TO EACH CLOSING.
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Your obligation to purchase and pay for the Notes to be sold to you at the
Closing or Closings on which you are scheduled to purchase and pay for such
Notes is subject to the fulfillment to your satisfaction, prior to or at such
Closing or Closings, of the following conditions:
Section 4.1. Representations and Warranties. The representations and
warranties of the Company in this Agreement shall be correct when made and at
the time of such Closing.
Section 4.2. Performance; No Default. The Company shall have performed
and complied with all agreements and conditions contained in this Agreement
required to be performed or complied with by it prior to or at such Closing,
and after giving effect to the issue and sale of the Notes (and the application
of the proceeds thereof as contemplated by SCHEDULE 5.14), no Default or Event
of Default shall have occurred and be continuing. Neither the Company nor any
Subsidiary shall have entered into any transaction since the date of the
Memorandum that would have been prohibited by any covenant contained in
SECTIONS 9 or 10 hereof had such SECTIONS applied since such date.
Section 4.3. Compliance Certificates.
(a) Officer's Certificate. The Company shall have delivered to you an
Officer's Certificate, dated the date of such Closing, certifying that the
conditions specified in SECTIONS 4.1, 4.2 and 4.9 have been fulfilled.
(b) Secretary's Certificate. The Company shall have delivered to you a
certificate certifying as to the resolutions attached thereto and other
corporate proceedings relating to the authorization, execution and delivery of
the Notes and the Agreements.
Section 4.4. Opinions of Counsel. You shall have received opinions in
form and substance satisfactory to you, dated the date of the Closing (a) from
Hogan & Hartson L.L.P., independent counsel for the Company, covering the
matters set forth in EXHIBIT 4.4(b) and covering such other matters incident to
the transactions contemplated hereby as you or your counsel may reasonably
request (and the Company hereby instructs its counsel to deliver such opinion
to you), (b) from Gambs Mucker Bauman & Seeger, special Indiana counsel to the
Company, covering the matters set forth in EXHIBIT 4.4(b) and covering such
other matters incident to the transactions contemplated hereby as you or your
counsel may reasonably request (and the Company hereby instructs its counsel to
deliver such opinion to you) and (c) from Chapman and Cutler, your special
counsel in connection with such transactions, substantially in the form set
forth in EXHIBIT 4.4(c) and covering such other matters incident to such
transactions as you may reasonably request.
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Section 4.5. Purchase Permitted By Applicable Law, etc. On the date of
such Closing your purchase of Notes scheduled to be sold to you on the date of
such Closing shall (a) be permitted by the laws and regulations of each
jurisdiction to which you are subject, without recourse to provisions (such as
Section 1405(a)(8) of the New York Insurance Law) permitting limited
investments by insurance companies without restriction as to the character of
the particular investment, (b) not violate any applicable law or regulation
(including, without limitation, Regulation G, T or X of the Board of Governors
of the Federal Reserve System) and (c) not subject you to any tax, penalty or
liability under or pursuant to any applicable law or regulation, which law or
regulation was not in effect on the date hereof. If requested by you, you
shall have received an Officer's Certificate certifying as to such matters of
fact as you may reasonably specify to enable you to determine whether such
purchase is so permitted.
Section 4.6. Sale of Other Notes. (a) Contemporaneously with such
Closing, the Company shall sell to the Other Purchasers scheduled to purchase
Notes on the date of such Closing, and such Other Purchasers shall purchase,
the Notes to be purchased by them at such Closing as specified in SCHEDULE A.
(b) On the date of each Closing consummated prior to the date of such
Closing, the Company shall have sold all of the Notes as specified in SCHEDULE
A on the date of such prior Closing.
Section 4.7. Payment of Special Counsel Fees. Without limiting the
provisions of SECTION 15.1, the Company shall have paid on or before such
Closing the fees, charges and disbursements of your special counsel referred to
in SECTION 4.4 incurred in connection with the preparation of this Agreement,
the Other Agreements and matters incident thereto to the extent reflected in a
statement of such counsel rendered to the Company at least one Business Day
prior to such Closing.
Section 4.8. Private Placement Number. On or prior to the date of the
first Closing, a Private Placement number issued by Standard & Poor's CUSIP
Service Bureau (in cooperation with the Securities Valuation Office of the
National Association of Insurance Commissioners) shall have been obtained for
each series of the Notes.
Section 4.9. Changes in Corporate Structure. Except as specified in
SCHEDULE 4.9, the Company shall on the date of such Closing not have changed
its jurisdiction of incorporation or been a party to any merger or
consolidation and shall not have succeeded to all or any substantial part of
the liabilities of any other entity, at any time following the date of the most
recent financial statements referred to in SCHEDULE 5.5.
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Section 4.10. Proceedings and Documents. All corporate and other
proceedings in connection with the transactions contemplated by this Agreement
on the date of such Closing and on the date of each prior Closing and all
documents and instruments incident to such transactions shall be satisfactory
to you and your special counsel, and you and your special counsel shall have
received all such counterpart originals or certified or other copies of such
documents as you or they may reasonably request.
SECTION 5. REPRESENTATIONS AND WARRANTIES OF THE COMPANY.
The Company represents and warrants to you that:
Section 5.1. Organization; Power and Authority. The Company is a
corporation duly organized, validly existing and in good standing under the
laws of its jurisdiction of incorporation, and is duly qualified as a foreign
corporation and is in good standing in each jurisdiction in which such
qualification is required by law, other than those jurisdictions as to which
the failure to be so qualified or in good standing could not, individually or
in the aggregate, reasonably be expected to have a Material Adverse Effect.
The Company has the corporate power and authority to own or hold under lease
the properties it purports to own or hold under lease, to transact the business
it transacts and proposes to transact, to execute and deliver this Agreement
and the Other Agreements and the Notes and to perform the provisions hereof and
thereof.
Section 5.2. Authorization, etc. This Agreement, the Other Agreements and
the Notes have been duly authorized by all necessary corporate action on the
part of the Company, and this Agreement constitutes, and upon execution and
delivery thereof against value therefor each Note will constitute, a legal,
valid and binding obligation of the Company enforceable against the Company in
accordance with its terms, except as such enforceability may be limited by (a)
applicable bankruptcy, insolvency, reorganization, moratorium or other similar
laws affecting the enforcement of creditors' rights generally and (b) general
principles of equity (regardless of whether such enforceability is considered
in a proceeding in equity or at law).
Section 5.3. Disclosure. The Company, through its agent, Salomon Brothers
Inc, has delivered to you and each Other Purchaser a copy of a Private
Placement Memorandum, dated October 15, 1996 (the "Memorandum"), relating to
the transactions contemplated hereby. Except as disclosed in SCHEDULE 5.3, the
Memorandum fairly describes, in all material respects, the general nature of
the business and principal properties of the Company and its Subsidiaries.
Except as disclosed in SCHEDULE 5.3, this Agreement, the Memorandum, the
documents, certificates or other writings delivered to you by or on behalf of
the Company in connection with the transactions contemplated hereby, including,
without limitation, the December 31, 1995 SEC Form 10-K (including all
documents incorporated by reference therein), the March 31, 1996 SEC
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Form 10-Q, June 30, 1996 SEC Form 10-Q and the September 30, 1996 SEC Form 10-Q
of the Company, and the financial statements listed in SCHEDULE 5.5, taken as a
whole, do not contain any untrue statement of a material fact or omit to state
any material fact necessary to make the statements therein not misleading in
light of the circumstances under which they were made. Except as disclosed in
the Memorandum or as expressly described in SCHEDULE 5.3, or in one of the
documents, certificates or other writings identified therein, or in the March
31, 1996, June 30, 1996 or September 30, 1996 SEC Forms 10-Q or in the
financial statements listed in SCHEDULE 5.5, since December 31, 1995, there has
been no change in the financial condition, operations, business, properties
or prospects of the Company or any Subsidiary except changes that individually
or in the aggregate could not reasonably be expected to have a Material Adverse
Effect. There is no fact known to the Company that could reasonably be
expected to have a Material Adverse Effect that has not been set forth herein
or in the Memorandum or in the other documents, certificates and other writings
delivered to you by or on behalf of the Company specifically for use in
connection with the transactions contemplated hereby.
Section 5.4. Organization and Ownership of Shares of Subsidiaries;
Affiliates. (a) SCHEDULE 5.4 contains (except as noted therein) complete and
correct lists (i) of the Company's Subsidiaries, showing, as to each
Subsidiary, the correct name thereof, the jurisdiction of its organization, and
the percentage of shares of each class of its capital stock or similar equity
interests outstanding owned by the Company and each other Subsidiary, (ii) of
the Company's Affiliates, other than Subsidiaries, and (iii) of the Company's
directors and executive officers.
(b) All of the outstanding shares of capital stock or similar equity
interests of each Subsidiary shown in SCHEDULE 5.4 as being owned by the
Company and its Subsidiaries have been validly issued, are fully paid and
nonassessable and are owned by the Company or another Subsidiary free and clear
of any Lien (except as otherwise disclosed in SCHEDULE 5.4).
(c) Each Subsidiary identified in SCHEDULE 5.4 is a corporation or other
legal entity duly organized, validly existing and in good standing under the
laws of its jurisdiction of organization, and is duly qualified as a foreign
corporation or other legal entity and is in good standing in each jurisdiction
in which such qualification is required by law, other than those jurisdictions
as to which the failure to be so qualified or in good standing could not,
individually or in the aggregate, reasonably be expected to have a Material
Adverse Effect. Each such Subsidiary has the corporate or other power and
authority to own or hold under lease the properties it purports to own or hold
under lease and to transact the business it transacts and proposes to transact.
(d) No Subsidiary is a party to, or otherwise subject to any legal
restriction or any agreement (other than this Agreement, the agreements listed
on SCHEDULE 5.4 and customary
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limitations imposed by corporate law statutes) restricting the ability of such
Subsidiary to pay dividends out of profits or make any other similar
distributions of profits to the Company or any of its Subsidiaries that owns
outstanding shares of capital stock or similar equity interests of such
Subsidiary.
Section 5.5. Financial Statements. The Company has delivered to each
Purchaser copies of the financial statements of the Company and its
Subsidiaries listed on SCHEDULE 5.5. All of said financial statements
(including in each case the related schedules and notes) fairly present in all
material respects the consolidated financial position of the Company and its
Subsidiaries as of the respective dates specified in such SCHEDULE and the
consolidated results of their operations and cash flows for the respective
periods so specified and have been prepared in accordance with GAAP
consistently applied throughout the periods involved except as set forth in the
notes thereto (subject, in the case of any interim financial statements, to
normal year-end adjustments).
Section 5.6. Compliance with Laws, Other Instruments, etc. (a) The
execution, delivery and performance by the Company of this Agreement and the
Notes will not (i) contravene, result in any breach of, or constitute a default
under, or result in the creation of any Lien in respect of any property of the
Company or any Subsidiary under, any indenture, mortgage, deed of trust, loan,
purchase or credit agreement, lease, corporate charter or by-laws, or any other
Material agreement or instrument to which the Company or any Subsidiary is
bound or by which the Company or any Subsidiary or any of their respective
properties may be bound or affected, (ii) conflict with or result in a breach
of any of the terms, conditions or provisions of any order, judgment, decree,
or ruling of any court, arbitrator or Governmental Authority applicable to the
Company or any Subsidiary or (iii) violate any provision of any statute or
other rule or regulation of any Governmental Authority applicable to the
Company or any Subsidiary.
(b) The Notes and all other obligations under this Agreement of the
Company are direct and unsecured obligations of the Company ranking pari passu
with all other existing unsecured Indebtedness of the Company (actual or
contingent) which is not expressed to be subordinated or junior in rank to any
other unsecured Indebtedness of the Company.
Section 5.7. Governmental Authorizations, etc. No consent, approval or
authorization of, or registration, filing or declaration with, any Governmental
Authority is required in connection with the execution, delivery or performance
by the Company of this Agreement or the Notes.
Section 5.8. Litigation; Observance of Agreements, Statutes and Orders.
(a) Except as disclosed in SCHEDULE 5.8, there are no actions, suits or
proceedings pending or, to the knowledge of the Company, threatened against or
affecting the Company or any Subsidiary or
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any property of the Company or any Subsidiary in any court or before any
arbitrator of any kind or before or by any Governmental Authority that,
individually or in the aggregate, could reasonably be expected to have a
Material Adverse Effect.
(b) Neither the Company nor any Subsidiary is in default under any term of
any agreement or instrument to which it is a party or by which it is bound, or
any order, judgment, decree or ruling of any court, arbitrator or Governmental
Authority or is in violation of any applicable law, ordinance, rule or
regulation (including without limitation Environmental Laws) of any
Governmental Authority, which default or violation, individually or in the
aggregate, could reasonably be expected to have a Material Adverse Effect.
Section 5.9. Taxes. The Company and its Subsidiaries have filed all tax
returns that are required to have been filed in any jurisdiction, and have paid
all taxes shown to be due and payable on such returns and all other taxes and
assessments levied upon them or their properties, assets, income or franchises,
to the extent such taxes and assessments have become due and payable and before
they have become delinquent, except for any taxes and assessments (a) the
amount of which is not individually or in the aggregate Material or (b) the
amount, applicability or validity of which is currently being contested in good
faith by appropriate proceedings and with respect to which the Company or a
Subsidiary, as the case may be, has established adequate reserves in accordance
with GAAP. The Company knows of no basis for any other tax or assessment that
could reasonably be expected to have a Material Adverse Effect. The charges,
accruals and reserves on the books of the Company and its Subsidiaries in
respect of Federal, state or other taxes for all fiscal periods are adequate.
The Federal income tax liabilities of the Company and its Subsidiaries have
been determined by the Internal Revenue Service and paid for all fiscal years
up to and including the fiscal year ended December 31, 1992.
Section 5.10. Title to Property; Leases. The Company and its Subsidiaries
have good and sufficient title to their respective properties that individually
or in the aggregate are Material (other than assets subject to Capitalized
Leases), including all such properties reflected in the most recent audited
balance sheet referred to in SECTION 5.5 or purported to have been acquired by
the Company or any Subsidiary after said date (except as sold or otherwise
disposed of in the ordinary course of business), in each case free and clear of
Liens prohibited by this Agreement, except for those defects in title and Liens
that, individually or in the aggregate, would not have a Material Adverse
Effect. All leases that individually or in the aggregate are Material are
valid and subsisting and are in full force and effect in all material respects.
Section 5.11. Licenses, Permits, etc. Except as disclosed in SCHEDULE
5.11,
(a) the Company and its Subsidiaries own, possess or have the lawful right
to use all licenses, permits, franchises, authorizations, patents, copyrights,
service marks, trademarks and
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trade names, or rights thereto, that individually or in the aggregate are
Material, without known conflict with the rights of others, except for those
conflicts that, individually or in the aggregate, would not have a Material
Adverse Effect;
(b) to the best knowledge of the Company, no product of the Company or any
of its Subsidiaries infringes in any material respect any license, permit,
franchise, authorization, patent, copyright, service mark, trademark, trade
name or other right owned by any other Person; and
(c) to the best knowledge of the Company, there is no Material violation
by any Person of any right of the Company or any of its Subsidiaries with
respect to any patent, copyright, service mark, trademark, trade name or other
right owned or used by the Company or any of its Subsidiaries.
Section 5.12. Compliance with ERISA. (a) The Company and each ERISA
Affiliate have operated and administered each Plan in compliance with all
applicable laws except for such instances of noncompliance as have not resulted
in and could not reasonably be expected to result in a Material Adverse Effect.
Neither the Company nor any ERISA Affiliate has incurred any liability
pursuant to Title I or IV of ERISA or the penalty or excise tax provisions of
the Code relating to employee benefit plans (as defined in Section 3 of ERISA),
and no event, transaction or condition has occurred or exists that could
reasonably be expected to result in the incurrence of any such liability by the
Company or any ERISA Affiliate, or in the imposition of any Lien on any of the
rights, properties or assets of the Company or any ERISA Affiliate, in either
case pursuant to Title I or IV of ERISA or to such penalty or excise tax
provisions or to Section 401(a)(29) or 412 of the Code, other than such
liabilities or Liens as would not be individually or in the aggregate Material.
(b) The present value of the aggregate benefit liabilities under each of
the Plans (other than Multiemployer Plans), determined as of the end of such
Plan's most recently ended plan year on the basis of the actuarial assumptions
specified for funding purposes in such Plan's most recent actuarial valuation
report, did not exceed the aggregate current value of the assets of such Plan
allocable to such benefit liabilities. The terms "benefit liabilities" has
the meaning specified in section 4001 of ERISA and the terms "current value"
and "present value" have the meaning specified in section 3 of ERISA.
(c) The Company and its ERISA Affiliates have not incurred withdrawal
liabilities (and are not subject to contingent withdrawal liabilities) under
section 4201 or 4204 of ERISA in respect of Multiemployer Plans that
individually or in the aggregate are Material.
(d) The expected post-retirement benefit obligation (determined as of the
last day of the Company's most recently ended fiscal year in accordance with
Financial Accounting
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Standards Board Statement No. 106, without regard to liabilities attributable
to continuation coverage mandated by section 4980B of the Code) of the Company
and its Subsidiaries is not Material.
(e) The execution and delivery of this Agreement and the issuance and sale
of the Notes hereunder will not involve any transaction that is subject to the
prohibitions of section 406(a)(1) of ERISA or in connection with which a tax
could be imposed pursuant to section 4975(c)(1)(A)-(D) of the Code. The
representation by the Company in the first sentence of this SECTION 5.12(E) is
made in reliance upon and subject to (i) the accuracy of your representation in
SECTION 6.2 as to the sources of the funds used to pay the purchase price of
the Notes to be purchased by you and (ii) the assumption, made solely for the
purpose of making such representation, that Department of Labor Interpretive
Bulletin 75-2 with respect to prohibited transactions remains valid in the
circumstances of the transactions contemplated herein.
Section 5.13. Private Offering by the Company. Neither the Company nor
Salomon Brothers Inc (the only Person authorized or employed by the Company as
agent, broker, dealer, financial advisor or otherwise in connection with the
offering or sale of the Notes or similar securities of the Company) has offered
the Notes or any similar securities for sale to, or solicited any offer to buy
any of the same from, or otherwise approached or negotiated in respect thereof
with, any person other than you, the Other Purchasers and not more than 100
other Institutional Investors, each of which has been offered the Notes at a
private sale for investment. Neither the Company nor any agent acting on its
behalf has taken, or will take, any action that would subject the issuance or
sale of the Notes to the registration requirements of Section 5 of the
Securities Act.
Section 5.14. Use of Proceeds; Margin Regulations. The Company will apply
the proceeds of the sale of the Notes as set forth in SCHEDULE 5.14. No part of
the proceeds from the sale of the Notes hereunder will be used, directly or
indirectly, for the purpose of buying or carrying any margin stock within the
meaning of Regulation G of the Board of Governors of the Federal Reserve System
(12 CFR 207), other than the shares of Common Stock, par value $0.01 per share,
of the Company which are purchased for the purpose of retiring such shares, or
for the purpose of buying or carrying or trading in any securities under such
circumstances as to involve the Company in a violation of Regulation X of said
Board (12 CFR 224) or to involve any broker or dealer in a violation of
Regulation T of said Board (12 CFR 220). Margin stock (excluding shares of
Common Stock, par value $0.01 per share, of the Company which have been
retired) does not constitute more than 5% of the value of the consolidated
assets of the Company and its Subsidiaries and the Company does not have any
present intention that margin stock will constitute more than 5% of the value
of such assets. As used in this SECTION 5.14, the terms
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"margin stock" and "purpose of buying or carrying" shall have the meanings
assigned to them in said Regulation G, but shall not include the aforesaid
shares of Common Stock.
Section 5.15. Existing Indebtedness; Future Liens. (a) SCHEDULE 5.15 sets
forth a complete and correct list of all outstanding Indebtedness of the
Company and its Subsidiaries aggregating in excess of $50,000 as of December 6,
1996, since which date there has been no Material change in the amounts,
interest rates, sinking funds, installment payments or maturities of the
Indebtedness of the Company or its Subsidiaries. Neither the Company nor any
Subsidiary is in default and no waiver of default is currently in effect, in
the payment of any principal or interest on any Indebtedness of the Company or
such Subsidiary and no event or condition exists with respect to any
Indebtedness of the Company or any Subsidiary that would permit (or that with
notice or the lapse of time, or both, would permit) one or more Persons to
cause such Indebtedness to become due and payable before its stated maturity or
before its regularly scheduled dates of payment.
(b) Except as disclosed in SCHEDULE 5.15, neither the Company nor any
Subsidiary 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 10.3.
Section 5.16. Foreign Assets Control Regulations, etc. Neither the sale
of the Notes by the Company hereunder nor its use of the proceeds thereof will
violate the Trading with the Enemy Act, as amended, or any of the foreign
assets control regulations of the United States Treasury Department (31 CFR,
Subtitle B, Chapter V, as amended) or any enabling legislation or executive
order relating thereto.
Section 5.17. Status under Certain Statutes. Neither the Company nor any
Subsidiary is subject to regulation under the Investment Company Act of 1940,
as amended, the Public Utility Holding Company Act of 1935, as amended, the
Interstate Commerce Act, as amended (the "ICA"), or the Federal Power Act, as
amended, except that Continental Transit Corp. is subject to regulation under
the ICA.
Section 5.18. Environmental Matters. Neither the Company nor any
Subsidiary has knowledge of any claim or has received any notice of any claim,
and no proceeding has been instituted raising any claim against the Company or
any of its Subsidiaries or any of their respective real properties now or
formerly owned, leased or operated by any of them or other assets, alleging any
damage to the environment or violation of any Environmental Laws, except, in
each case, such as could not reasonably be expected to result in a Material
Adverse Effect. Except as otherwise disclosed to you in writing:
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(a) neither the Company nor any Subsidiary has knowledge of any
facts which would give rise to any claim, public or private, of violation
of Environmental Laws or damage to the environment emanating from,
occurring on or in any way related to real properties now or formerly
owned, leased or operated by any of them or to other assets or their use,
except, in each case, such as could not reasonably be expected to result
in a Material Adverse Effect;
(b) neither the Company nor any of its Subsidiaries has stored any
Hazardous Materials on real properties now or formerly owned, leased or
operated by any of them and has not disposed of any Hazardous Materials
in a manner contrary to any Environmental Laws, in each case in any
manner that could reasonably be expected to result in a Material Adverse
Effect; and
(c) all buildings on all real properties now owned, leased or
operated by the Company or any of its Subsidiaries are in compliance with
applicable Environmental Laws, except where failure to comply could not
reasonably be expected to result in a Material Adverse Effect.
SECTION 6. REPRESENTATIONS OF THE PURCHASER.
Section 6.1. Purchase for Investment. You represent that you are
purchasing the Notes for your own account or for one or more separate accounts
maintained by you or for the account of one or more pension or trust funds
managed by you and not with a view to the distribution thereof, provided that
the disposition of your or their property shall at all times be within your or
their control. You understand that the Notes have not been registered under
the Securities Act and may be resold only if registered pursuant to the
provisions of the Securities Act or if an exemption from registration is
available, except under circumstances where neither such registration nor such
an exemption is required by law, and that the Company is not required to
register the Notes.
Section 6.2. Source of Funds. You represent that at least one of the
following statements is an accurate representation as to each source of funds
(a "Source") to be used by you to pay the purchase price of the Notes to be
purchased by you hereunder:
(a) if you are an insurance company, the Source is an "insurance
company general account" within the meaning of Department of Labor
Prohibited Transaction Exemption ("PTE") 95-60 (issued July 12, 1995) and
there is no employee benefit plan, treating as a single plan all plans
maintained by the same employer or employee organization, with respect to
which the amount of the general account reserves and liabilities for all
contracts held by or on behalf of such plan exceeds ten percent (10%) of
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the total reserves and liabilities of such general account (exclusive of
separate account liabilities) plus surplus, as set forth in the NAIC
Annual Statement filed with your state of domicile; or
(b) if you are an insurance company, the Source does not include
assets allocated to any separate account maintained by you in which any
employee benefit plan (or its related trust) has any interest, other than
a separate account that is maintained solely in connection with your
fixed contractual obligations under which the amounts payable, or
credited, to such plan and to any participant or beneficiary of such plan
(including any annuitant) are not affected in any manner by the
investment performance of the separate account; or
(c) the Source is either (i) an insurance company pooled separate
account, within the meaning of PTE 90-1 (issued January 29, 1990), or
(ii) a bank collective investment fund, within the meaning of the PTE
91-38 (issued July 12, 1991) and, except as you have disclosed to the
Company in writing pursuant to this paragraph (c), no employee benefit
plan or group of plans maintained by the same employer or employee
organization beneficially owns more than 10% of all assets allocated to
such pooled separate account or collective investment fund; or
(d) the Source constitutes assets of an "investment fund" (within
the meaning of Part V of the QPAM Exemption) managed by a "qualified
professional asset manager" or "QPAM" (within the meaning of Part V of
the QPAM Exemption), no employee benefit plan's assets that are included
in such investment fund, when combined with the assets of all other
employee benefit plans established or maintained by the same employer or
by an affiliate (within the meaning of Section V(c)(1) of the QPAM
Exemption) of such employer or by the same employee organization and
managed by such QPAM, exceed 20% of the total client assets managed by
such QPAM, the conditions of Part 1(c) and (g) of the QPAM Exemption are
satisfied, neither the QPAM nor a person controlling or controlled by the
QPAM (applying the definition of "control" in Section V(e) of the QPAM
Exemption) owns a 5% or more interest in the Company and (i) the identity
of such QPAM and (ii) the names of all employee benefit plans whose
assets are included in such investment fund have been disclosed to the
Company in writing pursuant to this paragraph (d); or
(e) the Source is a governmental plan; or
(f) the Source is one or more employee benefit plans, or a separate
account or trust fund comprised of one or more employee benefit plans,
each of which has been identified to the Company in writing pursuant to
this paragraph (f); or
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(g) the Source does not include assets of any employee benefit plan
that is subject to ERISA.
If you or any subsequent transferee of the Notes indicates that you or
such transferee are relying on any representation contained in paragraph (c),
(d) or (f) above, the Company shall deliver on the date of Closing on which you
are scheduled to purchase Notes and on the date of any applicable transfer a
certificate, which shall either state that (i) it is neither a party in
interest nor a "disqualified person" (as defined in Section 4975(e)(2) of the
Code), with respect to any plan identified pursuant to paragraphs (c) or (f)
above, or (ii) with respect to any plan, identified pursuant to paragraph (d)
above, neither it nor any "affiliate" (as defined in Section V(c) of the QPAM
Exemption) has at such time, and during the immediately preceding one year,
exercised the authority to appoint or terminate said QPAM as manager of any
plan identified in writing pursuant to paragraph (d) above or to negotiate the
terms of said QPAM's management agreement on behalf of any such identified
plan. As used in this SECTION 6.2, the terms "employee benefit plan",
"governmental plan", "party in interest" and "separate account" shall have the
respective meanings assigned to such terms in Section 3 of ERISA.
SECTION 7. INFORMATION AS TO COMPANY.
Section 7.1. Financial and Business Information. The Company shall
deliver to each holder of Notes that is an Institutional Investor:
(a) Quarterly Statements -- promptly upon their availability and in
any event within 60 days 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), 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 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,
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 applicable to quarterly financial statements
generally, and certified by a Senior Financial Officer as fairly presenting, in
all material respects, the financial position of the companies being reported
on and their results of operations and cash flows, subject to changes resulting
from year-end
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adjustments, provided that delivery within the time period specified above of
copies of the Company's Quarterly Report on Form 10-Q prepared in compliance
with the requirements therefor and filed with the Securities and Exchange
Commission shall be deemed to satisfy the requirements of this SECTION 7.1(a);
(b) Annual Statements -- promptly upon their availability and in any
event within 105 days after the end of each fiscal year of the Company,
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 each case in comparative form the figures for the
previous fiscal year, all in reasonable detail, prepared in accordance
with GAAP, and accompanied
(A) by an opinion thereon of independent certified
public accountants of recognized national standing, which
opinion shall 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 (except for any change in the
application of GAAP discussed therein or in the Notes thereto
with which such accountants concur) 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, and
(B) a certificate of such accountants stating that they
have reviewed this Agreement and stating further whether, in
making their audit, they have become aware of any condition
or event that then constitutes a Default or an Event of
Default, and, if they are aware that any such condition or
event then exists, specifying the nature and period of the
existence thereof (it being understood that such accountants
shall not be liable, directly or indirectly, for any failure
to obtain knowledge of any Default or Event of Default unless
such accountants should have obtained knowledge thereof in
making an audit in accordance with generally accepted
auditing standards or did not make such an audit),
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provided that the delivery within the time period specified above of the
Company's Annual Report on Form 10-K for such fiscal year (together with
the Company's annual report to shareholders, if any, prepared pursuant to
Rule 14a-3 under the Exchange Act) prepared in accordance with the
requirements therefor and filed with the Securities and Exchange
Commission, together with the accountant's certificate described in
clause (B) above, shall be deemed to satisfy the requirements of this
SECTION 7.1(b);
(c) SEC and Other Reports -- promptly upon their becoming available,
one copy of (i) each financial statement, report, notice or proxy
statement sent by the Company or any Subsidiary to public securities
holders generally, and (ii) each regular or periodic report, each
registration statement (other than registration statements relating to
employee benefit plans on Form S-8 and otherwise without exhibits except
as expressly requested by such holder), and each related final prospectus
and all amendments thereto filed by the Company or any Subsidiary with
the Securities and Exchange Commission and of all press releases and
other statements made available generally by the Company or any
Subsidiary to the public concerning developments that are Material;
(d) Notice of Default or Event of Default -- promptly, and in any
event within five days after a Responsible Officer becoming aware of the
existence of any Default or Event of Default or that any Person has given
any notice or taken any action with respect to a claimed default
hereunder or that any Person has given any notice or taken any action
with respect to a claimed default of the type referred to in SECTION
11(f), 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;
(e) ERISA Matters -- promptly, and in any event within five days
after a Responsible Officer becoming aware of any of the following, a
written notice setting forth the nature thereof and the action, if any,
that the Company or an ERISA Affiliate proposes to take with respect
thereto:
(i) with respect to any Plan, any reportable event, as defined
in section 4043(b) of ERISA and the regulations thereunder, for
which notice thereof has not been waived pursuant to such
regulations as in effect on the date hereof; or
(ii) the taking by the PBGC of steps to institute, or the
threatening by the PBGC of the institution of, proceedings under
section 4042 of ERISA for the termination of, or the appointment of
a trustee to administer, any Plan, or the receipt by the Company or
any ERISA Affiliate of a notice from a Multiemployer
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Plan that such action has been taken by the PBGC with respect to
such Multiemployer Plan; or
(iii) any event, transaction or condition that could result in
the incurrence of any liability by the Company or any ERISA
Affiliate pursuant to Title I or IV of ERISA or the penalty or
excise tax provisions of the Code relating to employee benefit
plans, or in the imposition of any Lien on any of the rights,
properties or assets of the Company or any ERISA Affiliate pursuant
to Title I or IV of ERISA or such penalty or excise tax provisions,
if such liability or Lien, taken together with any other such
liabilities or Liens then existing, could reasonably be expected to
have a Material Adverse Effect;
(f) Notices from Governmental Authority -- promptly, and in any
event within 30 days of receipt thereof, copies of any notice to the
Company or any Subsidiary from any Federal or state Governmental
Authority relating to any order, ruling, statute or other law or
regulation that could reasonably be expected to have a Material Adverse
Effect; and
(g) Requested Information -- with reasonable promptness, such other
data and information relating to the business, operations, affairs,
financial condition, assets or properties of the Company or any of its
Subsidiaries or relating to the ability of the Company to perform its
obligations hereunder and under the Notes as from time to time may be
reasonably requested by any such holder of Notes.
Section 7.2. Officer's Certificate. Each set of financial statements
delivered to a holder of Notes pursuant to SECTION 7.1(a) or SECTION 7.1(b)
hereof shall be accompanied by a certificate of a Senior Financial Officer
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 SECTIONS 10.1 through SECTION 10.5
hereof, inclusive, during the quarterly or annual period covered by the
statements 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 amount, ratio or
percentage then in existence); and
(b) Event of Default -- a statement that such officer has reviewed
the relevant terms hereof and has made, or caused to be made, under his
or her supervision, a review of the transactions and conditions of the
Company and its Subsidiaries from the
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beginning of the quarterly or annual period covered by the statements
then being furnished to the date of the certificate and that such review
shall not have disclosed the existence during such period of any
condition or event that constitutes a Default or an Event of Default or,
if any such condition or event existed or exists (including, without
limitation, any such event or condition resulting from the failure of the
Company or any Subsidiary to comply with any Environmental Law),
specifying the nature and period of existence thereof and what action the
Company shall have taken or proposes to take with respect thereto.
Section 7.3. Inspection. The Company shall permit the representatives of
each holder of Notes that is an Institutional Investor:
(a) No Default -- if no Default or Event of Default then exists, at
the expense of such holder and upon reasonable prior notice to the
Company, to visit the principal executive office of the Company, to
discuss the affairs, finances and accounts of the Company and its
Subsidiaries with the Company's officers, and (with the consent of the
Company, which consent will not be unreasonably withheld) its independent
public accountants, and (with the consent of the Company, which consent
will not be unreasonably withheld) to visit the other offices and
properties of the Company and each Subsidiary, all at such reasonable
times and as often as may be reasonably requested in writing; and
(b) Default -- if a Default or Event of Default then exists, at the
expense of the Company to visit and inspect any of the offices or
properties of the Company or any Subsidiary, 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 and independent
public accountants (and by this provision the Company authorizes said
accountants to discuss the affairs, finances and accounts of the Company
and its Subsidiaries), all at such times and as often as may be
requested.
SECTION 8. PREPAYMENT OF THE NOTES.
Section 8.1. Required Prepayments. (a) On December 30, 2006 and December
30, 2007 the Company will prepay $6,666,667 principal amount (or such lesser
principal amount as shall then be outstanding) of the Series G Notes at par and
without payment of the Make-Whole Amount or any premium, provided that upon any
partial prepayment of the Series G Notes pursuant to SECTION 8.2 or purchase of
the Series G Notes permitted by SECTION 8.5 the principal amount of each
required prepayment of the Series G Notes becoming due under this SECTION 8.1
on and after the date of such prepayment or purchase shall be reduced in the
same proportion as
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the aggregate unpaid principal amount of the Series G Notes is reduced as a
result of such prepayment or purchase.
(b) On December 17, 2007 the Company will prepay $12,500,000 principal
amount (or such lesser principal amount as shall then be outstanding) of the
Series H Notes at par and without payment of the Make-Whole Amount or any
premium, provided that upon any partial prepayment of the Series H Notes
pursuant to SECTION 8.2 or purchase of the Series H Notes permitted by SECTION
8.5 the principal amount of each required prepayment of the Series H Notes
becoming due under this SECTION 8.1 on and after the date of such prepayment or
purchase shall be reduced in the same proportion as the aggregate unpaid
principal amount of the Series H Notes is reduced as a result of such
prepayment or purchase.
Section 8.2. Optional Prepayments with Make-Whole Amount. The Company
may, at its option, upon notice as provided below, prepay at any time all, or
from time to time any part of, the Notes, in an amount not less than 10% of the
aggregate principal amount of the Notes then outstanding in the case of a
partial prepayment (but if in the case of a partial prepayment, then against
each series of Notes in proportion to the aggregate principal amount
outstanding on each series), at 100% of the principal amount so prepaid, plus
the Make-Whole Amount determined for the prepayment date with respect to such
principal amount. The Company will give each holder of Notes written notice of
each optional prepayment under this SECTION 8.2 not less than 30 days and not
more than 60 days prior to the date fixed for such prepayment. Each such
notice shall specify (a) such date, (b) the aggregate principal amount of the
Notes to be prepaid on such date, (c) the principal amount of each series of
Notes to be prepaid and the principal amount of each Note held by such holder
to be prepaid (in each case determined in accordance with SECTION 8.3), and (d)
the interest to be paid on the prepayment date with respect to such principal
amount being prepaid, and shall be accompanied by a certificate of a Senior
Financial Officer as to the estimated Make-Whole Amount due in connection with
such prepayment (calculated as if the date of such notice were the date of the
prepayment), setting forth the details of such computation. Two Business Days
prior to such prepayment, the Company shall deliver to each holder of Notes a
certificate of a Senior Financial Officer specifying the calculation of such
Make-Whole Amount as of the specified prepayment date.
Section 8.3. Allocation of Partial Prepayments. In the case of each
partial prepayment of the Notes, the principal amount of the Notes to be
prepaid shall be: (a) allocated among each series of Notes in proportion to the
aggregate unpaid principal amount of each such series of Notes, and (b)
allocated pro rata among all of the holders of each series of Notes at the time
outstanding in accordance with the unpaid principal amount thereof.
Section 8.4. Maturity; Surrender, etc. In the case of each prepayment of
Notes pursuant to this SECTION 8, the principal amount of each Note to be
prepaid shall mature and
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become due and payable on the date fixed for such prepayment, together with
interest on such principal amount accrued to such date and the applicable
Make-Whole Amount, if any. From and after such date, unless the Company shall
fail to pay such principal amount when so due and payable, together with the
interest and Make-Whole Amount, if any, as aforesaid, interest on such
principal amount shall cease to accrue. Any Note paid or prepaid in full shall
be surrendered to the Company and cancelled and shall not be reissued, and no
Note shall be issued in lieu of any prepaid principal amount of any Note.
Section 8.5. Purchase of Notes. The Company will not and will not permit
any Affiliate to purchase, redeem, prepay or otherwise acquire, directly or
indirectly, any series of the outstanding Notes or any part or portion of any
thereof, except upon the payment or prepayment of each series of the Notes in
accordance with the terms of this Agreement and the Notes. The Company will
promptly cancel all Notes acquired by it or any Affiliate pursuant to any
payment, prepayment or purchase of Notes pursuant to any provision of this
Agreement and no Notes may be issued in substitution or exchange for any such
Notes.
Section 8.6. Make-Whole Amount. The term "Make-Whole Amount" means, with
respect to any Note, an amount equal to the excess, if any, of the Discounted
Value of the Remaining Scheduled Payments with respect to the Called Principal
of such Note over the amount of such Called Principal, provided that the
Make-Whole Amount may in no event be less than zero. For the purposes of
determining the Make-Whole Amount, the following terms have the following
meanings:
"Called Principal" means, with respect to any Note, the principal of
such Note that is to be prepaid pursuant to SECTION 8.2 or has become or
is declared to be immediately due and payable pursuant to SECTION 12.1,
as the context requires.
"Discounted Value" means, with respect to the Called Principal of
any Note, the amount obtained by discounting all Remaining Scheduled
Payments with respect to such Called Principal from their respective
scheduled due dates to the Settlement Date with respect to such Called
Principal, in accordance with accepted financial practice and at a
discount factor (applied on the same periodic basis as that on which
interest on the Notes is payable) equal to the Reinvestment Yield with
respect to such Called Principal.
"Reinvestment Yield" means, with respect to the Called Principal of
any Note, .50% over the yield to maturity implied by (a) the yields
reported, as of 10:00 A.M. (New York City time) on the second Business
Day preceding the Settlement Date with respect to such Called Principal,
on the display designated as "Page PX1" on the Bloomberg Financial
Markets Services Screen (or such other display as may replace Page PX1 on
the Bloomberg Financial Markets Services Screen) for actively traded U.S.
Treasury
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securities having a maturity equal to the Remaining Average Life of such
Called Principal as of such Settlement Date, or (b) if such yields are
not reported as of such time or the yields reported as of such time are
not ascertainable, the Treasury Constant Maturity Series Yields reported,
for the latest day for which such yields have been so reported as of the
second Business Day preceding the Settlement Date with respect to such
Called Principal, in Federal Reserve Statistical Release H. 15 (519) (or
any comparable successor publication) for actively traded U.S. Treasury
securities having a constant maturity equal to the Remaining Average Life
of such Called Principal as of such Settlement Date. Such implied yield
will be determined, if necessary, by (i) converting U.S. Treasury bill
quotations to bond-equivalent yields in accordance with accepted
financial practice and (ii) interpolating linearly between (1) the
actively traded U.S. Treasury security with the duration closest to and
greater than the Remaining Average Life of such Called Principal and (2)
the actively traded U.S. Treasury security with the duration closest to
and less than the Remaining Average Life.
"Remaining Average Life" means, with respect to any Called
Principal, the number of years (calculated to the nearest one-twelfth
year) obtained by dividing (a) such Called Principal into (b) the sum of
the products obtained by multiplying (i) the principal component of each
Remaining Scheduled Payment with respect to such Called Principal by (ii)
the number of years (calculated to the nearest one-twelfth year) that
will elapse between the Settlement Date with respect to such Called
Principal and the scheduled due date of such Remaining Scheduled Payment.
"Remaining Scheduled Payments" means, with respect to the Called
Principal of any Note, all payments of such Called Principal and interest
thereon that would be due after the Settlement Date with respect to such
Called Principal if no payment of such Called Principal were made prior
to its scheduled due date, provided that if such Settlement Date is not a
date on which interest payments are due to be made under the terms of the
Notes, then the amount of the next succeeding scheduled interest payment
will be reduced by the amount of interest accrued to such Settlement Date
and required to be paid on such Settlement Date pursuant to SECTION 8.2
or 12.1.
"Settlement Date" means, with respect to the Called Principal of any
Note, the date on which such Called Principal is to be prepaid pursuant
to SECTION 8.2 or has become or is declared to be immediately due and
payable pursuant to SECTION 12.1, as the context requires.
SECTION 9. AFFIRMATIVE COVENANTS.
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The Company covenants that from and after the date of the first Closing
and continuing so long as any of the Notes are outstanding:
Section 9.1. Compliance with Law. The Company will and will cause each of
its Subsidiaries to comply with all laws, ordinances or governmental rules or
regulations to which each of them is subject, including, without limitation,
Environmental Laws, and will obtain and maintain in effect all licenses,
certificates, permits, franchises and other governmental authorizations
necessary to the ownership of their respective properties or to the conduct of
their respective businesses, in each case to the extent necessary to ensure
that non-compliance with such laws, ordinances or governmental rules or
regulations or failures to obtain or maintain in effect such licenses,
certificates, permits, franchises and other governmental authorizations could
not, individually or in the aggregate, reasonably be expected to have a
Material Adverse Effect.
Section 9.2. Insurance. The Company will and will cause each of its
Subsidiaries to maintain, with financially sound and reputable insurers,
insurance with respect to their respective properties and businesses against
such casualties and contingencies, of such types, on such terms and in such
amounts (including deductibles, co-insurance and self-insurance, if adequate
reserves are maintained with respect thereto) as is customary in the case of
entities of established reputations and comparable size engaged in the same or
a similar business and similarly situated.
Section 9.3. Maintenance of Properties. The Company will and will cause
each of its Subsidiaries to maintain and keep, or cause to be maintained and
kept, their respective properties in good repair, working order and condition
(other than ordinary wear and tear), so that the business carried on in
connection therewith may be properly conducted at all times, provided that this
SECTION 9.3 shall not prevent the Company or any Subsidiary from discontinuing
the operation and the maintenance of any of its properties if such
discontinuance is desirable in the conduct of its business and the Company has
concluded that such discontinuance could not, individually or in the aggregate,
reasonably be expected to have a Material Adverse Effect.
Section 9.4. Payment of Taxes and Claims. The Company will and will cause
each of its Subsidiaries to file all tax returns required to be filed in any
jurisdiction and to pay and discharge all taxes shown to be due and payable on
such returns and all other taxes, assessments, governmental charges, or levies
imposed on them or any of their properties, assets, income or franchises, to
the extent such taxes and assessments have become due and payable and before
they have become delinquent and all claims for which sums have become due and
payable that have or might become a Lien on properties or assets of the Company
or any Subsidiary, provided that neither the Company nor any Subsidiary need
pay any such tax or assessment or claims if (a) the amount, applicability or
validity thereof is contested by the Company or such Subsidiary on a timely
basis in good faith and in appropriate proceedings, and the Company or a
Subsidiary
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has established adequate reserves therefor in accordance with GAAP on the books
of the Company or such Subsidiary or (b) the nonpayment of all such taxes and
assessments in the aggregate could not reasonably be expected to have a
Material Adverse Effect.
Section 9.5. Corporate Existence, etc. The Company will at all times
preserve and keep in full force and effect its corporate existence. Subject to
SECTION 10.5, the Company will at all times preserve and keep in full force and
effect the corporate existence of each of its Subsidiaries (unless merged into
the Company or a Wholly-Owned Subsidiary) and all rights and franchises of the
Company and its Subsidiaries unless, in the good faith judgment of the Company,
the termination of or failure to preserve and keep in full force and effect
such corporate existence, right or franchise could not, individually or in the
aggregate, have a Material Adverse Effect.
Section 9.6. Maintenance of Business. The Company will continue, and will
cause each Subsidiary to continue, to engage primarily in the material lines of
business which the Company and its Subsidiaries operate, respectively, as of
the date hereof.
Section 9.7. Notes to Rank Pari Passu. The Notes and all other
obligations under this Agreement of the Company are and at all times shall
remain direct and unsecured obligations of the Company ranking pari passu as
against the assets of the Company with all other Notes from time to time issued
and outstanding hereunder without any preference among themselves and pari
passu with all other present and future unsecured Indebtedness (actual or
contingent) of the Company which is not expressed to be subordinate or junior
in rank to any other unsecured Indebtedness of the Company.
SECTION 10. NEGATIVE COVENANTS.
The Company covenants that from and after the date of the first Closing
and continuing so long as any of the Notes are outstanding:
Section 10.1. Consolidated Tangible Net Worth. The Company will at all
times keep and maintain Consolidated Tangible Net Worth at an amount not less
than the sum of (a) $135,000,000 plus (b) 25% of Consolidated Net Income
computed on a cumulative basis for each of the elapsed fiscal quarters ending
after December 31, 2000; provided that notwithstanding that Consolidated Net
Income for any such elapsed fiscal quarter may be a deficit figure, no
reduction as a result thereof shall be made on the sum to be maintained
pursuant hereto.
Section 10.2. Funded Debt.
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The Company will not, and will not permit any Subsidiary to, create,
issue, assume, guarantee or otherwise incur or in any manner become liable in
respect of any Funded Debt, except:
(a) the Notes;
(b) Funded Debt existing on the date of the first Closing, all of
which is set forth on SCHEDULE 5.15 hereto, and any renewals, extensions
and refundings thereof, provided that the principal amount thereof shall
not be increased; and
(c) other Funded Debt;
provided that, in the case of (a), (b) or (c), immediately after giving effect
to the creation, issuance, assumption, guarantee or incurrence of such Funded
Debt: (i) the aggregate amount of all Funded Debt of the Company and its
Subsidiaries on a consolidated basis does not exceed 60% of Consolidated Total
Capitalization determined as of the end of the immediately prior fiscal
quarter, and (ii) if such Funded Debt is Priority Debt, such creation,
issuance, assumption, guarantee or incurrence is permitted by SECTION 10.3.
Section 10.3. Priority Debt. The Company will not, and will not permit
any Subsidiary to, create, issue, assume, guarantee or otherwise incur or in
any manner become liable in respect of any Priority Debt unless (a) the
aggregate amount of all Priority Debt outstanding at any time does not exceed
20% of Consolidated Tangible Net Worth at such time, and (b) the creation,
issuance, assumption, guarantee or incurrence of such Priority Debt is
permitted by SECTION 10.2.
Section 10.4. Limitation on Liens. The Company will not, and will not
permit any Subsidiary to, create, assume, incur or suffer to exist any Lien
upon any of its property, whether now owned or hereafter acquired, except:
(a) Liens for taxes, assessments or other governmental charges or
levies not yet due or payable to the extent that nonpayment thereof is
permitted under the provisions of SECTION 9.4 hereof;
(b) Liens created by or resulting from any litigation or legal
proceeding which is currently being contested in good faith by
appropriate proceedings, provided that the enforcement of such Liens is
effectively stayed by such contest;
(c) other Liens incidental to the normal conduct of the business of
the Company or any Subsidiary or the ownership of its property which are
not incurred in
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connection with the incurrence of Indebtedness and which do not in the
aggregate materially impair the use of such property in the operation of
the business of the Company and its Subsidiaries taken as a whole or the
value of such property for the purposes of such business;
(d) any Lien existing on property of the Company or any Subsidiary
on the date of the first Closing, all of which are described in SCHEDULE
10.4 hereto;
(e) Liens on property of a Subsidiary to secure obligations of such
Subsidiary to the Company or another Wholly-Owned Subsidiary;
(f) any Lien renewing, extending or refunding any Lien permitted by
clause (d) of this SECTION 10.4, provided that the principal amount of
the obligations secured thereby is not increased and the Lien is not
extended to other property;
(g) (i) any Lien on property or on rights relating thereto to secure
all or a part of the purchase price or cost of the construction of, or
Indebtedness incurred to pay all or a portion of the purchase price or
cost of construction of, such property, which Liens are created
contemporaneously with, or within 180 days after, such acquisition or the
completion of such construction by the Company or a Subsidiary, (ii) any
Lien on property existing on such property at the time of acquisition
thereof whether or not the Indebtedness secured thereby is assumed by the
Company or such Subsidiary, or (iii) any Lien existing on the property of
a corporation at the time such corporation is merged into or consolidated
with the Company or a Subsidiary or existing on the property of a
corporation or firm at the time of a sale, lease or other disposition of
the properties of such corporation or firm as an entirety or
substantially as an entirety to the Company or a Subsidiary; provided,
however, that, in each case the obligations secured by any such Lien
shall not exceed the lesser of the total acquisition or purchase price or
cost of construction or improvement, as the case may be, or 100% of the
fair market value of the related property at the time of such
acquisition, completion or construction, merger, consolidation, sale,
lease or other disposition (as determined in good faith by a Responsible
Officer of the Company), and any such Lien shall attach solely to the
property acquired or constructed; and
(h) Liens securing other Priority Debt permitted under SECTION 10.3.
Section 10.5. Mergers, Consolidations and Sales of Assets. (a) The
Company will not, and will not permit any Subsidiary to, consolidate with or be
a party to a merger with any other Person, or sell, lease or otherwise dispose
of all or substantially all of its assets; provided that:
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(i) any Subsidiary may merge or consolidate with or into the Company
or any Wholly-owned Subsidiary so long as in any merger or consolidation
involving the Company, the Company shall be the surviving or continuing
corporation; and
(ii) the Company may consolidate or merge with or into any other
corporation if (1) the corporation which results from such consolidation
or merger (the "surviving corporation") is solvent and organized under
the laws of any state of the United States or the District of Columbia,
(2) the due and punctual payment of the principal of and premium, if any,
and interest on all of the Notes, according to their tenor, and the due
and punctual performance and observation of all of the covenants in the
Notes and this Agreement to be performed or observed by the Company are
expressly assumed in writing by the surviving corporation and the
surviving corporation shall furnish to the holders of the Notes an
opinion of counsel satisfactory to such holders to the effect that the
instrument of assumption has been duly authorized, executed and delivered
and constitutes the legal, valid and binding contract and agreement of
the surviving corporation enforceable in accordance with its terms,
except as enforcement of such terms may be limited by bankruptcy,
insolvency, reorganization, moratorium and similar laws affecting the
enforcement of creditors' rights generally and by general equitable
principles, and (3) at the time of such consolidation or merger and
immediately after giving effect thereto: (A) no Default or Event of
Default would exist and (B) the surviving corporation would be permitted
by the applicable provisions of SECTION 10.2(C) to incur at least $1.00
of additional Funded Debt.
(b) The Company will not, and will not permit any of its Subsidiaries to,
Transfer any of its property if, after giving effect to such Transfer, the
aggregate Value of all property Transferred (other than as permitted by clauses
(i), (ii) or (iii) of this SECTION 10.5(B) on or after the date of the first
Closing shall exceed 25% of Consolidated Total Assets determined as of and
based upon the Company's September 30, 1996 SEC Form 10-Q, except:
(i) the Transfer in the ordinary course of business of (1) inventory
held for sale or (2) equipment, fixtures, supplies or materials no longer
required in the operation of the business of the Company or such
Subsidiary or that is obsolete;
(ii) the Company or any Subsidiary may sell its accounts receivable
for fair market value, without recourse, to: (1) a bank or other
financial institution or (2) any other Person in a transaction in which a
bank or other financial institution their purchases such accounts
receivable in a transaction or transactions relating to the sale by the
Company or such Subsidiary to such Person of such accounts receivable;
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(iii) any Subsidiary may Transfer property to the Company or another
Wholly-Owned Subsidiary; and
(iv) either: (1) prior to, or contemporaneously with, such Transfer
the Company shall have delivered to each holder of a Note an Officer's
Certificate certifying that the Company is electing to use the Excess Net
Proceeds from such Transfer in the manner provided in this clause (1)
and, within one year after the date of such Transfer, the Company or the
Subsidiary making such Transfer shall have used such Excess Net Proceeds
to acquire other property useful and intended to be used in the operation
of the business of the Company and its Subsidiaries as described in
SECTION 9.6 and having a fair market value at least equal to the Value of
the property Transferred, provided that such acquired property shall not
be subject to any Lien to any greater extent than the Liens to which the
property transferred was subject or (2) the Company shall not less than
30 days nor more than 60 days prior to the date of such Transfer offer
pursuant to a written notice (the "Asset Disposition Prepayment Notice")
to apply on a pro rata basis the Excess Net Proceeds to which such assets
relate towards the prepayment of all outstanding Senior Funded Debt of
the Company (including, without limitation, the Notes, together with
accrued interest thereon, but without premium). Such Asset Disposition
Prepayment Notice shall specify (A) a date (the "Asset Disposition
Prepayment Date"), which shall be not less than 120 days nor more than
180 days following the date of such Asset Disposition Prepayment Notice,
on which the Company will apply such Excess Net Proceeds to the
prepayment on a pro rata basis of all of the outstanding Senior Funded
Debt of the Company held by any Person which accepts such offer of
prepayment and (B) a date, which shall be not more than 60 days nor less
than 30 days prior to such Asset Disposition Prepayment Date, on which
each holder of Senior Funded Debt of the Company must accept or decline
such offer of prepayment. Without limiting the foregoing, the Company
shall, not more than 15 days nor less than 10 days prior to such Asset
Disposition Prepayment Date, send a second written notice (the "Secondary
Asset Disposition Prepayment Notice") to all holders of outstanding
Senior Funded Debt of the Company notifying each such holder of the
decision of each other holder of Senior Funded Debt of the Company to
accept or reject such offer of prepayment and in such Secondary Asset
Disposition Prepayment Notice offer to each holder of outstanding Senior
Funded Debt to apply on a pro rata basis the amount of such Excess Net
Proceeds which will not be applied to such prepayment by virtue of any
such holder of Senior Funded Debt having declined the original offer of
prepayment. On such Asset Disposition Prepayment Date, the Company shall
apply the amount of such Excess Net Proceeds which has been agreed or
deemed to be agreed by holders of Senior Funded Debt of the Company
pursuant to any agreement pursuant to which any such Senior Funded Debt
is outstanding shall be applied to the prepayment of Senior Funded Debt
held by each holder thereof which has accepted or been so deemed to
accept such initial
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offer of prepayment or such initial offer and such secondary offer of
prepayment, as the case may be, to the prepayment of Senior Funded Debt
as and to the extent herein contemplated. It is understood and agreed by
the Company and each holder of the Notes by its acceptance thereof that
any such holder may decline any such offer of prepayment, that the
failure of any such holder to accept or decline any such offer of
prepayment shall be deemed to be an election by such holder to decline
such prepayment and that if any such offer is so accepted, the Excess Net
Proceeds so offered towards the prepayment of the Notes and accepted
shall be prepaid without premium pursuant to SECTION 8.2, notwithstanding
that the terms and provisions of said SECTION 8.2 contemplate that any
prepayment pursuant thereto shall be with a premium.
Section 10.6. Transactions with Affiliates. The Company will not and will
not permit any Subsidiary to enter into directly or indirectly any transaction
or Material group of related transactions (including without limitation the
purchase, lease, sale or exchange of properties of any kind or the rendering of
any service) with any Affiliate (other than the Company or another Subsidiary),
except in the ordinary course and pursuant to the 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 obtainable in
a comparable arm's-length transaction with a Person not an Affiliate.
SECTION 11. EVENTS OF DEFAULT.
An "Event of Default" shall exist if any of the following conditions or
events shall occur and be continuing:
(a) the Company defaults in the payment of any principal or
Make-Whole Amount, if any, on any Note when the same becomes due and
payable, whether at maturity or at a date fixed for prepayment or by
declaration or otherwise; or
(b) the Company defaults in the payment of any interest on any Note
for more than five Business Days after the same becomes due and payable;
or
(c) the Company defaults in the performance of or compliance with
any term contained in SECTIONS 7.1(D) or 10.1 through 10.5; or
(d) the Company defaults in the performance of or compliance with
any term contained herein (other than those referred to in paragraphs
(a), (b) and (c) of this SECTION 11) and such default is not remedied
within 30 days after the earlier of (i) a Responsible Officer obtaining
actual knowledge of such default and (ii) the Company receiving written
notice of such default from any holder of a Note; or
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(e) any representation or warranty made in writing by or on behalf
of the Company or by any officer of the Company in this Agreement or in
any writing furnished in connection with the transactions contemplated
hereby proves to have been false or incorrect in any material respect on
the date as of which made; or
(f) (i) the Company or any Subsidiary is in default (as principal or
as guarantor or other surety) in the payment of any principal of or
premium or make-whole amount or interest on any Indebtedness that is
outstanding in an aggregate principal amount of at least $2,000,000
beyond any period of grace provided with respect thereto, or (ii) the
Company or any Subsidiary is in default in the performance of or
compliance with any term of any evidence of any Indebtedness in an
aggregate outstanding principal amount of at least $2,000,000 or of any
mortgage, indenture or other agreement relating thereto or any other
condition exists, and as a consequence of such default or condition such
Indebtedness has become, or has been declared (or one or more Persons are
entitled to declare such Indebtedness to be), due and payable before its
stated maturity or before its regularly scheduled dates of payment, or
(iii) as a consequence of the occurrence or continuation of any event or
condition (other than the passage of time or the right of the holder of
Indebtedness to convert such Indebtedness into equity interests), (x) the
Company or any Subsidiary has become obligated to purchase or repay
Indebtedness before its regular maturity or before its regularly
scheduled dates of payment in an aggregate outstanding principal amount
of at least $2,000,000, or (y) one or more Persons have the right to
require the Company or any Subsidiary so to purchase or repay such
Indebtedness; or
(g) the Company or any Subsidiary (i) is generally not paying, or
admits in writing its inability to pay, its debts as they become due,
(ii) files, or consents by answer or otherwise to the filing against it
of, a petition for relief or reorganization or arrangement or any other
petition in bankruptcy, for liquidation or to take advantage of any
bankruptcy, insolvency, reorganization, moratorium or other similar law
of any jurisdiction, (iii) makes an assignment for the benefit of its
creditors, (iv) consents to the appointment of a custodian, receiver,
trustee or other officer with similar powers with respect to it or with
respect to any substantial part of its property, (v) is adjudicated as
insolvent or to be liquidated, or (vi) takes corporate action for the
purpose of any of the foregoing; or
(h) a court or governmental authority of competent jurisdiction
enters an order appointing, without consent by the Company or any of its
Subsidiaries, a custodian, receiver, trustee or other officer with
similar powers with respect to it or with respect to any substantial part
of its property, or constituting an order for relief or approving a
petition for relief or reorganization or any other petition in bankruptcy
or for liquidation
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or to take advantage of any bankruptcy or insolvency law of any
jurisdiction, or ordering the dissolution, winding-up or liquidation of
the Company or any of its Subsidiaries, or any such petition shall be
filed against the Company or any of its Subsidiaries and such petition
shall not be dismissed within 60 days; or
(i) a final judgment or judgments for the payment of money
aggregating in excess of $1,000,000 are rendered against one or more of
the Company and its Subsidiaries and which judgments are not, within 60
days after entry thereof, bonded, discharged or stayed pending appeal, or
are not discharged within 60 days after the expiration of such stay; or
(j) if (i) any Plan shall fail to satisfy the minimum funding
standards of ERISA or the Code for any plan year or part thereof or a
waiver of such standards or extension of any amortization period is
sought or granted under section 412 of the Code, (ii) a notice of intent
to terminate any Plan shall have been or is reasonably expected to be
filed with the PBGC or the PBGC shall have instituted proceedings under
ERISA section 4042 to terminate or appoint a trustee to administer any
Plan or the PBGC shall have notified the Company or any ERISA Affiliate
that a Plan may become a subject of any such proceedings, (iii) the
aggregate "amount of unfunded benefit liabilities" (within the meaning of
section 4001(a)(18) of ERISA) under all Plans, determined in accordance
with Title IV of ERISA, shall exceed $1,000,000, (iv) the Company or any
ERISA Affiliate shall have incurred or is reasonably expected to incur
any liability pursuant to Title I or IV of ERISA or the penalty or excise
tax provisions of the Code relating to employee benefit plans, (v) the
Company or any ERISA Affiliate withdraws from any Multiemployer Plan, or
(vi) the Company or any Subsidiary establishes or amends any employee
welfare benefit plan that provides post-employment welfare benefits in a
manner that would increase the liability of the Company or any Subsidiary
thereunder; and any such event or events described in clauses (i) through
(vi) above, either individually or together with any other such event or
events, could reasonably be expected to have a Material Adverse Effect.
As used in SECTION 11(J), the terms "employee benefit plan" and "employee
welfare benefit plan" shall have the respective meanings assigned to such terms
in Section 3 of ERISA.
SECTION 12. REMEDIES ON DEFAULT, ETC.
Section 12.1. Acceleration. (a) If an Event of Default with respect to
the Company described in paragraph (g) or (h) of SECTION 11 (other than an
Event of Default described in clause (i) of paragraph (g) or described in
clause (vi) of paragraph (g) by virtue of the fact that
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such clause encompasses clause (i) of paragraph (g)) has occurred, all the
Notes then outstanding shall automatically become immediately due and payable.
(b) If any other Event of Default has occurred and is continuing, any
holder or holders of more than 35% in principal amount of the Notes at the time
outstanding may at any time at its or their option, by notice or notices to the
Company, declare all the Notes then outstanding to be immediately due and
payable.
(c) If any Event of Default described in paragraph (a) or (b) of SECTION
11 has occurred and is continuing, any holder or holders of Notes at the time
outstanding affected by such Event of Default may at any time, at its or their
option, by notice or notices to the Company, declare all the Notes held by it
or them to be immediately due and payable.
Upon any Notes becoming due and payable under this SECTION 12.1, whether
automatically or by declaration, such Notes will forthwith mature and the
entire unpaid principal amount of such Notes, plus (x) all accrued and unpaid
interest thereon and (y) the Make-Whole Amount determined in respect of such
principal amount (to the full extent permitted by applicable law), shall all be
immediately due and payable, in each and every case without presentment,
demand, protest or further notice, all of which are hereby waived. The Company
acknowledges, and the parties hereto agree, that each holder of a Note has the
right to maintain its investment in the Notes free from repayment by the
Company (except as herein specifically provided for), and that the provision
for payment of a Make-Whole 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.
Section 12.2. Other Remedies. If any Default or Event of Default has
occurred and is continuing, and irrespective of whether any Notes have become
or have been declared immediately due and payable under SECTION 12.1, the
holder of any Note at the time outstanding may proceed to protect and enforce
the rights of such holder by an action at law, suit in equity or other
appropriate proceeding, whether for the specific performance of any agreement
contained herein or in any Note, or for an injunction against a violation of
any of the terms hereof or thereof, or in aid of the exercise of any power
granted hereby or thereby or by law or otherwise.
Section 12.3. Rescission. At any time after any Notes have been declared
due and payable pursuant to clause (b) or (c) of SECTION 12.1, the holders of
not less than 66-2/3% in principal amount of the Notes then outstanding, by
written notice to the Company, may rescind and annul any such declaration and
its consequences if (a) the Company has paid all overdue interest on the Notes,
all principal of and Make-Whole Amount, if any, on any Notes that are due and
payable and are unpaid other than by reason of such declaration, and all
interest on such overdue principal and Make-Whole Amount, if any, and (to the
extent permitted by applicable
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law) any overdue interest in respect of the Notes, at the Default Rate, (b) all
Events of Default and Defaults, other than non-payment of amounts that have
become due solely by reason of such declaration, have been cured or have been
waived pursuant to SECTION 17, and (c) no judgment or decree has been entered
for the payment of any monies due pursuant hereto or to the Notes. No
rescission and annulment under this SECTION 12.3 will extend to or affect any
subsequent Event of Default or Default or impair any right consequent thereon.
Section 12.4. No Waivers or Election of Remedies, Expenses, etc. No
course of dealing and no delay on the part of any holder of any Note in
exercising any right, power or remedy shall operate as a waiver thereof or
otherwise prejudice such holder's rights, powers or remedies. No right, power
or remedy conferred by this Agreement or by any Note upon any holder thereof
shall be exclusive of any other right, power or remedy referred to herein or
therein or now or hereafter available at law, in equity, by statute or
otherwise. Without limiting the obligations of the Company under SECTION 15,
the Company will pay to the holder of each Note on demand such further amount
as shall be sufficient to cover all costs and expenses of such holder incurred
in any enforcement or collection under this SECTION 12, including, without
limitation, reasonable attorneys' fees, expenses and disbursements.
SECTION 13. REGISTRATION; EXCHANGE; SUBSTITUTION OF NOTES.
Section 13.1. Registration of Notes. The Company shall keep at its
principal executive office a register for the registration and registration of
transfers 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 such register. Prior to due presentment for
registration of transfer, 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 the Company shall not be affected by any notice or knowledge to the
contrary. The Company shall give to any holder of a Note that is an
Institutional Investor promptly upon request therefor, a complete and correct
copy of the names and addresses of all registered holders of Notes.
Section 13.2. Transfer and Exchange of Notes. Upon surrender of any Note
at the principal executive office of the Company for registration of transfer
or exchange (and in the case of a surrender for registration of transfer, duly
endorsed or accompanied by a written instrument of transfer duly executed by
the registered holder of such Note or its attorney duly authorized in writing
and accompanied by the address for notices of each transferee of such Note or
part thereof), the Company shall execute and deliver, at the Company's expense
(except as provided below), one or more new Notes (as requested by the holder
thereof) in exchange therefor, of the same series and 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 1, 2, 3, 4, 5, 6 or 7, as the
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case may be. 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. Notes
shall not be transferred in denominations of less than $100,000, provided that
if necessary to enable the registration of transfer by a holder of its entire
holding of Notes, one Note may be in a denomination of less than $100,000. Any
transferee, by its acceptance of a Note registered in its name (or the name of
its nominee), shall be deemed to have made the representation set forth in
SECTION 6.2.
Section 13.3. 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 (which evidence shall be, in the case of
an Institutional Investor, notice from such Institutional Investor of such
ownership and such loss, theft, destruction or mutilation), 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, or is a nominee for, (i) an Institutional Investor or (ii) another
holder of a Note which has a minimum net worth of at least $50,000,000,
such Person'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.
SECTION 14. PAYMENTS ON NOTES.
Section 14.1. Place of Payment. Subject to SECTION 14.2, payments of
principal, Make-Whole Amount, if any, and interest becoming due and payable on
the Notes shall be made in Chicago, Illinois at the principal office of a bank
or trust company in such jurisdiction which the Company agrees to designate at
any time when there is any holder of any Note not entitled to the benefits of
SECTION 14.2. The Company may at any time, by notice to each holder of a
Note, change the place of payment of the Notes so long as such place of payment
shall be either the principal office of the Company in such jurisdiction or the
principal office of a bank or trust company in such jurisdiction.
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Section 14.2. Home Office Payment. So long as you or your nominee shall
be the holder of any Note, and notwithstanding anything contained in SECTION
14.1 or in such Note to the contrary, the Company will pay all sums becoming
due on such Note for principal, Make-Whole Amount, if any, and interest by the
method and at the address specified for such purpose below your name in
SCHEDULE A, or by such other method or at such other address as you shall have
from time to time specified to the Company in writing for such purpose, without
the presentation or surrender of such Note or the making of any notation
thereon, except that upon written request of the Company made concurrently with
or reasonably promptly after payment or prepayment in full of any Note, you
shall surrender such Note for cancellation, reasonably promptly after any such
request, to the Company at its principal executive office or at the place of
payment most recently designated by the Company pursuant to SECTION 14.1.
Prior to any sale or other disposition of any Note held by you or your nominee
you will, at your election, either endorse thereon the amount of principal paid
thereon and the last date to which interest has been paid thereon or surrender
such Note to the Company in exchange for a new Note or Notes pursuant to
SECTION 13.2. The Company will afford the benefits of this SECTION 14.2 to any
Institutional Investor that is the direct or indirect transferee of any Note
purchased by you under this Agreement and that has made the same agreement
relating to such Note as you have made in this SECTION 14.2.
SECTION 15. EXPENSES, ETC.
Section 15.1. Transaction Expenses. Whether or not the transactions
contemplated hereby are consummated, the Company will pay all out-of-pocket
costs and expenses (including reasonable attorneys' fees of a special counsel
and, if reasonably required, local or other counsel) incurred by you and each
Other Purchaser or holder of a Note in connection with such transactions and in
connection with any amendments, waivers or consents under or in respect of this
Agreement or the Notes (whether or not such amendment, waiver or consent
becomes effective), including, without limitation: (a) the costs and expenses
incurred in enforcing or defending (or determining whether or how to enforce or
defend) any rights under this Agreement or the Notes or in responding to any
subpoena or other legal process or informal investigative demand issued in
connection with this Agreement or the Notes, or by reason of being a holder of
any Note, and (b) the costs and expenses, including financial advisors' fees,
incurred in connection with the insolvency or bankruptcy of the Company or any
Subsidiary or in connection with any work-out or restructuring of the
transactions contemplated hereby and by the Notes. The Company will pay, and
will save you and each other holder of a Note harmless from, all claims in
respect of any fees, costs or expenses, if any, of brokers and finders (other
than those retained by you).
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Section 15.2. Survival. The obligations of the Company under this SECTION
15 will survive the payment or transfer of any Note, the enforcement, amendment
or waiver of any provision of this Agreement or the Notes, and the termination
of this Agreement.
SECTION 16. SURVIVAL OF REPRESENTATIONS AND WARRANTIES; ENTIRE AGREEMENT.
All representations and warranties contained herein shall survive the
execution and delivery of this Agreement and the Notes, the purchase or
transfer by you of any Note or portion thereof or interest therein and the
payment of any Note, and may be relied upon by any subsequent holder of a Note,
regardless of any investigation made at any time by or on behalf of you or any
other holder of a Note. All statements contained in any certificate or other
instrument delivered by or on behalf of the Company pursuant to this Agreement
shall be deemed representations and warranties of the Company under this
Agreement. Subject to the preceding sentence, this Agreement and the Notes
embody the entire agreement and understanding between you and the Company and
supersede all prior agreements and understandings relating to the subject
matter hereof.
SECTION 17. AMENDMENT AND WAIVER.
Section 17.1. Requirements. This Agreement and the Notes may be amended,
and the observance of any term hereof or of the Notes may be waived (either
retroactively or prospectively), with (and only with) the written consent of
the Company and the Required Holders, provided that (a) no amendment or waiver
of any of the provisions of SECTION 1, 2, 3, 4, 5, 6 or 21 hereof, or any
defined term (as it is used therein), will be effective as to you unless
consented to by you in writing, and (b) no such amendment or waiver may,
without the written consent of the holder of each Note at the time outstanding
affected thereby, (i) subject to the provisions of SECTION 12 relating to
acceleration or rescission, change the amount or time of any prepayment or
payment of principal of, or reduce the rate or change the time of payment or
method of computation of interest or of the Make-Whole Amount on, the Notes,
(ii) change the percentage of the principal amount of the Notes the holders of
which are required to consent to any such amendment or waiver, or (iii) amend
any of SECTIONS 8, 11(a), 11(b), 12, 17 or 20; and provided further that,
anything contained in this SECTION 17 to the contrary notwithstanding, if for
any reason whatsoever it becomes necessary or appropriate to enter into any
amendment of this Agreement or any waiver with respect to compliance herewith
by the Company during the period from and including the date of the first
Closing through and including the earlier of the date of the third Closing and
March 31, 1997 (the "Series C and Series E Note Cut-Off Date"): (1) Principal
Mutual Life Insurance Company shall be deemed to be the holder of $24,000,000
aggregate principal amount of outstanding Notes and Great-West Life & Annuity
Insurance Company shall be deemed to be the holder of $13,000,000 aggregate
principal amount of outstanding Notes (i) for purposes of any determination of
the percentage of holders of the Notes
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required to grant or deny such requested amendment or waiver and (ii) for
purposes of any determination of any payment of remuneration, whether by way of
supplemental or additional interest, fee or otherwise pursuant to SECTION
17.2(B), notwithstanding that the issuance, sale and delivery of the Notes on
the date of the third Closing has not been consummated at the time such
amendment or waiver is requested or such payment of remuneration is determined
pursuant to SECTION 17.2(B), and (2) if for any reason whatsoever, the Notes to
be issued to Principal Mutual Life Insurance Company or to Great-West Life &
Annuity Insurance Company are not issued on or prior to the Series C and Series
E Note Cut-Off Date, any such amendment or waiver entered into as contemplated
by the foregoing clause (1)(i) of this SECTION 17.1 shall, at the option of the
Required Holders, be deemed null and void.
Section 17.2. Solicitation of Holders of Notes.
(a) Solicitation. The Company will provide each holder of the Notes
(irrespective of the amount or series of Notes then owned by it) with
sufficient information, sufficiently far in advance of the date a decision is
required, to enable such holder to make an informed and considered decision
with respect to any proposed amendment, waiver or consent in respect of any of
the provisions hereof or of the Notes. The Company will deliver executed or
true and correct copies of each amendment, waiver or consent effected pursuant
to the provisions of this SECTION 17 to each holder of outstanding Notes
promptly following the date on which it is executed and delivered by, or
receives the consent or approval of, the requisite holders of Notes.
(b) Payment. The Company will not directly or indirectly 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 any series
of the Notes as consideration for or as an inducement to the entering into by
such holder of Notes or any waiver or amendment of any of the terms and
provisions hereof unless such remuneration is concurrently paid, or security is
concurrently granted, on the same terms, ratably to each holder of each series
of Notes then outstanding even if such holder did not consent to such waiver or
amendment.
Section 17.3. Binding Effect, etc. Any amendment or waiver consented to
as provided in this SECTION 17 applies equally to all holders of each series of
Notes and is binding upon them and upon each future holder of any Note of any
series and upon the Company without regard to whether such Note has been marked
to indicate such amendment or waiver. No such amendment or waiver will extend
to or affect any obligation, covenant, agreement, Default or Event of Default
not expressly amended or waived or impair any right consequent thereon. No
course of dealing between the Company and the holder of any Note of any series
nor any delay in exercising any rights hereunder or under any Note of any
series shall operate as a waiver of any rights of any holder of such Note. As
used herein, the term "this Agreement" and references thereto shall mean this
Agreement as it may from time to time be amended or supplemented.
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Section 17.4. Notes Held by Company, etc. Solely for the purpose of
determining whether the holders of the requisite percentage of the aggregate
principal amount of Notes then outstanding approved or consented to any
amendment, waiver or consent to be given under this Agreement or the Notes, or
have directed the taking of any action provided herein or in the Notes to be
taken upon the direction of the holders of a specified percentage of the
aggregate principal amount of Notes then outstanding, Notes of any series
directly or indirectly owned by the Company or any of its Affiliates shall be
deemed not to be outstanding.
SECTION 18. NOTICES.
All notices and communications provided for hereunder shall be in writing
and sent (a) by telefacsimile if the sender on the same day sends a confirming
copy of such notice by a recognized overnight delivery service (charges
prepaid), or (b) by registered or certified mail with return receipt requested
(postage prepaid), or (c) by a recognized overnight delivery service (with
charges prepaid). Any such notice must be sent:
(i) if to you or your nominee, to you or it at the address specified
for such communications in SCHEDULE A, or at such other address as you or
it shall have specified to the Company in writing,
(ii) if to any other holder of any Note, to such holder at such
address as such other holder shall have specified to the Company in
writing, or
(iii) if to the Company, to the Company at its address set forth at
the beginning hereof to the attention of the Chief Financial Officer, or
at such other address as the Company shall have specified to the holder
of each Note in writing.
Notices under this SECTION 18 will be deemed given only when actually received.
SECTION 19. 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) financial statements, certificates and other information
previously or hereafter furnished to you, may be reproduced by you by any
photographic, photostatic, microfilm, microcard, miniature photographic or
other similar process and you may destroy any original document so reproduced.
The Company agrees and stipulates that, to the extent permitted by applicable
law, 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 you
in the regular
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course of business) and any enlargement, facsimile or further reproduction of
such reproduction shall likewise be admissible in evidence. This SECTION 19
shall not prohibit the Company or any other holder of Notes from contesting any
such reproduction to the same extent that it could contest the original, or
from introducing evidence to demonstrate the inaccuracy of any such
reproduction.
SECTION 20. CONFIDENTIAL INFORMATION.
For the purposes of this SECTION 20, "Confidential Information" means
information delivered to you by or on behalf of the Company or any Subsidiary
in connection with the transactions contemplated by or otherwise pursuant to
this Agreement that is proprietary in nature and that was clearly marked or
labeled or otherwise adequately identified in writing when received by you as
being confidential information of the Company or such Subsidiary, provided that
such term does not include information that (a) was publicly known or otherwise
known to you prior to the time of such disclosure, (b) subsequently becomes
publicly known through no act or omission by you or any Person acting on your
behalf, (c) otherwise becomes known to you other than through disclosure by the
Company or any Subsidiary or (d) constitutes financial statements delivered to
you under SECTION 7.1 that are otherwise publicly available. You will maintain
the confidentiality of such Confidential Information in accordance with
procedures adopted by you in good faith to protect confidential information of
third parties delivered to you, provided that you may deliver or disclose
Confidential Information to (i) your directors, trustees, officers, employees,
agents, attorneys and affiliates (to the extent such disclosure reasonably
relates to the administration of the investment represented by your Notes),
(ii) your financial advisors and other professional advisors who agree to hold
confidential the Confidential Information substantially in accordance with the
terms of this SECTION 20, (iii) any other holder of any Note, (iv) any
Institutional Investor to which you sell or offer to sell such Note or any part
thereof or any participation therein (if such Person has agreed in writing
prior to its receipt of such Confidential Information to be bound by the
provisions of this SECTION 20), (v) any Person from which you offer to purchase
any security of the Company (if such Person has agreed in writing prior to its
receipt of such Confidential Information to be bound by the provisions of this
SECTION 20), (vi) any federal or state regulatory authority having jurisdiction
over you, (vii) the National Association of Insurance Commissioners or any
similar organization, or any nationally recognized rating agency that requires
access to information about your investment portfolio or (viii) any other
Person to which such delivery or disclosure may be necessary or appropriate (w)
to effect compliance with any law, rule, regulation or order applicable to you,
(x) in response to any subpoena or other legal process, (y) in connection with
any litigation to which you are a party or (z) if an Event of Default has
occurred and is continuing, to the extent you may reasonably determine such
delivery and disclosure to be necessary or appropriate in the enforcement or
for the protection of the rights and remedies under your Notes and this
Agreement. Each holder of a Note, by its acceptance of a Note, will be deemed
to have agreed to
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be bound by and to be entitled to the benefits of this SECTION 20 as though it
were a party to this Agreement. On reasonable request by the Company in
connection with the delivery to any holder of a Note of information required to
be delivered to such holder under this Agreement or requested by such holder
(other than a holder that is a party to this Agreement or its nominee), such
holder will enter into an agreement with the Company embodying the provisions
of this SECTION 20.
SECTION 21. SUBSTITUTION OF PURCHASER.
You shall have the right to substitute any one of your Affiliates as the
purchaser of the Notes that you have agreed to purchase hereunder, by written
notice to the Company, which notice shall be signed by both you and such
Affiliate, shall contain such Affiliate's agreement to be bound by this
Agreement and shall contain a confirmation by such Affiliate of the accuracy
with respect to it of the representations set forth in SECTION 6. Upon receipt
of such notice, wherever the word "you" is used in this Agreement (other than
in this SECTION 21), such word shall be deemed to refer to such Affiliate in
lieu of you. In the event that such Affiliate is so substituted as a purchaser
hereunder and such Affiliate thereafter transfers to you all of the Notes then
held by such Affiliate, upon receipt by the Company of notice of such transfer,
wherever the word "you" is used in this Agreement (other than in this SECTION
21), such word shall no longer be deemed to refer to such Affiliate, but shall
refer to you, and you shall have all the rights of an original holder of the
Notes under this Agreement.
SECTION 22. MISCELLANEOUS.
Section 22.1. Successors and Assigns. All covenants and other agreements
contained in this Agreement by or on behalf of any of the parties hereto bind
and inure to the benefit of their respective successors and assigns (including,
without limitation, any subsequent holder of a Note) whether so expressed or
not.
Section 22.2. Payments Due on Non-Business Days. Anything in this
Agreement or the Notes to the contrary notwithstanding, any payment of
principal of or Make-Whole Amount or interest on any Note that is due on a date
other than a Business Day shall be made on the next succeeding Business Day
without including the additional days elapsed in the computation of the
interest payable on such next succeeding Business Day.
Section 22.3. Severability. Any provision of this Agreement that is
prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction,
be ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof, and any such prohibition or
unenforceability in any jurisdiction shall (to the full extent permitted by
law) not invalidate or render unenforceable such provision in any other
jurisdiction.
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Section 22.4. Construction. Each covenant contained herein shall be
construed (absent express provision to the contrary) as being independent of
each other covenant contained herein, so that compliance with any one covenant
shall not (absent such an express contrary provision) be deemed to excuse
compliance with any other covenant. 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.
Section 22.5. Counterparts. This Agreement may be executed in any number
of counterparts, each of which shall be an original but all of which together
shall constitute one instrument. Each counterpart may consist of a number of
copies hereof, each signed by less than all, but together signed by all, of the
parties hereto.
Section 22.6. Governing Law. THIS AGREEMENT SHALL BE CONSTRUED AND
ENFORCED IN ACCORDANCE WITH, AND THE RIGHTS OF THE PARTIES SHALL BE GOVERNED
BY, THE LAW OF THE STATE OF ILLINOIS, EXCLUDING CHOICE-OF-LAW PRINCIPLES OF THE
LAW OF SUCH STATE THAT WOULD REQUIRE THE APPLICATION OF THE LAWS OF A
JURISDICTION OTHER THAN SUCH STATE.
* * * * *
If you are in agreement with the foregoing, please sign the form of
agreement on the accompanying counterpart of this Agreement and return it to
the Company, whereupon the foregoing shall become a binding agreement between
you and the Company.
Very truly yours,
WABASH NATIONAL CORPORATION
By
[Title]
The foregoing is hereby agreed
to as of the date thereof.
[VARIATION]
By _______________________________
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[Title]
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DEFINED TERMS
As used herein, the following terms have the respective meanings set forth
below or set forth in the SECTION hereof following such term:
"Affiliate" means, at any time, and with respect to any Person, (a) any
other Person that at such time directly or indirectly through one or more
intermediaries Controls, or is Controlled by, or is under common Control with,
such first Person, and (b) any Person beneficially owning or holding, directly
or indirectly, 10% or more of any class of voting or equity interests of the
Company or any Subsidiary or any corporation of which the Company and its
Subsidiaries beneficially own or hold, in the aggregate, directly or
indirectly, 10% or more of any class of voting or equity interests. 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. Unless the context otherwise clearly requires, any reference to an
"Affiliate" is a reference to an Affiliate of the Company.
"Asset Disposition Prepayment Date" is defined in SECTION 10.5(B)(IV).
"Asset Disposition Prepayment Notice" is defined in SECTION 10.5(B)(IV).
"Business Day" means (a) for the purposes of SECTION 8.6 only, any day
other than a Saturday, a Sunday or a day on which commercial banks in New York
City are required or authorized to be closed, and (b) for the purposes of any
other provision of this Agreement, any day other than a Saturday, a Sunday or a
day on which commercial banks in Indianapolis, Indiana are required or
authorized to be closed.
"Capitalized Lease" shall mean any lease the obligation for Rentals with
respect to which is required to be capitalized on a consolidated balance sheet
of the lessee and its subsidiaries in accordance with GAAP.
"Capitalized Rentals" of any Person shall mean as of the date of any
determination thereof the amount at which the aggregate Rentals due and to
become due under all Capitalized Leases under which such Person is a lessee
would be reflected as a liability on a consolidated balance sheet of such
Person.
"Closing" and "Closings" are defined in SECTION 3.
SCHEDULE B
(to Note Purchase Agreement)
51
"Code" means the Internal Revenue Code of 1986, as amended from time to
time, and the rules and regulations promulgated thereunder from time to time.
"Company" means Wabash National Corporation, a Delaware corporation.
"Confidential Information" is defined in SECTION 20.
"Consolidated Funded Debt" means Funded Debt of the Company and its
Subsidiaries, determined on a consolidated basis eliminating intercompany
items.
"Consolidated Net Income" means, with reference to any period, the net
income (or loss) of the Company and its Subsidiaries for such period (taken as
a cumulative whole), as determined in accordance with GAAP, after eliminating
all offsetting debits and credits between the Company and its Subsidiaries and
all other items required to be eliminated in the course of the preparation of
consolidated financial statements of the Company and its Subsidiaries in
accordance with GAAP.
"Consolidated Tangible Net Worth" means as of the date of any
determination thereof, the arithmetic sum of:
(a) the amount of the capital stock accounts (net of treasury stock,
at cost) plus (or minus in the case of deficit) the surplus and retained
earnings of the Company and its Subsidiaries,
PLUS
(b) minority interests and deferred taxes of the Company and its
Subsidiaries,
MINUS
(c) the net book value, after deducting any reserves applicable
thereto, of all items of the following character which are included in
the assets of the Company and its Subsidiaries, to wit:
(i) the incremental increase in an asset resulting from any
reappraisal, revaluation or write-up of assets (other than any
revaluation or write-up of assets in accordance with GAAP); and
(ii) goodwill, patents, patent applications, permits,
trademarks, trade names, copyrights, licenses, franchises,
experimental expense, organizational
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52
expense, unamortized debt discount and expense, the excess of cost
of shares acquired over book value of related assets and such other
assets as are properly classified as "intangible assets" acquired
by the Company or any Subsidiary after the date of the first
Closing to the extent and in the amount by which the fair market
value thereof is in excess of 10% of Consolidated Total Assets as
of any date of determination of Consolidated Total Assets;
all determined in accordance with GAAP.
"Consolidated Total Assets" means as of the date of any determination
thereof, total assets of the Company and its Subsidiaries determined on a
consolidated basis in accordance with GAAP.
"Consolidated Total Capitalization" means as of the date of any
determination thereof, the sum of (a) Consolidated Funded Debt plus (b)
Consolidated Tangible Net Worth.
"Default" means an event or condition the occurrence or existence of which
would, with the lapse of time or the giving of notice or both, become an Event
of Default.
"Default Rate" means that rate of interest that is the greater of (i)
8.99% per annum in the case of the Series B Notes, the Series C Designated Rate
plus 2% per annum in the case of the Series C Notes, 9.31% per annum in the
case of the Series D Notes, the Series E Designated Rate plus 2% per annum in
the case of the Series E Notes, 9.47% per annum in the case of the Series F
Notes, 9.53% per annum in the case of the Series G Notes and 9.55% per annum in
the case of the Series H Notes or (ii) 2% over the rate of interest publicly
announced by Morgan Guaranty Bank of New York in New York City, New York as its
"base" or "prime" rate.
"Designated Rate" is defined in SECTION 1(b).
"Environmental Laws" means any and all Federal, state, local, and foreign
statutes, laws, regulations, ordinances, rules, judgments, orders, decrees,
permits, concessions, grants, franchises, licenses, agreements or governmental
restrictions relating to pollution and the protection of the environment or the
release of any materials into the environment, including but not limited to
those related to hazardous substances or wastes, air emissions and discharges
to waste or public systems.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended from time to time, and the rules and regulations promulgated thereunder
from time to time in effect.
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"ERISA Affiliate" means any trade or business (whether or not
incorporated) that is treated as a single employer together with the Company
under section 414 of the Code.
"Event of Default" is defined in SECTION 11.
"Excess Net Proceeds" means, with respect to any Transfer of property, the
Net Proceeds from such Transfer to the extent attributable to property
Transferred in excess of the limitation imposed by the provisions of the
introductory portion of SECTION 10.5(B).
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
"Funded Debt" of any Person means all Indebtedness of such Person which
would, in accordance with GAAP, constitute long-term Indebtedness, including,
without limitation (a) all Indebtedness of such Person for borrowed money or
which has been incurred in connection with the acquisition of assets in each
case having a final maturity of more than one year from the date of origin
thereof (or which is renewable or extendible at the option of the obligor for a
period or periods more than one year from the date of origin), including in any
event all payments in respect thereof that are required to be made within one
year from the date of any determination of Funded Debt, whether or not the
obligation to make such payments shall constitute a current liability of the
obligor under GAAP, and all Indebtedness of such Person outstanding under any
revolving credit, line of credit, commercial extension of credit or similar
agreement between such Person and an Institutional Investor which is classified
as long-term in accordance with GAAP, (b) all Capitalized Rentals of such
Person, (c) all Guaranties by such Person of Funded Debt of others, and (d) all
Indebtedness of such Person outstanding under any revolving credit, line of
credit, commercial extension of credit or similar agreement between such Person
and an Institutional Investor, whether or not classified as long-term or
short-term Indebtedness, if, during the 365-day period immediately preceding
the date of any determination of Funded Debt of such Person, there shall not
have been a period of at least 30 consecutive days during which Indebtedness of
such Person outstanding under such revolving credit, line of credit, commercial
extension of credit or similar agreement is equal to zero, in which event there
shall be included in such determination of Funded Debt an amount equal to the
highest aggregate amount of all such Indebtedness outstanding during any period
of 30 consecutive days selected by such Person during such preceding 365-day
period.
"GAAP" means generally accepted accounting principles as in effect from
time to time in the United States of America.
"Governmental Authority" means
(a) the government of
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(i) the United States of America or any State or other
political subdivision thereof, or
(ii) any jurisdiction in which the Company or any Subsidiary
conducts all or any part of its business, or which asserts
jurisdiction over any properties of the Company or any Subsidiary,
or
(b) any entity exercising executive, legislative, judicial,
regulatory or administrative functions of, or pertaining to, any such
government.
"Guaranty" means, with respect to any Person, any obligation (except the
endorsement in the ordinary course of business of negotiable instruments for
deposit or collection) of such Person guaranteeing or in effect guaranteeing
any Indebtedness, dividend or other obligation of any other Person in any
manner, whether directly or indirectly, including (without limitation)
obligations incurred through an agreement, contingent or otherwise, by such
Person:
(a) to purchase such Indebtedness or obligation or any property
constituting security therefor;
(b) to advance or supply funds (i) for the purchase or payment of
such Indebtedness or obligation, or (ii) to maintain any working capital
or other balance sheet condition or any income statement condition of any
other Person or otherwise to advance or make available funds for the
purchase or payment of such Indebtedness or obligation;
(c) to lease properties or to purchase properties or services
primarily for the purpose of assuring the owner of such Indebtedness or
obligation of the ability of any other Person to make payment of the
Indebtedness or obligation; or
(d) otherwise to assure the owner of such Indebtedness or obligation
against loss in respect thereof.
In any computation of the Indebtedness or other liabilities of the obligor
under any Guaranty, the Indebtedness or other obligations that are the subject
of such Guaranty shall be assumed to be direct obligations of such obligor.
"Hazardous Material" means any and all pollutants, toxic or hazardous
wastes or any 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
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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).
"holder" means, with respect to any Note, the Person in whose name such
Note is registered in the register maintained by the Company pursuant to
SECTION 13.1.
"Indebtedness" means, with respect to any Person, without duplication,
(a) its liabilities for borrowed money;
(b) its liabilities for the deferred purchase price of property
acquired by such Person (excluding accounts payable arising in the
ordinary course of business but including, without limitation, all
liabilities created or arising under any conditional sale or other title
retention agreement with respect to any such property);
(c) its Capitalized Rentals;
(d) all liabilities for borrowed money secured by any Lien with
respect to any property owned by such Person (whether or not it has
assumed or otherwise become liable for such liabilities);
(e) any Guaranty of such Person with respect to liabilities of a
type described in any of clauses (a) through (d) hereof.
Indebtedness of any Person shall include all obligations of such Person of the
character described in clauses (a) through (e) to the extent such Person
remains legally liable in respect thereof notwithstanding that any such
obligation is deemed to be extinguished under GAAP. In no event shall
Indebtedness include Unfunded Pension Liability of any Plan of the Company and
its Subsidiaries, which amount, as of December 31, 1995, was zero.
"Institutional Investor" means (a) any original purchaser of a Note, (b)
any holder of a Note holding more than 5% of the aggregate principal amount of
the Notes then outstanding, and (c) any bank, trust company, savings and loan
association or other financial institution, any pension plan, any investment
company, any insurance company, any broker or dealer, or any other similar
financial institution or entity, regardless of legal form.
"Investments" means all investments in cash or by delivery of property,
made directly or indirectly in any property or assets or any Person, whether by
acquisition of shares of capital stock, Indebtedness or other obligations or
securities or by loan, advance or capital contribution
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or otherwise; provided "Investments" shall not mean or include routine
investments and property to be used or consumed in the ordinary course of
business.
"Lien" means, with respect to any Person, any mortgage, lien, pledge,
charge, security interest or other encumbrance, or any interest or title of any
vendor, lessor, lender or other secured party to or of such Person under any
conditional sale or other title retention agreement or Capital Lease, upon or
with respect to any property or asset of such Person (including in the case of
stock, stockholder agreements, voting trust agreements and all similar
arrangements).
"Make-Whole Amount" is defined in SECTION 8.6.
"Material" means material in relation to the business, operations,
affairs, financial condition, assets, properties, or prospects of the Company
and its Subsidiaries taken as a whole.
"Material Adverse Effect" means a material adverse effect on (a) the
business, operations, affairs, financial condition, assets or properties of the
Company and its Subsidiaries taken as a whole, or (b) the ability of the
Company to perform its obligations under this Agreement and the Notes, or (c)
the validity or enforceability of this Agreement or the Notes.
"Memorandum" is defined in SECTION 5.3.
"Multiemployer Plan" means any Plan that is a "multiemployer plan" (as
such term is defined in section 4001(a)(3) of ERISA).
"Net Proceeds" means, with respect to any Transfer of any property by any
Person, an amount equal to the excess of (a) the aggregate amount of all
consideration (valued at the fair market value of such consideration at the
time of consummation of such Transfer) received by such Person in respect of
such Transfer, over (b) the ordinary and reasonable out-of-pocket costs and
expenses actually incurred by such Person in connection with such Transfer.
"Notes" is defined in SECTION 1.
"Officer's Certificate" means a certificate of a Senior Financial Officer
or of any other officer of the Company whose responsibilities extend to the
subject matter of such certificate.
"Other Agreements" is defined in SECTION 2.
"Other Purchasers" is defined in SECTION 2.
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"PBGC" means the Pension Benefit Guaranty Corporation referred to and
defined in ERISA or any successor thereto.
"Person" means an individual, partnership, corporation, limited liability
company, association, trust, unincorporated organization, or a government or
agency or political subdivision thereof.
"Plan" means an "employee benefit plan" (as defined in section 3(3) of
ERISA) that is or, within the preceding five years, has been established or
maintained, or to which contributions are or, within the preceding five years,
have been made or required to be made, by the Company or any ERISA Affiliate or
with respect to which the Company or any ERISA Affiliate may have any
liability.
"Priority Debt" means (i) all Indebtedness of the Company or any
Subsidiary secured by a Lien on any property of the Company or any Subsidiary,
excluding Indebtedness secured by Liens permitted by clauses (a), (c), (d),
(e), (f) or (g) of SECTION 10.4, but including Indebtedness secured by Liens
permitted by clauses (b) or (h) of SECTION 10.4, and (ii) all Indebtedness of
Subsidiaries.
"property" or "properties" means, unless otherwise specifically limited,
real or personal property of any kind, tangible or intangible, choate or
inchoate.
"QPAM Exemption" means Prohibited Transaction Class Exemption 84-14 issued
by the United States Department of Labor.
"Required Holders" means, at any time, the holders of at least 66-2/3% in
principal amount of the Notes at the time outstanding (exclusive of Notes then
owned by the Company or any of its Affiliates).
"Responsible Officer" means any Senior Financial Officer and any other
officer of the Company with responsibility for the administration of the
relevant portion of this agreement.
"Secondary Asset Disposition Prepayment Notice" is defined in SECTION
10.5(B)(IV).
"Securities Act" means the Securities Act of 1933, as amended from time to
time.
"Senior Financial Officer" means the chief financial officer, principal
accounting officer, treasurer or comptroller of the Company.
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"Senior Funded Debt" of any Person means Funded Debt of such Person which
is not expressed to be subordinate or junior in rank to any other Funded Debt
of such Person.
"Series B Notes" is defined in SECTION 1.
"Series C Notes" is defined in SECTION 1.
"Series D Notes" is defined in SECTION 1.
"Series E Notes" is defined in SECTION 1.
"Series F Notes" is defined in SECTION 1.
"Series G Notes" is defined in SECTION 1.
"Series H Notes" is defined in SECTION 1.
"Series C Note and Series E Note Cut-Off Date" is defined in SECTION 17.1
"Series C Designated Rate" is defined in SECTION 1(B).
"Series E Designated Rate" is defined in SECTION 1(B).
"Series C Institutional Investors" is defined in SECTION 1(B).
"Series E Institutional Investors" is defined in SECTION 1(B).
"Subsidiary" means, as to any Person, any corporation, association or
other business entity in which such Person or one or more of its Subsidiaries
or such Person and one or more of its Subsidiaries owns sufficient equity or
voting interests to enable it or them (as a group) ordinarily, in the absence
of contingencies, to elect a majority of the directors (or Persons performing
similar functions) of such entity, and any partnership or joint venture if more
than a 50% interest in the profits or capital thereof is owned by such Person
or one or more of its Subsidiaries or such Person and one or more of its
Subsidiaries (unless such partnership can and does ordinarily take major
business actions without the prior approval of such Person or one or more of
its Subsidiaries). Unless the context otherwise clearly requires, any
reference to a "Subsidiary" is a reference to a Subsidiary of the Company.
"Transfer" means, with respect to any property, the sale, exchange,
conveyance, lease, transfer or other disposition of such property.
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"Unfunded Pension Liability" of any Plan means the amount, if any, by
which the actuarial present value of the accumulated plan benefits under the
Plan as of the close of its most recent plan year, determined in accordance
with statement of Financial Accounting Standards No. 35, based upon the
actuarial assumptions used by the Plan's actuary in the most recent annual
valuation of the Plan, exceeds the fair market value of the assets allocable
thereto, determined in accordance with Section 412 of the Code.
"Value" means, with respect to any property on any date, the greater of
the book value of such property on such date or the fair market value of such
property on such date.
"Wholly-Owned Subsidiary" means, at any time, any Subsidiary one hundred
percent (100%) of all of the equity interests (except directors' qualifying
shares) and voting interests of which are owned by any one or more of the
Company and the Company's other Wholly-Owned Subsidiaries at such time.
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EXHIBIT 4.4(c)
(to Note Purchase Agreement)