EXHIBIT 10.6
WEIGH-TRONIX, LLC
SUBSCRIPTION AGREEMENT
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June 13, 2000
To: Marconi, Inc.
Re: Offering of Exchangeable PIK Preferred Member Interest
Ladies and Gentlemen:
Subject to the terms and conditions of this Subscription Agreement (this
"Agreement") and in reliance upon the representations and warranties of the
respective parties contained herein:
(a) The Company agrees to sell to Marconi, Inc., or its designated affiliate
(the "Subscriber"), and the Subscriber irrevocably subscribes for and agrees to
purchase from the Company, a new class of member interest of the Company
designated as the Exchangeable PIK Preferred Member Interest (the "PIK Preferred
Interest") and to thereby become a Member of the Company, in consideration of
the Subscriber's agreement to contribute capital (the "Capital Contribution")
equal to the amount indicated opposite such Subscriber's name on Schedule 1
attached hereto; and
(b) The Company agrees that the Subscriber shall be admitted as a Member of
the Company, upon the terms and conditions and in consideration of the
Subscriber's agreement to be bound by the terms and provisions of (i) the
Amended and Restated Operating Agreement of the Company, to be dated the date
hereof, the form of which is attached as Annex A hereto and incorporated herein
by reference (the "Operating Agreement"), and (ii) the Amended and Restated
Members Agreement, also to be dated the date hereof, the form of which is
attached as Annex B hereto and incorporated herein by reference (the "Members
Agreement", and together with the Operating Agreement, the "Amended Company
Documents").
In connection with such subscription, and intending to be legally bound, the
Subscriber and the Company hereby agree with each other as follows:
1. Definitions. Capitalized terms used herein and not otherwise defined
shall have the respective meanings set forth in the Offering Memorandum of the
Company and its subsidiary, SWT Finance B.V. (the "Issuer") dated June 2, 2000,
with respect to the offer and sale of the Issuer's Senior Subordinated Notes Due
2010 (the "Notes"), Certain other terms used in Sections 7(a) and 8 hereof are
as defined in the Indenture.
2. Closing. The purchase and sale of the PIK Preferred Interest will take
place at a closing (the "Closing") at such place as the parties shall mutually
agree. The Closing shall take place on or prior to June 13, 2000, or at such
other time as the parties shall mutually agree. At the Closing, each of the
parties hereto shall execute and deliver the Amended Company
Documents, and thereby become bound to one another with respect to all of the
terms and provisions thereof. Pursuant to the terms of the Operating Agreement,
the PIK Preferred Interest will be issued to and held by the Subscriber as of
the Closing. The Subscriber will make full payment of its Capital Contribution
to the Company at the Closing in such manner as the parties shall mutually
agree.
3. Representations and Warranties by the Company and the Issuer. With full
knowledge that the Subscriber intends to reply upon the representations and
warranties made herein, each of the Company and the Issuer hereby represents and
warrants as follows:
(a) Organization and Standing. Each of the Company and the Issuer is a
limited liability company duly organized and validly existing in good standing
under the laws of its respective jurisdiction of organization and has all
requisite power and authority for the ownership and operation of its properties
and for the carrying out of its business as now conducted and as proposed to be
conducted.
(b) Corporate Action. Each of the Company and the Issuer has all
necessary power and authority and has taken all action required to make such of
this Agreement, the PIK Preferred Interest, the Amended Company Documents and
any other agreements and instruments executed in connection herewith to which it
is a party and therewith the valid and enforceable obligations of the Company or
the Issuer (as the case may be). This Agreement and, upon the execution and
delivery of the Amended Company Documents, the Amended Company Documents each
constitute a legal, valid and binding obligation of the Company enforceable
against the Company and (in case of this Agreement) the Issuer in accordance
with its terms, subject to the effect of bankruptcy, insolvency or similar laws
and subject to the application of general equitable principles. The issuance of
the PIK Preferred Interest is not subject to preemptive or other preferential
rights, or similar statutory or contractual rights, either arising pursuant to
any agreement or instrument to which the Company is a party or which are
otherwise binding upon the Company (including the Amended Company Documents).
The execution, delivery and performance of such of this Agreement and the
Amended Company Documents to which it is a party, the issuance of the PIK
Preferred Interest and the consummation of the transactions contemplated hereby
and thereby will not result in any violation of, or default under, any agreement
or other instrument to which the Company or the Issuer (as the case may be) is a
party or by which it or any of its properties is bound, or any judgment, decree,
statute, order, rule or regulation applicable to the Company or its business or
properties.
(c) Governmental Approvals. All authorizations, consents, approvals,
exemptions from or filings or registrations with any court or governmental
department, commission, board, bureau, agency or instrumentality, domestic or
foreign, necessary for or in connection with the offer, issuance, sale,
execution or delivery by each of the Company and the Issuer, or for the
performance by it of its obligations under this Agreement or (in the case of the
Company) the Amended Company Documents, have been made prior to, and are
effective as of, the Closing.
(d) Litigation. There is no litigation, governmental proceeding or
investigation pending or threatened against the Company or the Issuer which
questions the validity of this Agreement, or (in the case of the Company) the
PIK Preferred Interest
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or the Amended Company Documents or (in any case) any action taken or to be
taken pursuant hereto or thereto.
(e) The Company and the Issuer represents that no Person has or will
have, as a result of any act or omission by the Company and the Issuer, any
right, interest or valid claim against or upon the Subscriber for any
commission, fee or other compensation as a finder or broker, or in any similar
capacity, as a result of dealings with the Company and the Issuer in connection
with the transactions contemplated by this Agreement.
4. Subscriber's Representations and Warranties. With the full knowledge
that the Company and the Board of Managers of the Company (the "Manager") intend
to rely upon the representations and warranties made herein, the Subscriber
hereby represents and warrants to and for the benefit of the Company and the
Manager as follows:
(a) The Subscriber is an "accredited investor" as that term is defined
in Regulation (S)203.501 under the Securities Act of 1933, as amended (the
"Act"). The Subscriber is capable of evaluating the merits and risks of
purchasing the PIK Preferred Interest. The Subscriber represents that the
statements made by the Subscriber in the Confidential Investor Questionnaire
completed and signed by him are true and correct in all material respects.
(b) The Subscriber has been advised that (i) there will be no public
market for the PIK Preferred Interest, (ii) it may not be possible to readily
liquidate an investment in the PIK Preferred Interest, (iii) the PIK Preferred
Interest cannot be resold without either registration under the Act and under
applicable state securities laws, or an opinion of securities counsel that an
exemption is available therefrom and (iv) the Company has no obligation to
register the PIK Preferred Interest under the Act or supply information
necessary to enable the Subscriber to make a sale of the PIK Preferred Interest
under Rule 144 under the Act.
(c) The Subscriber is purchasing the PIK Preferred Interest for
investment for the Subscriber's own account and not with any present view
towards resale or other distribution of the PIK Preferred Interest.
(d) The Subscriber is able to bear the economic risk of its investment
in the PIK Preferred Interest and, at the present time, could afford a complete
loss of such investment. The Subscriber has adequate means of providing for
current needs and personal contingencies and has no need for liquidity in
connection with its investment in the PIK Preferred Interest, and such
investment in the PIK Preferred Interest will not cause the Subscriber's overall
committed investments that are not readily marketable to become excessive.
(e) The Subscriber represents that no Person has or will have, as a
result of any act or omission by such Subscriber, any right, interest or valid
claim against or upon the Company for any commission, fee or other compensation
as a finder or broker, or in any similar capacity, as a result of dealings with
such Subscriber in connection with the transactions contemplated by this
Agreement.
(f) The Subscriber understands that no state or governmental authority
has made any finding or determination relating to the fairness of an investment
in the PIK Preferred Interest.
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(g) This Agreement, the Amended Company Documents and all other
instruments executed by the Subscriber in connection with the Subscriber's
investment in the Company, (i) have been duly executed and delivered by the
Subscriber, (ii) if the Subscriber is not a natural Person, have been duly
authorized by all necessary action on behalf of the Subscriber, and (iii) are
the legal, valid and binding obligations of the Subscriber, enforceable in
accordance with their terms, subject to the effect of bankruptcy, insolvency or
similar rules and subject to the application of general equitable principles.
(h) The execution and delivery by the Subscriber of this Agreement,
the Amended Company Documents and all other instruments executed in connection
with its investment in the Company do not, and the performance thereof will not,
(i) contravene any provision of existing law or regulations of any court or
governmental order by which the Subscriber is bound, (ii) conflict with the
charter, by-laws and/or other organization documents of the Subscriber, or (iii)
conflict with, result in any breach of the term of, constitute a default under,
or result in any encumbrance upon any of the properties of the Subscriber
pursuant to, any indenture, mortgage, or other agreement or instrument to which
the Subscriber is a party or by which it is bound.
(i) No approval, authorization, or other action by or filing with, any
federal, state, municipal, or other governmental commission, board, or agency is
required by the Subscriber in connection with the execution and delivery by the
Subscriber of this Agreement, the Amended Company Documents and all other
instruments executed in connection with the investment in the Company by the
Subscriber, or the consummation of the purchase of the PIK Preferred Interest by
the Subscriber.
5. Conditions Precedent to Subscriber's Obligations. The Subscriber's
obligations to subscribe to the PIK Preferred Interest and to pay its Capital
Contribution at the Closing is subject to the fulfillment, prior to or at the
time of the Closing, of the following conditions:
(a) The contemporaneous consummation of the Merger, the Offering of the
Notes and the placement of the Senior Credit Facility;
(b) The execution and delivery by the Company and the requisite
percentage of existing Members of the Company of the Amended Company Documents;
(c) The representations and warranties of the Company contained in
Section 3 of this Agreement shall be true and correct in all material respects
when made and at the time of the Closing; and
(d) The Subscriber shall have received its Warrant under the Acquisition
Agreement for five percent (5%) of the Company's fully diluted equity capital as
of June 13, 2000, upon the terms and conditions described in the Warrant
Agreement, Operating Agreement and the Members' Agreement.
6. Conditions Precedent to the Company's Obligations. The obligations of
the Company to issue the PIK Preferred Interest and to admit the Subscriber as a
new Member at the Closing shall be subject to the fulfillment, prior to or at
the time of the Closing, of the following conditions:
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(a) The contemporaneous consummation of the Merger, the Offering of the
Notes and the placement of the Senior Credit Facility;
(b) The execution and delivery by the Subscriber and the requisite
percentage of existing Members of the Company of the Amended Company Documents;
and
(c) The representations and warranties made by the Subscriber contained
in Section 4 of this Agreement shall be true and correct in all material
respects when made and at the time of the Closing.
7. Covenants of the Company. The Company hereby covenants and agrees as
follows, intending that the Subscriber shall be the beneficiary of such
covenants and agreements for so long as the PIK Preferred Interest remains
outstanding, and that such covenants and agreements shall be in addition to the
rights and privileges of the Subscriber under the Amended Documents, as the
holder of the PIK Preferred Interest:
(a) General Covenants. The Company hereby agrees that the following
covenants and agreements which appear in Article IV and V of the Indenture are
also hereby made for the benefit of the Subscriber and its permitted successors
and assigns:
(i) Section 4.3 - Limitation on Restricted Payments;
(ii) Section 4.4 - Limitation on Indebtedness;
(iii) Section 4.5 - Corporate Existence;
(iv) Section 4.6 - Payment of Taxes and Other Claims;
(v) Section 4.7 - Maintenance of Properties and Insurance;
(vi) Section 4.9 - Compliance with Laws;
(vii) Section 4.12 - Limitation on Transactions with Affiliates;
(viii) Section 4.13 - Limitation on Dividend and Other Payment
Restrictions Affecting Restricted Subsidiaries;
(ix) Section 4.14 - Limitation on Liens;
(x) Section 4.16 - Limitation on Asset Sales (excepting clauses
(c) through (h) thereof);
(xi) Section 4.18 - Limitation on Layering;
(xii) Section 4.19 - Limitation on the Issuance and Sale of
Capital Stock of Restricted Subsidiaries;
(xiii) Section 4.22 - Business Activities;
(xiv) Section 4.24 - Sale and Leaseback Transaction; and
(xv) Section 5.1 - Merger, Consolidation or Sale of Assets.
The above-referenced covenants shall be deemed to be incorporated herein by
reference in full, as if the text thereof was fully set forth herein.
Capitalized terms used in such covenants shall have the respective meanings set
forth in the Indenture.
(b) Financial Reporting Requirements. The Company shall furnish to the
Subscriber all of the following information, all of which is also required to be
delivered under the Senior Credit Facility:
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(A) as soon as available, but in any event within 90 days after
the end of each fiscal year of the Company, a copy of the audited consolidated
balance sheet of the Company and its consolidated Subsidiaries as at the end of
such year and the related audited consolidated statements of income and cash
flows for such year, setting forth in each case in comparative form the figures
as of the end of and for the previous year, reported on without qualification or
exception, by PricewaterhouseCoopers LLP or other independent certified public
accountants of nationally recognized standing;
(B) as soon as available, but in any event not later than 45 days
after the end of each quarterly period of each fiscal year of the Company, the
unaudited consolidated and consolidating balance sheets of the Company and its
consolidated Subsidiaries as at the end of such quarter and the related
unaudited consolidated and consolidating statements of income and cash flows for
such quarter and the portion of the fiscal year through the end of such quarter
(provided that no such consolidating statements of cash flows shall be required
for the fiscal quarter ended June 30, 2000), setting forth in each case in
comparative form the figures as of the end of and for the corresponding period
in the previous year and a comparison of such figures to the budget with respect
to such period previously delivered to the Subscriber, certified by the chief
financial officer of the Company as being fairly stated in all material respects
(subject to normal year-end audit adjustments) and a narrative discussion and
analysis of the financial condition and results of operations of the Company and
its Subsidiaries for such fiscal quarter and for the period from the beginning
of the then-current fiscal year to the end of such fiscal quarter, as compared
to the portion of the Projections covering such period and to the comparable
periods of the previous year and to its budget with respect to such period
previously delivered to the Subscriber; and
(C) as soon as available, but in any event not later than 45 days
after the end of each month occurring during each fiscal year of the Company
(other than the third, sixth, ninth and twelfth such month), the unaudited
consolidated and consolidating balance sheets of the Company and its
Subsidiaries as at the end of such month and the related unaudited consolidated
and consolidating statements of income and cash flows for such month and the
portion of the fiscal year through the end of such month, setting forth in each
case in comparative form the figures as of the end of and for the corresponding
period in the previous year and a comparison of such figures to the budget with
respect to such period previously delivered to the Subscriber, certified by the
Company's chief financial officer as being fairly stated in all material
respects (subject to normal year-end audit adjustments); provided, that no such
consolidating information shall be required for the first fiscal year following
the Closing and no such consolidating statements of cash flows shall be required
pursuant to this paragraph at any time;
all such financial statements to be complete and correct in all material
respects and to be prepared in reasonable detail and in accordance with GAAP
applied consistently throughout the periods reflected therein and with prior
periods (except as approved by such accountants or officer, as the case may be,
and disclosed therein).
(D) concurrently with the delivery of the financial statements
referred to in paragraphs (A) through (C) above, a copy of any certificates of
the chief financial officer of the Company and/or the independent certified
public accountants reporting on such financial statements which are delivered
pursuant to the Senior Credit Facility;
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(c) Termination of Covenants. Upon the exchange of the PIK Preferred
Interest as described in Section 9 below and subject to Section 9 below, all of
the covenants set forth in paragraphs (a), (b) and (c) of this Section 7 shall
terminate and be of no further force or effect pursuant to this Agreement.
8. Subordination.
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(a) Agreement to Subordinate. The Subscriber agrees, and each holder of
the PIK Preferred Interest upon any transfer thereto shall be deemed to agree,
that all obligations of the Company to pay or redeem the PIK Preferred Interest
and all dividends or other amounts due therein are subordinated in right of
payment, to the extent and in the manner (but only to that extent and in that
manner) provided in the following paragraphs (b) to (e) of this Section 8, to
the prior payment in full of all "Senior Debt" and all "Senior Subordinated
Debt", (as each of such terms is defined in the Indenture in the form it is in
on the date hereof), and that such subordination is for the benefit of and
enforceable by the holders of the Senior Debt and/or the holders of the Senior
Subordinated Debt. The Senior Debt and Senior Subordinated Debt is referred to
collectively herein as "Superior Debt".
(b) Liquidation, Dissolution, Bankruptcy. Upon any payment or
distribution of the assets of the Company to creditors upon a total liquidation
or a total dissolution of the Company or any bankruptcy, insolvency,
receivership or similar proceeding related to the Company or its properties or
an assignment for the benefit of creditors of the Company's assets or
liabilities:
(i) the holders of Superior Debt shall be entitled to receive payment
in full in cash or Cash Equivalents (as such term is defined in the Indenture in
the form it is in on the date hereof) of all obligations due with respect to
Superior Debt (including interest after the commencement of any such proceeding
at the rate specified in the applicable Superior Debt) before the holders of the
PIK Preferred Interest shall be entitled to receive any payment of principal of,
accrued dividend on, or interest (including interest accruing after the
commencement of any such proceeding) with respect to the PIK Preferred Interest;
and
(ii) until the Superior Debt is paid in full in cash or Cash
Equivalents (as defined in the Indenture in the form it is in on the date
hereof), any payment or distribution to which the holders of the PIK Preferred
Interest would be entitled but for this Section 7 shall be made to the holders
of Superior Debt, as their respective interests may appear.
(c) Relative Rights. This Section 7 defines the relative rights of the
holder of the PIK Preferred Interest in relation to the rights of the holders of
Superior Debt. Nothing in this Section 7 shall be deemed to impair, as between
the Company and the holder of the PIK Preferred Interest, the obligation of the
Company to make all payments, including but not limited to Guaranteed Payments,
dividends and redemption amounts and the obligations of the Company and the
Issuer to carry out their respective obligations to exchange the PIK Preferred
Interest for additional Notes in accordance with the terms of this Agreement and
the Amended Company Documents, or otherwise prevent the holder of the PIK
Preferred Interest from otherwise exercising its available remedies against the
Company or the Issuer, subject always to the rights
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of holders of Superior Debt under this Section 7 to receive distributions which
might otherwise be payable to holders of the PIK Preferred Interest.
(d) Subordination May Not Be Impaired by Company. The right of any holder
of Superior Debt to enforce the subordination evidenced by this Section 7 shall
not be impaired by any act or failure to act by the Company or the Issuer.
(e) Reliance by Holders of Superior Debt on Subordination Provisions.
Each holder of the PIK Preferred Interest by accepting such PIK Preferred
Interest and all rights and benefits accruing thereto, hereby acknowledges and
agrees that the foregoing subordination provisions are, and are intended to be,
an inducement and a consideration of each holder of any Superior Debt, whether
such Superior Debt was created or required before or after the issuance of the
PIK Preferred Interest to acquire, or to continue to hold, such Superior Debt
and such holder of Superior Debt shall be deemed conclusive that you have relied
on such Subordination Provisions in acquiring in holding and continuing to hold
or in containing to hold such Superior Debt.
9. Exchange of PIK Preferred Interest into Notes; Joinder by Issuer. The
parties hereto acknowledge that, as set forth more fully in the Amended
Operating Agreement, the PIK Preferred Interest is exchangeable by the
Subscriber or redeemable by the Company for an equivalent principal amount of
Notes from the Issuer.
The Issuer hereby joins in this Agreement for the purpose of expressing its
covenant and agreement and hereby covenants and agrees with the Subscriber to
issue additional Notes to the Subscriber pursuant to all of the terms and
conditions of the Indenture, or its designated affiliate, in an amount of the
full aggregate Capital Contribution (as defined in the Operating Agreement) of
the PIK Preferred Interest (plus all accrued and unpaid amounts payable to the
holder thereof) upon the exchange or redemption of the Preferred Interest in
accordance with the terms and conditions of the Amended Members' Agreement.
10. Miscellaneous.
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(a) Entire Agreement; Amendments. This Agreement sets forth the entire
understanding and agreement between the parties hereto with respect to the
subject matter hereof, and, subject to applicable law, may be amended or
terminated only in writing. Notwithstanding the foregoing sentence, the parties
acknowledge that various material terms of the PIK Preferred Interest are also
set forth in the Amended Company Documents.
(b) Waiver of Rights or Remedies. Any failure by the Subscriber, the
Managers or the Company to exercise any right or remedy under this Agreement, or
any delay in exercising any such right or remedy, shall not operate as a waiver
of such right or remedy. No waiver of any such right or remedy shall be
effective unless it is in writing and signed by the party making the waiver.
(c) Governing Law, Jurisdiction; Jury Trial. This Agreement shall be
construed in accordance with, and its validity, construction, and performance
shall be governed by, the laws of The State of Delaware. The Subscriber hereby
irrevocably consents to the exclusive jurisdiction of any federal or state court
sitting in The State of Delaware for the
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purposes of any proceeding relating to this Agreement and waives any objection
to the convenience of any such court. The Subscriber hereby irrevocably waives
any right to a jury trial with respect to any matter relating to this Agreement
or the Subscriber's investment in the PIK Preferred Interest.
(d) Headings and Captions; Pronouns. Headings and captions in this
Agreement are inserted only as a matter of convenience and for reference and in
no way define, limit, extend or describe the scope of this Agreement or the
intent of any provisions thereof. The use of a particular pronoun herein shall
not be restrictive as to gender or number but shall be interpreted as the
context may require.
(e) Severability. In the event that any provision of this Agreement
shall be found to be invalid, illegal, or unenforceable as written, such finding
or invalidity, illegality, or unenforceability shall have no bearing or effect
upon the validity or enforceability of any other provision of this Agreement.
In the event that any otherwise valid provision contained in this Agreement
shall be found invalid, illegal, or unenforceable as applied in any case, such
finding or invalidity, illegality, or unenforceability of such provision in such
application shall have no bearing or effect upon the validity, legality or
enforceability of such provision in any other application or of any other
provision of this Agreement except to the extent that such continued validity,
legality, or enforceability shall be expressly and conclusively precluded by the
judgment of the court or tribunal that made such finding of invalidity,
illegality, or unenforceability.
(f) Notices. All demands, notices, and other communications under
this Agreement shall be in writing, shall be deemed effective when sent by
overnight delivery service or by certified or registered mail (in any such case,
postage prepaid and return receipt requested) or by facsimile, and, if sent to
the Subscriber, shall be addressed to the Subscriber at the address given on the
Subscriber Signature Page hereto (or such other address of which the Subscriber
may hereafter notify the Company) or, if sent to the Company, shall be addressed
to the Company at Weigh-Tronix, LLC, 000 Xxxxx Xxxx Xxxxxx, Xxxxxxxxxx, Xxxxx
Xxxxxx 00000, Attention: Chief Financial Officer (or such other address of
which the Company may hereafter notify the Subscriber).
(g) Successor and Assigns; Rights of Transfer. The Agreement shall be
binding upon and inure to the benefit of and be enforceable by the respective
successor and assigns of the parties hereto.
The PIK Preferred Interest shall be non-transferable except pursuant to a
Permitted Transfer (as defined in the Amended Members' Agreement).
(h) Counterparts. This Agreement may be executed in one or more
counterparts, all of which shall constitute one and the same instrument.
* * * *
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WEIGH-TRONIX, LLC
SIGNATURE PAGE
TO
SUBSCRIPTION AGREEMENT
The undersigned hereby executes and delivers the Subscription Agreement and
Investor Questionnaire (attached thereto) to which this Signature Page is
attached, which, together with all counterparts of said Agreements and Signature
Pages of the other parties named in said Agreements, shall constitute one and
the same document in accordance with the terms of said Agreements.
Date: June 13, 2000 Marconi, Inc.
----------------------------------------------------
Name of Subscriber
By:____________________________
Print Name:_____________________
Title:__________________________
Address:________________________
________________________________
Telecopier No.:_________________
Social Security Number or Taxpayer Identification
Number:______________________________
ACCEPTED AND AGREED:
WEIGH-TRONIX, LLC
By:______________________________
SWT FINANCE B.V. (as to Paragraphs 3 and 9 hereof)
By:______________________________
By Designation under Power of
Attorney
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SCHEDULE 1
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WEIGH-TRONIX, LLC
CLASS MEMBER
------------
NAME AND ADDRESSES CAPITAL
OF CLASS MEMBER CONTRIBUTION
--------------- ------------
Marconi, Inc. 10,000,000
c/o Marconi Data Systems Inc. (EURO $10 million)
0000 Xxxxxx Xxxx.
Xxxx Xxxx, Xxxxxxxx 00000-0000
with a copy to:
Marconi Corp. PLC
Xxx Xxxxxx Xxxxxx
Xxxxxx XXX 0XX
Attn: Xxxxxxxx Xxxxxx
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CONFIDENTIAL INVESTOR QUESTIONNAIRE
The PIK Preferred Interest (the "PIK Preferred Interest") in WEIGH-TRONIX,
LLC, a Delaware limited liability company (the "Company"), are being offered to
a limited number of qualified investors, without registration under the
Securities Act of 1933, as amended (the "1933 Act"), and without registration
under various state securities or blue sky laws in reliance on exemptions
therefrom. The following information is required in order to determine whether
the subscriber (the "Subscriber") will be a qualified purchaser of the PIK
Preferred Interest pursuant to the exemptions from federal securities
registration provided under Section 4(2) of the 1933 Act, and/or Regulation D
promulgated thereunder by the Securities and Exchange Commission ("SEC"), and
the requirements of applicable state securities laws.
The Subscriber must and will notify the Company immediately of any material
change in any statement made herein.
Date Questionnaire Completed:
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PART 1. IDENTIFICATION OF SUBSCRIBER
(TO BE COMPLETED BY ALL SUBSCRIBERS)
Subscriber
----------
(1) Name(s) of Subscriber(s) _________________________________
(2) If not a natural Person, Type of Entity:
[ ] Corporation [ ] Trust
[ ] Partnership [ ] Other _______________________________
(Specify)
Note: If Subscriber is not a natural Person, the following additional
information will be required:
State of Organization:___________________________________________________
Number of shareholders or
partners:________________________________________________________________
Name of contact person:__________________________________________________
Name(s) and title(s) of individual(s) executing
documents:_______________________________________________________________
____________________________________________________________________________
____________________________________________________________________________
(3) If the Subscriber is a natural Person, identify the nature of ownership of
the proposed investment in the Company:
[ ] Single Ownership
[ ] Tenancy by the entirety (Spouses only)
[ ] Community property
[ ] Joint tenancy with right of survivorship
[ ] Tenancy in common
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(4) Home Address _____________________
_____________________
Telephone No. (____)_______________
(5) Business Address _____________________
_____________________
Telephone No. (____)_______________
(6) Address to which correspondence should be mailed:
[ ] Home [ ] Business [ ] Other (Specify)_________________
_________________
_________________
(7) Date of Birth (or Formation if an Entity): __________________
(8) Social Security or Taxpayer ID No.: __________________
(9) Marital Status (if applicable): _______________________
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PART II. ACCREDITED INVESTOR STATUS
(To Be Completed by All Subscribers)
A. SUBSCRIBER WILL QUALIFY AS AN "ACCREDITED INVESTOR" FOR PURPOSES OF
PURCHASING THE UNITS IF HE MEETS ANY ONE OF THE FOLLOWING QUALIFICATIONS.
PLEASE INDICATE IF YOU QUALIFY UNDER ONE OR MORE OF THE FOLLOWING (please
check all that apply):
[ ] 1. Subscriber is a natural Person and has a net worth as of the date of
this subscription (alone or including the net worth of the spouse of
such Subscriber) in excess of $1,000,000.
[ ] 2. Subscriber is a natural Person and had individual income in excess of
$200,000, or joint income with the spouse of such Subscriber in excess
of $300,000, in each of the two most recent calendar years and
reasonably expects the same income level in the current year.
[ ] 3. Subscriber is a corporation, partnership, charitable organization
described in Section 501(c)(3) of the Internal Revenue Code, or
business trust, not formed for the specific purpose of acquiring the
Units, with total assets in excess of $5,000,000.
[ ] 4. Subscriber is an entity which falls within one of the following
categories of institutional accredited investors, set forth in Rule
501(a) of Regulation D under the 1933 Act:
(If Subscriber has checked Category 4, check below the item which
describes Subscriber)
[ ] (a) A bank as defined in Section 3(a)(2) of the 1933 Act, or
any savings and loan association or other institution as
defined in Section 3(a)(5)(A) of the 1933 Act whether
acting in its individual or a fiduciary capacity.
[ ] (b) A broker or dealer registered pursuant to Section 15 of
the Securities Exchange Act of 1934.
[ ] (c) An insurance company as defined in Section 2(13) of the
0000 Xxx.
[ ] (d) An investment company registered under the Investment
Company Act of 1940 or a business development company as
defined in Section 2(a)(48) of that Act.
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[ ] (e) A Small Business Investment Company licensed by the U.S.
Small Business Administration under Section 301(c) or (d)
of the Small Business Investment Act of 195 8.
[ ] (f) Any plan established and maintained by a state, its
political subdivisions, or any agency or instrumentality
of a state or its political subdivisions for the benefit
of its employees, if such a plan has total assets in
excess of $5,000,000.
[ ] (g) Any private business development company as defined in
Section 202(a)(22) of the Investment Advisers Act of 1940.
[ ] (h) An employee benefit plan within the meaning of the
Employee Retirement Income Security Act of 1974, if the
investment decision is made by a plan fiduciary, as
defined in Section 3(21) of such Act, which is either a
bank, savings and loan association, insurance company or
registered investment adviser, or if the employee benefit
plan has total assets in excess of $5,000,000 or, if a
self-directed plan, with investment decisions made solely
by Persons that are accredited investors.
[ ] (i) A trust, with total assets in excess of $5,000,000, not
formed for the specific purpose of acquiring the Units,
whose purchase is directed by a sophisticated person as
described in Rule 506(b)(2)(ii) of Regulation D.
[ ] 5. Subscriber is an entity in which all of the equity owners are
accredited investors and described in one or more of the Categories
set forth in paragraphs 1 through 4 above.
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