EXHIBIT 4.3
TEKNI-PLEX, INC.
$200,000,000
9 1/4% Senior Subordinated Notes due 2008
Purchase Agreement
February 25, 1998
X.X. Xxxxxx Securities Inc.
00 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
Ladies and Gentlemen:
Tekni-Plex, Inc., a corporation formed under the laws of Delaware (the
"Company"), proposes to issue and sell (the "Offering") to X.X. Xxxxxx
Securities Inc. (the "Initial Purchaser") $200,000,000 principal amount of its 9
1/4% Senior Subordinated Notes due 2008 (the "Notes"). The Notes will be issued
pursuant to the provisions of an Indenture to be dated as of March 1, 1998 (the
"Indenture") among the Company, the Guarantors (as defined) and Marine Midland
Bank, as trustee (the "Trustee"). The Notes will be guaranteed (the "Guarantee"
and, collectively with the Notes, the "Securities") on a senior subordinated
basis by each of the entities listed on the signature pages hereto which will
become subsidiaries of the Company upon the consummation of the Merger referred
to below (the "Guarantors").
The sale of the Securities to the Initial Purchaser will be made
without registration of the Securities under the Securities Act of 1933, as
amended (the "Act" or the "Securities Act"), in reliance upon the exemption
therefrom provided by Section 4(2) of the Act. Holders of the Securities will
have the benefits of a Registration Rights Agreement to be dated as of March 3,
1998 among the Company, the Guarantors and the Initial Purchaser, substantially
in the form attached hereto as Exhibit A (the "Registration Rights Agreement")
pursuant to which the Issuers will agree to file with the Securities and
Exchange Commission (the "Commission") (i) a registration statement under the
Securities Act (the "Exchange Registration Statement") registering an issue of
senior subordinated notes of the Company (the "Exchange Notes") which are
identical in all material respects to the Securities (except that the Exchange
Notes will not contain terms with respect to transfer restrictions or liquidated
damages) and (ii) under certain limited circumstances, a shelf registration
statement with respect to the resale of the Securities pursuant to Rule 415
under the Securities Act (the "Shelf Registration Statement"). This Agreement,
the Indenture, the Notes, the Exchange Notes and the Registration Rights
Agreement are collectively referred to herein as the "Offering Agreements."
The Securities are being sold in connection with (i) the merger of P.T.
Holding, Inc., a Delaware corporation ("P.T. Holding") and PureTec Corporation,
a Delaware corporation ("PureTec"), with PureTec continuing as the surviving
corporation (the "Merger"), all pursuant to an Agreement and Plan of Merger
(together with all related documents and agreements, the "Merger Agreement")
dated as of November 11, 1997 among the Company, P.T. Holding, PureTec and
Plastic Specialties & Technologies, Inc. ("PS&T", and together with each of
PureTec's other direct and indirect subsidiaries, the "PureTec Subsidiaries"),
(ii) the execution of a Credit Agreement (together with all related documents
and agreements, the "Credit Agreement") providing for a $50 million term loan
facility (the "A Term Loan Facility"), a $65 million term loan facility (the "B
Term Loan Facility" and together with the A Term Loan Facility, the "Term Loan
Facilities") and a $90 million revolving credit facility (the "Revolving Credit
Facility" and together with the Term Loan Facilities, the "Bank Financing") and
(iii) a consent solicitation and tender offer (the "Debt Tender Offer") by PS&T
for all of its outstanding 11.25% senior secured notes due 2003 (the "PS&T
Notes") pursuant to an offer to purchase and consent solicitation statement (the
"Offer to Purchase"). Pursuant to the Merger Agreement, simultaneously with the
Merger, PureTec will repay and, except as set forth in the Offering Memorandum
referred to below, will cause each of its subsidiaries to repay substantially
all of its and their outstanding debt (the "Debt Retirement"). PS&T has also
agreed to eliminate its 4% minority shareholders' interest concurrently with or
prior to the Merger (the "PS&T Minority Buyout" and together with the Debt
Retirement, the "Related Transactions"). Pursuant to the Debt Tender Offer, PS&T
will amend the indenture and related security agreements governing the PS&T
Notes to delete or amend such provisions as Tekni-Plex requires (the
"Supplemental Indenture"). The Merger, the Bank Financing, the Debt Tender Offer
and the Related Transactions are collectively referred to herein as the
"Transactions". The Merger Agreement, the Credit Agreement, the Offer to
Purchase and the Supplemental Indenture, in each case, together with all related
documents and agreements, are referred to herein as the "Transaction Documents."
PureTec and the PureTec Subsidiaries are collectively referred to as the
"PureTec Companies". The date of the filing of a merger certificate (the "Merger
Certificate") in connection with the Merger shall be referred to as the
"Effectiveness Date".
The Company and the Guarantors hereby agree, jointly and severally,
with the Initial Purchaser as follows:
1. The Company agrees to issue and sell the Notes and the Guarantors
agree to issue the Guarantees to the Initial Purchaser as hereinafter provided,
and the Initial Purchaser, upon the basis of the representations and warranties
herein contained, but subject to the conditions hereinafter stated, agrees to
purchase from the Company all of the Securities at a price (the "Purchase
Price") equal to 97.25% of their principal amount. No additional consideration
shall be paid by the Initial Purchaser for the Guarantee.
2. The Company and the Guarantors understand that the Initial Purchaser
intends (x) to offer privately the Securities as soon after this Agreement has
become effective as in the judgment of the Initial Purchaser is advisable and
(y) initially to offer the Securities upon the terms set forth in the Offering
Memorandum (as defined below).
The Company and the Guarantors confirm that they have authorized the
Initial Purchaser, subject to the restrictions set forth below, to distribute
copies of the Offering Memorandum in connection with the offering of the
Securities. The Initial Purchaser hereby makes to the Company and the Guarantors
the following representations and agreements:
(i) it is a qualified institutional buyer within the meaning of
Rule 144A under the Act; and
(ii) (A) it will not solicit offers for, or offer to sell, the
Securities by any form of general solicitation or general advertising
(as those terms are used in Regulation D under the Act) or in any
manner involving a public offering within the meaning of Section 4(2)
of the Act, (B) it will solicit offers for the Securities only from,
and will offer, sell or deliver the Securities only to, (1) persons
whom it reasonably believes to be "qualified institutional buyers"
within the meaning of Rule 144A under the Act to whom notice has been
given that such offer, sale or delivery is being made in reliance on
Rule 144A in transactions under Rule 144A or (2) upon the terms and
conditions set forth in Annex I to this Agreement, and (C) it is not
purchasing with a view to or for offer or sale in connection with any
distribution that would be in violation of federal or state law.
3. Payment for the Securities shall be made by wire transfer in
immediately available funds, to the account specified by the Company to the
Initial Purchaser no later than noon on the Business Day (as defined below)
prior to the Closing Date (as defined below), on March 3, 1998, or at such other
time on the same or such other date, not later than the fifth Business Day
thereafter, as the Initial Purchaser and the Company may agree upon in writing.
The time and date of such payment are referred to herein as the "Closing Date".
As used herein, the term "Business Day" means any day other than a day on which
banks are permitted or required to be closed in New York City.
Payment for the Securities shall be made against delivery to the
nominee of The Depository Trust Company for the account of the Initial Purchaser
of one or more global notes representing the Securities (collectively, the
"Global Notes"), with any transfer taxes payable in connection with the transfer
to the Initial Purchaser of the Securities duly paid by the Company. The Global
Notes will be made available for inspection by the Initial Purchaser at the
office of X.X. Xxxxxx Securities Inc. at the address set forth above, or at such
other location as the Company and the Initial Purchaser agree, not later than
1:00 P.M., New York City time, on the Business Day prior to the Closing Date.
4. Each of the Company and each Guarantor represents and warrants to
the Initial Purchaser that:
(a) a preliminary offering memorandum, dated February 10, 1998
(the "Preliminary Offering Memorandum") and an offering memorandum,
dated February 25, 1998 (the "Offering Memorandum") have been prepared
in connection with the offering of the Securities. Any reference to the
Preliminary Offering Memorandum or the Offering Memorandum shall be
deemed to refer to and include any Rule 144A(d)(4) Information (as
defined in Section 5(m)) furnished by the Company prior to the
completion of the distribution of the Securities. The Preliminary
Offering Memorandum or the Offering Memorandum and any amendments or
supplements thereto did not and will not, as of their respective dates,
contain an untrue statement of a material fact or omit to state a
material fact necessary in order to make the statements therein, in the
light of the circumstances under which they were made, not misleading;
provided that this representation and warranty does not apply to
statements or omissions made in reliance upon and in conformity with
information furnished in writing by the Initial Purchaser relating to
the Initial Purchaser to the Company expressly for use in the
Preliminary Offering Memorandum, the Offering Memorandum or any
amendment or supplement thereto;
(b) the financial statements, and the related notes thereto,
included in the Offering Memorandum present fairly the consolidated
financial position of each of the Company and its consolidated
subsidiaries and of PureTec and its consolidated subsidiaries, as of
the dates indicated and the results of their operations and the changes
in their consolidated cash flows for the periods specified; said
financial statements have been prepared in conformity with generally
accepted accounting principles and practices applied on a consistent
basis; and the pro forma financial information, and the related notes
thereto, included in the Offering Memorandum are based upon good faith
estimates and assumptions believed by the Company to be reasonable;
(c) since the respective dates as of which information is
given in the Offering Memorandum, except as otherwise stated therein,
there has not been any material change in the capital stock or
long-term debt of the Company or its subsidiaries, or any material
adverse change, or any development involving a prospective material
adverse change, in or affecting the business, condition (financial or
other), results of operations or prospects of PureTec and its
subsidiaries or the Company and its subsidiaries and PureTec and its
subsidiaries, taken as a whole (a "Material Adverse Change" or
"Prospective Material Adverse Change", respectively), otherwise than as
set forth or contemplated in the Offering Memorandum; and except as set
forth or contemplated in the Offering Memorandum, neither the Company,
the Existing Subsidiaries, nor, to the best of the Company's knowledge,
any of the PureTec Companies has entered into any transaction or
agreement (whether or not in the ordinary course of business) material
to PureTec and its subsidiaries or to the Company and its subsidiaries
and PureTec and its subsidiaries, taken as a whole;
(d) the Company has been duly incorporated and is validly
existing as a corporation under the laws of its jurisdiction of
incorporation, with power and authority (corporate and other) to own
its properties and conduct its business as described in the Offering
Memorandum, and has been duly qualified as a foreign corporation for
the transaction of business and is in good standing under the laws of
each other jurisdiction in which it owns or leases properties, or
conducts any business, so as to require such qualification, other than
where the failure to be so qualified or in good standing would not have
a material adverse effect on the business, condition (financial or
other), results of operations or prospects of PureTec and its
subsidiaries and the Company and its subsidiaries, taken as a whole or,
if applicable, PureTec and its subsidiaries (a "Material Adverse
Effect");
(e) the Company has no subsidiaries other than P.T. Holding,
PurePlast, Inc., a Canadian corporation and PurePlast Acquisition
Corp., a Canadian corporation (together, the "Existing Subsidiaries")
and Dolco Packaging Ltd., a Canadian corporation which is currently
being dissolved; each of the Existing Subsidiaries has been duly
incorporated and is validly existing as a corporation under the laws of
its jurisdiction of incorporation, with power and authority (corporate
and other) to own its properties and conduct its business as described
in the Offering Memorandum, and has been duly qualified as a foreign
corporation for the transaction of business and is in good standing
under the laws of each jurisdiction in which its owns or leases
properties or conducts any business, so as to require such
qualification, other than where the failure to be so qualified or in
good standing would not have a Material Adverse Effect; and all the
outstanding shares of capital stock of the Existing Subsidiaries has
been duly authorized and validly issued, are fully-paid and
non-assessable under the corporate laws of the jurisdiction of
incorporation, and (except as described in the Offering Memorandum)
owned by the Company free and clear of all liens, encumbrances,
security interests and claims;
(f) this Agreement has been duly authorized, executed and
delivered by each of the Company and P.T. Holding and, as of the
Effectiveness Date, will have been duly authorized, executed and
delivered by the Guarantors;
(g) the Registration Rights Agreement has been duly authorized
by each of the Company and, as of the Effectiveness Date, will have
been duly authorized by the Guarantors, and when executed and delivered
by them and (assuming the due authorization, execution and delivery by
the other party thereto) will constitute a valid agreement of each of
the parties thereto and, subject to (i) the effect of applicable
bankruptcy, insolvency, reorganization, moratorium, fraudulent
conveyance and other laws affecting creditors' rights generally, (ii)
general principles of equity and (iii) principles of public policy
limiting the rights to enforce indemnification provisions (clauses (i),
(ii) and (ii) being referred to herein as the "Creditors' Rights
Limitations"), will be binding and will be enforceable in accordance
with its terms; and will conform, in all material respects, to the
description thereof in the Offering Memorandum;
(h) the Notes and the Exchange Notes have been duly authorized
by the Company, and when issued and delivered pursuant to this
Agreement (and the Registration Rights Agreement in the case of the
Exchange Notes), will have been duly executed, issued and delivered
and, when the Notes and the Exchange Notes are authenticated by the
Trustee in accordance with the terms of the Indenture (assuming the due
authorization, execution and delivery by the Trustee) and are delivered
to and paid for by the Initial Purchaser in accordance with the terms
of this Agreement (and the Registration Rights Agreement in the case of
the Exchange Notes), will constitute valid obligations of the Company
entitled to the benefits provided by the Indenture and, subject to the
Creditors' Rights Limitations, will be binding and will be enforceable
in accordance with their terms; the Indenture has been duly authorized
by the Company and, when executed and delivered by each of the Company
and the Guarantors (assuming the due authorization, execution and
delivery by the Trustee), the Indenture will constitute a valid
instrument of the Company and, subject to the Creditors' Rights
Limitations, will be binding and will be enforceable in accordance with
its terms; and the Securities and the Indenture will conform, in all
material respects, to the descriptions thereof in the Offering
Memorandum;
(i) the Guarantee as of the Effectiveness Date will have been
duly authorized by the Guarantors, and when the Notes or Exchange
Notes, as the case may be, are issued and delivered pursuant to this
Agreement (and the Registration Rights Agreement in the case of the
Exchange Notes), will have been duly executed and delivered and, when
the Notes or Exchange Notes, as the case may be, are authenticated by
the Trustee in accordance with the terms of the Indenture (assuming the
due authorization, execution and delivery by the Trustee) and are
delivered to and paid for by the Initial Purchaser in accordance with
the terms of this Agreement (and the Registration Rights Agreement in
the case of the Exchange Notes), will constitute a valid obligation of
the Guarantors and, subject to the Creditors' Rights Limitations, will
be binding and will be enforceable in accordance with its terms; the
Indenture as of the Effectiveness Date, will have been duly authorized
by the Guarantors and, when executed and delivered by each of the
Guarantors and the Company (assuming the due authorization, execution
and delivery by the Trustee), the Indenture will constitute a valid
instrument of each such Guarantor and, subject to the Creditors' Rights
Limitations, will be binding and will be enforceable in accordance with
its terms;
(j) each of the Company and P.T. Holding has the corporate
power and authority to execute and deliver the Merger Agreement and
Credit Agreement (to the extent each is a party thereto) and to perform
its obligations, thereunder; all action to be taken by the Company,
P.T. Holding or the PureTec Companies for the due and proper
authorization, execution and delivery of each of the Transaction
Documents to which it is a party and the consummation of the
transactions contemplated thereby have been duly and validly taken or,
with respect to the PureTec Companies, will have been taken as of the
Effectiveness Date; and when executed and delivered by each of the
parties thereto, each of the Transaction Documents will constitute a
valid instrument or agreement of each of the Company and the
Guarantors, as the case may be, and subject to the Creditors' Rights
Limitations, will be binding and enforceable in accordance with its
terms; and the Transaction Documents conform, in all material respects,
to the descriptions thereof in the Offering Memorandum;
(k) none of the transactions contemplated by this Agreement
(including, without limitation, the use of the proceeds from the sale
of the Securities) will violate or result in a violation of Section 7
of the Securities Exchange Act of 1934, as amended (the "Exchange
Act"), or any regulation promulgated thereunder, including, without
limitation, Regulations G, T, U, and X of the Board of Governors of the
Federal Reserve System;
(l) neither the Company nor any Existing Subsidiary is, or
with the giving of notice or lapse of time or both would be, in
violation of or in default under its Certificate of Incorporation or
By-Laws (or similar organizational documents) or any indenture,
mortgage, deed of trust, loan agreement or other agreement or
instrument to which it is a party or by which it or any of its
properties is bound, except for violations and defaults which
individually and in the aggregate would not have a Material Adverse
Effect or are not material to the holders of the Securities as such;
the issue and sale of the Securities and the performance by each of the
Company and the Guarantors of all of the provisions of their
obligations under the Securities, the Indenture, the Registration
Rights Agreement and this Agreement and the consummation of the
transactions herein and therein contemplated will not conflict with or
result in a breach of any of the terms or provisions of, or constitute
a default under, any indenture, mortgage, deed of trust, loan agreement
or other agreement or instrument to which the Company or any Guarantor
is a party or by which the Company or any Guarantor is bound or to
which any of the property or assets of the Company or any Guarantor is
subject, except such as would not have a Material Adverse Effect, nor
will any such action result in any violation of the provisions of the
Certificate of Incorporation or By-Laws of the Company or any Guarantor
or (assuming the accuracy of the representations by, and compliance
with the agreements of, the Initial Purchaser set forth in paragraph 2
of this Agreement) any applicable law or statute or any order, rule or
regulation of any court or governmental agency or body having
jurisdiction over the Company, any Guarantor or any of their respective
properties; and no consent, approval, authorization, order, license,
registration or qualification of or with any such court or governmental
agency or body is required for the issue and sale of the Securities or
the consummation by the Company or any Guarantor of the transactions
contemplated by this Agreement or the Indenture, except such consents,
approvals, authorizations, registrations or qualifications as may be
required under any state securities or Blue Sky Laws in connection with
the purchase and distribution of the Securities by the Initial
Purchaser and except as such as would not have a Material Adverse
Effect;
(m) other than as set forth or contemplated in the Offering
Memorandum, there are no legal or governmental investigations, actions,
suits or proceedings pending or, to the knowledge of the Company,
threatened against or affecting the Company or any Existing Subsidiary
or any of their respective properties or to which the Company or any
Existing Subsidiary is or may be a party or to which any property of
the Company or any Existing Subsidiary is or may be the subject which
could individually or in the aggregate have, or reasonably be expected
to have, a Material Adverse Effect and, to the best of the Company's
knowledge, no such proceedings are threatened or contemplated by
governmental authorities or threatened by others;
(n) neither the Company nor any affiliate (as defined in Rule
501(b) of Regulation D under the Act ("Regulation D")) of the Company
has directly, or through any agent, sold, offered for sale, solicited
offers to buy or otherwise negotiated in respect of, any security (as
defined in the Act) which is or will be integrated with the sale of the
Securities in a manner that would require the registration under the
Act of the offering contemplated by the Offering Memorandum;
(o) neither the Company, the Guarantors nor any person (other
than the Initial Purchaser, as to which the Company makes no
representation) acting on their behalf has offered or sold the
Securities by means of any general solicitation or general advertising
within the meaning of Rule 502(c) under the Act or, with respect to
Securities sold outside the United States to non-U.S. persons (as
defined in Rule 902 under the Act), by means of any directed selling
efforts within the meaning of Rule 902 under the Act and the Company,
the Guarantors and any of their affiliates and any person (other than
the Initial Purchaser) acting on their behalf has complied with and
will implement the "offering restriction" within the meaning of such
Rule 902;
(p) the Company is not, and will not be after giving effect to
the offering and sale of the Securities to be sold and the application
of the proceeds from such sale (as described in the Offering Memorandum
under the caption "Use of Proceeds"), an "investment company" as such
term is defined in the Investment Company Act of 1940, as amended;
(q) assuming that the representations of the Initial Purchaser
set forth in paragraph 2 of this Agreement are true, correct and
complete and assuming compliance by the Initial Purchaser with its
agreements in paragraph 2 of this Agreement, it is not necessary in
connection with the offer, sale and delivery of the Securities in the
manner contemplated by this Agreement to register the Securities under
the Act or to qualify an indenture under the Trust Indenture Act of
1939, as amended (the "TIA");
(r) the Securities satisfy the requirements set forth in Rule
144A(d)(3) under the Act;
(s) BDO Xxxxxxx, LLP, who has certified certain financial
statements of the Company and its subsidiaries and Deloitte & Touche
LLP, who has certified certain financial statements of PureTec
Corporation and its subsidiaries and PS&T and its subsidiaries, are
independent public accountants as required by the Act;
(t) the Company and the Existing Subsidiaries have good and
marketable title in fee simple to all material items of real property
and good and marketable title to all material personal property owned
by them, in each case free and clear of all liens, encumbrances and
defects except such as are otherwise described or referred to in the
Offering Memorandum or such as do not interfere with the use made or
proposed to be made of such property by the Company and the Existing
Subsidiaries; and any real property and buildings held under lease by
the Company or the Existing Subsidiaries are held by them under valid,
existing and enforceable leases (subject to the Creditors' Rights
Limitations) with such exceptions as are not material and do not
interfere with the use made or proposed to be made of such property and
buildings by the Company or the Existing Subsidiaries. The Company and
the Existing Subsidiaries own or possess, or have no reason to believe
they cannot acquire on reasonable terms, adequate licenses or other
rights to use all patents, trademarks, service marks, trade names,
copyrights and know-how necessary to conduct the businesses now or
proposed to be operated by them as described in the Offering
Memorandum, except where the failure to own, possess or have the
ability to acquire any such licenses or other rights could not,
individually or in the aggregate, be reasonably expected to have a
Material Adverse Effect, and neither the Company nor any Existing
Subsidiary has received any written or, to the best knowledge of the
Company, oral notice of infringement of or conflict with asserted
rights of others with respect to any patents, trademarks, service
marks, trade names, copyrights or know-how which, if such assertion of
infringement or conflict were sustained, would have a Material Adverse
Effect;
(u) the Company and the Existing Subsidiaries have filed all
federal, state, local and foreign tax returns which have been required
to be filed and have paid all taxes shown thereon and all assessments
received by them or any of them to the extent that such taxes have
become due and are not being contested in good faith, and, except as
disclosed in the Offering Memorandum, the Company has no knowledge of
any material tax deficiency which has been or might reasonably be
expected to be asserted or threatened against the Company;
(v) each of the Company and each Existing Subsidiary owns,
possesses or has obtained all material licenses, permits, certificates,
consents, orders, approvals and other authorizations from, and has made
all declarations and filings with, all federal, state, local and other
governmental authorities (including foreign regulatory agencies), all
self-regulatory organizations and all courts and other tribunals,
domestic or foreign, necessary to own or lease, as the case may be, and
to operate its properties and to carry on its business as conducted as
of the date hereof, except to the extent that the failure to so obtain
or file, individually or in the aggregate, could not reasonably be
expected to have a Material Adverse Effect, and neither the Company nor
any Existing Subsidiary has received any actual notice, or is not
aware, of any proceeding relating to revocation or modification of any
such license, permit, certificate, consent, order, approval or other
authorization, except as described in the Offering Memorandum; and each
of the Company and each Existing Subsidiary is in compliance with all
laws and regulations relating to the conduct of its business as of the
date hereof;
(w) there are no existing or, to the best knowledge of the
Company, threatened labor disputes with the employees of the Company
and the Existing Subsidiaries which are likely to have a Material
Adverse Effect;
(x) each of the Company and each Existing Subsidiary (i) is in
compliance with any and all applicable federal, state and local laws
and regulations relating to the protection of human health and safety,
the environment or hazardous or toxic substances or wastes, pollutants
or contaminants ("Environmental Laws"), (ii) has received all permits,
licenses or other approvals required of it under applicable
Environmental Laws to conduct its business and (iii) is in compliance
or is in the process of complying with all terms and conditions of any
such permit, license or approval, except where such noncompliance with
Environmental Laws, failure to receive required permits, licenses or
other approvals or failure to comply with the terms and conditions of
such permits, licenses or approvals would not, individually or in the
aggregate, reasonably be expected to have a Material Adverse Effect;
associated costs and liabilities (including, without limitation, any
capital or operating expenditures required for clean-up, closure of
properties or compliance with Environmental Laws or any permit, license
or approval, any related constraints on operating activities and any
potential liabilities to third parties) would not, individually or in
the aggregate, reasonably be expected to have a Material Adverse
Effect; and
(y) each employee benefit plan, within the meaning of Section
3(3) of the Employee Retirement Income Security Act of 1974, as amended
("ERISA"), that is maintained, administered or contributed to by the
Company or any affiliates of the Company for employees or former
employees of the Company and its affiliates has been maintained, in all
material respects, in compliance with its terms and the requirements of
any applicable statutes, orders, rules and regulations, including but
not limited to ERISA and the Internal Revenue Code of 1986, as amended
(the "Code"); no prohibited transaction, within the meaning of Section
406 of ERISA or Section 4975 of the Code has occurred with respect to
any such plan excluding transactions effected pursuant to a statutory
or administrative exemption and excluding transactions which would not
have a Material Adverse Effect; and for each such plan which is subject
to the funding rules of Section 412 of the Code or Section 302 of ERISA
no "accumulated funding deficiency" as defined in Section 412 of the
Code has been incurred, whether or not waived, and the fair market
value of the assets of each such plan which is subject to Title IV of
ERISA (excluding for these purposes accrued but unpaid contributions)
exceeded the present value of all benefits accrued under such plan as
determined using reasonable actuarial assumptions.
(z) to the best knowledge of the Company, each of the
representations and warranties made by PureTec in the Merger Agreement
are true and correct in all material respects and except to the extent
previously disclosed to the Initial Purchaser and counsel for the
Initial Purchaser in environmental audit reports.
5. Each of the Company and each Guarantor covenants and agrees with the
Initial Purchaser as follows:
(a) before distributing any amendment or supplement to the
Offering Memorandum, to furnish to the Initial Purchaser a copy of the
proposed amendment or supplement for review and not to distribute any
such proposed amendment or supplement to which the Initial Purchaser
reasonably objects;
(b) if, at any time prior to the completion of the initial
placement of the Securities, any event shall occur as a result of which
it is necessary to amend or supplement the Offering Memorandum in order
that the Offering Memorandum does not contain an untrue statement of a
material fact or omit to state a material fact necessary in order to
make the statements therein, in the light of the circumstances when the
Offering Memorandum is delivered to a purchaser, not misleading, or if
it is necessary to amend or supplement the Offering Memorandum to
comply with law, forthwith to prepare and furnish, at the expense of
the Company, to the Initial Purchaser and to the dealers (whose names
and addresses the Initial Purchaser will furnish to the Company) to
which Securities may have been sold by the Initial Purchaser on behalf
of the Initial Purchaser and to any other dealers upon request, such
amendments or supplements to the Offering Memorandum as may be
necessary so that the Offering Memorandum as so amended or supplemented
will not contain an untrue statement of a material fact or omit to
state a material fact necessary in order to make the statements
therein, in the light of the circumstances when the Offering Memorandum
is delivered to a purchaser, not misleading or so that the Offering
Memorandum will comply with law;
(c) to cooperate with you and your counsel in connection with
the registration or qualification of the Securities for offering and
sale by the Initial Purchaser and by dealers under the securities or
Blue Sky laws of such jurisdictions as you may designate and will file
such consents to service of process or other documents necessary or
appropriate in order to effect such registration or qualification;
provided that in no event shall the Company or the Guarantors be
obligated to qualify to do business in any jurisdiction where it is not
now so qualified or to take any action that would subject it to
taxation or service of process in suits, other than those arising out
of the Offering or sale of the Securities, in any jurisdiction where it
is not now so subject;
(d) so long as the Securities are outstanding, to furnish to
the Initial Purchaser copies of all reports or other communications
(financial or other) furnished to holders of Securities, and copies of
any reports and financial statements furnished to or filed with the
Commission or any national securities exchange;
(e) during the period beginning on the date hereof and
continuing to and including the Business Day following the Closing
Date, not to offer, sell, contract to sell, or otherwise dispose of any
debt securities of or guaranteed by the Company or the Guarantors which
are substantially similar to the Securities;
(f) to use the net proceeds received by the Company from the
sale of the Securities pursuant to this Agreement in the manner
specified in the Offering Memorandum under the caption "Use of
Proceeds";
(g) if requested by you, to use its best efforts to cause such
Securities to be eligible for the PORTAL trading system of the National
Association of Securities Dealer, Inc.;
(h) to furnish to the holders of the Securities as soon as
practicable after the end of each fiscal year an annual report
(including a balance sheet and statements of income, stockholders'
equity and cash flows of the Company and its consolidated subsidiaries
certified by independent public accountants) and, as soon as
practicable after the end of each of the first three quarters of each
fiscal year (beginning with the fiscal quarter ending after the date of
the Offering Memorandum), consolidated summary financial information of
the Company and its subsidiaries of such quarter in reasonable detail;
(i) during the period of two years after the Closing Date, not
to, and to use its best efforts not to permit any of its "affiliates"
(as defined in Rule 144 under the Act) to, resell any of the Securities
which constitute "restricted securities" under Rule 144 that have been
reacquired by any of them;
(j) whether or not the transactions contemplated by this
Agreement are consummated or this Agreement is terminated and in
addition to any obligations they may have under any other agreements
with you and/or your affiliates, to pay or cause to be paid all costs
and expenses incident to the performance of their obligations
hereunder, including without limiting the generality of the foregoing,
all costs and expenses (i) incident to the preparation, issuance,
execution, authentication and delivery of the Securities, including any
expenses of the Trustee, (ii) incident to the preparation, printing and
distribution of the Offering Memorandum and any preliminary offering
memorandum (including in each case all exhibits, amendments and
supplements thereto), (iii) incurred in connection with the
registration or qualification and determination of eligibility for
investment of the Securities under the laws of such jurisdictions as
the Initial Purchaser may designate (including fees of counsel for the
Initial Purchaser and their disbursements), (iv) in connection with the
application for eligibility for trading of the Securities in the PORTAL
trading system, (v) in connection with the printing (including word
processing and duplication costs) and delivery of this Agreement, the
Indenture, the Registration Rights Agreement, the Preliminary and
Supplemental Blue Sky Memoranda and any Legal Investment Survey and the
furnishing to the Initial Purchaser and dealers of copies of the
Offering Memorandum, including mailing and shipping, as herein
provided, (vi) payable to rating agencies in connection with the rating
of the Securities, and (vii) incurred by the Company in connection with
a "road show" presentation to potential investors;
(k) to take all reasonable action that is appropriate or
necessary to assure that its offerings of other securities will not be
integrated for purposes of the Act with the offerings contemplated
hereby;
(l) not to solicit any offer to buy or offer to sell
Securities by means of any form of general solicitation or general
advertising within the meaning of Rule 502(c) of Regulation D under the
Act;
(m) while the Securities remain outstanding and are
"restricted securities" within the meaning of Rule 144(a)(3) under the
Act, during any period in which it is not subject to Section 13 or
15(d) under the Exchange Act, to make available to the Initial
Purchaser and any holder of Securities in connection with any sale
thereof and any prospective purchaser of Securities, in each case upon
request, the information specified in, and meeting the requirements of,
Rule 144A(d)(4) ("Rule 144A(d)(4) Information") under the Act (or any
successor thereto); and
(n) not to take any action prohibited by Regulation M under
the Exchange Act (or any successor provision), in connection with the
distribution of the Securities contemplated hereby.
6. The obligations of the Initial Purchaser hereunder to purchase the
Securities on the Closing Date are subject to the performance, in all material
respects, by each of the Company and the Guarantors of their obligations
hereunder and to the following additional conditions:
(a) the representations and warranties of each of the Company
and the Guarantors contained herein are true and correct on and as of
the Closing Date as if made on and as of the Closing Date and each of
the Company and the Guarantors shall have complied, in all material
respects, with all agreements and all conditions on its part to be
performed or satisfied hereunder at or prior to the Closing Date;
(b) subsequent to the execution and delivery of this Agreement
and prior to the Closing Date, there shall not have occurred any
downgrading, nor shall any notice have been given of (i) any
downgrading, (ii) any intended or potential downgrading or (iii) any
review or possible change that does not indicate an improvement, in the
rating accorded any securities of or guaranteed by the Company by any
"nationally recognized statistical rating organization", as such term
is defined for purposes of Rule 436(g)(2) under the Act;
(c) since the respective dates as of which information is
given in the Offering Memorandum, except as otherwise stated therein,
there shall not have been any material change in the capital stock or
long-term debt of any of the Company or the Guarantors or any Material
Adverse Change, or any development involving a Prospective Material
Adverse Change, otherwise than as set forth or contemplated in the
Offering Memorandum, the effect of which in the judgment of the Initial
Purchaser makes it impracticable or inadvisable to proceed with the
offering or the delivery of the Securities on the Closing Date on the
terms and in the manner contemplated in the Offering Memorandum; and
neither the PureTec Companies, the Company nor the Existing
Subsidiaries has sustained since the date of the latest audited
financial statements included in the Offering Memorandum any loss or
interference with its respective business from fire, flood, hurricane,
accident or other calamity, whether or not covered by insurance, or
from any labor dispute or legal or governmental proceeding, which loss
or interference, in the judgment of the Initial Purchaser, has had or
has a Material Adverse Effect, otherwise than as set forth or
contemplated in the Offering Memorandum;
(d) the Initial Purchaser shall have received on and as of the
Closing Date a certificate of the Company signed for the Company by an
executive officer of the Company, with specific knowledge about the
Company's and Guarantors' financial matters, satisfactory to the
Initial Purchaser to the effect set forth in subsections (a) and (b) of
this Section and to the further effect that there has not occurred any
Material Adverse Change, or any development involving a Prospective
Material Adverse Change, from those set forth or contemplated in the
Offering Memorandum;
(e) Xxxxx Xxxx & Xxxxxxxx, Counsel for the Company, shall have
furnished to the Initial Purchaser their written opinion, dated the
Closing Date in form and substance satisfactory to the Initial
Purchaser, to the effect that:
(i) the Company has been duly organized and is validly
existing as a corporation in good standing under the laws of
Delaware with the corporate power and authority to own its
properties and conduct its business as described in the
Offering Memorandum;
(ii) each Guarantor listed on Schedule A is a corporation
validly existing under the laws of its jurisdiction of
incorporation with power and authority to enter into this
Agreement, the Registration Rights Agreement, the Indenture
and the Guarantee;
(iii) to such counsel's knowledge, other than as set forth or
contemplated in the Offering Memorandum, there are no legal or
governmental investigations, actions, suits or proceedings (i)
pending or threatened against or affecting the Company or the
Guarantors or any of their respective properties or to which
the Company or any Guarantor is or may be a party or to which
any property of the Company or any Guarantor is or may be the
subject which, if determined adversely to the Company or such
Guarantor, could individually or in the aggregate have, or
reasonably be expected to have, a Material Adverse Effect or
(ii) which seek to restrain, enjoin, prevent the consummation
of or otherwise challenge the issuance or sale of the
Securities in the manner contemplated by the Offering
Memorandum or the consummation of the Offering or the
Transactions; to such counsel's knowledge, no such proceedings
are threatened or contemplated by governmental authorities or
threatened by others;
(iv) this Agreement has been duly authorized, executed and
delivered by each of the Company and each Guarantor listed on
Schedule A; the Registration Rights Agreement has been duly
authorized, executed and delivered by each of the Company and
each Guarantor listed on Schedule A and is a valid agreement
of each of the Company and each such Guarantor and, subject to
the Creditors' Rights Limitations, is binding and is
enforceable in accordance with its terms;
(v) the Guarantee has been duly authorized, executed and
delivered by each Guarantor listed on Schedule A and, and upon
delivery to and payment for the Notes by the Initial Purchaser
in accordance with the terms of this Agreement, will
constitute a valid obligation of each such Guarantor and,
subject to the Creditors' Rights Limitations, is binding and
is enforceable against each such Guarantor in accordance with
its terms;
(vi) the Notes have been duly authorized, executed and
delivered by the Company and, when duly authenticated in
accordance with the terms of the Indenture and delivered to
and paid for by the Initial Purchaser in accordance with the
terms of this Agreement, will constitute valid obligations of
the Company entitled to the benefits provided by the Indenture
and, subject to the Creditors' Rights Limitations, are binding
and are enforceable against the Company in accordance with
their terms;
(vii) the Indenture has been duly authorized, executed and
delivered by the Company and each Guarantor listed on Schedule
A and (assuming the due authorization, execution and delivery
by the Trustee) constitutes a valid agreement of the Company
and each such Guarantor and, subject to the Creditors' Rights
Limitations, is binding and is enforceable against the Company
and each such Guarantor, respectively, in accordance with its
terms;
(viii) the Merger Agreement and the Credit Agreement have
been duly authorized, executed and delivered by the Company
and the Existing Subsidiaries (to the extent such person is a
party thereto), and is a valid agreement of each of the
Company and such Existing Subsidiary, as the case may be, and,
subject to the Creditors' Rights Limitations, the Merger
Agreement and the Credit Agreement are binding and are
enforceable in accordance with its terms. The Merger has
become effective in accordance with the law of the State of
Delaware;
(ix) other than the subject matter of subparagraphs (x) and
(xiv), the issue and sale of the Securities and the
performance by the Company and the Guarantors of their
obligations under the Securities, the execution and delivery
of this Agreement, the Indenture and the Registration Rights
Agreement and the consummation by the Company and the
Guarantors of the transactions contemplated hereby and thereby
will not conflict with or constitute or result in a breach or
a default under or violation of any of (i) the terms or
provisions of any indenture, mortgage, deed of trust, loan
agreement or other material agreement or instrument known to
such counsel to which the Company or such Guarantor is a party
or by which they or any of their properties is known by such
counsel to be bound except as such as would not have a
Material Adverse Effect, (ii) the Certificate of Incorporation
or By-Laws of the Company or such Guarantor, or (iii) any
applicable federal or New York statute or, to the best of such
counsel's knowledge, any federal or New York order, rule or
regulation of any federal or New York governmental agency or
body having jurisdiction over the Company, the Guarantors or
any of their respective properties or any judgment, decree or
order of any court to which the Company or such Guarantor is a
named party;
(x) other than the subject matter of paragraph (xi), to their
knowledge, no consent, approval, authorization, order,
license, registration or qualification of or with any court or
governmental agency or body is required for the issue and sale
of the Securities or the consummation of the other
transactions contemplated by this Agreement or the Indenture,
except as may be required under state securities or Blue Sky
laws in connection with the purchase and distribution of the
Securities or the Exchange Notes or the federal securities
laws with respect to the Exchange Notes;
(xi) no registration under the Act of the Securities is
required in connection with the sale of the Securities to the
Initial Purchaser as contemplated by this Agreement and the
Offering Memorandum or in connection with the initial resale
of the Securities by the Initial Purchaser in accordance with
Section 2 (including Annex I) of this Agreement, and prior to
the commencement of the Exchange Offer or the effectiveness of
the Shelf Registration Statement, the Indenture is not
required to be qualified under the TIA, in each case assuming
(i) that the purchasers who buy the Securities in the initial
resales are qualified institutional buyers (as defined in Rule
144A under the Act) or non-U.S. Persons (as defined in Rule
902 under the Act) and (ii) the accuracy of the Initial
Purchaser's representations and those of the Company and the
Guarantor contained in this Agreement regarding the absence of
a general solicitation in connection with the sale of the
Securities to the Initial Purchaser and the initial resales
thereof (it being understood that such counsel need express no
opinion as to any subsequent resale of any Notes);
(xii) the Securities satisfy the requirements set forth in
Rule 144A(d)(3) under the Act;
(xiii) the statements in the Offering Memorandum under
"Business -- Legal Proceedings and Environmental Matters -
Tekni-Plex," "Description of Notes," and "Certain United
States Federal Income Tax Considerations," insofar as such
statements constitute a description of the legal matters,
documents or proceedings referred to therein, fairly present
the information called for with respect to such legal matters,
documents or proceedings;
(xiv) on the basis stated below, no facts have come to the
attention of such counsel that lead such counsel to believe,
except for the financial statements, related financial
statement schedules, and other financial and statistical
information contained in the Offering Memorandum as to which
such counsel expresses no belief, that the Offering
Memorandum, as of its date of issuance and, as amended or
supplemented, if applicable, as of the Closing Date, contained
an untrue statement of a material fact or omitted to state a
material fact necessary in order to make the statements
therein, in the light of the circumstances under which they
were made, not misleading; and
(xv) the Company is not and, after giving effect to the
offering and sale of the Securities to be sold and the
application of the proceeds from such sale (as described in
the Offering Memorandum under the caption "Use of Proceeds")
will not be, an "investment company" as defined in the
Investment Company Act of 1940, as amended.
In rendering such opinions, such counsel may rely (A) as to
matters involving the application of laws other than the federal laws
of the United States, the corporate law of the State of Delaware and
the laws of the State of New York, to the extent such counsel deems
proper and to the extent specified in such opinion, if at all, upon an
opinion or opinions (reasonably satisfactory to the Initial Purchaser's
counsel) of other counsel, reasonably acceptable to the Initial
Purchaser's counsel, familiar with the applicable laws; and (B) as to
matters of fact, to the extent such counsel deems proper, on the
representations and warranties made by the Company and the Guarantors
herein, and certificates and statements of public officials and
officers and other representatives of the Company and the Guarantors
(and such counsel has not independently verified or investigated, nor
does such counsel assume any responsibility for, the factual accuracy
or completeness of such representations and warranties or certificates
or of such factual statements). The opinion of such counsel for the
Company shall state that the opinion of any such other counsel upon
which they relied is in form satisfactory to such counsel and, in such
counsel's opinion, the Initial Purchaser and they are justified in
relying thereon. With respect to the matters to be covered in
subparagraph (xiv) above counsel may state that their opinion and
belief is based upon their participation in the preparation of the
Offering Memorandum and any amendment or supplement thereto, and that
since such counsel has not conducted any independent investigation with
regard to the information set forth in the Offering Memorandum and any
amendment or supplement thereto, such counsel is not passing upon and
does not assume any responsibility for the accuracy, completeness or
fairness of the statements contained therein except with respect to the
opinions set forth in subparagraph (xiii) above.
The opinion of Xxxxx Xxxx & Xxxxxxxx described above shall be
rendered to the Initial Purchaser at the request of the Company and
shall so state therein.
(f) on the date of the issuance of the Offering Memorandum and
also on the Closing Date, BDO Xxxxxxx, LLP and Deloitte & Touche LLP
shall have furnished to the Initial Purchaser letters, dated the
respective dates of delivery thereof, in form and substance
satisfactory to you, containing statements and information of the type
customarily included in accountants "comfort letters" to underwriters
with respect to the financial statements and certain financial
information contained in the Offering Memorandum;
(g) the Company and the Guarantors shall have executed and
delivered the Registration Rights Agreement substantially in the form
attached hereto as Annex II;
(h) the Supplemental Indenture shall have been executed, the
Debt Tender Offer shall have been consummated, the PS&T Notes tendered
in the Debt Tender Offer shall have been accepted for payment and the
Related Transactions shall have occurred; the Company shall have
previously executed the Credit Agreement (as defined in the Offering
Memorandum) in form and substance reasonably satisfactory to the
Initial Purchaser and shall have funds available thereunder as
contemplated by the Offering Memorandum;
(i) all material conditions in the Merger Agreement required
to be performed on or prior to the Closing Date shall have been
satisfied and not waived or modified, all covenants in the Merger
Agreement shall have been satisfied in all material respects, all
representations and warranties contained in the Merger Agreement shall
be true and correct in all material respects, the Merger shall have
been consummated and the Merger Certificate shall have been filed with
the Secretary of State of the State of Delaware;
(j) an indenture supplement relating to the Company's existing
11 1/4% Senior Subordinated Notes due 2007 (the "11 1/4% Notes") shall
have been executed and delivered by the Guarantors as guarantors under
the 11 1/4% Notes in accordance with the terms thereof;
(k) the Initial Purchaser shall have received on and as of the
Closing Date an opinion of Xxxxxx Xxxxxx & Xxxxxxx, counsel to the
Initial Purchaser, with respect to the validity of the Indenture and
the Securities, and such other related matters as the Initial Purchaser
may reasonably request, and such counsel shall have received such
papers and information as they may reasonably request to enable them to
pass upon such matters; and
(l) on or prior to the Closing Date, the Company shall have
furnished to the Initial Purchaser such further certificates and
documents as the Initial Purchaser shall reasonably request.
7. Each of the Company and each Guarantor, jointly and severally,
agrees to indemnify and hold harmless the Initial Purchaser, each affiliate of
the Initial Purchaser which assists the Initial Purchaser in the distribution of
the Securities, its officers and directors, and each person, if any, who
controls the Initial Purchaser within the meaning of either Section 15 of the
Act or Section 20 of the Exchange Act, from and against any and all losses,
claims, damages and liabilities (including without limitation the legal fees and
other expenses reasonably incurred in connection with any suit, action or
proceeding or any claim asserted) caused by any untrue statement or alleged
untrue statement of a material fact contained in the Offering Memorandum (and
any amendment or supplement thereto if the Company shall have furnished any
amendments or supplements thereto) or any Preliminary Offering Memorandum, or
caused by any omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements therein, in
the light of the circumstances under which they were made, not misleading,
except insofar as such losses, claims, damages or liabilities are caused by any
untrue statement or omission or alleged untrue statement or omission (i) made in
reliance upon and in conformity with information relating to the Initial
Purchaser furnished to the Company in writing by the Initial Purchaser expressly
for use therein or (ii) contained in the Preliminary Offering Memorandum if the
Initial Purchaser failed to send or deliver a copy of the Offering Memorandum to
the person asserting such losses, claims, damages or liabilities on or prior to
the delivery of written confirmation of sale of the Securities to such person
and such Offering Memorandum would have corrected such untrue statement or
omission and it shall have been determined that such losses, claims, damages or
liabilities would not have arisen had the Offering Memorandum been delivered or
sent.
The Initial Purchaser agrees to indemnify and hold harmless each of the
Company, the Guarantors, their respective directors and officers and each person
who controls the Company within the meaning of Section 15 of the Act and Section
20 of the Exchange Act, to the same extent as the foregoing indemnity from the
Company to the Initial Purchaser, but only with reference to information
relating to the Initial Purchaser furnished to the Company in writing by the
Initial Purchaser expressly for use in the Offering Memorandum, any amendment or
supplement thereto, or any preliminary offering memorandum.
If any suit, action, proceeding (including any governmental or
regulatory investigation), claim or demand shall be brought or asserted against
any person in respect of which indemnity may be sought pursuant to either of the
two preceding paragraphs, such person (the "Indemnified Person") shall promptly
notify the person against whom such indemnity may be sought (the "Indemnifying
Person") in writing, and the Indemnifying Person, upon request of the
Indemnified Person, shall retain counsel reasonably satisfactory to the
Indemnified Person to represent the Indemnified Person and any others the
Indemnifying Person may designate in such proceeding and shall pay the fees and
expenses of such counsel related to such proceeding. In any such proceeding, any
Indemnified Person shall have the right to retain its own counsel, but the fees
and expenses of such counsel shall be at the expense of such Indemnified Person
unless (i) the Indemnifying Person and the Indemnified Person shall have
mutually agreed in writing to the contrary, (ii) the Indemnifying Person has
failed within a reasonable time to retain counsel reasonably satisfactory to the
Indemnified Person or (iii) the named parties in any such proceeding (including
any impleaded parties) include both the Indemnifying Person and the Indemnified
Person and representation of both parties by the same counsel would be
inappropriate due to actual or potential differing interests between them. It is
understood that the Indemnifying Person shall not, in connection with any
proceeding or related proceeding in the same jurisdiction, be liable for the
fees and expenses of more than one separate firm (in addition to any local
counsel) for all Indemnified Persons, and that all such fees and expenses shall
be reimbursed as they are incurred. Any such separate firm for the Initial
Purchaser, each affiliate of the Initial Purchaser which assists the Initial
Purchaser in the distribution of the Securities, its officers and directors and
such control persons of Initial Purchaser shall be designated in writing by X.X.
Xxxxxx Securities Inc. and any such separate firm for the Company, the
Guarantors, their directors, their officers and such control persons of the
Company shall be designated in writing by the Company. The Indemnifying Person
shall not be liable for any settlement of any proceeding effected without its
written consent, but if settled with such consent or if there be a final
judgment for the plaintiff, the Indemnifying Person agrees to indemnify any
Indemnified Person from and against any loss or liability by reason of such
settlement or judgment. Notwithstanding the foregoing sentence, if at any time
an Indemnified Person shall have requested in writing to the chief legal officer
or, if no chief legal officer exists, to the chief executive officer of the
Indemnifying Person to reimburse the Indemnified Person for fees and expenses of
counsel as contemplated by the third sentence of this paragraph, the
Indemnifying Person agrees that it shall be liable for any settlement of any
proceeding or claim effected without its written consent if (i) such settlement
is entered into more than 60 days after receipt by such Indemnifying Person of
the aforesaid request, (ii) a second such written request shall have been sent
to and received by the chief legal officer or, if no chief legal officer exists,
by the chief executive officer of the Indemnifying Person at least 30 days after
the first such request but at least 15 days prior to the date of such
settlement, and (iii) with respect to such request, such Indemnifying Person
shall not have reimbursed such Indemnified Person for all reasonable fees and
expenses of such counsel prior to the date of such settlement. No Indemnifying
Person shall, without the prior written consent of the Indemnified Person,
effect any settlement of any pending or threatened proceeding in respect of
which any Indemnified Person is or could have been a party and indemnity could
have been sought hereunder by such Indemnified Person, unless such settlement
includes an unconditional release of such Indemnified Person from all liability
on claims that are the subject matter of such proceeding.
If the indemnification provided for in the first and second paragraphs
of this Section 7 is unavailable to an Indemnified Person in respect of any
losses, claims, damages or liabilities referred to therein, then each
Indemnifying Person under such paragraph, in lieu of indemnifying such
Indemnified Person thereunder, shall contribute to the amount paid or payable by
such Indemnified Person as a result of such losses, claims, damages or
liabilities (i) in such proportion as is appropriate to reflect the relative
benefits received by the Company and the Guarantors on the one hand and the
Initial Purchaser on the other hand from the offering of the Securities or (ii)
if the allocation provided by clause (i) above is not permitted by applicable
law, in such proportion as is appropriate to reflect not only the relative
benefits referred to in clause (i) above but also the relative fault of the
Company and the Guarantors on the one hand and the Initial Purchaser on the
other in connection with the statements or omissions that resulted in such
losses, claims, damages or liabilities, as well as any other relevant equitable
considerations. The relative benefits received by the Company and the Guarantors
on the one hand and the Initial Purchaser on the other shall be deemed to be in
the same respective proportions as the net proceeds from the offering (before
deducting expenses) received by the Company and the total discounts and
commissions received by the Initial Purchaser, in each case as set forth in the
table on the cover of the Offering Memorandum, bear to the aggregate offering
price of the Securities. The relative fault of the Company and the Guarantors on
the one hand and the Initial Purchaser on the other shall be determined by
reference to, among other things, whether the untrue or alleged untrue statement
of a material fact or the omission or alleged omission to state a material fact
relates to information supplied by the Company or the Guarantors or by the
Initial Purchaser and the parties' relative intent, knowledge, access to
information and opportunity to correct or prevent such statement or omission.
The Company, the Guarantors and the Initial Purchaser agree that it
would not be just and equitable if contribution pursuant to this Section 7 were
determined by pro rata allocation or by any other method of allocation that does
not take account of the equitable considerations referred to in the immediately
preceding paragraph. The amount paid or payable by an Indemnified Person as a
result of the losses, claims, damages and liabilities referred to in the
immediately preceding paragraph shall be deemed to include, subject to the
limitations set forth above, any legal or other expenses incurred by such
Indemnified Person in connection with investigating or defending any such action
or claim. Notwithstanding the provisions of this Section 7, in no event shall
the Initial Purchaser be required to contribute any amount in excess of the
amount by which the total price at which the Securities purchased by it were
offered exceeds the amount of any damages that the Initial Purchaser has
otherwise been required to pay by reason of such untrue or alleged untrue
statement or omission or alleged omission. No person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Act) shall be
entitled to contribution from any person who was not guilty of such fraudulent
misrepresentation.
The remedies provided for in this Section 7 are not exclusive and shall
not limit any rights or remedies which may otherwise be available to any
indemnified party at law or in equity.
The indemnity and contribution agreements contained in this Section 7
and the representations and warranties made as of the date hereof and as of
Closing Date of the Company, the Guarantors and the Initial Purchaser set forth
in this Agreement shall remain operative and in full force and effect regardless
of (i) any termination of this Agreement, (ii) any investigation made by or on
behalf of the Initial Purchaser or any person controlling the Initial Purchaser
or by or on behalf of the Company, the Guarantors, such Company's officers or
directors or any other person controlling the Company and (iii) acceptance of
and payment for any of the Securities.
8. Notwithstanding anything herein contained, this Agreement may be
terminated in the absolute discretion of the Initial Purchaser, by notice given
to the Company, if after the execution and delivery of this Agreement and prior
to the Closing Date (i) trading generally shall have been suspended or
materially limited on or by, as the case may be, any of the New York Stock
Exchange, the American Stock Exchange or the National Association of Securities
Dealers, Inc., the Chicago Board Options Exchange, the Chicago Mercantile
Exchange or the Chicago Board of Trade (ii) trading of any securities of or
guaranteed by the Company shall have been suspended on any exchange or in any
over-the-counter market, (iii) a general moratorium on commercial banking
activities in New York shall have been declared by either Federal or New York
State authorities, or (iv) there shall have occurred any outbreak or escalation
of hostilities or any change in financial markets or any calamity or crisis
that, in the judgment of the Initial Purchaser, is material and adverse and
which, in the judgment of the Initial Purchaser, makes it impracticable to
market the Securities on the terms and in the manner contemplated in the
Offering Memorandum.
9. This Agreement shall become effective upon the execution and
delivery hereof by the parties hereto.
10. If this Agreement shall be terminated by the Initial Purchaser,
because of any failure or refusal on the part of any of the Company to comply
with the terms or to fulfill any of the conditions of this Agreement, or if for
any reason any of the Company shall be unable to perform its obligations under
this Agreement or any condition of the Initial Purchaser's obligations cannot be
fulfilled other than solely by reason of a default by the Initial Purchaser in
payment for the Securities on the Closing Date, the Company agrees to reimburse
the Initial Purchaser for all out-of-pocket expenses (including the fees and
expenses of its counsel) reasonably incurred by the Initial Purchaser in
connection with this Agreement or the offering contemplated hereunder.
11. This Agreement shall inure to the benefit of and be binding upon
the Company, the Initial Purchaser, any controlling persons referred to herein
and their respective successors and assigns. Nothing expressed or mentioned in
this Agreement is intended or shall be construed to give any other person, firm
or corporation any legal or equitable right, remedy or claim under or in respect
of this Agreement or any provision herein contained. No purchaser of Securities
from the Initial Purchaser shall be deemed to be a successor by reason merely of
such purchase.
12. All notices and other communications hereunder shall be in writing
and shall be deemed to have been duly given if mailed or transmitted by any
standard form of telecommunication. Notices to the Initial Purchaser shall be
given to them at the following address: X.X. Xxxxxx Securities Inc., 00 Xxxx
Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000; Attention: Syndicate Department. Notices to
the Company shall be given to them at the following address: Tekni-Plex, Inc.,
000 Xxxxxxxxxx Xxxxxxx, Xxxxxxxxxx, Xxx Xxxxxx 00000; Attention: Dr. F. Xxxxxxx
Xxxxx; with a copy to Xxxxx Xxxx & Xxxxxxxx, 000 Xxxxxxxxx Xxxxxx, Xxx Xxxx, XX
00000; Attention: Xxxxxxxx Xxxxxx, Esq.
13. This Agreement may be signed in counterparts, each of which shall
be an original and all of which together shall constitute one and the same
instrument.
14. Pursuant to Section 5-1401 of the General Obligations Laws of the
State of New York, this Agreement shall be governed by and construed in
accordance with the laws of the State of New York, without giving effect to any
other conflicts of laws provisions.
15. Contemporaniously with the consummation of the merger, the Company
shall cause each of the PureTec Companies to become a party hereto as a
Guarantor by executing and delivering to the Initial Purchaser a counterpart
hereof.
If the foregoing is in accordance with your understanding, please sign
and return four counterparts hereof.
Very truly yours,
TEKNI-PLEX, INC.
By:
------------------------
Name:
Title:
Accepted: February 25, 1998
X.X. XXXXXX SECURITIES INC.
By:
-----------------------------
Name:
Title:
Each of the undersigned by its execution hereof agrees to become a
party to this Agreement as a Guarantor as this 3rd day of March, 1997:
PURETEC CORPORATION
PTI PLASTICS, INC.
OZITE CORPORATION
PLASTIC SPECIALTIES AND
TECHNOLOGIES, INC.
PLASTIC SPECIALTIES AND
TECHNOLOGIES INVESTMENTS, INC.
BURLINGTON RESINS, INC.
PURE TECH APR, INC.
MULTI CONTAINER RECYCLER, INC.
COAST RECYCLING NORTH, INC.
DISTRIBUTORS RECYCLING, INC.
REI DISTRIBUTORS, INC.
PURE TECH RECYCLING OF CALIFORNIA
ALUMET SMELTING CORP.
CONCONRE CORP.,
collectively, the Guarantors
By:_____________________________
Name:
Title:
ANNEX I
(A) In addition to offers pursuant to clauses (B)(1) and (B)(2) of
paragraph 2(ii) of the Agreement, the Initial Purchaser intends to offer and
sell the Securities in accordance with Regulation S under the Act. Accordingly,
the Initial Purchaser agrees that neither it, its affiliates nor any persons
acting on its or their behalf has engaged or will engage in any directed selling
efforts within the meaning of Rule 902 under the Act with respect to the
Securities and it and they have complied and will comply with the offering
restrictions requirement of Regulation S. The Initial Purchaser agrees that, at
or prior to confirmation of sale of Securities (other than a sale pursuant to
and in accordance with paragraph 2(ii) of the Agreement to purchasers described
in clauses (B)(1) and (B)(2) thereof), it will have sent to each distributor,
dealer or person receiving a selling concession, fee or other remuneration that
purchases Securities from it during the restricted period a confirmation or
notice to substantially the following effect:
"The Securities covered hereby have not been registered under
the United States Securities Act of 1933, as amended (the "Act"), and
may not be offered, sold or delivered within the United States or to,
or for the account or benefit of, U.S. persons (i) as part of their
distribution at any time or (ii) otherwise until 40 days after the
later of the commencement of the offering and the closing date, except
in either case in accordance with Regulation S (or Rule 144A if
available) under the Act. Terms used above have the meaning given to
them by Regulation S."
Terms used in this paragraph have the meanings given to them by Regulation S.
The Initial Purchaser agrees that it has not entered and will not enter
into any contractual arrangement with respect to the distribution or delivery of
the Securities in accordance with this paragraph (A), except with its affiliates
or with the prior written consent of the Company.
(B) The Initial Purchaser represents and agrees that (i) it has not
offered or sold, and prior to the date six months after the Closing Date will
not offer or sell any Securities to persons in the United Kingdom except to
persons whose ordinary activities involve them in acquiring, holding, managing
or disposing of investments (as principal or agent) for the purposes of their
businesses or otherwise in circumstances which have not resulted and will not
result in an offer to the public in the United Kingdom within the meaning of the
Public Offers of Securities Regulations 1995, (ii) it has complied, and will
comply, with all applicable provisions of the Financial Services Xxx 0000 with
respect to anything done by it in relation to the Securities in, from or
otherwise involving the United Kingdom, and (iii) it has only issued or passed
on, and will only issue or pass on, in the United Kingdom, any document received
by it in connection with the issuance of the Securities to a person who is of a
kind described in Article 11(3) of the Financial Services Xxx 0000 (Investment
Advertisements) (Exemptions) Order 1996 or is a person to whom such document may
otherwise lawfully be issued or passed on.
(C) The Initial Purchaser agrees that it will not directly or
indirectly offer, sell or deliver any of the Securities or distribute any
offering memorandum, prospectus or other document or information in any
jurisdiction outside the United States except under circumstances that will
result in compliance with the applicable laws thereof, and that it will take at
its own expense whatever action is required to permit its purchase and resale of
the Securities in such jurisdictions. The Initial Purchaser understands that no
action has been taken by the Company to permit a public offering in any
jurisdiction outside the United States where action would be required for such
purposes. The Initial Purchaser agrees not to cause any advertisement of the
Securities to be published in any newspaper or periodical or posted in any
public place and not to issue any circular relating to the Securities in any
jurisdiction outside of the United States. Without prejudice to the generality
of the foregoing, the Initial Purchaser is not authorized to give any
information or to make any representation in connection with the offering or
sale of the Securities other than those contained in the Offering Memorandum.
ANNEX II
[Form of Registration Rights Agreement]
SCHEDULE A
PureTec Corporation (Delaware)
PTI Plastics, Inc. (Delaware)
Ozite Corporation (Delaware)
Plastics, Specialties and Technologies, Inc. (Delaware)
Plastics, Specialties and Technologies Investments, Inc. (Delaware)
Burlington Resins, Inc. (Delaware)
