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EXHIBIT 10.8
CONFORMED COPY
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LINCARE HOLDINGS INC.
$125,000,000
Senior Secured Notes
$30,000,000
8.91% Senior Secured Notes, Series A
due September 15, 2003
$50,000,000
9.01% Senior Secured Notes, Series B
due September 15, 2004
$45,000,000
9.11% Senior Secured Notes, Series C
due September 15, 2005
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NOTE PURCHASE AGREEMENT
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Dated as of September 1, 2000
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Series A PPN: 532791 A* 1
Series B PPN: 532791 A@ 9
Series C PPN: 532791 A# 7
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TABLE OF CONTENTS
SECTION PAGE
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1. AUTHORIZATION OF NOTES..................................................................................1
2. SALE AND PURCHASE OF NOTES..............................................................................2
3. CLOSING.................................................................................................2
4. CONDITIONS TO CLOSING...................................................................................2
4.1. Representations and Warranties.................................................................2
4.2. Performance; No Default........................................................................3
4.3. Compliance Certificates........................................................................3
4.4. Opinions of Counsel............................................................................3
4.5. Purchase Permitted By Applicable Law, etc......................................................3
4.6. Sale of Other Notes............................................................................3
4.7. Payment of Special Counsel Fees................................................................4
4.8. Private Placement Number.......................................................................4
4.9. Changes in Corporate Structure.................................................................4
4.10. Subsidiary Guaranty............................................................................4
4.11. Intercreditor Agreement........................................................................4
4.12. Pledge Agreement...............................................................................4
4.13. Proceedings and Documents......................................................................4
5. REPRESENTATIONS AND WARRANTIES OF THE COMPANY...........................................................5
5.1. Organization; Power and Authority..............................................................5
5.2. Authorization, etc.............................................................................5
5.3. Disclosure.....................................................................................5
5.4. Organization and Ownership of Shares of Subsidiaries...........................................6
5.5. Financial Statements...........................................................................7
5.6. Compliance with Laws, Other Instruments, etc...................................................7
5.7. Governmental Authorizations, etc...............................................................7
5.8. Litigation; Observance of Statutes and Orders..................................................8
5.9. Taxes..........................................................................................8
5.10. Title to Property; Leases......................................................................8
5.11. Licenses, Permits, etc.........................................................................8
5.12. Compliance with ERISA..........................................................................9
5.13. Private Offering by the Company...............................................................10
5.14. Use of Proceeds; Margin Regulations...........................................................10
5.15. Existing Indebtedness.........................................................................10
5.16. Foreign Assets Control Regulations, etc.......................................................11
5.17. Status under Certain Statutes.................................................................11
5.18. Environmental Matters.........................................................................11
5.19. Solvency of Subsidiary Guarantors.............................................................12
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SECTION PAGE
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6. REPRESENTATIONS OF THE PURCHASERS......................................................................12
6.1. Purchase for Investment.......................................................................12
6.2. Source of Funds...............................................................................12
7. INFORMATION AS TO COMPANY..............................................................................14
7.1. Financial and Business Information............................................................14
7.2. Officer's Certificate.........................................................................16
7.3. Inspection....................................................................................17
8. PREPAYMENT OF THE NOTES................................................................................17
8.1. No Scheduled Prepayments......................................................................17
8.2. Optional Prepayments with Make-Whole Amount...................................................17
8.3. Mandatory Offer to Prepay Upon Change of Control..............................................18
8.4. Allocation of Partial Prepayments.............................................................19
8.5. Maturity; Surrender, etc......................................................................19
8.6. Purchase of Notes.............................................................................19
8.7. Make-Whole Amount.............................................................................20
9. AFFIRMATIVE COVENANTS..................................................................................21
9.1. Compliance with Law...........................................................................21
9.2. Insurance.....................................................................................21
9.3. Maintenance of Properties.....................................................................21
9.4. Payment of Taxes and Claims...................................................................22
9.5. Corporate Existence, etc......................................................................22
9.6. Consolidating Financial Statements............................................................22
10. NEGATIVE COVENANTS.....................................................................................22
10.1. Adjusted Consolidated Net Worth...............................................................23
10.2. Leverage Ratio................................................................................23
10.3. Indebtedness of Restricted Subsidiaries.......................................................23
10.4. Fixed Charge Coverage.........................................................................23
10.5. Restricted Payments; Restricted Investments...................................................24
10.6. Liens.........................................................................................24
10.7. Mergers, Consolidations, etc..................................................................25
10.8. Sale of Assets................................................................................26
10.9. Disposition of Stock of Restricted Subsidiaries...............................................27
10.10. Designation of Restricted and Unrestricted Subsidiaries.......................................27
10.11. Restricted Subsidiary Guaranties..............................................................27
10.12. Nature of Business............................................................................27
10.13. Transactions with Affiliates..................................................................28
11. EVENTS OF DEFAULT......................................................................................28
12. REMEDIES ON DEFAULT, ETC...............................................................................30
12.1. Acceleration..................................................................................30
12.2. Other Remedies................................................................................31
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SECTION PAGE
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12.3. Rescission....................................................................................31
12.4. No Waivers or Election of Remedies, Expenses, etc.............................................32
13. REGISTRATION; EXCHANGE; SUBSTITUTION OF NOTES..........................................................32
13.1. Registration of Notes.........................................................................32
13.2. Transfer and Exchange of Notes................................................................32
13.3. Replacement of Notes..........................................................................33
14. PAYMENTS ON NOTES......................................................................................33
14.1. Place of Payment..............................................................................33
14.2. Home Office Payment...........................................................................33
15. EXPENSES, ETC..........................................................................................34
15.1. Transaction Expenses..........................................................................34
15.2. Survival......................................................................................34
16. SURVIVAL OF REPRESENTATIONS AND WARRANTIES; ENTIRE AGREEMENT...........................................34
17. AMENDMENT AND WAIVER...................................................................................35
17.1. Requirements..................................................................................35
17.2. Solicitation of Holders of Notes..............................................................35
17.3. Binding Effect, etc...........................................................................35
17.4. Notes held by Company, etc....................................................................36
18. NOTICES................................................................................................36
19. REPRODUCTION OF DOCUMENTS..............................................................................36
20. CONFIDENTIAL INFORMATION...............................................................................37
21. SUBSTITUTION OF PURCHASER..............................................................................38
22. RELEASE OF SUBSIDIARY GUARANTOR........................................................................38
23. MISCELLANEOUS..........................................................................................38
23.1. Successors and Assigns........................................................................38
23.2. Payments Due on Non-Business Days.............................................................39
23.3. Severability..................................................................................39
23.4. Construction..................................................................................39
23.5. Counterparts..................................................................................39
23.6. Governing Law.................................................................................39
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SCHEDULE A -- Information Relating to Purchasers
SCHEDULE B -- Defined Terms
SCHEDULE B-1 -- Investments
SCHEDULE 4.9 -- Changes in Corporate Structure
SCHEDULE 5.3 -- Disclosure Materials
SCHEDULE 5.4 -- Subsidiaries; Affiliates
SCHEDULE 5.5 -- Financial Statements
SCHEDULE 5.11 -- Licenses, Permits, etc.
SCHEDULE 5.14 -- Use of Proceeds
SCHEDULE 5.15 -- Indebtedness
SCHEDULE 10.6 -- Liens
EXHIBIT 1(a) -- Form of Series A Senior Secured Note
EXHIBIT 1(b) -- Form of Series B Senior Secured Note
EXHIBIT 1(c) -- Form of Series C Senior Secured Note
EXHIBIT 1(d) -- Form of Subsidiary Guaranty
EXHIBIT 4.4(a)(i) -- Form of Opinion of New York Counsel for the Company
EXHIBIT 4.4(a)(ii) -- Form of Opinion of Florida Counsel for the Company
EXHIBIT 4.4(b) -- Form of Opinion of Special Counsel for the Purchasers
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LINCARE HOLDINGS INC.
00000 XX 00 Xxxxx, Xxxxx 000
Xxxxxxxxxx, Xxxxxxx 00000
(000) 000-0000
Fax: (000) 000-0000
$125,000,000
Senior Secured Notes
$30,000,000 8.91% Senior Secured Notes, Series A, due September 15, 2003
$50,000,000 9.01% Senior Secured Notes, Series B, due September 15, 2004
$45,000,000 9.11% Senior Secured Notes, Series C, due September 15, 2005
Dated as of September 1, 2000
TO EACH OF THE PURCHASERS LISTED IN
THE ATTACHED SCHEDULE A:
Ladies and Gentlemen:
LINCARE HOLDINGS INC., a Delaware corporation (the "Company"),
agrees with you as follows:
1. AUTHORIZATION OF NOTES.
The Company has authorized the issue and sale of $30,000,000
aggregate principal amount of its 8.91% Senior Secured Notes, Series A, due
September 15, 2003 (the "Series A Notes"), $50,000,000 aggregate principal
amount of its 9.01% Senior Secured Notes, Series B, due September 15, 2004 (the
"Series B Notes"), and $45,000,000 aggregate principal amount of its 9.11%
Senior Secured Notes, Series C, due September 15, 2005 (the "Series C Notes"
and, collectively with the Series A Notes and Series B Notes, the "Notes", such
term to include any such Notes issued in substitution therefor pursuant to
Section 13 of this Agreement). The Notes shall be substantially in the form set
out in Exhibits 1(a), 1(b) and 1(c) with such changes therefrom, if any, as may
be approved by you, the Other Purchasers and the Company. Certain capitalized
terms used in this Agreement are defined in Schedule B; references to a
"Schedule" or an "Exhibit" are, unless otherwise specified, to a Schedule or an
Exhibit attached to this Agreement. Subject to Section 22, the Notes will be
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secured by a pledge of common stock of each Subsidiary pursuant to the Pledge
Agreement. In addition, and also subject to Section 22, the Notes will be
guaranteed by each Subsidiary that now or in the future becomes a signatory to
the Bank Guarantees (individually, a "Subsidiary Guarantor" and collectively,
the "Subsidiary Guarantors") pursuant to a guaranty in substantially the form of
Exhibit 1(d) (the "Subsidiary Guaranty"). The Notes shall rank pari passu with
the Company's Indebtedness to Banks under the Credit Agreements.
2. SALE AND PURCHASE OF NOTES.
Subject to the terms and conditions of this Agreement, the
Company will issue and sell to you and each of the other purchasers named in
Schedule A (the "Other Purchasers"), and you and the Other Purchasers will
purchase from the Company, at the Closing provided for in Section 3, Notes of
the series and in the principal amount specified opposite your names in Schedule
A at the purchase price of 100% of the principal amount thereof. Your obligation
hereunder and the obligations of the Other Purchasers are several and not joint
obligations and you shall have no liability to any Person for the performance or
non-performance by any Other Purchaser hereunder.
3. CLOSING.
The sale and purchase of the Notes to be purchased by you and
the Other Purchasers shall occur at the offices of Xxxxxxx, Carton & Xxxxxxx,
Quaker Tower, Suite 0000, 000 Xxxxx Xxxxx Xxxxxx, Xxxxxxx, Xxxxxxxx 00000 at
9:00 a.m., Chicago time, at a closing (the "Closing") on September 6, 2000 or on
such other Business Day thereafter on or prior to September 30, 2000 as may be
agreed upon by the Company and you and the Other Purchasers. At the Closing the
Company will deliver to you the Notes to be purchased by you in the form of a
single Note (or such greater number of Notes in denominations of at least
$500,000 as you may request) dated the date of the Closing and registered in
your name (or in the name of your nominee), against delivery by you to the
Company or its order of immediately available funds in the amount of the
purchase price therefor by wire transfer of immediately available funds for the
account of the Company to account number 3751050678 at Bank of America, ABA
#000000000, Global Banking, 6th Floor, 000 Xxxxxxxxx Xx. XX, Xxxxxxx, Xxxxxxx
00000, Attn: Xxxxxx Xxxxxx. If at the Closing the Company fails to tender such
Notes to you as provided above in this Section 3, or any of the conditions
specified in Section 4 shall not have been fulfilled to your satisfaction, you
shall, at your election, be relieved of all further obligations under this
Agreement, without thereby waiving any rights you may have by reason of such
failure or such nonfulfillment.
4. CONDITIONS TO CLOSING.
Your obligation to purchase and pay for the Notes to be sold
to you at the Closing is subject to the fulfillment to your satisfaction, prior
to or at the Closing, of the following conditions:
4.1. REPRESENTATIONS AND WARRANTIES.
The representations and warranties of the Company in this
Agreement shall be correct in all material respects when made and at the time of
the Closing.
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4.2. PERFORMANCE; NO DEFAULT.
The Company shall have performed and complied in all material
respects with all agreements and conditions contained in this Agreement required
to be performed or complied with by it prior to or at the Closing and after
giving effect to the issue and sale of the Notes (and the application of the
proceeds thereof as contemplated by Schedule 5.14) no Default or Event of
Default shall have occurred and be continuing.
4.3. COMPLIANCE CERTIFICATES.
(a) OFFICER'S CERTIFICATE. The Company shall have delivered to
you an Officer's Certificate, dated the date of the Closing, certifying
that the conditions specified in Sections 4.1, 4.2 and 4.9 have been
fulfilled.
(b) SECRETARY'S CERTIFICATE. The Company shall have delivered
to you a certificate certifying as to the resolutions attached thereto
and other corporate proceedings relating to the authorization,
execution and delivery of the Notes and the Agreement.
4.4. OPINIONS OF COUNSEL.
You shall have received opinions in form and substance
satisfactory to you, dated the date of the Closing (a) from (i) Reboul,
XxxXxxxxx, Xxxxxx, Xxxxxxx & Xxxxxxx, New York counsel for the Company, covering
the matters set forth in Exhibit 4.4(a)(i) and (ii) Xxxxxx X. XxXxxxxx, P.A.,
Florida counsel for the Company, covering the matters set forth in Exhibit
4.4(a)(ii) (and the Company instructs its counsel to deliver such opinions to
you) and (b) from Xxxxxxx, Xxxxxx & Xxxxxxx, your special counsel in connection
with such transactions, substantially in the form set forth in Exhibit 4.4(b).
4.5. PURCHASE PERMITTED BY APPLICABLE LAW, ETC.
On the date of the Closing your purchase of Notes shall (i) be
permitted by the laws and regulations of each jurisdiction to which you are
subject, without recourse to provisions (such as Section 1405(a)(8) of the New
York Insurance Law) permitting limited investments by insurance companies
without restriction as to the character of the particular investment, (ii) not
violate any applicable law or regulation (including, without limitation,
Regulation U, T or X of the Board of Governors of the Federal Reserve System)
and (iii) not subject you to any tax, penalty or liability under or pursuant to
any applicable law or regulation, which law or regulation was not in effect on
the date hereof. If requested by you, you shall have received an Officer's
Certificate certifying as to such matters of fact as you may reasonably specify
to enable you to determine whether such purchase is so permitted.
4.6. SALE OF OTHER NOTES.
Contemporaneously with the Closing the Company shall sell to
the Other Purchasers and the Other Purchasers shall purchase the Notes to be
purchased by them at the Closing as specified in Schedule A.
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4.7. PAYMENT OF SPECIAL COUNSEL FEES.
Without limiting the provisions of Section 15.1, the Company
shall have paid on or before the Closing the reasonable fees, charges and
disbursements of your special counsel referred to in Section 4.4, to the extent
reflected in a statement of such counsel rendered to the Company at least one
Business Day prior to the Closing.
4.8. PRIVATE PLACEMENT NUMBER.
Private Placement Numbers issued by Standard & Poor's CUSIP
Service Bureau (in cooperation with the Securities Valuation Office of the
National Association of Insurance Commissioners) shall have been obtained by
Xxxxxxx, Carton & Xxxxxxx for each series of the Notes.
4.9. CHANGES IN CORPORATE STRUCTURE.
Except as specified in Schedule 4.9, the Company shall not
have changed its jurisdiction of incorporation or been a party to any merger or
consolidation and shall not have succeeded to all or any substantial part of the
liabilities of any other entity, at any time following the date of the most
recent financial statements referred to in Schedule 5.5.
4.10. SUBSIDIARY GUARANTY.
Each Subsidiary Guarantor shall have executed and delivered
the Subsidiary Guaranty in favor of you and the Other Purchasers.
4.11. INTERCREDITOR AGREEMENT.
You and each of the Other Purchasers shall have entered into
an Intercreditor Agreement (the "Intercreditor Agreement"), on terms
satisfactory to you, with Bank of America, N.A., as agent for the banks party to
the Credit Agreements, and as collateral agent (the "Collateral Agent") for the
banks and the holders of the Notes.
4.12. PLEDGE AGREEMENT.
The Company and, if required, each Subsidiary Guarantor shall
have executed and delivered the Pledge Agreement, in favor of the Collateral
Agent, for the benefit of the banks party to the Credit Agreements and the
holders of the Notes, to secure the obligations under the Credit Agreements,
this Agreement and the Notes.
4.13. PROCEEDINGS AND DOCUMENTS.
All corporate and other proceedings in connection with the
transactions contemplated by this Agreement and all documents and instruments
incident to such transactions shall be satisfactory to you and your special
counsel, and you and your special counsel shall have received all such
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counterpart originals or certified or other copies of such documents as you or
they may reasonably request.
5. REPRESENTATIONS AND WARRANTIES OF THE COMPANY.
The Company represents and warrants to you that:
5.1. ORGANIZATION; POWER AND AUTHORITY.
The Company is a corporation duly organized, validly existing
and in good standing under the laws of its jurisdiction of incorporation, and is
duly qualified as a foreign corporation and is in good standing in each
jurisdiction in which such qualification is required by law, other than those
jurisdictions as to which the failure to be so qualified or in good standing
could not, individually or in the aggregate, reasonably be expected to have a
Material Adverse Effect. The Company has the corporate power and authority to
own or hold under lease the properties it purports to own or hold under lease,
to transact the business it transacts and proposes to transact, to execute and
deliver this Agreement, the Pledge Agreement and the Notes and to perform the
provisions hereof and thereof.
5.2. AUTHORIZATION, ETC.
This Agreement, the Pledge Agreement and the Notes have been
duly authorized by all necessary corporate action on the part of the Company,
and this Agreement and the Pledge Agreement constitute, and upon execution and
delivery thereof each Note will constitute, a legal, valid and binding
obligation of the Company enforceable against the Company in accordance with its
terms, except as such enforceability may be limited by (i) applicable
bankruptcy, insolvency, reorganization, moratorium or other similar laws
affecting the enforcement of creditors' rights generally and (ii) general
principles of equity (regardless of whether such enforceability is considered in
a proceeding in equity or at law).
The Subsidiary Guaranty and the Pledge Agreement, to the
extent required, have been duly authorized by all necessary corporate action on
the part of each Subsidiary Guarantor and upon execution and delivery thereof
will constitute the legal, valid and binding obligation of each Subsidiary
Guarantor, enforceable against each Subsidiary Guarantor in accordance with its
terms, except as such enforceability may be limited by (i) applicable
bankruptcy, insolvency, reorganization, moratorium or other similar laws
affecting the enforcement of creditors' rights generally and (ii) general
principles of equity (regardless of whether such enforceability is considered in
a proceeding in equity or at law).
5.3. DISCLOSURE.
The Company, through its agent, Banc of America Securities,
Inc., has delivered to you and each Other Purchaser a copy of a Private
Placement Memorandum, dated June 2000 (the "Memorandum"), relating to the
transactions contemplated. The Memorandum fairly describes, in all material
respects, the general nature of the business and principal properties of the
Company and its Subsidiaries. Except as disclosed in Schedule 5.3, this
Agreement, the Memorandum, the documents, certificates or other writings
delivered to you by or on behalf of the Company in connection with the
transactions contemplated hereby (which documents, certificates and other
writings are set forth in Schedule 5.3) and the financial statements listed in
Schedule 5.5, taken as a whole, do not contain any untrue statement of a
material fact or omit to state any material fact necessary to make the
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statements therein not misleading in light of the circumstances under which they
were made. Except as disclosed in the Memorandum or as expressly described in
Schedule 5.3, or in one of the documents, certificates or other writings
identified therein, or in the financial statements listed in Schedule 5.5, since
December 31, 1999, there has been no change in the financial condition,
operations, business or properties of the Company or any Subsidiary except
changes that individually or in the aggregate could not reasonably be expected
to have a Material Adverse Effect. There is no fact known to the Company that
could reasonably be expected to have a Material Adverse Effect that has not been
set forth herein or in the Memorandum or in the other documents, certificates
and other writings delivered to you by or on behalf of the Company specifically
for use in connection with the transactions contemplated hereby.
5.4. ORGANIZATION AND OWNERSHIP OF SHARES OF SUBSIDIARIES.
(a) Schedule 5.4 contains (except as noted therein) complete
and correct lists of: (i) the Company's Subsidiaries, showing, as to
each Subsidiary, the correct name thereof, the jurisdiction of its
organization, and the percentage of shares of each class of its capital
stock or similar equity interests outstanding owned by the Company and
each other Subsidiary, (ii) the Company's Affiliates, other than
Subsidiaries, and (iii) the Company's directors and senior officers.
Each Subsidiary listed in Schedule 5.4 other than Lincare of Columbia,
L.P. is designated a Restricted Subsidiary by the Company.
(b) All of the outstanding shares of capital stock or similar
equity interests of each Subsidiary shown in Schedule 5.4 as being
owned by the Company and its Subsidiaries have been validly issued, are
fully paid and nonassessable and are owned by the Company or another
Subsidiary free and clear of any Lien other than the Pledge Agreement
(except as otherwise disclosed in Schedule 5.4).
(c) Each Subsidiary identified in Schedule 5.4 is a
corporation or other legal entity duly organized, validly existing and
in good standing under the laws of its jurisdiction of organization,
and is duly qualified as a foreign corporation or other legal entity
and is in good standing in each jurisdiction in which such
qualification is required by law, other than those jurisdictions as to
which the failure to be so qualified or in good standing could not,
individually or in the aggregate, reasonably be expected to have a
Material Adverse Effect. Each such Subsidiary has the corporate or
other power and authority to own or hold under lease the properties it
purports to own or hold under lease and to transact the business it
transacts and proposes to transact.
(d) No Subsidiary is a party to, or otherwise subject to, any
legal restriction or any agreement (other than this Agreement, the
agreements listed on Schedule 5.4 and customary limitations imposed by
corporate law statutes) restricting the ability of such Subsidiary to
pay dividends out of profits or make any other similar distributions of
profits to the Company or any of its Subsidiaries that owns outstanding
shares of capital stock or similar equity interests of such Subsidiary.
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5.5. FINANCIAL STATEMENTS.
The Company has delivered to you and each Other Purchaser
copies of the financial statements of the Company and its Subsidiaries listed on
Schedule 5.5. All of said financial statements (including in each case the
related schedules and notes) fairly present in all material respects the
consolidated financial condition of the Company and its Subsidiaries as of the
respective dates specified in such Schedule and the consolidated results of
their operations and cash flows for the respective periods so specified and have
been prepared in accordance with GAAP consistently applied throughout the
periods involved except as set forth in the notes thereto (subject, in the case
of any interim financial statements, to normal year-end adjustments).
5.6. COMPLIANCE WITH LAWS, OTHER INSTRUMENTS, ETC.
The execution, delivery and performance by the Company of this
Agreement, the Pledge Agreement and the Notes will not (i) contravene, result in
any breach of, or constitute a default under, or result in the creation of any
Lien in respect of any property of the Company or any Subsidiary (other than the
Lien of the Pledge Agreement) under, any indenture, mortgage, deed of trust,
loan, purchase or credit agreement, lease, corporate charter or by-laws, or any
other agreement or instrument to which the Company or any Subsidiary is bound or
by which the Company or any Subsidiary or any of their respective properties may
be bound or affected, (ii) conflict with or result in a breach of any of the
terms, conditions or provisions of any order, judgment, decree, or ruling of any
court, arbitrator or Governmental Authority applicable to the Company or any
Subsidiary or (iii) violate any provision of any statute or other rule or
regulation of any Governmental Authority applicable to the Company or any
Subsidiary.
The execution, delivery and performance by each Subsidiary
Guarantor of the Subsidiary Guaranty and, to the extent required, the Pledge
Agreement will not (i) contravene, result in any breach of, or constitute a
default under, or result in the creation of any Lien in respect of any property
of such Subsidiary Guarantor (other than the Lien of the Pledge Agreement) under
indenture, mortgage, deed of trust, loan, purchase or credit agreement, lease,
corporate charter or by-laws, or any other agreement or instrument to which such
Subsidiary Guarantor is bound or by which such Subsidiary Guarantor or any of
its properties may be bound or affected, (ii) conflict with or result in a
breach of any of the terms, conditions or provisions of any order, judgment,
decree, or ruling of any court, arbitrator or Governmental Authority applicable
to such Subsidiary Guarantor or (iii) violate any provision of any statute or
other rule or regulation of any Governmental Authority applicable to such
Subsidiary Guarantor.
5.7. GOVERNMENTAL AUTHORIZATIONS, ETC.
No consent, approval or authorization of, or registration,
filing or declaration with, any Governmental Authority is required in connection
with the execution, delivery or performance by the Company of this Agreement,
the Pledge Agreement or the Notes or the execution, delivery or performance by
each Subsidiary Guarantor of the Subsidiary Guaranty, except such as may be
required under the blue sky or securities laws of any jurisdiction in connection
with the transactions contemplated by this Agreement.
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5.8. LITIGATION; OBSERVANCE OF STATUTES AND ORDERS.
(a) Except as disclosed in Schedule 5.8, there are no actions,
suits or proceedings pending or, to the knowledge of the Company,
threatened against or affecting the Company or any Subsidiary or any
property of the Company or any Subsidiary in any court or before any
arbitrator of any kind or before or by any Governmental Authority that,
individually or in the aggregate, could reasonably be expected to have
a Material Adverse Effect.
(b) Neither the Company nor any Subsidiary is in default under
any term of any agreement or instrument to which it is a party or by
which it is bound, or any order, judgment, decree or ruling of any
court, arbitrator or Governmental Authority or is in violation of any
applicable law, ordinance, rule or regulation (including without
limitation Environmental Laws) of any Governmental Authority, which
default or violation, individually or in the aggregate, could
reasonably be expected to have a Material Adverse Effect.
5.9. TAXES.
The Company and its Subsidiaries have filed all tax returns
that are required to have been filed in any jurisdiction, and have paid all
taxes shown to be due and payable on such returns and all other taxes and
assessments levied upon them or their properties, assets, income or franchises,
to the extent such taxes and assessments have become due and payable and before
they have become delinquent, except for any taxes and assessments (i) the amount
of which is not individually or in the aggregate Material or (ii) the amount,
applicability or validity of which is currently being contested in good faith by
appropriate proceedings and with respect to which the Company or a Subsidiary,
as the case may be, has established adequate reserves in accordance with GAAP.
The Company knows of no basis for any other tax or assessment that could
reasonably be expected to have a Material Adverse Effect. The charges, accruals
and reserves on the books of the Company and its Subsidiaries in respect of
Federal, state or other taxes for all fiscal periods are adequate. The Federal
income tax liabilities of the Company and its Subsidiaries have been determined
by the Internal Revenue Service and paid for all fiscal years up to and
including the fiscal year ended December 31, 1993.
5.10. TITLE TO PROPERTY; LEASES.
The Company and its Subsidiaries have good and sufficient
title to their respective properties that individually or in the aggregate are
Material, including all such properties reflected in the most recent audited
balance sheet referred to in Section 5.5 or purported to have been acquired by
the Company or any Subsidiary after said date (except as sold or otherwise
disposed of in the ordinary course of business), in each case free and clear of
Liens prohibited by this Agreement. All leases that individually or in the
aggregate are Material are valid and subsisting and are in full force and effect
in all material respects.
5.11. LICENSES, PERMITS, ETC.
Except as disclosed in Schedule 5.11,
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(a) the Company and its Subsidiaries own or possess all
licenses, permits, franchises, authorizations, patents, copyrights,
service marks, trademarks and trade names, or rights thereto, that
individually or in the aggregate are Material and necessary for the
conduct of their business, without known conflict with the rights of
others;
(b) to the best knowledge of the Company, no product of the
Company infringes in any material respect any license, permit,
franchise, authorization, patent, copyright, service mark, trademark,
trade name or other right owned by any other Person; and
(c) to the best knowledge of the Company, there is no Material
violation by any Person of any right of the Company or any of its
Subsidiaries with respect to any patent, copyright, service mark,
trademark, trade name or other right owned or used by the Company or
any of its Subsidiaries.
5.12. COMPLIANCE WITH XXXXX.
(a) The Company and each ERISA Affiliate have operated and
administered each Plan in compliance with all applicable laws except
for such instances of noncompliance as have not resulted in and could
not reasonably be expected to result in a Material Adverse Effect.
Neither the Company nor any ERISA Affiliate has incurred any liability
pursuant to Title I or IV of ERISA or the penalty or excise tax
provisions of the Code relating to employee benefit plans (as defined
in Section 3 of ERISA), and no event, transaction or condition has
occurred or exists that could reasonably be expected to result in the
incurrence of any such liability by the Company or any ERISA Affiliate,
or in the imposition of any Lien on any of the rights, properties or
assets of the Company or any ERISA Affiliate, in either case pursuant
to Title I or IV of ERISA or to such penalty or excise tax provisions
or to Section 401(a)(29) or 412 of the Code, other than such
liabilities or Liens as would not be individually or in the aggregate
Material.
(b) Neither the Company nor any of its ERISA Affiliates is or
within the last five years has been a party to, or contributes to or
during the last five years has contributed to, any "defined pension
benefit plan" (as such term is defined in Section 3 of ERISA) or any
Multiemployer Plan.
(c) The expected postretirement benefit obligation (determined
as of the last day of the Company's most recently ended fiscal year in
accordance with Financial Accounting Standards Board Statement No. 106,
without regard to liabilities attributable to continuation coverage
mandated by section 4980B of the Code) of the Company and its
Subsidiaries is not Material.
(d) The execution and delivery of this Agreement and the
issuance and sale of the Notes hereunder will not involve any
transaction that is subject to the prohibitions of section 406 of ERISA
or in connection with which a tax could be imposed pursuant to section
4975(c)(1)(A)-(D) of the Code. The representation by the Company in the
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first sentence of this Section 5.12(d) is made in reliance upon and
subject to the accuracy of your representation in Section 6.2 as to the
sources of the funds used to pay the purchase price of the Notes to be
purchased by you.
5.13. PRIVATE OFFERING BY THE COMPANY.
Neither the Company nor anyone acting on its behalf has
offered the Notes, the Subsidiary Guaranty or any similar securities for sale
to, or solicited any offer to buy any of the same from, or otherwise approached
or negotiated in respect thereof with, any person under circumstances that would
require the registration of the Notes or the Subsidiary Guaranty under Section 5
of the Securities Act. Neither the Company nor anyone acting on its behalf has
taken, or will take, any action that would subject the issuance or sale of the
Notes or the execution and delivery of the Subsidiary Guaranty to the
registration requirements of Section 5 of the Securities Act.
5.14. USE OF PROCEEDS; MARGIN REGULATIONS.
The Company will apply the proceeds of the sale of the Notes
for general corporate purposes and to refinance Indebtedness as set forth in
Schedule 5.14. No part of the proceeds from the sale of the Notes will be used,
directly or indirectly, for the purpose of buying or carrying any margin stock
within the meaning of Regulation U of the Board of Governors of the Federal
Reserve System (12 CFR 221), or for the purpose of buying or carrying or trading
in any securities under such circumstances as to involve the Company in a
violation of Regulation X of said Board (12 CFR 224) or to involve any broker or
dealer in a violation of Regulation T of said Board (12 CFR 220). Margin stock
(which shall not be deemed to include treasury shares) does not constitute more
than 10% of the value of the consolidated assets of the Company and its
Subsidiaries and the Company does not have any present intention that margin
stock will constitute more than 10% of the value of such assets. As used in this
Section, the terms "margin stock" and "purpose of buying or carrying" shall have
the meanings assigned to them in said Regulation U.
5.15. EXISTING INDEBTEDNESS.
(a) Except as described therein, Schedule 5.15 sets forth a
complete and correct list of all outstanding Indebtedness of the
Company and its Subsidiaries as of July 31, 2000, since which date
there has been no Material change in the amounts, interest rates,
sinking funds, installment payments or maturities of the Indebtedness
of the Company or its Subsidiaries. Neither the Company nor any
Subsidiary is in default and no waiver of default is currently in
effect, in the payment of any principal or interest on any Indebtedness
of the Company or such Subsidiary and no event or condition exists with
respect to any Indebtedness of the Company or any Subsidiary that would
permit (or that with notice or the lapse of time, or both, would
permit) one or more Persons to cause such Indebtedness to become due
and payable before its stated maturity or before its regularly
scheduled dates of payment.
(b) Except as disclosed in Schedule 5.15, neither the Company
nor any Subsidiary has agreed or consented to cause or permit in the
future (upon the happening of a contingency or otherwise) any of its
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property, whether now owned or hereafter acquired, to be subject to a
Lien not permitted by Section 10.6.
5.16. FOREIGN ASSETS CONTROL REGULATIONS, ETC.
Neither the sale of the Notes by the Company hereunder nor its
use of the proceeds thereof will violate the Trading with the Enemy Act, as
amended, or any of the foreign assets control regulations of the United States
Treasury Department (31 CFR, Subtitle B, Chapter V, as amended) or any enabling
legislation or executive order relating thereto.
5.17. STATUS UNDER CERTAIN STATUTES.
Neither the Company nor any Subsidiary is subject to
regulation under the Investment Company Act of 1940, as amended, the Public
Utility Holding Company Act of 1935, as amended, the Interstate Commerce Act, as
amended by the ICC Termination Act, as amended, or the Federal Power Act, as
amended.
5.18. ENVIRONMENTAL MATTERS.
Neither the Company nor any Subsidiary has knowledge of any
claim or has received any notice of any claim, and no proceeding has been
instituted raising any claim against the Company or any of its Subsidiaries or
any of their respective real properties now or formerly owned, leased or
operated by any of them or other assets, alleging any damage to the environment
or violation of any Environmental Laws, except, in each case, such as could not
reasonably be expected to result in a Material Adverse Effect. Except as
otherwise disclosed to you in writing,
(a) neither the Company nor any Subsidiary has knowledge of
any facts which would give rise to any claim, public or private, of
violation of Environmental Laws or damage to the environment emanating
from, occurring on or in any way related to real properties now or
formerly owned, leased or operated by any of them or to other assets or
their use, except, in each case, such as could not reasonably be
expected to result in a Material Adverse Effect;
(b) neither the Company nor any of its Subsidiaries has stored
any Hazardous Materials on real properties now or formerly owned,
leased or operated by any of them and has not disposed of any Hazardous
Materials in a manner contrary to any Environmental Laws in each case
in any manner that could reasonably be expected to result in a Material
Adverse Effect; and
(c) all buildings on all real properties now owned, leased or
operated by the Company or any of its Subsidiaries are in compliance
with applicable Environmental Laws, except where failure to comply
could not reasonably be expected to result in a Material Adverse
Effect.
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5.19. SOLVENCY OF SUBSIDIARY GUARANTORS.
After giving effect to the transactions contemplated herein
and after giving due consideration to any rights of contribution (i) each
Subsidiary Guarantor has received fair consideration and reasonably equivalent
value for the incurrence of its obligations under the Subsidiary Guaranty, (ii)
the fair value of the assets of each Subsidiary Guarantor (both at fair
valuation and at present fair saleable value) exceeds its liabilities, (ii) each
Subsidiary Guarantor is able to and expects to be able to pay its debts as they
mature, and (iii) each Subsidiary Guarantor has capital sufficient to carry on
its business as conducted and as proposed to be conducted.
6. REPRESENTATIONS OF THE PURCHASERS.
6.1. PURCHASE FOR INVESTMENT.
You represent and warrant to the Company that you are
purchasing the Notes for your own account or for one or more separate accounts
maintained by you or for the account of one or more pension or trust funds and
not with a view to the distribution thereof, provided that the disposition of
your or their property shall at all times be within your or their control. You
understand that the Notes have not been registered under the Securities Act by
reason of their issuance in a transaction exempt from the registration
requirements of the Securities Act pursuant to Section 4(2) thereof and that the
Notes must be held indefinitely unless a subsequent disposition thereof is
registered under the Securities Act or is exempt from such registration. You
represent that you are an "accredited investor" within the meaning of
subparagraph (a)(1), (2), (3) or (7) of Rule 501 of Regulation D under the
Securities Act.
6.2. SOURCE OF FUNDS.
You represent that at least one of the following statements is
an accurate representation as to each source of funds (a "Source") to be used by
you to pay the purchase price of the Notes to be purchased by you hereunder:
(a) the Source is an "insurance company general account" as
such term is defined in the Department of Labor Prohibited Transaction
Exemption ("PTE") 95-60 (issued July 12, 1995) ("PTE 95-60") and as of
the date of this Agreement there is no "employee benefit plan" with
respect to which the aggregate amount of such general account's
reserves and liabilities for the contracts held by or on behalf of such
employee benefit plan and all other employee benefit plans maintained
by the same employer (and affiliates thereof as defined in Section
V(a)(1) of PTE 95-60) or by the same employee organization (in each
case determined in accordance with the provisions of PTE 95-60) exceeds
10% of the total reserves and liabilities of such general account (as
determined under PTE 95-60) (exclusive of separate account liabilities)
plus surplus as set forth in the National Association of Insurance
Commissioners Annual Statement filed with your state of domicile; or
(b) the Source is either (i) an insurance company pooled
separate account, within the meaning of PTE 90-1 (issued January 29,
1990), or (ii) a bank collective investment fund, within the meaning of
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PTE 91-38 (issued July 12, 1991) and, except as you have disclosed to
the Company in writing pursuant to this paragraph (b), no employee
benefit plan or group of plans maintained by the same employer or
employee organization beneficially owns more than 10% of all assets
allocated to such pooled separate account or collective investment
fund; or
(c) the Source constitutes assets of an "investment fund"
(within the meaning of Part V of the QPAM Exemption) managed by a
"qualified professional asset manager" or "QPAM" (within the meaning of
Part V of the QPAM Exemption), no employee benefit plan's assets that
are included in such investment fund, when combined with the assets of
all other employee benefit plans established or maintained by the same
employer or by an affiliate (within the meaning of Section V(c)(1) of
the QPAM Exemption) of such employer or by the same employee
organization and managed by such QPAM, exceed 20% of the total client
assets managed by such QPAM, the conditions of Part I(c) and (g) of the
QPAM Exemption are satisfied, neither the QPAM nor a person controlling
or controlled by the QPAM (applying the definition of "control" in
Section V(e) of the QPAM Exemption) owns a 5% or more interest in the
Company and (i) the identity of such QPAM and (ii) the names of all
employee benefit plans whose assets are included in such investment
fund have been disclosed to the Company in writing pursuant to this
paragraph (c); or
(d) the Source is a governmental plan; or
(e) the Source is one or more employee benefit plans, or a
separate account or trust fund comprised of one or more employee
benefit plans, each of which has been identified to the Company in
writing pursuant to this paragraph (e); or
(f) the Source is the assets of one or more employee benefit
plans that are managed by an "in-house asset manager," as that term is
defined in PTE 96-23 and such purchase and holding of the Notes is
exempt under PTE 96-23; or
(g) the Source does not include assets of any employee benefit
plan, other than a plan exempt from the coverage of ERISA.
As used in this Section 6.2, the terms "employee benefit plan", "governmental
plan" and "separate account" shall have the respective meanings assigned to such
terms in Section 3 of ERISA.
7. INFORMATION AS TO COMPANY.
7.1. FINANCIAL AND BUSINESS INFORMATION
The Company will deliver to each holder of Notes that is an
Institutional Investor:
(a) QUARTERLY STATEMENTS -- within 45 days after the end of
each quarterly fiscal period in each fiscal year of the Company (other
than the last quarterly fiscal period of each such fiscal year),
duplicate copies of,
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(i) consolidated balance sheet of the Company and its
Subsidiaries as at the end of such quarter,
(ii) consolidated statements of income of the Company
and its Subsidiaries for such quarter and (in the case of the
second and third quarters) for the portion of the fiscal year
ending with such quarter, and
(iii) consolidated statements of cash flows of the
Company and its Subsidiaries for such quarter or (in the case
of the second and third quarters) for the portion of the
fiscal year ending with such quarter,
setting forth in each case in comparative form the figures for the
corresponding periods in the previous fiscal year, all in reasonable
detail, prepared in accordance with GAAP applicable to quarterly
financial statements generally, and certified by a Senior Financial
Officer as fairly presenting, in all material respects, the financial
condition of the companies being reported on and their results of
operations and cash flows, subject to changes resulting from year-end
adjustments, provided that delivery within the time period specified
above of copies of the Company's Quarterly Report on Form 10-Q prepared
in compliance with the requirements therefor and filed with the
Securities and Exchange Commission shall be deemed to satisfy the
requirements of this Section 7.1(a);
(b) ANNUAL STATEMENTS -- within 90 days after the end of each
fiscal year of the Company, duplicate copies of,
(i) consolidated balance sheet of the Company and its
Subsidiaries, as at the end of such year, and
(ii) consolidated statements of income, changes in
shareholders' equity and cash flows of the Company and its
Subsidiaries, for such year,
setting forth in each case in comparative form the figures for the
previous fiscal year, all in reasonable detail, prepared in accordance
with GAAP, and accompanied by an opinion of independent certified
public accountants of recognized national standing, which opinion shall
state that such financial statements present fairly, in all material
respects, the financial position of the companies being reported upon
and their results of operations and cash flows and have been prepared
in conformity with GAAP, and that the examination of such accountants
in connection with such financial statements has been made in
accordance with generally accepted auditing standards, and that such
audit provides a reasonable basis for such opinion in the
circumstances, PROVIDED that the delivery within the time period
specified above of the Company's Annual Report on Form 10-K for such
fiscal year (together with the Company's annual report to shareholders,
if any, prepared pursuant to Rule 14a-3 under the Exchange Act)
prepared in accordance with the requirements therefor and filed with
the Securities and Exchange Commission shall be deemed to satisfy the
requirements of this Section 7.1(b);
(c) UNRESTRICTED SUBSIDIARIES -- if, at the time of delivery
of any financial statements pursuant to Section 7.1(a) or (b),
Unrestricted Subsidiaries account for more than 10% of (i) the
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consolidated total assets of the Company and its Subsidiaries reflected
in the balance sheet included in such financial statements or (ii) the
consolidated revenues of the Company and its Subsidiaries reflected in
the consolidated statement of income included in such financial
statements, an unaudited balance sheet for all Unrestricted
Subsidiaries taken as whole as at the end of the fiscal period included
in such financial statements and the related unaudited statements of
income, stockholders' equity and cash flows for such Unrestricted
Subsidiaries for such period, together with consolidating statements
reflecting all eliminations or adjustments necessary to reconcile such
group financial statements to the consolidated financial statements of
the Company and its Subsidiaries shall be delivered together with the
financial statements required pursuant to Sections 7.1(a) and (b);
(d) SEC AND OTHER REPORTS -- promptly upon their becoming
available, one copy of (i) each financial statement, report, notice or
proxy statement sent by the Company or any Restricted Subsidiary to
public securities holders generally, and (ii) each regular or periodic
report, each registration statement (without exhibits except as
expressly requested by such holder), and each prospectus and all
amendments thereto filed by the Company or any Restricted Subsidiary
with the Securities and Exchange Commission and of all press releases
and other statements made available generally by the Company or any
Restricted Subsidiary to the public concerning developments that are
Material;
(e) NOTICE OF DEFAULT OR EVENT OF DEFAULT -- promptly, and in
any event within five Business Days after a Responsible Officer
becoming aware of the existence of any Default or Event of Default or
that any Person has given any notice or taken any action with respect
to a claimed default hereunder or that any Person has given notice or
taken any action with respect to a claimed default of the type referred
to in Section 11(f), a written notice specifying the nature and period
of existence thereof and what action the Company is taking or proposes
to take with respect thereto;
(f) ERISA MATTERS -- promptly, and in any event within five
days after a Responsible Officer becoming aware of any of the
following, a written notice setting forth the nature thereof and the
action, if any, that the Company or an ERISA Affiliate proposes to take
with respect thereto:
(i) with respect to any Plan, any reportable event,
as defined in section 4043(b) of ERISA and the regulations
thereunder, for which notice thereof has not been waived
pursuant to such regulations as in effect on the date hereof;
or
(ii) the taking by the PBGC of steps to institute, or
the threatening by the PBGC of the institution of, proceedings
under section 4042 of ERISA for the termination of, or the
appointment of a trustee to administer, any Plan, or the
receipt by the Company or any ERISA Affiliate of a notice from
a Multiemployer Plan that such action has been taken by the
PBGC with respect to such Multiemployer Plan; or
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(iii) any event, transaction or condition that could
result in the incurrence of any liability by the Company or
any ERISA Affiliate pursuant to Title I or IV of ERISA or the
penalty or excise tax provisions of the Code relating to
employee benefit plans, or in the imposition of any Lien on
any of the rights, properties or assets of the Company or any
ERISA Affiliate pursuant to Title I or IV of ERISA or such
penalty or excise tax provisions, if such liability or Lien,
taken together with any other such liabilities or Liens then
existing, could reasonably be expected to have a Material
Adverse Effect;
(g) NOTICES FROM GOVERNMENTAL AUTHORITY -- promptly, and in
any event within 30 days of receipt thereof, copies of any notice to
the Company or any Subsidiary from any Federal or state Governmental
Authority alleging a violation of any order, ruling, statute or other
law or regulation that could reasonably be expected to have a Material
Adverse Effect; and
(h) REQUESTED INFORMATION -- with reasonable promptness, such
other data and information relating to the business, operations,
affairs, financial condition, assets or properties of the Company or
any of its Subsidiaries or relating to the ability of the Company to
perform its obligations hereunder and under the Notes as from time to
time may be reasonably requested by any such holder of Notes.
7.2. OFFICER'S CERTIFICATE.
Each set of financial statements delivered to a holder of
Notes pursuant to Section 7.1(a) or (b) shall be accompanied by a certificate of
a Senior Financial Officer setting forth:
(a) COVENANT COMPLIANCE -- the information (including detailed
calculations) required in order to establish whether the Company was in
compliance with the requirements of Section 10.1 through Section 10.13,
inclusive, during the quarterly or annual period covered by the
statements then being furnished (including with respect to each such
Section, where applicable, the calculations of the maximum or minimum
amount, ratio or percentage, as the case may be, permissible under the
terms of such Sections, and the calculation of the amount, ratio or
percentage then in existence); and
(b) EVENT OF DEFAULT -- a statement that such officer has
reviewed the relevant terms hereof and has made, or caused to be made,
under his or her supervision, a review of the transactions and
conditions of the Company and its Restricted Subsidiaries from the
beginning of the quarterly or annual period covered by the statements
then being furnished to the date of the certificate and that such
review shall not have disclosed the existence during such period of any
condition or event that constitutes a Default or an Event of Default
or, if any such condition or event existed or exists (including any
such event or condition resulting from the failure of the Company or
any Restricted Subsidiary to comply with any Environmental Law),
specifying the nature and period of existence thereof and what action
the Company shall have taken or proposes to take with respect thereto.
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7.3. INSPECTION.
The Company will permit the representatives of each holder of
Notes that is an Institutional Investor:
(a) NO DEFAULT -- if no Default or Event of Default then
exists, at the expense of such holder and upon reasonable prior notice
to the Company, to visit the principal executive office of the Company,
to discuss the affairs, finances and accounts of the Company and its
Subsidiaries with the Company's officers, and (with the consent of the
Company, which consent will not be unreasonably withheld) its
independent public accountants, and (with the consent of the Company,
which consent will not be unreasonably withheld) to visit the other
offices and properties of the Company and each Subsidiary, all at such
reasonable times and as often as may be reasonably requested in
writing; and
(b) DEFAULT -- if a Default or Event of Default then exists,
at the expense of the Company, to visit and inspect any of the offices
or properties of the Company or any Subsidiary, to examine all their
respective books of account, records, reports and other papers, to make
copies and extracts therefrom, and to discuss their respective affairs,
finances, and accounts with their respective officers and independent
public accountants (and by this provision the Company authorizes said
accountants to discuss the affairs, finances and accounts of the
Company and its Subsidiaries), all at such times and as often as may be
requested.
8. PREPAYMENT OF THE NOTES.
8.1. NO SCHEDULED PREPAYMENTS.
No regularly scheduled prepayments are due on the Notes prior
to their stated maturity.
8.2. OPTIONAL PREPAYMENTS WITH MAKE-WHOLE AMOUNT.
The Company may, at its option, upon notice as provided below,
prepay at any time all, or from time to time any part of, the Notes in an amount
not less than $1,000,000 in the aggregate in the case of a partial prepayment,
at 100% of the principal amount so prepaid, plus the Make-Whole Amount
determined for the prepayment date with respect to such principal amount. The
Company will give each holder of Notes written notice of each optional
prepayment under this Section 8.2 not less than 30 days and not more than 60
days prior to the date fixed for such prepayment. Each such notice shall specify
such date, the aggregate principal amount of the Notes to be prepaid on such
date, the principal amount of each Note held by such holder to be prepaid
(determined in accordance with Section 8.3), and the interest to be paid on the
prepayment date with respect to such principal amount being prepaid, and shall
be accompanied by a certificate of a Senior Financial Officer as to the
estimated Make-Whole Amount due in connection with such prepayment (calculated
as if the date of such notice were the date of the prepayment), setting forth
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the details of such computation. Two Business Days prior to such prepayment, the
Company shall deliver to each holder of Notes a certificate of a Senior
Financial Officer specifying the calculation of such Make-Whole Amount as of the
specified prepayment date.
8.3. MANDATORY OFFER TO PREPAY UPON CHANGE OF CONTROL.
(a) NOTICE OF CHANGE OF CONTROL OR CONTROL EVENT -- The
Company will, within 15 Business Days after any Responsible Officer has
knowledge of the occurrence of any Change of Control or Control Event,
give notice of such Change of Control or Control Event to each holder
of Notes unless notice in respect of such Change of Control (or the
Change of Control contemplated by such Control Event) shall have been
given pursuant to subparagraph (b) of this Section 8.3. If a Change of
Control has occurred, such notice shall contain and constitute an offer
to prepay Notes as described in paragraph (c) of this Section 8.3 and
shall be accompanied by the certificate described in paragraph (g) of
this Section 8.3.
(b) CONDITION TO COMPANY ACTION -- The Company will not take
any action that consummates or finalizes a Change of Control unless (i)
at least 30 days prior to such action it shall have given to each
holder of Notes written notice containing and constituting an offer to
prepay Notes as accompanied by the certificate described in paragraph
(g) of this Section 8.3, and (ii) subject to the provisions of
paragraph (d) below, contemporaneously with such action, it prepays all
Notes required to be prepaid in accordance with this Section 8.3.
(c) OFFER TO PREPAY NOTES -- The offer to prepay Notes
contemplated by paragraphs (a) and (b) of this Section 8.3 shall be an
offer to prepay, in accordance with and subject to this Section 8.3,
all, but not less than all, of the Notes held by each holder (in this
case only, "holder" in respect of any Note registered in the name of a
nominee for a disclosed beneficial owner shall mean such beneficial
owner) on a date specified in such offer (the "Proposed Prepayment
Date"). If such Proposed Prepayment Date is in connection with an offer
contemplated by subparagraph (a) of this Section 8.3, such date shall
be not less than 30 days and not more than 60 days after the date of
such offer.
(d) ACCEPTANCE -- A holder of Notes may accept the offer to
prepay made pursuant to this Section 8.3 by causing a notice of such
acceptance to be delivered to the Company within 15 Business Days of
receipt of the offer to prepay. A failure by a holder of Notes to
respond to an offer to prepay made pursuant to this Section 8.3 shall
be deemed to constitute rejection of such offer by such holder.
(e) PREPAYMENT -- Prepayment of the Notes to be prepaid
pursuant to this Section 8.3 shall be at 100% of the principal amount
of such Notes, together with interest on such Notes accrued to the date
of prepayment and shall not require the payment of any Make-Whole
Amount. The prepayment shall be made on the Proposed Prepayment Date
except as provided in paragraph (f) of this Section 8.3.
(f) DEFERRAL PENDING CHANGE IN CONTROL -- The obligation of
the Company to prepay Notes pursuant to the offers required by
paragraphs (a) and (b) and accepted in accordance with paragraph (d) of
this Section 8.3 is subject to the occurrence of the Change of Control
in respect of which such offers and acceptances shall have been made.
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In the event that such Change of Control does not occur on the Proposed
Prepayment Date in respect thereof, the prepayment shall be deferred
until and shall be made on the date on which such Change of Control
occurs. The Company shall keep each holder of Notes reasonably and
timely informed of (i) any such deferral of the date of prepayment,
(ii) the date on which such Change of Control and the prepayment are
expected to occur, and (iii) any determination by the Company that
efforts to effect such Change of Control have ceased or been abandoned
(in which case the offers and acceptances made pursuant to this Section
8.3 in respect of such Change of Control shall be deemed rescinded).
Notwithstanding the foregoing, in the event that the prepayment has not
been made within 90 days after such Proposed Prepayment Date by virtue
of the deferral provided for in this Section 8.3(f), the Company shall
make a new offer to prepay in accordance with paragraph (c) of this
Section 8.3.
(g) OFFICER'S CERTIFICATE -- Each offer to prepay the Notes
pursuant to this Section 8.3 shall be accompanied by a certificate,
executed by a Senior Financial Officer of the Company and dated the
date of such offer, specifying: (i) the Proposed Prepayment Date, (ii)
that such offer is made pursuant to this Section 8.3, (iii) the
principal amount of each Note offered to be prepaid, (iv) the interest
that would be due on each Note offered to be prepaid, accrued to the
Proposed Prepayment Date, (v) that the conditions of this Section 8.3
have been fulfilled and (vi) in reasonable detail, the nature and date
or proposed date of the Change of Control.
8.4. ALLOCATION OF PARTIAL PREPAYMENTS.
In the case of each partial prepayment of the Notes pursuant
to Section 8.2, the principal amount of the Notes to be prepaid shall be
allocated among all of the Notes at the time outstanding in proportion, as
nearly as practicable, to the respective unpaid principal amounts thereof not
theretofore called for prepayment.
8.5. MATURITY; SURRENDER, ETC.
In the case of each prepayment of Notes pursuant to this
Section 8, the principal amount of each Note to be prepaid shall mature and
become due and payable on the date fixed for such prepayment, together with
interest on such principal amount accrued to such date and the applicable
Make-Whole Amount, if any. From and after such date, unless the Company shall
fail to pay such principal amount when so due and payable, together with the
interest and Make-Whole Amount, if any, as aforesaid, interest on such principal
amount shall cease to accrue. Any Note paid or prepaid in full shall be
surrendered to the Company and canceled and shall not be reissued, and no Note
shall be issued in lieu of any prepaid principal amount of any Note.
8.6. PURCHASE OF NOTES.
The Company will not and will not permit any Affiliate to
purchase, redeem, prepay or otherwise acquire, directly or indirectly, any of
the outstanding Notes except upon the payment or prepayment of the Notes in
accordance with the terms of this Agreement and the Notes. The Company will
promptly cancel all Notes acquired by it or any Affiliate pursuant to any
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payment, prepayment or purchase of Notes pursuant to any provision of this
Agreement and no Notes may be issued in substitution or exchange for any such
Notes.
8.7. MAKE-WHOLE AMOUNT.
The term "MAKE-WHOLE AMOUNT" means, with respect to any Note,
an amount equal to the excess, if any, of the Discounted Value of the Remaining
Scheduled Payments with respect to the Called Principal of such Note over the
amount of such Called Principal, provided that the Make-Whole Amount may in no
event be less than zero. For the purposes of determining the Make-Whole Amount,
the following terms have the following meanings:
"CALLED PRINCIPAL" means, with respect to any Note, the
principal of such Note that is to be prepaid pursuant to Section 8.2 or
has become or is declared to be immediately due and payable pursuant to
Section 12.1, as the context requires.
"DISCOUNTED VALUE" means, with respect to the Called Principal
of any Note, the amount obtained by discounting all Remaining Scheduled
Payments with respect to such Called Principal from their respective
scheduled due dates to the Settlement Date with respect to such Called
Principal, in accordance with accepted financial practice and at a
discount factor (applied on the same periodic basis as that on which
interest on the Notes is payable) equal to the Reinvestment Yield with
respect to such Called Principal.
"REINVESTMENT YIELD" means, with respect to the Called
Principal of any Note, .50% over the yield to maturity implied by (i)
the yields reported, as of 10:00 A.M. (New York City time) on the
second Business Day preceding the Settlement Date with respect to such
Called Principal, on the display designated as the "PX Screen" on the
Bloomberg Financial Market Service (or such other display as may
replace the PX Screen on Bloomberg Financial Market Service) for
actively traded U.S. Treasury securities having a maturity equal to the
Remaining Average Life of such Called Principal as of such Settlement
Date, or (ii) if such yields are not reported as of such time or the
yields reported as of such time are not ascertainable, the Treasury
Constant Maturity Series Yields reported, for the latest day for which
such yields have been so reported as of the second Business Day
preceding the Settlement Date with respect to such Called Principal, in
Federal Reserve Statistical Release H.15 (519) (or any comparable
successor publication) for actively traded U.S. Treasury securities
having a constant maturity equal to the Remaining Average Life of such
Called Principal as of such Settlement Date. Such implied yield will be
determined, if necessary, by (a) converting U.S. Treasury bill
quotations to bond-equivalent yields in accordance with accepted
financial practice and (b) interpolating linearly between (1) the
actively traded U.S. Treasury security with the maturity closest to and
greater than the Remaining Average Life and (2) the actively traded
U.S. Treasury security with the maturity closest to and less than the
Remaining Average Life.
"REMAINING AVERAGE LIFE" means, with respect to any Called
Principal, the number of years (calculated to the nearest one-twelfth
year) obtained by dividing (i) such Called Principal into (ii) the sum
of the products obtained by multiplying (a) the principal component of
each Remaining Scheduled Payment with respect to such Called Principal
by (b) the number of years (calculated to the nearest one-twelfth year)
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that will elapse between the Settlement Date with respect to such
Called Principal and the scheduled due date of such Remaining Scheduled
Payment.
"REMAINING SCHEDULED PAYMENTS" means, with respect to the
Called Principal of any Note, all payments of such Called Principal and
interest thereon that would be due after the Settlement Date with
respect to such Called Principal if no payment of such Called Principal
were made prior to its scheduled due date, provided that if such
Settlement Date is not a date on which interest payments are due to be
made under the terms of the Notes, then the amount of the next
succeeding scheduled interest payment will be reduced by the amount of
interest accrued to such Settlement Date and required to be paid on
such Settlement Date pursuant to Section 8.2 or 12.1.
"SETTLEMENT DATE" means, with respect to the Called Principal
of any Note, the date on which such Called Principal is to be prepaid
pursuant to Section 8.2 or has become or is declared to be immediately
due and payable pursuant to Section 12.1, as the context requires.
9. AFFIRMATIVE COVENANTS.
The Company covenants that so long as any of the Notes are
outstanding:
9.1. COMPLIANCE WITH LAW.
The Company will, and will cause each Subsidiary to, comply
with all laws, ordinances or governmental rules or regulations to which each of
them is subject, including, without limitation, Environmental Laws, and will
obtain and maintain in effect all licenses, certificates, permits, franchises
and other governmental authorizations necessary to the ownership of their
respective properties or to the conduct of their respective businesses, in each
case to the extent necessary to ensure that non-compliance with such laws,
ordinances or governmental rules or regulations or failures to obtain or
maintain in effect such licenses, certificates, permits, franchises and other
governmental authorizations could not, individually or in the aggregate,
reasonably be expected to have a Material Adverse Effect.
9.2. INSURANCE.
The Company will, and will cause each Restricted Subsidiary
to, maintain, with financially sound and reputable insurers, insurance with
respect to their respective properties and businesses against such casualties
and contingencies, of such types, on such terms and in such amounts (including
deductibles, co-insurance and self-insurance, if adequate reserves are
maintained with respect thereto) as is customary in the case of entities of
established reputations engaged in the same or a similar business and similarly
situated.
9.3. MAINTENANCE OF PROPERTIES.
The Company will and will cause each Restricted Subsidiary to
maintain and keep, or cause to be maintained and kept, their respective
properties in good repair, working order and condition (other than ordinary wear
and tear), so that the business carried on in connection therewith may be
properly conducted at all times, provided that this Section shall not prevent
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the Company or any Restricted Subsidiary from discontinuing the operation and
the maintenance of any of its properties if such discontinuance is desirable in
the conduct of its business and the Company has concluded that such
discontinuance could not, individually or in the aggregate, reasonably be
expected to have a Material Adverse Effect.
9.4. PAYMENT OF TAXES AND CLAIMS.
The Company will, and will cause each Subsidiary to, file all
income tax or similar tax returns required to be filed in any jurisdiction and
to pay and discharge all taxes shown to be due and payable on such returns and
all other taxes, assessments, governmental charges, or levies imposed on them or
any of their properties, assets, income or franchises, to the extent such taxes
and assessments have become due and payable and before they have become
delinquent and all claims for which sums have become due and payable that have
or might become a Lien on properties or assets of the Company or any Subsidiary,
provided that neither the Company nor any Subsidiary need pay any such tax or
assessment or claims if (i) the amount, applicability or validity thereof is
contested by the Company or such Subsidiary on a timely basis in good faith and
in appropriate proceedings, and the Company or a Subsidiary has established
adequate reserves therefor in accordance with GAAP on the books of the Company
or such Subsidiary or (ii) the nonpayment of all such taxes and assessments in
the aggregate could not reasonably be expected to have a Material Adverse
Effect.
9.5. CORPORATE EXISTENCE, ETC.
The Company will at all times preserve and keep in full force
and effect its corporate existence. Subject to Sections 10.8 through 10.10,
inclusive, the Company will at all times preserve and keep in full force and
effect the corporate existence of each of its Restricted Subsidiaries (unless
merged into the Company or a Restricted Subsidiary) and all rights and
franchises of the Company and its Restricted Subsidiaries unless, in the good
faith judgment of the Company, the termination of or failure to preserve and
keep in full force and effect such corporate existence, right or franchise could
not, individually or in the aggregate, have a Material Adverse Effect.
9.6. CONSOLIDATING FINANCIAL STATEMENTS.
If at any time the Company provides consolidating financial
statements to the Banks or any other holder of Indebtedness, the Company will
provide copies of the same to you and any other holder of the Notes.
10. NEGATIVE COVENANTS.
The Company covenants that so long as any of the Notes are
outstanding:
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10.1. ADJUSTED CONSOLIDATED NET WORTH.
The Company will not permit Adjusted Consolidated Net Worth at
any time to be less than $420,000,000 plus the cumulative sum of 25% of
Consolidated Net Income (but only if a positive number) for each fiscal quarter
ending after September 30, 2000.
10.2. LEVERAGE RATIO.
The Company will not permit the ratio of Consolidated
Indebtedness (as of any date of determination) to Consolidated Operating Cash
Flow (for the Company's then most recently completed four fiscal quarters) to be
greater than 2.5 to 1.0 at any time
10.3. INDEBTEDNESS OF RESTRICTED SUBSIDIARIES.
The Company will not permit any Restricted Subsidiary that is
not a Subsidiary Guarantor to create, assume, incur, guarantee or otherwise
become liable, directly or indirectly, for any Indebtedness, except:
(a) Indebtedness owed to the Company or a Wholly Owned
Restricted Subsidiary;
(b) Indebtedness outstanding as of the date of this Agreement
that is described in Schedule 5.15;
(c) Indebtedness secured by Xxxxx permitted under Section
10.6(g);
(d) Indebtedness of a Subsidiary outstanding at the time of
its acquisition by the Company and initial designation as a Restricted
Subsidiary, provided that (i) such Indebtedness was not incurred in
contemplation of such Subsidiary becoming a Restricted Subsidiary and
(ii) immediately after giving effect to the designation of such
Subsidiary as a Restricted Subsidiary, no Default or Event of Default
would exist;
(e) Indebtedness in addition to that permitted by Sections
10.3(a) through (d), provided that Priority Debt does not at any time
exceed 20% of Adjusted Consolidated Net Worth, determined as of the end
of the most recently ended fiscal quarter.
Any Indebtedness of Subsidiary Guarantor that is released from the Subsidiary
Guaranty shall be deemed to have been incurred by such Subsidiary on the date of
such release.
10.4. FIXED CHARGE COVERAGE.
The Company will not permit the ratio (calculated as of the
end of each fiscal quarter) of Consolidated Income Available for Fixed Charges
to Consolidated Fixed Charges for the period of four quarters ending as of each
fiscal quarter to be less than 2.0 to 1.0.
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10.5. RESTRICTED PAYMENTS; RESTRICTED INVESTMENTS.
The Company will not, and will not permit any Restricted
Subsidiary to, declare, make, or incur any liability to declare or make, any
Restricted Payment or Restricted Investment unless immediately after giving
effect thereto no Default or Event of Default would exist.
10.6. LIENS.
The Company will not, and will not permit any Restricted
Subsidiary to, permit to exist, create, assume or incur, directly or indirectly,
any Lien on its properties or assets, whether now owned or hereafter acquired,
except:
(a) Liens existing on property or assets of the Company or any
Restricted Subsidiary as of the date of this Agreement that are
described in Schedule 10.6;
(b) Liens for taxes, assessments or governmental charges not
then due and delinquent or the nonpayment of which is permitted by
Section 9.4;
(c) encumbrances in the nature of leases, subleases, zoning
restrictions, easements, rights of way, minor survey exceptions and
other rights and restrictions of record on the use of real property and
defects in title arising or incurred in the ordinary course of
business, which, individually and in the aggregate, do not materially
impair the use or value of the property or assets subject thereto or
which relate only to assets that in the aggregate are not material;
(d) Liens incidental to the conduct of business or the
ownership of properties and assets (including landlords', lessors',
carriers', warehousemen's, mechanics', materialmen's and other similar
liens) and Liens to secure the performance of bids, tenders, leases or
trade contracts, or to secure statutory obligations (including
obligations under workers compensation, unemployment insurance and
other social security legislation), surety or appeal bonds or other
Liens of like general nature incurred in the ordinary course of
business and not in connection with the borrowing of money;
(e) any attachment or judgment Lien, unless the judgment it
secures has not, within 60 days after the entry thereof, been
discharged or execution thereof stayed pending appeal, or has not been
discharged within 60 days after the expiration of any such stay;
(f) Liens securing Indebtedness of a Restricted Subsidiary to
the Company or to another Wholly Owned Restricted Subsidiary;
(g) Liens (i) existing on property at the time of its
acquisition by the Company or a Restricted Subsidiary and not created
in contemplation thereof, whether or not the Indebtedness secured by
such Lien is assumed by the Company or a Restricted Subsidiary; or (ii)
on property created contemporaneously with its acquisition or within
180 days of the acquisition or completion of construction thereof to
secure or provide for all or a portion of the purchase price or cost of
construction of such property after the date of Closing; or (iii)
existing on property of a Person at the time such Person is merged or
consolidated with, or becomes a Restricted Subsidiary of, or
substantially all of its assets are acquired by, the Company or a
Restricted Subsidiary and not created in contemplation thereof;
provided that in the case of clauses (i), (ii) and (iii) such Liens do
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not extend to additional property of the Company or any Restricted
Subsidiary (other than property that is an improvement to or is
acquired for specific use in connection with the subject property) and,
in the case of clause (ii) only, that (A) the aggregate principal
amount of Indebtedness secured by each such Lien does not exceed the
lesser of cost of acquisition or construction or the fair market value
(determined in good faith by one or more officers of the Company to
whom authority to enter into the transaction has been delegated by the
board of directors of the Company) of the property subject thereto and
(B) in the case of construction or acquisition of improvements to real
estate, the land on which such improvements are located need not have
been acquired within the 180 day period;
(h) the Lien of the Pledge Agreement as of the date of this
Agreement and as it may in the future be extended to other property of
the Company in compliance with the terms of this Section 10.6; and
(i) Liens securing Indebtedness not otherwise permitted by
paragraphs (a) through (h) above, provided that Priority Debt does not
at any time exceed 20% of Adjusted Consolidated Net Worth determined as
of the end of the most recently ended fiscal quarter.
Notwithstanding the foregoing, the terms of this Section 10.6 shall not be
applicable to treasury shares held by the Company.
10.7. MERGERS, CONSOLIDATIONS, ETC.
The Company will not, and will not permit any Restricted
Subsidiary to, consolidate with or merge with any other Person or convey,
transfer, sell or lease all or substantially all of its assets in a single
transaction or series of transactions to any Person except that:
(a) the Company may consolidate or merge with any other Person
or convey, transfer, sell or lease all or substantially all of its
assets in a single transaction or series of transactions to any Person,
provided that:
(i) the successor formed by such consolidation or the
survivor of such merger or the Person that acquires by
conveyance, transfer, sale or lease all or substantially all
of the assets of the Company as an entirety, as the case may
be, is a solvent corporation organized and existing under the
laws of the United States or any state thereof (including the
District of Columbia), and, if the Company is not such
corporation, such corporation (y) shall have executed and
delivered to each holder of any Notes its assumption of the
due and punctual performance and observance of each covenant
and condition of this Agreement and the Notes and (z) shall
have caused to be delivered to each holder of any Notes an
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opinion of independent counsel reasonably satisfactory to the
Required Holders, to the effect that all agreements or
instruments effecting such assumption are enforceable in
accordance with their terms and comply with the terms hereof;
and
(ii) immediately before and after giving effect to
such transaction, no Default or Event of Default shall exist;
and
(b) Any Restricted Subsidiary may (x) merge into the Company
(provided that the Company is the surviving corporation) or another
Wholly Owned Restricted Subsidiary or (y) sell, transfer or lease all
or any part of its assets to the Company or another Wholly Owned
Restricted Subsidiary, or (z) merge or consolidate with, or sell,
transfer or lease all or substantially all of its assets to, any Person
in a transaction that is permitted by Section 10.8 or, as a result of
which, such Person becomes a Restricted Subsidiary; provided in each
instance set forth in clauses (x) through (z) that, immediately before
and after giving effect thereto, there shall exist no Default or Event
of Default;
No such conveyance, transfer, sale or lease of all or substantially all of the
assets of the Company shall have the effect of releasing the Company or any
successor corporation that shall theretofore have become such in the manner
prescribed in this Section 10.7 from its liability under this Agreement or the
Notes.
10.8. SALE OF ASSETS.
Except as permitted by Section 10.7, the Company will not, and
will not permit any Restricted Subsidiary to, sell, lease, transfer or otherwise
dispose of, including by way of merger (collectively a "Disposition"), any
assets, including capital stock of Restricted Subsidiaries, in one or a series
of transactions, to any Person, other than (a) Dispositions in the ordinary
course of business, (b) Dispositions by a Restricted Subsidiary to the Company
or another Wholly Owned Restricted Subsidiary or (c) Dispositions not otherwise
permitted by clauses (a) or (b) of this Section 10.8, provided that (i) each
such Disposition is for a consideration at least equal to the fair market value
of the property subject thereto, (ii) the aggregate net book value of all assets
so disposed of in any fiscal year pursuant to this Section 10.8(c) does not
exceed 15% of Consolidated Net Assets as of the end of the immediately preceding
fiscal year, (iii) the operations of such assets sold pursuant to this Section
10.8(c) generated less than 15% of the consolidated operating profit of the
Company and its Restricted Subsidiaries for the immediately preceding fiscal
year, and (iv) after giving effect to such Disposition no Default or Event of
Default would exist. Notwithstanding the foregoing, the Company may, or may
permit any Restricted Subsidiary to, make a Disposition and the assets subject
to such Disposition shall not be subject to or included in the foregoing
limitation and computation contained in clause (c) of the preceding sentence to
the extent that (i) each such Disposition is for a consideration at least equal
to the fair market value of the property subject thereto, and (ii) the net
proceeds from such Disposition are within 180 days of such Disposition (A)
reinvested in productive assets by the Company or a Restricted Subsidiary or (B)
applied to the payment or prepayment of any outstanding Indebtedness of the
Company or any Restricted Subsidiary that is PARI PASSU with or senior to the
Notes. Any prepayment of Notes pursuant to this Section 10.8 shall be in
accordance with Sections 8.2 and 8.3, without regard to the minimum prepayment
requirements of Section 8.2.
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10.9. DISPOSITION OF STOCK OF RESTRICTED SUBSIDIARIES.
The Company will not, and will not permit any Restricted
Subsidiary to, issue, sell, transfer or otherwise dispose of any capital stock
of a Restricted Subsidiary if such sale would be prohibited by Section 10.8. If
a Restricted Subsidiary at any time ceases to be such as a result of issuance or
sale of its capital stock, Indebtedness of the Company or any other Restricted
Subsidiary owed to such Restricted Subsidiary that is not contemporaneously
repaid and any Liens on property of the Company or any Restricted Subsidiary
securing such Indebtedness shall be deemed to have been incurred by the Company
or such other Restricted Subsidiary, as the case may be, at the time such
Restricted Subsidiary ceases to be a Restricted Subsidiary.
10.10. DESIGNATION OF RESTRICTED AND UNRESTRICTED SUBSIDIARIES.
The Company may designate any Restricted Subsidiary as an
Unrestricted Subsidiary and any Unrestricted Subsidiary as a Restricted
Subsidiary; provided that,
(a) if such Subsidiary initially is designated a Restricted
Subsidiary, then such Restricted Subsidiary may be subsequently
designated as an Unrestricted Subsidiary and such Unrestricted
Subsidiary may be subsequently designated as a Restricted Subsidiary,
but no further changes in designation may be made;
(b) if such Subsidiary initially is designated an Unrestricted
Subsidiary, then such Unrestricted Subsidiary may be subsequently
designated as a Restricted Subsidiary and such Restricted Subsidiary
may be subsequently designated as an Unrestricted Subsidiary, but no
further changes in designation may be made;
(c) the Company may not designate a Restricted Subsidiary as
an Unrestricted Subsidiary unless: (i) such Restricted Subsidiary does
not own, directly or indirectly, any Indebtedness or capital stock of
the Company or any other Restricted Subsidiary, (ii) such designation,
considered as a sale of assets, is permitted pursuant to Sections 10.7
through 10.9, inclusive, (iii) immediately before and after such
designation there exists no Default or Event of Default; and
(d) a Subsidiary Guarantor may not be designated an
Unrestricted Subsidiary.
10.11. RESTRICTED SUBSIDIARY GUARANTIES.
The Company will not permit any Restricted Subsidiary to
become a party to the Bank Guarantees or to directly or indirectly guarantee any
of the Company's Indebtedness or other obligations unless such Restricted
Subsidiary is, or concurrently therewith becomes, a party to the Subsidiary
Guaranty.
10.12. NATURE OF BUSINESS.
The Company will not, and will not permit any Restricted
Subsidiary to, engage in any business if, as a result, the general nature of the
business in which the Company and its Restricted Subsidiaries, taken as a whole,
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would then be engaged would be substantially changed from the general nature of
the business in which the Company and its Restricted Subsidiaries, taken as a
whole, are engaged on the date of this Agreement as described in the Memorandum.
10.13. TRANSACTIONS WITH AFFILIATES.
The Company will not and will not permit any Restricted
Subsidiary to enter into directly or indirectly any transaction or Material
group of related transactions (including without limitation the purchase, lease,
sale or exchange of properties of any kind or the rendering of any service) with
any Affiliate (other than the Company or another Restricted Subsidiary), except
upon fair and reasonable terms no less favorable to the Company or such
Restricted Subsidiary than would be obtainable in a comparable arm's-length
transaction with a Person not an Affiliate.
11. EVENTS OF DEFAULT.
An "Event of Default" shall exist if any of the following
conditions or events shall occur and be continuing:
(a) the Company defaults in the payment of any principal or
Make-Whole Amount, if any, on any Note when the same becomes due and
payable, whether at maturity or at a date fixed for prepayment or by
declaration or otherwise; or
(b) the Company defaults in the payment of any interest on any
Note for more than five Business Days after the same becomes due and
payable; or
(c) the Company defaults in the performance of or compliance
with any term contained in or Sections 10.1 through 10.13; or
(d) the Company defaults in the performance of or compliance
with any term contained herein (other than those referred to in
paragraphs (a), (b) and (c) of this Section 11) and such default is not
remedied within 30 days after the earlier of (i) a Responsible Officer
obtaining actual knowledge of such default and (ii) the Company
receiving written notice of such default from any holder of a Note; or
(e) any representation or warranty made in writing by or on
behalf of the Company or any Subsidiary Guarantor or by any officer of
the Company or a Subsidiary Guarantor in this Agreement, the Subsidiary
Guaranty or the Pledge Agreement or in any writing furnished in
connection with the transactions contemplated hereby or thereby proves
to have been false or incorrect in any material respect on the date as
of which made; or
(f) (i) the Company or any Restricted Subsidiary is in default
(as principal or as guarantor or other surety) in the payment of any
principal of or premium or make-whole amount or interest on any
Indebtedness that is outstanding in an aggregate principal amount of at
least $10,000,000 beyond any period of grace provided with respect
thereto, or (ii) the Company or any Restricted Subsidiary is in default
in the performance of or compliance with any term of any evidence of
any Indebtedness that is outstanding in an aggregate principal amount
of at least $10,000,000 or of any mortgage, indenture or other
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agreement relating thereto or any other condition exists, and as a
consequence of such default or condition such Indebtedness has become,
or has been declared (or one or more Persons are entitled to declare
such Indebtedness to be), due and payable before its stated maturity or
before its regularly scheduled dates of payment, or (iii) as a
consequence of the occurrence or continuation of any event or condition
(other than the passage of time or the right of the holder of
Indebtedness to convert such Indebtedness into equity interests), (x)
the Company or any Restricted Subsidiary has become obligated to
purchase or repay Indebtedness before its regular maturity or before
its regularly scheduled dates of payment in an aggregate outstanding
principal amount of at least $10,000,000, or (y) one or more Persons
have the right to require the Company or any Subsidiary so to purchase
or repay such Indebtedness; or
(g) the Company or any Restricted Subsidiary (i) is generally
not paying, or admits in writing its inability to pay, its debts as
they become due, (ii) files, or consents by answer or otherwise to the
filing against it of, a petition for relief or reorganization or
arrangement or any other petition in bankruptcy, for liquidation or to
take advantage of any bankruptcy, insolvency, reorganization,
moratorium or other similar law of any jurisdiction, (iii) makes an
assignment for the benefit of its creditors, (iv) consents to the
appointment of a custodian, receiver, trustee or other officer with
similar powers with respect to it or with respect to any substantial
part of its property, (v) is adjudicated as insolvent or to be
liquidated, or (vi) takes corporate action for the purpose of any of
the foregoing; or
(h) a court or governmental authority of competent
jurisdiction enters an order appointing, without consent by the Company
or any Restricted Subsidiary, a custodian, receiver, trustee or other
officer with similar powers with respect to it or with respect to any
substantial part of its property, or constituting an order for relief
or approving a petition for relief or reorganization or any other
petition in bankruptcy or for liquidation or to take advantage of any
bankruptcy or insolvency law of any jurisdiction, or ordering the
dissolution, winding-up or liquidation of the Company or any Restricted
Subsidiary, or any such petition shall be filed against the Company or
any Restricted Subsidiary and such petition shall not be dismissed
within 60 days; or
(i) a final judgment or judgments for the payment of money
aggregating at least $10,000,000 are rendered against one or more of
the Company and its Restricted Subsidiaries, which judgments are not,
within 60 days after entry thereof, bonded, discharged or stayed
pending appeal, or are not discharged within 60 days after the
expiration of such stay; or
(j) if (i) any Plan shall fail to satisfy the minimum funding
standards of ERISA or the Code for any plan year or part thereof or a
waiver of such standards or extension of any amortization period is
sought or granted under section 412 of the Code, (ii) a notice of
intent to terminate any Plan shall have been or is reasonably expected
to be filed with the PBGC or the PBGC shall have instituted proceedings
under ERISA section 4042 to terminate or appoint a trustee to
administer any Plan or the PBGC shall have notified the Company or any
ERISA Affiliate that a Plan may become a subject of any such
proceedings, (iii) the aggregate "amount of unfunded benefit
liabilities" (within the meaning of section 4001(a)(18) of ERISA) under
all Plans determined in accordance with Title IV of ERISA, shall be at
least $10,000,000, (iv) the Company or any ERISA Affiliate shall have
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incurred or is reasonably expected to incur any liability pursuant to
Title I or IV of ERISA or the penalty or excise tax provisions of the
Code relating to employee benefit plans, (v) the Company or any ERISA
Affiliate withdraws from any Multiemployer Plan, or (vi) the Company or
any Subsidiary establishes or amends any employee welfare benefit plan
that provides post-employment welfare benefits in a manner that would
increase the liability of the Company or any Subsidiary thereunder; and
any such event or events described in clauses (i) through (vi) above,
either individually or together with any other such event or events,
could reasonably be expected to have a Material Adverse Effect; or
(k) any Subsidiary Guarantor defaults in the performance of or
compliance with any term contained in the Subsidiary Guaranty or the
Subsidiary Guaranty ceases to be in full force and effect as a result
of acts taken by the Company or any Subsidiary Guarantor, except as
provided in Section 22, or is declared to be null and void in whole or
in material part by a court or other governmental or regulatory
authority having jurisdiction or the validity or enforceability thereof
shall be contested by any of the Company or any Subsidiary Guarantor or
any of them renounces any of the same or denies that it has any or
further liability thereunder; or
(l) the Company or any Subsidiary Guarantor defaults in the
performance of or compliance with any term contained in the Pledge
Agreement or the Pledge Agreement ceases to be in full force and effect
as a result of acts taken by the Company or any Subsidiary Guarantor,
except as provided in Section 22, or is declared to be null and void in
whole or in material part by a court or other governmental or
regulatory authority having jurisdiction or the validity or
enforceability thereof shall be contested by any of the Company or any
Subsidiary Guarantor or any of them renounces any of the same or denies
that it has any or further liability thereunder.
As used in Section 11(j), the terms "employee benefit plan" and "employee
welfare benefit plan" shall have the respective meanings assigned to such terms
in Section 3 of ERISA.
12. REMEDIES ON DEFAULT, ETC.
12.1. ACCELERATION.
(a) If an Event of Default with respect to the Company
described in paragraph (g) or (h) of Section 11 (other than an Event of
Default described in clause (i) of paragraph (g) or described in clause
(vi) of paragraph (g) by virtue of the fact that such clause
encompasses clause (i) of paragraph (g)) has occurred, all the Notes
then outstanding shall automatically become immediately due and
payable.
(b) If any other Event of Default has occurred and is
continuing, holders of a majority or more in principal amount of the
Notes at the time outstanding may at any time at its or their option,
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by notice or notices to the Company, declare all the Notes then
outstanding to be immediately due and payable.
(c) If any Event of Default described in paragraph (a) or (b)
of Section 11 has occurred and is continuing, any holder or holders of
Notes at the time outstanding affected by such Event of Default may at
any time, at its or their option, by notice or notices to the Company,
declare all the Notes held by it or them to be immediately due and
payable.
Upon any Notes becoming due and payable under this Section
12.1, whether automatically or by declaration, such Notes will forthwith mature
and the entire unpaid principal amount of such Notes, plus (x) all accrued and
unpaid interest thereon and (y) the Make-Whole Amount determined in respect of
such principal amount (to the full extent permitted by applicable law), shall
all be immediately due and payable, in each and every case without presentment,
demand, protest or further notice, all of which are hereby waived. The Company
acknowledges, and the parties hereto agree, that each holder of a Note has the
right to maintain its investment in the Notes free from repayment by the Company
(except as herein specifically provided for) and that the provision for payment
of a Make-Whole Amount by the Company in the event that the Notes are prepaid or
are accelerated as a result of an Event of Default, is intended to provide
compensation for the deprivation of such right under such circumstances.
12.2. OTHER REMEDIES.
If any Default or Event of Default has occurred and is
continuing, and irrespective of whether any Notes have become or have been
declared immediately due and payable under Section 12.1, the holder of any Note
at the time outstanding may proceed to protect and enforce the rights of such
holder by an action at law, suit in equity or other appropriate proceeding,
whether for the specific performance of any agreement contained herein or in any
Note, or for an injunction against a violation of any of the terms hereof or
thereof, or in aid of the exercise of any power granted hereby or thereby or by
law or otherwise.
12.3. RESCISSION.
At any time after any Notes have been declared due and payable
pursuant to clause (b) or (c) of Section 12.1, the holders of a majority in
principal amount of the Notes then outstanding, by written notice to the
Company, may rescind and annul any such declaration and its consequences if (a)
the Company has paid all overdue interest on the Notes, all principal of and
Make-Whole Amount, if any, on any Notes that are due and payable and are unpaid
other than by reason of such declaration, and all interest on such overdue
principal and Make-Whole Amount, if any, and (to the extent permitted by
applicable law) any overdue interest in respect of the Notes, at the Default
Rate, (b) all Events of Default and Defaults, other than non-payment of amounts
that have become due solely by reason of such declaration, have been cured or
have been waived pursuant to Section 17, and (c) no judgment or decree has been
entered for the payment of any monies due pursuant hereto or to the Notes. No
rescission and annulment under this Section 12.3 will extend to or affect any
subsequent Event of Default or Default or impair any right consequent thereon.
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12.4. NO WAIVERS OR ELECTION OF REMEDIES, EXPENSES, ETC.
No course of dealing and no delay on the part of any holder of
any Note in exercising any right, power or remedy shall operate as a waiver
thereof or otherwise prejudice such holder's rights, powers or remedies. No
right, power or remedy conferred by this Agreement or by any Note upon any
holder thereof shall be exclusive of any other right, power or remedy referred
to herein or therein or now or hereafter available at law, in equity, by statute
or otherwise. Without limiting the obligations of the Company under Section 15,
the Company will pay to the holder of each Note on demand such further amount as
shall be sufficient to cover all costs and expenses of such holder incurred in
any enforcement or collection under this Section 12, including, without
limitation, reasonable attorneys' fees, expenses and disbursements.
13. REGISTRATION; EXCHANGE; SUBSTITUTION OF NOTES.
13.1. REGISTRATION OF NOTES.
The Company shall keep at its principal executive office a
register for the registration and registration of transfers of Notes. The name
and address of each holder of one or more Notes, each transfer thereof and the
name and address of each transferee of one or more Notes shall be registered in
such register. Prior to due presentment for registration of transfer, the Person
in whose name any Note shall be registered shall be deemed and treated as the
owner and holder thereof for all purposes hereof, and the Company shall not be
affected by any notice or knowledge to the contrary. The Company shall give to
any holder of a Note that is an Institutional Investor, promptly upon request
therefor, a complete and correct copy of the names and addresses of all
registered holders of Notes.
13.2. TRANSFER AND EXCHANGE OF NOTES.
Upon surrender of any Note at the principal executive office
of the Company for registration of transfer or exchange (and in the case of a
surrender for registration of transfer, duly endorsed or accompanied by a
written instrument of transfer duly executed by the registered holder of such
Note or his attorney duly authorized in writing and accompanied by the address
for notices of each transferee of such Note or part thereof), the Company shall
execute and deliver, at the Company's expense (except as provided below), one or
more new Notes (as requested by the holder thereof) of the same series in
exchange therefor, in an aggregate principal amount equal to the unpaid
principal amount of the surrendered Note. Each such new Note shall be payable to
such Person as such holder may request and shall be substantially in the form of
Exhibit 1(a), 1(b) or 1(c), as appropriate. Each such new Note shall be dated
and bear interest from the date to which interest shall have been paid on the
surrendered Note or dated the date of the surrendered Note if no interest shall
have been paid thereon. The Company may require payment of a sum sufficient to
cover any stamp tax or governmental charge imposed in respect of any such
transfer of Notes. Notes shall not be transferred in denominations of less than
$500,000, provided that if necessary to enable the registration of transfer by a
holder of its entire holding of Notes, one Note may be in a denomination of less
than $500,000. Any transferee, by its acceptance of a Note registered in its
name (or the name of its nominee), shall be deemed to have made the
representation set forth in Section 6.2.
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13.3. REPLACEMENT OF NOTES.
Upon receipt by the Company of evidence reasonably
satisfactory to it of the ownership of and the loss, theft, destruction or
mutilation of any Note (which evidence shall be, in the case of an Institutional
Investor, notice from such Institutional Investor of such ownership and such
loss, theft, destruction or mutilation), and
(a) in the case of loss, theft or destruction, of indemnity
reasonably satisfactory to it (provided that if the holder of such Note
is, or is a nominee for, an original Purchaser or another Institutional
Investor holder of a Note with a minimum net worth of at least
$50,000,000, such Person's own unsecured agreement of indemnity shall
be deemed to be satisfactory), or
(b) in the case of mutilation, upon surrender and cancellation
thereof,
the Company at its own expense shall execute and deliver, in lieu thereof, a new
Note of the same series, dated and bearing interest from the date to which
interest shall have been paid on such lost, stolen, destroyed or mutilated Note
or dated the date of such lost, stolen, destroyed or mutilated Note if no
interest shall have been paid thereon.
14. PAYMENTS ON NOTES.
14.1. PLACE OF PAYMENT.
Subject to Section 14.2, payments of principal, Make-Whole
Amount, if any, and interest becoming due and payable on the Notes shall be made
in Chicago, Illinois at the principal office of Bank of America in such
jurisdiction. The Company may at any time, by notice to each holder of a Note,
change the place of payment of the Notes so long as such place of payment shall
be either the principal office of the Company in such jurisdiction or the
principal office of a bank or trust company in such jurisdiction.
14.2. HOME OFFICE PAYMENT.
So long as you or your nominee shall be the holder of any
Note, and notwithstanding anything contained in Section 14.1 or in such Note to
the contrary, the Company will pay all sums becoming due on such Note for
principal, Make-Whole Amount, if any, and interest by the method and at the
address specified for such purpose below your name in Schedule A, or by such
other method or at such other address as you shall have from time to time
specified to the Company in writing for such purpose, without the presentation
or surrender of such Note or the making of any notation thereon, except that
upon written request of the Company made concurrently with or reasonably
promptly after payment or prepayment in full of any Note, you shall surrender
such Note for cancellation, reasonably promptly after any such request, to the
Company at its principal executive office or at the place of payment most
recently designated by the Company pursuant to Section 14.1. Prior to any sale
or other disposition of any Note held by you or your nominee you will, at your
election, either endorse thereon the amount of principal paid thereon and the
last date to which interest has been paid thereon or surrender such Note to the
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Company in exchange for a new Note or Notes pursuant to Section 13.2. The
Company will afford the benefits of this Section 14.2 to any Institutional
Investor that is the direct or indirect transferee of any Note purchased by you
under this Agreement and that has made the same agreement relating to such Note
as you have made in this Section 14.2.
15. EXPENSES, ETC.
15.1. TRANSACTION EXPENSES.
Whether or not the transactions contemplated hereby are
consummated, the Company will pay all costs and expenses (including reasonable
attorneys' fees of one special counsel for you and the Other Purchasers
collectively and, if reasonably required, local or other counsel) incurred by
you and each Other Purchaser or holder of a Note in connection with such
transactions and in connection with any amendments, waivers or consents under or
in respect of this Agreement, the Notes, the Pledge Agreement, the Intercreditor
Agreement or the Subsidiary Guaranty (whether or not such amendment, waiver or
consent becomes effective), including: (a) the costs and expenses incurred in
enforcing or defending (or determining whether or how to enforce or defend) any
rights under this Agreement, the Notes, the Pledge Agreement, the Intercreditor
Agreement or the Subsidiary Guaranty or in responding to any subpoena or other
legal process or informal investigative demand issued in connection with this
Agreement, the Notes, the Pledge Agreement, the Intercreditor Agreement or the
Subsidiary Guaranty, or by reason of being a holder of any Note, and (b) the
costs and expenses, including financial advisors' fees, incurred in connection
with the insolvency or bankruptcy of the Company or any Subsidiary or in
connection with any work-out or restructuring of the transactions contemplated
hereby and by the Notes. The Company will pay, and will save you and each other
holder of a Note harmless from, all claims in respect of any fees, costs or
expenses if any, of brokers and finders (other than those retained by you).
15.2. SURVIVAL.
The obligations of the Company under this Section 15 will
survive the payment or transfer of any Note, the enforcement, amendment or
waiver of any provision of this Agreement or the Notes, and the termination of
this Agreement.
16. SURVIVAL OF REPRESENTATIONS AND WARRANTIES; ENTIRE AGREEMENT.
All representations and warranties contained herein shall
survive the execution and delivery of this Agreement and the Notes, the purchase
or transfer by you of any Note or portion thereof or interest therein and the
payment of any Note, and may be relied upon by any subsequent holder of a Note,
regardless of any investigation made at any time by or on behalf of you or any
other holder of a Note. All statements contained in any certificate or other
instrument delivered by or on behalf of the Company pursuant to this Agreement
shall be deemed representations and warranties of the Company under this
Agreement. Subject to the preceding sentence, this Agreement and the Notes
embody the entire agreement and understanding between you and the Company and
supersede all prior agreements and understandings relating to the subject matter
hereof.
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17. AMENDMENT AND WAIVER.
17.1. REQUIREMENTS.
This Agreement, the Notes, the Subsidiary Guaranty and the
Pledge Agreement may be amended, and the observance of any term hereof or of the
Notes may be waived (either retroactively or prospectively), with (and only
with) the written consent of the Company and the Required Holders, except that
(a) no amendment or waiver of any of the provisions of Section 1, 2, 3, 4, 5, 6
or 21 hereof, or any defined term (as it is used therein), will be effective as
to you unless consented to by you in writing, and (b) no such amendment or
waiver may, without the written consent of the holder of each Note at the time
outstanding affected thereby, (i) subject to the provisions of Section 12
relating to acceleration or rescission, change the amount or time of any
prepayment or payment of principal of, or reduce the rate or change the time of
payment or method of computation of interest or of the Make-Whole Amount on, the
Notes, (ii) change the percentage of the principal amount of the Notes the
holders of which are required to consent to any such amendment or waiver, (iii)
amend any of Sections 8, 11(a), 11(b), 12, 17 or 20.
17.2. SOLICITATION OF HOLDERS OF NOTES.
(a) SOLICITATION. The Company will provide each holder of the
Notes (irrespective of the amount of Notes then owned by it) with
sufficient information, sufficiently far in advance of the date a
decision is required, to enable such holder to make an informed and
considered decision with respect to any proposed amendment, waiver or
consent in respect of any of the provisions hereof or of the Notes. The
Company will deliver executed or true and correct copies of each
amendment, waiver or consent effected pursuant to the provisions of
this Section 17 to each holder of outstanding Notes promptly following
the date on which it is executed and delivered by, or receives the
consent or approval of, the requisite holders of Notes.
(b) PAYMENT. The Company will not directly or indirectly pay
or cause to be paid any remuneration, whether by way of supplemental or
additional interest, fee or otherwise, or grant any security, to any
holder of Notes as consideration for or as an inducement to the
entering into by any holder of Notes or any waiver or amendment of any
of the terms and provisions hereof unless such remuneration is
concurrently paid, or security is concurrently granted, on the same
terms, ratably to each holder of Notes then outstanding even if such
holder did not consent to such waiver or amendment.
17.3. BINDING EFFECT, ETC.
Any amendment or waiver consented to as provided in this
Section 17 applies equally to all holders of Notes and is binding upon them and
upon each future holder of any Note and upon the Company without regard to
whether such Note has been marked to indicate such amendment or waiver. No such
amendment or waiver will extend to or affect any obligation, covenant,
agreement, Default or Event of Default not expressly amended or waived or impair
any right consequent thereon. No course of dealing between the Company and the
holder of any Note nor any delay in exercising any rights hereunder or under any
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Note shall operate as a waiver of any rights of any holder of such Note. As used
herein, the term "this Agreement" or "the Agreement" and references thereto
shall mean this Agreement as it may from time to time be amended or
supplemented.
17.4. NOTES HELD BY COMPANY, ETC.
Solely for the purpose of determining whether the holders of
the requisite percentage of the aggregate principal amount of Notes then
outstanding approved or consented to any amendment, waiver or consent to be
given under this Agreement or the Notes, or have directed the taking of any
action provided herein or in the Notes to be taken upon the direction of the
holders of a specified percentage of the aggregate principal amount of Notes
then outstanding, Notes directly or indirectly owned by the Company or any of
its Affiliates shall be deemed not to be outstanding.
18. NOTICES.
All notices and communications provided for hereunder shall be
in writing and sent (a) by telecopy if the sender on the same day sends a
confirming copy of such notice by a recognized overnight delivery service
(charges prepaid), or (b) by registered or certified mail with return receipt
requested (postage prepaid), or (c) by a recognized overnight delivery service
(with charges prepaid). Any such notice must be sent:
(i) if to you or your nominee, to you or it at the
address specified for such communications in Schedule A, or at
such other address as you or it shall have specified to the
Company in writing,
(ii) if to any other holder of any Note, to such
holder at such address as such other holder shall have
specified to the Company in writing, or
(iii) if to the Company, to the Company at its
address set forth at the beginning hereof to the attention of
the Chief Financial Officer and Legal Department, or at such
other address as the Company shall have specified to the
holder of each Note in writing.
Notices under this Section 18 will be deemed given only when actually received.
19. REPRODUCTION OF DOCUMENTS.
This Agreement and all documents relating thereto, including,
without limitation, (a) consents, waivers and modifications that may hereafter
be executed, (b) documents received by you at the Closing (except the Notes
themselves), and (c) financial statements, certificates and other information
previously or hereafter furnished to you, may be reproduced by you by any
photographic, photostatic, microfilm, microcard, miniature photographic or other
similar process and you may destroy any original document so reproduced. The
Company agrees and stipulates that, to the extent permitted by applicable law,
any such reproduction shall be admissible in evidence as the original itself in
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any judicial or administrative proceeding (whether or not the original is in
existence and whether or not such reproduction was made by you in the regular
course of business) and any enlargement, facsimile or further reproduction of
such reproduction shall likewise be admissible in evidence. This Section 19
shall not prohibit the Company or any other holder of Notes from contesting any
such reproduction to the same extent that it could contest the original, or from
introducing evidence to demonstrate the inaccuracy of any such reproduction.
20. CONFIDENTIAL INFORMATION.
For the purposes of this Section 20, "Confidential
Information" means information delivered to you by or on behalf of the Company
or any Subsidiary in connection with the transactions contemplated by or
otherwise pursuant to this Agreement that is proprietary in nature and that was
clearly marked or labeled or otherwise adequately identified in writing when
received by you as being confidential information of the Company or such
Subsidiary, provided that such term does not include information that (a) was
publicly known or otherwise known to you prior to the time of such disclosure,
(b) subsequently becomes publicly known through no act or omission by you or any
person acting on your behalf, (c) otherwise becomes known to you other than
through disclosure by the Company or any Subsidiary or (d) constitutes financial
statements delivered to you under Section 7.1 that are otherwise publicly
available. You will maintain the confidentiality of such Confidential
Information in accordance with procedures adopted by you in good faith to
protect confidential information of third parties delivered to you, provided
that you may deliver or disclose Confidential Information to (i) your directors,
trustees, officers, employees, agents, attorneys and affiliates (to the extent
such disclosure reasonably relates to the administration of the investment
represented by your Notes), (ii) your financial advisors and other professional
advisors who agree to hold confidential the Confidential Information
substantially in accordance with the terms of this Section 20, (iii) any other
holder of any Note, (iv) any Institutional Investor to which you sell or offer
to sell such Note or any part thereof or any participation therein (if such
Person has agreed in writing prior to its receipt of such Confidential
Information to be bound by the provisions of this Section 20), (v) any Person
from which you offer to purchase any security of the Company (if such Person has
agreed in writing prior to its receipt of such Confidential Information to be
bound by the provisions of this Section 20), (vi) any federal or state
regulatory authority having jurisdiction over you, (vii) the National
Association of Insurance Commissioners or any similar organization, or any
nationally recognized rating agency that requires access to information about
your investment portfolio or (viii) any other Person to which such delivery or
disclosure may be necessary or appropriate (w) to effect compliance with any
law, rule, regulation or order applicable to you, (x) in response to any
subpoena or other legal process, (y) in connection with any litigation to which
you are a party or (z) if an Event of Default has occurred and is continuing, to
the extent you may reasonably determine such delivery and disclosure to be
necessary or appropriate in the enforcement or for the protection of the rights
and remedies under your Notes and this Agreement. Each holder of a Note, by its
acceptance of a Note, will be deemed to have agreed to be bound by and to be
entitled to the benefits of this Section 20 as though it were a party to this
Agreement. On reasonable request by the Company in connection with the delivery
to any holder of a Note of information required to be delivered to such holder
under this Agreement or requested by such holder (other than a holder that is a
party to this Agreement or its nominee), such holder will enter into an
agreement with the Company embodying the provisions of this Section 20.
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21. SUBSTITUTION OF PURCHASER.
You shall have the right to substitute any one of your
Affiliates as the purchaser of the Notes that you have agreed to purchase
hereunder, by written notice to the Company, which notice shall be signed by
both you and such Affiliate, shall contain such Affiliate's agreement to be
bound by this Agreement and shall contain a confirmation by such Affiliate of
the accuracy with respect to it of the representations set forth in Section 6.
Upon receipt of such notice, wherever the word "you" is used in this Agreement
(other than in this Section 21), such word shall be deemed to refer to such
Affiliate in lieu of you. In the event that such Affiliate is so substituted as
a purchaser hereunder and such Affiliate thereafter transfers to you all of the
Notes then held by such Affiliate, upon receipt by the Company of notice of such
transfer, wherever the word "you" is used in this Agreement (other than in this
Section 21), such word shall no longer be deemed to refer to such Affiliate, but
shall refer to you, and you shall have all the rights of an original holder of
the Notes under this Agreement.
22. RELEASE OF SUBSIDIARY GUARANTOR.
You and each subsequent holder of a Note agree to release any
Subsidiary Guarantor from the Subsidiary Guaranty or the capital stock of any
Restricted Subsidiary from the Pledge Agreement (i) if such Subsidiary Guarantor
or Restricted Subsidiary, as the case may be, ceases to be such as a result of a
Disposition permitted by Sections 10.7, 10.8 or 10.9 or (ii) at such time as the
banks party to the Credit Agreements release such Subsidiary from the Bank
Guarantees or release such capital stock from the Pledge Agreement; provided,
however, that you and each subsequent holder will not be required to release a
Subsidiary Guarantor from the Subsidiary Guaranty or the capital stock of a
Restricted Subsidiary from the Pledge Agreement under the circumstances
contemplated by clause (ii), if (A) a Default or Event of Default has occurred
and is continuing, (B) such Subsidiary Guarantor is to become a borrower under
the Credit Agreements or (C) such release is part of a plan of financing that
contemplates such Subsidiary Guarantor guaranteeing, or the capital stock of
such Restricted Subsidiary securing, any other Indebtedness of the Company. Your
obligation to release a Subsidiary Guarantor from the Subsidiary Guaranty or the
capital stock of a Restricted Subsidiary from the Pledge Agreement is
conditioned upon your prior receipt of a certificate from a Senior Financial
Officer of the Company stating that none of the circumstances described in
clauses (A), (B) and (C) above are true.
23. MISCELLANEOUS.
23.1. SUCCESSORS AND ASSIGNS.
All covenants and other agreements contained in this Agreement
by or on behalf of any of the parties hereto bind and inure to the benefit of
their respective successors and assigns (including, without limitation, any
subsequent holder of a Note) whether so expressed or not.
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23.2. PAYMENTS DUE ON NON-BUSINESS DAYS.
Anything in this Agreement or the Notes to the contrary
notwithstanding, any payment of principal of or Make-Whole Amount or interest on
any Note that is due on a date other than a Business Day shall be made on the
next succeeding Business Day without including the additional days elapsed in
the computation of the interest payable on such next succeeding Business Day.
23.3. SEVERABILITY.
Any provision of this Agreement that is prohibited or
unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective
to the extent of such prohibition or unenforceability without invalidating the
remaining provisions hereof, and any such prohibition or unenforceability in any
jurisdiction shall (to the full extent permitted by law) not invalidate or
render unenforceable such provision in any other jurisdiction.
23.4. CONSTRUCTION.
Each covenant contained herein shall be construed (absent
express provision to the contrary) as being independent of each other covenant
contained herein, so that compliance with any one covenant shall not (absent
such an express contrary provision) be deemed to excuse compliance with any
other covenant. Where any provision herein refers to action to be taken by any
Person, or which such Person is prohibited from taking, such provision shall be
applicable whether such action is taken directly or indirectly by such Person.
23.5. COUNTERPARTS.
This Agreement may be executed in any number of counterparts,
each of which shall be an original but all of which together shall constitute
one instrument. Each counterpart may consist of a number of copies hereof, each
signed by less than all, but together signed by all, of the parties hereto.
23.6. GOVERNING LAW.
This Agreement shall be construed and enforced in accordance
with, and the rights of the parties shall be governed by, the law of the State
of Illinois excluding choice-of-law principles of the law of such State that
would require the application of the laws of a jurisdiction other than such
State.
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If you are in agreement with the foregoing, please sign the
form of agreement on the accompanying counterpart of this Agreement and return
it to the Company, whereupon the foregoing shall become a binding agreement
between you and the Company.
Very truly yours,
LINCARE HOLDINGS INC.
By: /s/ XXXX X. XXXXX
----------------------------------------
Name: Xxxx X. Xxxxx
Title: Chief Financial Officer/Secretary
S-1
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The foregoing is agreed to as of the date thereof.
ALLSTATE LIFE INSURANCE COMPANY
By: /s/ XXXXXXX X. XXXXX
---------------------------------------
Name: Xxxxxxx X. Xxxxx
By: /s/ XXXXX X. XXXXX
---------------------------------------
Name: Xxxxx X. Xxxxx
Authorized Signatories
ALLSTATE INSURANCE COMPANY
By: /s/ XXXXXXX X. XXXXX
---------------------------------------
Name: Xxxxxxx X. Xxxxx
By: /s/ XXXXX X. XXXXX
---------------------------------------
Name: Xxxxx X. Xxxxx
Authorized Signatories
S-2
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TEACHERS INSURANCE AND ANNUITY
ASSOCIATION OF AMERICA
By: /s/ XXXXX XXX
------------------------------------------------
Name: Xxxxx Xxx
Title: Director - Private Placements
S-3
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CONNECTICUT GENERAL LIFE INSURANCE
COMPANY
By: Cigna Investments, Inc. (authorized agent)
By: /s/ XXXXXXXX X. XXXXX
------------------------------
Name: Xxxxxxxx X. Xxxxx
Title: Managing Director
LIFE INSURANCE COMPANY OF NORTH AMERICA
By: Cigna Investments, Inc. (authorized agent)
By: /s/ XXXXXXXX X. XXXXX
------------------------------
Name: Xxxxxxxx X. Xxxxx
Title: Managing Director
S-4
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MONY LIFE INSURANCE COMPANY
By: /s/ XXXXXXX X. XXXXXX
---------------------------------------
Name: Xxxxxxx X. Xxxxxx
Title: Managing Director
S-5
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UNITED OF OMAHA LIFE INSURANCE
COMPANY
By: /s/ XXXXX X. XXXXXXXX XX.
------------------------------------------------
Name: Xxxxx X. Xxxxxxxx Xx.
Title: First Vice President
S-6
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NATIONWIDE LIFE INSURANCE COMPANY
By: /s/ XXXX X. XXXXXXXXX
---------------------------------------
Name: Xxxx X. Xxxxxxxxx
Title: Associate Vice President
NATIONWIDE LIFE AND ANNUITY INSURANCE COMPANY
By: /s/ XXXX X. XXXXXXXXX
---------------------------------------
Name: Xxxx X. Xxxxxxxxx
Title: Associate Vice President
S-7
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SCHEDULE B
DEFINED TERMS
As used herein, the following terms have the respective
meanings set forth below or set forth in the Section hereof following such term:
"ADJUSTED CONSOLIDATED NET WORTH" means, as of any date,
consolidated stockholders' equity of the Company and its Restricted Subsidiaries
on such date, determined in accordance with GAAP, less the amount by which
outstanding Restricted Investments on such date exceed 20% of consolidated
stockholders' equity.
"AFFILIATE" means, at any time, and with respect to any
Person, (a) any other Person that at such time directly or indirectly through
one or more intermediaries Controls, or is Controlled by, or is under common
Control with, such first Person, and (b) any Person beneficially owning or
holding, directly or indirectly, 10% or more of any class of voting or equity
interests of the Company or any Subsidiary or any corporation of which the
Company and its Subsidiaries beneficially own or hold, in the aggregate,
directly or indirectly, 10% or more of any class of voting or equity interests.
As used in this definition, "CONTROL" means the possession, directly or
indirectly, of the power to direct or cause the direction of the management and
policies of a Person, whether through the ownership of voting securities, by
contract or otherwise. Unless the context otherwise clearly requires, any
reference to an "Affiliate" is a reference to an Affiliate of the Company.
"BANK GUARANTEES" means the Guarantees of the Subsidiary
Guarantors of Indebtedness outstanding under the Credit Agreements, as such
Guarantees or agreements may be amended, restated or otherwise modified, and any
successors thereto.
"BANKS" means the banks party to the Credit Agreements,
including Bank of America, N.A., as agent for such banks.
"BUSINESS DAY" means (a) for the purposes of Section 8.6 only,
any day other than a Saturday, a Sunday or a day on which commercial banks in
New York City are required or authorized to be closed, and (b) for the purposes
of any other provision of this Agreement, any day other than a Saturday, a
Sunday or a day on which commercial banks in Chicago, Illinois or Clearwater,
Florida are required or authorized to be closed.
"CAPITAL LEASE" means, at any time, a lease with respect to
which the lessee is required concurrently to recognize the acquisition of an
asset and the incurrence of a liability in accordance with GAAP.
"CHANGE OF CONTROL" means the acquisition through purchase or
otherwise by any Person, or group of Persons acting in concert, directly or
indirectly, in one or more transactions, of beneficial ownership or control of
Schedule B
53
securities representing more than 50% of the combined voting power of the
Company's Voting Stock (including the agreement to act in concert by Persons who
beneficially own or control securities representing more than 50% of the
combined voting power of the Company's Voting Stock).
"CLOSING" is defined in Section 3.
"CODE" means the Internal Revenue Code of 1986, as amended
from time to time, and the rules and regulations promulgated thereunder from
time to time.
"COLLATERAL AGENT" is defined in Section 4.11.
"COMPANY" means Lincare Holdings Inc., a Delaware corporation.
"CONFIDENTIAL INFORMATION" is defined in Section 20.
"CONSOLIDATED FIXED CHARGES" means, for any period, the sum of
(i) Consolidated Rentals for such period under all leases other than Capital
Leases, (ii) Consolidated Interest Expense for such period and (iii) all
capitalized interest of the Company and its Restricted Subsidiaries incurred
during such period.
"CONSOLIDATED INCOME AVAILABLE FOR FIXED CHARGES" means, for
any period, Consolidated Net Income for such period, plus, to the extent
deducted in determining such Consolidated Net Income, (i) all provisions for
federal, state and other income taxes made by the Company and its Restricted
Subsidiaries during such period and (ii) Consolidated Fixed Charges for such
period.
"CONSOLIDATED INDEBTEDNESS" means, as of any date, outstanding
Indebtedness of the Company and its Restricted Subsidiaries as of such date
determined on a consolidated basis in accordance with GAAP.
"CONSOLIDATED INTEREST EXPENSE" means, for any period, the
consolidated interest expense of the Company and its Restricted Subsidiaries for
such period determined in accordance with GAAP (including imputed interest on
Capital Lease Obligations.
"CONSOLIDATED NET ASSETS" means, as of any date, Consolidated
Total Assets less Restricted Investments and consolidated current liabilities of
the Company and its Restricted Subsidiaries as of such date.
"CONSOLIDATED NET INCOME" means, for any period, the net
income or loss of the Company and its Restricted Subsidiaries for such period
determined on a consolidated basis in accordance with GAAP, but in any event
excluding (a) extraordinary nonrecurring gains or losses and (b) the income (or
loss) of any Person (other than a Restricted Subsidiary) in which the Company or
any Restricted Subsidiary has an ownership interest, except to the extent that
any such income has been actually received by the Company or such Subsidiary in
the form of cash dividends or similar cash distributions.
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Schedule B
54
"CONSOLIDATED OPERATING CASH FLOW" means, for any period, the
sum of Consolidated Net Income for such period, plus, to the extent deducted in
determining such Consolidated Net Income, (i) Consolidated Interest Expense,
(ii) federal, state, local and foreign income, value added and similar taxes,
(iii) depreciation and amortization expense and (iv) other extraordinary
non-recurring, noncash charges, all as determined in accordance with GAAP.
"CONSOLIDATED TOTAL ASSETS" means, as of any date, the assets
and properties of the Company and its Restricted Subsidiaries as of such date,
determined on a consolidated basis in accordance with GAAP.
"CONSOLIDATED RENTALS" means, for any period, the rentals of
the Company and its Restricted Subsidiaries for such period under all leases,
determined on a consolidated basis in accordance with GAAP.
"CONTROL EVENT" means:
(a) the execution by the Company or any of its Subsidiaries or
Affiliates of any agreement with respect to any proposed transaction or
event or series of transactions or events which, individually or in the
aggregate, may reasonably be expected to result in a Change of Control,
(b) the execution of any written agreement which, when fully
performed by the parties thereto, would result in a Change of Control,
or
(c) the making of any written offer by any person (as such
term is used in section 13(d) and section 14(d)(2) of the Exchange Act
as in effect on the date of the Closing) or related persons
constituting a group (as such term is used in Rule 13d-5 under the
Exchange Act as in effect on the date of each Closing) to the holders
of the common stock of the Company, which offer, if accepted by the
requisite number of holders, would result in a Change of Control.
"CREDIT AGREEMENTS" means, collectively (i) the Three-Year
Credit Agreement dated as of August 23, 1999 among the Company, each Subsidiary
of the Company, the banks party thereto, and Bank of America, N.A., as agent,
and (ii) the 364-Day Credit Agreement dated as of August 21, 2000 among the
Company, each Subsidiary of the Company, the banks party thereto, and Bank of
America, N.A., as agent; as such agreements have been or may be hereafter
amended, modified, restated, supplemented, refinanced, increased or reduced from
time to time, and any successor credit agreements or similar facilities.
"DEFAULT" means an event or condition the occurrence or
existence of which would, with the lapse of time or the giving of notice or
both, become an Event of Default.
"DEFAULT RATE" means that rate of interest that is the greater
of (i) 2% per annum above the rate of interest stated in clause (a) of the first
paragraph of the Notes or (ii) 2% over the rate of interest publicly announced
by Bank of America in Chicago, Illinois as its "base" or "prime" rate.
3
Schedule B
55
"DISTRIBUTION" means, in respect of any Person:
(a) dividends or other distributions or payments on capital
stock or other equity interests of such Person (except distributions in
such stock or other equity interests); and
(b) the redemption or acquisition of such stock or other
equity interests or of warrants, rights or other options to purchase
such stock or other equity interests (except when solely in exchange
for such stock or other equity interests) unless made,
contemporaneously, from the net proceeds of a sale of such stock or
other equity interests.
"ENVIRONMENTAL LAWS" means any and all Federal, state, local,
and foreign statutes, laws, regulations, ordinances, rules, judgments, orders,
decrees, permits, concessions, grants, franchises, licenses, agreements or
governmental restrictions relating to pollution and the protection of the
environment or the release of any materials into the environment, including but
not limited to those related to hazardous substances or wastes, air emissions
and discharges to waste or public systems.
"ERISA" means the Employee Retirement Income Security Act of
1974, as amended from time to time, and the rules and regulations promulgated
thereunder from time to time in effect.
"ERISA AFFILIATE" means any trade or business (whether or not
incorporated) that is treated as a single employer together with the Company
under section 414 of the Code.
"EVENT OF DEFAULT" is defined in Section 11.
"EXCHANGE ACT" means the Securities Exchange Act of 1934, as
amended.
"GAAP" means generally accepted accounting principles as in
effect from time to time in the United States of America.
"GOVERNMENTAL AUTHORITY" means
(a) the government of
(i) the United States of America or any State or
other political subdivision thereof, or
(ii) any jurisdiction in which the Company or any
Subsidiary conducts all or any part of its business, or which
asserts jurisdiction over any properties of the Company or any
Subsidiary, or
(b) any entity exercising executive, legislative, judicial,
regulatory or administrative functions of, or pertaining to, any such
government.
4
Schedule B
56
"GUARANTY" means, with respect to any Person, any obligation
(except the endorsement in the ordinary course of business of negotiable
instruments for deposit or collection) of such Person guaranteeing or in effect
guaranteeing any indebtedness, dividend or other obligation of any other Person
in any manner, whether directly or indirectly, including (without limitation)
obligations incurred through an agreement, contingent or otherwise, by such
Person:
(a) to purchase such indebtedness or obligation or any
property constituting security therefor;
(b) to advance or supply funds (i) for the purchase or payment
of such indebtedness or obligation, or (ii) to maintain any working
capital or other balance sheet condition or any income statement
condition of any other Person or otherwise to advance or make available
funds for the purchase or payment of such indebtedness or obligation;
(c) to lease properties or to purchase properties or services
primarily for the purpose of assuring the owner of such indebtedness or
obligation of the ability of any other Person to make payment of the
indebtedness or obligation; or
(d) otherwise to assure the owner of such indebtedness or
obligation against loss in respect thereof.
In any computation of the indebtedness or other liabilities of the obligor under
any Guaranty, the indebtedness or other obligations that are the subject of such
Guaranty shall be assumed to be direct obligations of such obligor.
"HAZARDOUS MATERIAL" means any and all pollutants, toxic or
hazardous wastes or any other substances that might pose a hazard to health or
safety, the removal of which may be required or the generation, manufacture,
refining, production, processing, treatment, storage, handling, transportation,
transfer, use, disposal, release, discharge, spillage, seepage, or filtration of
which is or shall be restricted, prohibited or penalized by any applicable law
(including, without limitation, asbestos, urea formaldehyde foam insulation and
polycholorinated biphenyls).
"HOLDER" means, with respect to any Note, the Person in whose
name such Note is registered in the register maintained by the Company pursuant
to Section 13.1.
"INDEBTEDNESS" with respect to any Person means, at any time,
without duplication,
(a) its liabilities for borrowed money and its redemption
obligations in respect of mandatorily redeemable Preferred Stock;
(b) its liabilities for the deferred purchase price of
property acquired by such Person (excluding accounts payable and other
5
Schedule B
57
accrued liabilities arising in the ordinary course of business but
including all liabilities created or arising under any conditional sale
or other title retention agreement with respect to any such property);
(c) all liabilities appearing on its balance sheet in
accordance with GAAP in respect of Capital Leases; and
(d) all liabilities for borrowed money secured by any Lien
with respect to any property owned by such Person (whether or not it
has assumed or otherwise become liable for such liabilities);
(e) all its liabilities in respect of letters of credit or
instruments serving a similar function issued or accepted for its
account by banks and other financial institutions (whether or not
representing obligations for borrowed money); and
(f) any Guaranty of such Person with respect to liabilities of
a type described in any of clauses (a) through (e) hereof.
Indebtedness of any Person shall include all obligations of such Person of the
character described in clauses (a) through (e) to the extent such Person remains
legally liable in respect thereof notwithstanding that any such obligation is
deemed to be extinguished under GAAP.
"INSTITUTIONAL INVESTOR" means (a) any original purchaser of a
Note and (b) any bank, trust company, savings and loan association or other
financial institution, any pension plan, any investment company, any insurance
company, any broker or dealer, or any other similar financial institution or
entity, regardless of legal form.
"INTERCREDITOR AGREEMENT" is defined in Section 4.11.
"INVESTMENTS" means all investments made, in cash or by
delivery of property, directly or indirectly, by any Person, in any other
Person, whether by acquisition of shares of capital stock, indebtedness or other
obligations or securities or by loan, advance, capital contribution or
otherwise.
"LIEN" means, with respect to any Person, any mortgage, lien,
pledge, charge, security interest or other encumbrance, or any interest or title
of any vendor, lessor, lender or other secured party to or of such Person under
any conditional sale or other title retention agreement or Capital Lease, upon
or with respect to any property or asset of such Person (including in the case
of stock, stockholder agreements, voting trust agreements and all similar
arrangements).
"MAKE-WHOLE AMOUNT" is defined in Section 8.6.
"MATERIAL" means material in relation to the business,
operations, financial condition, assets or properties of the Company and its
Subsidiaries taken as a whole.
6
Schedule B
58
"MATERIAL ADVERSE EFFECT" means a material adverse effect on
(a) the business, operations, financial condition, assets or properties of the
Company and its Subsidiaries taken as a whole, or (b) the ability of the Company
to perform its obligations under this Agreement and the Notes, or (c) the
ability of any Subsidiary Guarantor to perform its obligations under the
Subsidiary Guaranty, or (d) the validity or enforceability of this Agreement,
the Pledge Agreement, the Notes or the Subsidiary Guaranty.
"MEMORANDUM" is defined in Section 5.3.
"MULTIEMPLOYER PLAN" means any Plan that is a "multiemployer
plan" (as such term is defined in section 4001(a)(3) of ERISA).
"NOTES" is defined in Section 1.
"OFFICER'S CERTIFICATE" means a certificate of a Senior
Financial Officer or of any other officer of the Company whose responsibilities
extend to the subject matter of such certificate.
"OTHER PURCHASERS" is defined in Section 2.
"PBGC" means the Pension Benefit Guaranty Corporation referred
to and defined in ERISA or any successor thereto.
"PERSON" means an individual, partnership, corporation,
limited liability company, association, trust, unincorporated organization, or a
government or agency or political subdivision thereof.
"PLAN" means an "employee benefit plan" (as defined in section
3(3) of ERISA) that is or, within the preceding five years, has been established
or maintained, or to which contributions are or, within the preceding five
years, have been made or required to be made, by the Company or any ERISA
Affiliate or with respect to which the Company or any ERISA Affiliate may have
any liability.
"PLEDGE AGREEMENT" means the Second Amended and Restated
Pledge Agreement dated as of September 6, 2000 among the Company, the Subsidiary
Guarantors and Bank of America, N.A., as collateral agent for the benefit of the
holders of the Notes and the Banks.
"PREFERRED STOCK" means any class of capital stock of a
corporation that is preferred over any other class of capital stock of such
corporation as to the payment of dividends or the payment of any amount upon
liquidation or dissolution of such corporation.
"PRIORITY DEBT" means, as of any date, the sum (without
duplication) of (a) outstanding Indebtedness of Restricted Subsidiaries not
otherwise permitted by Sections 10.3(a) through (d) and (b) Indebtedness of the
Company and its Restricted Subsidiaries secured by Liens not otherwise permitted
by Sections 10.6(a) through (h).
7
Schedule B
59
"PROPERTY" or "PROPERTIES" means, unless otherwise
specifically limited, real or personal property of any kind, tangible or
intangible, xxxxxx or inchoate.
"PROPOSED PREPAYMENT DATE" is defined in Section 8.3(c).
"PURCHASER" means each purchaser listed in Schedule A.
"QPAM EXEMPTION" means Prohibited Transaction Class Exemption
84-14 issued by the United States Department of Labor.
"REQUIRED HOLDERS" means, at any time, the holders of at least
a majority in principal amount of the Notes at the time outstanding (exclusive
of Notes then owned by the Company or any of its Affiliates).
"RESPONSIBLE OFFICER" means any Senior Financial Officer and
any other officer of the Company with responsibility for the administration of
the relevant portion of this agreement.
"RESTRICTED INVESTMENTS" means all Investments of the Company
and its Restricted Subsidiaries, other than:
(a) property or assets to be used or consumed in the ordinary
course of business;
(b) current assets arising from the sale of goods or services
in the ordinary course of business;
(c) Investments in Restricted Subsidiaries or in any Person
that, as a result thereof, becomes a Restricted Subsidiary;
(d) Investments existing as of the date of this Agreement that
are listed in the attached Schedule B-1;
(e) Investments in:
(i) obligations, maturing within one year from the
date of acquisition, of or fully guaranteed by the United
States of America or an agency thereof;
(ii) state or municipal securities, maturing within
one year from the date of acquisition, that are rated in one
8
Schedule B
60
of the top two rating classifications by at least one
nationally recognized rating agency;
(iii) certificates of deposit or banker's acceptances
maturing within one year from the date of acquisition of or
issued by Bank of America or other commercial banks whose
long-term unsecured debt obligations (or the long-term
unsecured debt obligations of the bank holding company owning
all of the capital stock of such bank) are rated in one of the
top two rating classifications by at least one nationally
recognized rating agency;
(iv) commercial paper maturing within 270 days from
the date of issuance that, at the time of acquisition, is
rated in one of the top two rating classifications by at least
one credit rating agency of recognized national standing;
(v) repurchase agreements, having a term of not more
than 90 days and fully collateralized with obligations of the
type described in clause (i), with a bank satisfying the
requirements of clause (iii); and
(vi) money market instrument programs or registered
investment companies that invest in securities of the type
described in this clause (f) that are properly classified as
current assets in accordance with GAAP.
"RESTRICTED PAYMENT" means any Distribution in respect of the
Company or any Restricted Subsidiary of the Company (other than on account of
capital stock or other equity interests of a Restricted Subsidiary owned legally
and beneficially by the Company or another Restricted Subsidiary), including any
Distribution resulting in the acquisition by the Company of securities that
would constitute treasury stock.
"RESTRICTED SUBSIDIARY" means any Subsidiary (a) of which at
least a majority of the voting securities are owned by the Company and/or one or
more Wholly Owned Restricted Subsidiaries and (b) that the Company has not
designated an Unrestricted Subsidiary by notice in writing given to the holders
of the Notes.
"SECURITIES ACT" means the Securities Act of 1933, as amended
from time to time.
"SENIOR FINANCIAL OFFICER" means the chief financial officer,
principal accounting officer, treasurer or comptroller of the Company.
"SERIES A NOTES" is defined in Section 1.
"SERIES B NOTES" is defined in Section 1.
"SERIES C NOTES" is defined in Section 1.
"SOURCE" is defined in Section 6.2.
"SUBSIDIARY" means, as to any Person, any corporation,
association or other business entity in which such Person or one or more of its
Subsidiaries or such Person and one or more of its Subsidiaries owns sufficient
equity or voting interests to enable it or them (as a group) ordinarily, in the
absence of contingencies, to elect a majority of the directors (or Persons
performing similar functions) of such entity, and any partnership, limited
liability company or joint venture if more than a 50% interest in the profits or
9
Schedule B
61
capital thereof is owned by such Person or one or more of its Subsidiaries or
such Person and one or more of its Subsidiaries (unless such partnership can and
does ordinarily take major business actions without the prior approval of such
Person or one or more of its Subsidiaries). Unless the context otherwise clearly
requires, any reference to a "Subsidiary" is a reference to a Subsidiary of the
Company.
"SUBSIDIARY GUARANTOR" is defined in Section 1.
"SUBSIDIARY GUARANTY" is defined in Section 1.
"THIS AGREEMENT" OR "THE AGREEMENT" is defined in Section
17.3.
"UNRESTRICTED SUBSIDIARY" means any Subsidiary of the Company
that has been so designated by notice in writing given to the holders of the
Notes.
"VOTING STOCK" means the capital stock of any class or classes
of a corporation having power under ordinary circumstances to vote for the
election of members of the board of directors of such corporation, or person
performing similar functions (irrespective of whether or not at the time stock
of any of the class or classes shall have or might have special voting power or
rights by reason of the happening of any contingency).
"WHOLLY OWNED SUBSIDIARY" or "WHOLLY OWNED RESTRICTED
SUBSIDIARY" mean, at any time, any Subsidiary, or Restricted Subsidiary, as the
case may be, 100% of all of the equity interests (except directors' qualifying
shares) and voting interests of which are owned by any one or more of the
Company and the Company's other Wholly Owned Subsidiaries or Wholly Owned
Restricted Subsidiaries, as the case may be, at such time.
10
Schedule B
