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PURCHASE AGREEMENT
among
D and W HOLDINGS, INC.,
as Issuer,
and
THE PURCHASERS NAMED HEREIN
Dated as of October 25, 2000
Relating to:
$36,500,000 Aggregate Principal Amount of 15% Senior Pay-In-Kind Notes due 2010
and
shares representing 8.4% of fully diluted Common Stock of the Issuer
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TABLE OF CONTENTS
Page
RECITALS............................................................................................1
SECTION 1
DEFINITIONS AND ACCOUNTING TERMS
1.01. Definitions................................................................................2
1.02. Computation of Time Periods...............................................................12
1.03. Accounting Terms..........................................................................12
SECTION 2
AUTHORIZATION, ISSUANCE AND SALE OF SECURITIES
2.01. Authorization of Issue....................................................................12
2.02. Sale......................................................................................12
2.03. Closing...................................................................................12
2.04. Allocation of Purchase Price..............................................................13
SECTION 3
CONDITIONS TO CLOSING
SECTION 4
REPRESENTATIONS AND WARRANTIES OF THE ISSUER
4.01. Corporate Existence.......................................................................16
4.02. Financial Condition.......................................................................16
4.03. Litigation................................................................................18
4.04. No Breach; No Default.....................................................................18
4.05. Action....................................................................................18
4.06. Authorization of this Agreement...........................................................19
4.07. Authorization of the Indenture............................................................19
4.08. Authorization of the Notes and Exchange Notes.............................................19
4.09. Authorization of the Exchange and Registration Rights Agreement...........................19
4.10. Authorization of Common Stock.............................................................19
4.11. Authorization of the Registration Rights Agreement........................................20
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4.12. [INTENTIONALLY OMITTED]...................................................................20
4.13. Approvals.................................................................................20
4.14. Representations and Warranties in Transaction Documents...................................20
4.15. ERISA.....................................................................................20
4.16. Taxes.....................................................................................21
4.17. Investment Company Act; Public Utility Holding Company Act; Other Restrictions............21
4.18. Environmental Matters.....................................................................22
4.19. Subsidiaries..............................................................................22
4.20. Properties................................................................................22
4.21. Licenses and Permits; Compliance with Laws................................................22
4.22. True and Complete Disclosure..............................................................23
4.23. Solvency; Etc.............................................................................23
4.24. Labor Matters.............................................................................24
4.25. Private Offering; No Integration or General Solicitation..................................24
4.26. Eligibility for Resale Under Rule 144A....................................................24
4.27. No Brokers................................................................................24
SECTION 5
REPRESENTATIONS OF THE PURCHASERS
5.01. Purchase for Investment...................................................................25
5.02. Source of Funds...........................................................................26
SECTION 6
COVENANTS TO PROVIDE INFORMATION
6.01. Future Reports to Holders.................................................................28
(a) Monthly and Quarterly Statements...................................................28
(b) Annual Statements..................................................................28
(c) Compliance Certificate.............................................................29
(d) Other Information..................................................................30
(e) Notice of Default..................................................................30
(f) Additional Information to Holders of Other Indebtedness............................30
(g) Credit Agreement...................................................................30
(h) Calculation of Original Issue Discount.............................................30
(i) Annual Budgets.....................................................................31
(j) Requested Information..............................................................31
6.02. Information to Be Provided Pursuant to Rule 144A(d)(4)....................................31
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SECTION 7
OTHER AFFIRMATIVE COVENANTS
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7.01. Preservation of Corporate Existence and Franchises........................................31
7.02. Maintenance of Properties.................................................................32
7.03. Taxes.....................................................................................32
7.04. Books and Records.........................................................................32
7.05. Compliance with Law.......................................................................32
7.06. Insurance.................................................................................33
7.07. Mandatory AHYDO Redemption................................................................33
7.08. Maximum Total Leverage Ratio..............................................................33
7.09. Minimum Interest Coverage Ratio...........................................................33
7.10. Inspection................................................................................34
SECTION 8
COVENANTS
8.01. Incorporation of Covenants................................................................35
SECTION 9
PROVISIONS RELATING TO RESALES OF SECURITIES
9.01. Private Offerings.........................................................................35
(a) Offers and Sales Only to Institutional Accredited Investors or Qualified
Institutional Buyers...............................................................35
(b) No General Solicitation............................................................36
(c) Purchases by Non-Bank Fiduciaries..................................................36
(d) Restrictions on Transfer; Legend...................................................36
(e) No Future Liability................................................................36
(f) Securities Act Restrictions........................................................36
9.02. Resale Offering Assistance................................................................38
9.03. Blue Sky Compliance.......................................................................39
9.04. No Integration............................................................................39
9.05. Form of Legend for the Securities.........................................................39
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SECTION 10
THE NOTES
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10.01. Form and Execution........................................................................40
10.02. Terms of the Notes........................................................................41
(a) Stated Maturity....................................................................41
(b) Interest...........................................................................41
10.03. Denominations.............................................................................41
10.04. Payments and Computations.................................................................41
10.05. Registration; Registration of Transfer and Exchange.......................................42
(a) Security Register..................................................................42
(b) Registration of Transfer...........................................................42
(c) Exchange...........................................................................47
(d) Effect of Registration of Transfer or Exchange.....................................47
(e) Requirements; Charges..............................................................47
(f) Certain Limitations................................................................47
10.06. Mutilated, Destroyed, Lost and Stolen Notes...............................................47
10.07. Persons Deemed Owners.....................................................................48
10.08. Cancellation..............................................................................48
10.09. Home Office Payment.......................................................................49
SECTION 11
REDEMPTION
11.01. Right of Redemption.......................................................................49
11.02. Partial Redemptions.......................................................................49
11.03. Notice of Redemption......................................................................50
11.04. Deposit of Redemption Price...............................................................50
11.05. Notes Payable on Redemption Date..........................................................51
11.06. Notes Redeemed in Part....................................................................51
SECTION 12
EVENTS OF DEFAULT
12.01. Events of Default.........................................................................52
12.02. Remedies..................................................................................54
12.03. Waiver of Past Defaults...................................................................56
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SECTION 13
EXPENSES, INDEMNIFICATION AND
CONTRIBUTION AND TERMINATION
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13.01. Expenses..................................................................................56
13.02. Indemnification...........................................................................57
(a) Indemnification by the Issuer......................................................57
(b) Indemnification by the Purchasers..................................................57
(c) Notifications and Other Indemnification Procedures.................................58
13.03. Contribution..............................................................................59
13.04. Survival..................................................................................60
SECTION 14
MISCELLANEOUS
14.01. Notices...................................................................................60
14.02. Benefit of Agreement; Assignments and Participations......................................61
14.03. No Waiver; Remedies Cumulative............................................................61
14.04. Amendments................................................................................62
14.05. Counterparts..............................................................................62
14.06. Reproduction..............................................................................62
14.07. Headings..................................................................................63
14.08. Governing Law; Submission to Jurisdiction; Venue..........................................63
14.09. Severability..............................................................................64
14.10. Entirety..................................................................................64
14.11. Survival of Representations and Warranties................................................64
14.12. Incorporation.............................................................................65
EXHIBITS
Exhibit A - Form of Note
Exhibit B - Form of Exchange and Registration Rights Agreement
Exhibit C - Form of Registration Rights Agreement
Exhibit D - Form of Indenture
Exhibit E - Form of Issuer Counsel Opinion
Exhibit F - Form of Purchaser Counsel Opinion
Exhibit G - Form of Solvency Certificate
Exhibit H - Form of Amended and Restated Certificate of
Incorporation
Exhibit I - Form of Legend
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SCHEDULES
Schedule A - Information Relating to Purchasers
Schedule 3D - Outstanding Indebtedness
Schedule 4.03 - Litigation
Schedule 4.18 - Environmental Matters
Schedule 4.19 - Subsidiaries
Schedule 4.25 - Labor Matters
Schedule 4.28 - Sources of Funds
Annex A - Credit Agreement
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PURCHASE AGREEMENT
PURCHASE AGREEMENT, dated as of October 25, 2000, by and
among D and W HOLDINGS, INC., a Delaware corporation (the "ISSUER"), and THE
PURCHASERS NAMED ON THE SIGNATURE PAGES HEREIN (each a "PURCHASER" and,
collectively, the "PURCHASERS").
RECITALS
WHEREAS, upon the terms and subject to the conditions set
forth in this Agreement, the Issuer has agreed to sell to the Purchasers, and
each Purchaser, acting severally and not jointly, has agreed to purchase from
the Issuer, in the proportions set forth on Exhibit A hereto opposite such
Purchaser's name, (i) $36.5 million aggregate principal amount of the
Issuer's 15% Senior Pay-In-Kind Notes, Series A, in the form of Exhibit A
hereto (together with such additional notes, when issued, as may be paid as
interest, the "NOTES") and (ii) 13,168,922 shares (the "SERIES A SHARES") of
the Issuer's series A common stock, par value $.01 per share (the "SERIES A
COMMON STOCK"), and 3,292,231 shares (the "SERIES B SHARES" and, together
with the Series A Shares, the "SHARES") of the Issuer's series B common
stock, par value $.01 per share (the "SERIES B COMMON STOCK", and together
with the Series A Common Stock, the "COMMON STOCK"). The Notes and the Shares
are collectively referred to as the "SECURITIES."
WHEREAS, the holders of the Notes will be entitled to the
benefits of an Exchange and Registration Rights Agreement, dated the date
hereof (the "EXCHANGE AND REGISTRATION RIGHTS AGREEMENT"), by and among the
Issuer and the Purchasers in the form of Exhibit B hereto.
WHEREAS, the holders of Shares from time to time will be
entitled to the benefits of the Registration Rights Agreement, dated the date
hereof (the "REGISTRATION RIGHTS AGREEMENT"), by and among the Issuer, the
Purchasers and certain stockholders of the Issuer in the form of Exhibit C
hereto.
WHEREAS, the Issuer has duly authorized the creation and
issuance of the Securities and the Issuer has duly authorized the execution
and delivery of this Agreement, the Exchange and Registration Rights
Agreement and the Registration Rights Agreement.
WHEREAS, all things necessary to make this Agreement, the
Notes (when issued and delivered hereunder), the Shares (when issued and
delivered hereunder), the Exchange and Registration Rights Agreement and the
Registration Rights Agreement valid and binding obligations of the Issuer in
accordance with their respective terms have been done.
NOW, THEREFORE, the parties hereto agree as follows:
SECTION 1
DEFINITIONS AND ACCOUNTING TERMS
1.01. DEFINITIONS. As used herein, the following terms
shall have the meanings specified herein unless the context otherwise
requires:
"ACQUISITION" means the acquisition contemplated by the
Xxxxxxx Acquisition Agreement.
"AFFILIATE" means, with respect to any Person, any other
Person that directly or indirectly controls, or is under common control with,
or is controlled by, such Person. As used in this definition, "control"
(including, with its correlative meanings, "controlled by" and "under common
control with") shall mean possession, directly or indirectly, of power to
direct or cause the direction of management or policies (whether through
ownership of securities or partnership or other ownership interests, by
contract or otherwise).
"AHYDO AMOUNT" is defined in Exhibit A.
"AHYDO SCHEDULE" is defined in Section 3J.
"ARDSHIEL" means Ardshiel, Inc., a Delaware corporation.
"ATRIUM" means Atrium Companies, Inc., a Delaware
corporation.
"BANKRUPTCY LAW" means Xxxxx 00, Xxxxxx Xxxxxx Code or any
similar federal or state law relating to bankruptcy, insolvency,
receivership, winding-up, liquidation, reorganization or relief of debtors or
the law of any other jurisdiction relating to bankruptcy, insolvency,
receivership, winding-up, liquidation, reorganization or relief of debtors or
any amendment to, succession to or change in any such law.
"BANKRUPTCY ORDER" means any court order made in a
proceeding pursuant to or within the meaning of any Bankruptcy Law,
containing an adjudication of bankruptcy or insolvency, or providing for
liquidation, receivership, winding-up, dissolution, "concordate" or
reorganization, or appointing a Custodian of a debtor or of all or any
substantial part of a debtor's property, or providing for the staying,
arrangement, adjustment or composition of indebtedness or other relief of a
debtor.
"BOARD OF DIRECTORS" means the board of directors of the
Issuer or any of its Subsidiaries, as the case may be, or any duly authorized
committee of such board.
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"CERCLA" means the Comprehensive Environmental Response,
Compensation and Liability Act of 1980, as amended from time to time, 42
U.S.C. ss. 9601 et seq.
"CLOSING TIME" is defined in Section 2.03.
"CODE" means the Internal Revenue Code of 1986, as amended
from time to time, and the rules and regulations promulgated thereunder, as
amended from time to time.
"COMMISSION" means the Securities and Exchange Commission,
as from time to time constituted, or if at any time after the execution of
this Agreement such Commission is not existing and performing the duties now
assigned to it, then the body performing such duties at such time.
"COMMON STOCK" is defined in the first recital to this
Agreement.
"CONTRACTUAL OBLIGATION" means as to any Person, any
provision of any security issued by such Person or of any mortgage, security
agreement, pledge agreement, indenture, credit agreement, securities purchase
agreement, debt instrument, contract, agreement, instrument or other
undertaking to which such Person is a party or by which it or any of its
Property is bound or subject.
"CONTROLLING PERSON" is defined in Section 13.02(a).
"CREDIT AGREEMENT" means the amended and restated credit
agreement dated as of October 2, 1998, amended and restated as of October 25,
2000, among Atrium, as borrower; the Issuer, as guarantor; the other
guarantors party thereto; each of the lenders that is a signatory thereto;
Xxxxxxx Xxxxx & Co., Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx Incorporated, as
lead arranger, syndication agent and documentation agent; and Fleet National
Bank, as administrative agent.
"CUSTODIAN" means any receiver, interim receiver, receiver
and manager, receiver-manager, trustee, assignee, liquidator, sequestrator or
similar official under any Bankruptcy Law or any other law respecting secured
creditors and the enforcement of their security or any other Person with like
powers whether appointed judicially or out of court and whether pursuant to
an interim or final appointment.
"DEBT SECURITIES" means any debt securities issued by the
Issuer or any Subsidiary or Affiliate of the Issuer in a public offering or a
private placement.
"DEFAULT" has the meaning ascribed to such term in the
Indenture.
"DEFAULT INTEREST" means the greater of (i) the interest
rate in effect during any time a Default or Event of Default has occurred and
remains uncured plus 1% per annum and (ii) the Prime Rate then in effect.
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"XXXXXXX" means VES, Inc., a Delaware corporation, doing
business in North Carolina as Xxxxxxx Extrusion Systems, Inc.
"XXXXXXX ACQUISITION AGREEMENT" means the amended and
restated purchase agreement, dated as of October 25, 2000 by and between The
Xxxxxxx Company, Inc., and the Issuer pursuant to which the Issuer will
acquire all of the outstanding capital stock of Xxxxxxx and substantially all
of the assets of Xxxxxxx'x Window and Doors Division.
"EMPLOYEE BENEFIT PLAN" means an employee benefit plan (as
defined in Section 3(3) of ERISA) that is maintained or contributed to by any
ERISA Entity or with respect to which the Issuer or any Subsidiary could
incur liability.
"ENVIRONMENTAL LAWS" means any and all present and future
applicable laws, rules or regulations of any Governmental Authority, any
orders, decrees, judgments or injunctions and the common law in each case as
now or hereafter in effect, relating to pollution or protection of human
health, safety or the environment, including, without limitation, ambient
air, indoor air, soil, surface water, groundwater, land or subsurface strata
and natural resources such as wetlands, flora and fauna, including, without
limitation, those relating to Releases or threatened Releases of Hazardous
Materials into the environment, or otherwise relating to the manufacture,
processing, generation, distribution, use, treatment, storage, disposal,
transport or handling of Hazardous Materials.
"EQUITY INTERESTS" means, with respect to any Person, any
and all shares, interests, participations or other equivalents, including
membership interests (however designated, whether voting or non-voting), of
capital of such Person, including, if such Person is a partnership,
partnership interests (whether general or limited) and any other interest or
participation that confers on a Person the right to receive a share of the
profits and losses of, or distributions of assets of, such partnership,
whether outstanding on or after the Closing Time.
"ERISA" means the Employee Retirement Income Security Act
of 1974, as amended from time to time.
"ERISA ENTITY" means any member of an ERISA Group.
"ERISA EVENT" means (a) any "reportable event," as defined
in Section 4043 of ERISA or the regulations issued thereunder, with respect
to a Plan (other than an event for which the 30-day notice period is waived);
(b) the existence with respect to any Plan of an "accumulated funding
deficiency" (as defined in Section 412 of the Code or Section 302 of ERISA),
whether or not waived, the failure to make by its due date a required
installment under Section 412(m) of the Code with respect to any Plan or the
failure to make any required contribution to a Multiemployer Plan; (c) the
filing pursuant to Section 412(d) of the Code or Section 303(d) of ERISA of
an application for a waiver of the minimum funding standard with respect to
any Plan; (d) the incurrence by any ERISA Entity of any liability under Ti-
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tle IV of ERISA with respect to the termination of any Plan; (e) the receipt
by any ERISA Entity from the Pension Benefit Guaranty Corporation ("PBGC") of
any notice relating to an intention of the PBGC to terminate any Plan or
Plans or to appoint a trustee to administer any Plan, or the occurrence of
any event or condition which is reasonably likely to constitute grounds under
ERISA for the PBGC to terminate or appoint a trustee to administer any Plan;
(f) the incurrence by any ERISA Entity of any liability with respect to the
withdrawal or partial withdrawal from any Multiemployer Plan; (g) the receipt
by any ERISA Entity of any notice, or the receipt by any Multiemployer Plan
from the Issuer or any of its Subsidiaries of any notice, concerning the
imposition of Withdrawal Liability or a determination that a Multiemployer
Plan is, or is expected to be, insolvent or in reorganization, within the
meaning of Title IV of ERISA; (h) the making of any amendment to any Plan
which could result in the imposition of a lien or the posting of a bond or
other security; or (i) the occurrence of a nonexempt prohibited transaction
(within the meaning of Section 4975 of the Code or Section 406 of ERISA) that
is reasonably likely to result in liability to any ERISA Entity.
"ERISA GROUP" means the Issuer or any of its Subsidiaries
and all members of a controlled group of corporations and all trades or
businesses (whether or not incorporated) under common control which, together
with the Issuer or any Subsidiary, are treated as a single employer under
Section 414 of the Code.
"ESTIMATED AHYDO AMOUNT" is defined in Section 7.07.
"EVENT OF DEFAULT" is defined in Section 12.01.
"EXCHANGE ACT" means the Securities Exchange Act of 1934,
as amended, and the rules and regulations promulgated by the Commission
thereunder.
"EXCHANGE AND REGISTRATION RIGHTS AGREEMENT" is defined in
the second recital to this Agreement.
"EXCHANGE NOTES" means the notes issued in the Exchange
Offer.
"EXCHANGE OFFER" is defined in the Exchange and
Registration Rights Agreement.
"FOREIGN PLAN" means any employee benefit plan, program,
policy, arrangement or agreement maintained or contributed to by, or entered
into with, the Issuer or any Subsidiary with respect to employees employed
outside the United States.
"FULLY DILUTED" means the sum of all shares of Common Stock
outstanding as of the Closing Time and all shares of Common Stock issuable
upon the conversion or exercise of options or warrants to purchase, or
securities convertible into or exercisable for, shares of Common Stock
outstanding as of the Closing Time.
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"GAAP" means, at any date of determination, generally
accepted accounting principles in effect in the United States that are
applicable at the date of determination and which are consistently applied
for all applicable periods.
"GOVERNMENTAL AUTHORITY" means any government or political
subdivision of the United States or any other country or any agency,
authority, board, bureau, central bank, commission, department or
instrumentality thereof or therein, including, without limitation, any court,
tribunal, grand jury or arbitrator, in each case whether foreign or domestic,
or any entity exercising executive, legislative, judicial, regulatory or
administrative functions of or pertaining to such government or political
subdivision.
"HAZARDOUS MATERIAL" means any pollutant, contaminant,
toxic, hazardous or extremely hazardous substance, constituent or waste, or
any other constituent, waste, material, compound or substance subject to
regulation under any Environmental Law including, without limitation,
petroleum or any petroleum product, including crude oil or any fraction
thereof, polychlorinated biphenyls, urea-formaldehyde insulation and asbestos.
"HOLDER" means a Person in whose name a Note or Share is
registered on the Security Register.
"INDEMNIFIED PERSON" is defined in Section 13.02(c).
"INDENTURE" means the indenture in the form attached hereto
as Exhibit D governing the Exchange Notes as originally executed (including
all exhibits and schedules thereto) and as it may from time to time be
supplemented or amended by one or more indentures supplemental thereto
entered into pursuant to the applicable provisions thereof.
"INSTITUTIONAL INVESTOR" means any Holder that (a) is an
original Purchaser of the Notes or an Affiliate of such an original
Purchaser, (b) holds more than 5% of the aggregate principal amount of the
Outstanding Notes, or (c) is a bank, trust company, savings and loan
association or other financial institution, a pension plan, an investment
company, an insurance company, a broker dealer, or another other similar
financial institution or entity, regardless of legal form.
"ISSUE DATE" means the original issue date of the Notes
hereunder.
"ISSUER" is defined in the preamble to this Agreement and
includes its successors and assigns.
"ISSUER INDEMNIFIED PERSON" is defined in Section 13.02(b).
"LAW" means, as to any Person, any law, treaty, rule or
regulation or determination of an arbitrator or a court or other Governmental
Authority, in each case applicable to
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or binding upon such Person or any of its property or to which such Person or
any of its property is subject.
"LEGAL HOLIDAY" means a Saturday, a Sunday or a day on
which banking institutions in The City of New York or at a place of payment
are authorized by law, regulation or executive order to remain closed.
"LIEN" means any mortgage, pledge, security interest,
encumbrance, lien or charge of any kind (including any conditional sale or
other title retention agreement or lease in the nature thereof).
"MATERIAL ADVERSE EFFECT" means a material adverse effect
on (a) the business, management, operations, condition (financial or
otherwise), prospects or assets of the Issuer and its Subsidiaries taken as a
whole, (b) the ability of the Issuer or any Subsidiary to perform any of its
material obligations under any of the Transaction Documents, or (c) the
validity or enforceability of any Transaction Document, other than, in the
case of clause (a), any effect arising from any matter disclosed in writing
to the Purchasers on or prior to the date hereof.
"MATURITY" means, when used with respect to any Note, the
date on which the principal of such Note becomes due and payable as therein
or herein provided, whether at the Stated Maturity or by declaration of
acceleration, call for redemption or otherwise (including in connection with
any offer to purchase that this Agreement requires the Issuer to make).
"MULTIEMPLOYER PLAN" means at any time a multiemployer plan
within the meaning of Section 4001(a)(3) of ERISA (i) to which any member of
the ERISA Group is then making or accruing an obligation to make
contributions while a member of the ERISA Group, (ii) to which any member of
the ERISA Group has within the preceding five plan years made contributions,
including for these purposes any Person which ceased to be a member of the
ERISA Group during such five year period, or (iii) with respect to which the
Issuer or any of its Subsidiaries is reasonably likely to incur liability.
"NOTEHOLDERS" means the holders of the Notes.
"NOTES" is defined in the first recital to this Agreement.
"OFFICER" means, with respect to any Person, the President,
the Chief Executive Officer, the Chief Financial Officer, an Executive Vice
President, a Vice President, the Secretary, an Assistant Secretary, the
Treasurer or an Assistant Treasurer of such Person.
"OFFICERS' CERTIFICATE" means, with respect to any Person,
a certificate signed by two Officers of such Person; PROVIDED, HOWEVER, that
every Officers' Certificate with respect to compliance with a covenant or
condition provided for in this Agreement shall include (i) a statement that
the Officers making or giving such Officers' Certificate have read such
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condition and any definitions or other provisions contained in this Agreement
relating thereto, (ii) a statement that, in the opinion of the signers, they
have made or have caused to be made such examination or investigation as is
necessary to enable them to express an informed opinion as to whether or not
such term or condition has been satisfied or complied with or the
certifications required to be made therein are complete and accurate, (iii) a
statement as to whether, in the opinion of the signers, such condition has
been complied with and (iv) all other statements and determinations required
by the related terms and conditions of this Agreement giving rise to the
delivery of such Officers' Certificate.
"ORGANIC DOCUMENT" means, relative to any Person, its
certificate of incorporation, its bylaws, its partnership agreement, its
memorandum and articles of association, share designations or similar
organizational documents and all shareholder agreements, voting trusts and
similar arrangements applicable to any of its authorized Equity Interests.
"OUTSTANDING NOTES" means, as of the date of determination,
all Notes issued pursuant to this Agreement, other than Notes owned by the
Issuer or any of its Affiliates or Notes that have been redeemed or canceled
prior to such date, and all Exchange Notes, which shall vote together with
the Notes as a single class.
"PERMITS" means all licenses, permits, certificates of
need, approvals and authorizations from all Governmental Authorities required
to lawfully conduct a business as presently conducted.
"PERSON" means any individual, corporation (including,
without limitation, a business trust, professional corporation and insurance
company), limited liability company, partnership, joint venture, association,
joint-stock company, trust, unincorporated organization or government or any
agency or political subdivision thereof or any other legally recognizable
entity.
"PIK REDEMPTION AMOUNT" is defined in Exhibit A.
"PLAN" means, at a particular time, any employee benefit
plan that is covered by ERISA and in respect of which the Issuer or a
Commonly Controlled Entity (as defined in ERISA) is (or, if such plan were
terminated at such time, would under Section 4069 of ERISA be deemed to be)
an "employer" as defined in Section 3(5) of ERISA.
"PREFERRED STOCK" has the meaning ascribed to that term in
the Indenture.
"PRIME RATE" means the rate of interest from time to time
announced by Citibank, N.A. at its principal office as its prime commercial
lending rate.
"PRIVATE OFFERING" means any offering by any of the
Purchasers of some or all of the Securities without registration under the
Securities Act.
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"PROCEEDING" means any claim, counterclaim, action,
judgment, suit, hearing, governmental investigation, arbitration or
proceeding, including by or before any Governmental Authority and whether
judicial or administrative.
"PROPERTY" means any right, title or interest in or to
property or assets of any kind whatsoever, whether real, personal or mixed
and whether tangible or intangible and including Equity Interests or other
ownership interests of any Person.
"PTE" is defined in Section 5.02.
"PURCHASE PRICE" is defined in Section 2.02.
"PURCHASER INDEMNIFIED PERSON" is defined in Section
13.02(a).
"PURCHASERS" is defined in the preamble to this Agreement.
"QPAM EXEMPTION" means Prohibited Transaction Class
Exemption 84-14 issued by the United States Department of Labor on March 13,
1984.
"QUALIFIED INSTITUTIONAL BUYER" means any Person that is a
"qualified institutional buyer" within the meaning of Rule 144A.
"REDEMPTION DATE" means, when used with respect to any Note
to be redeemed, the date fixed for such redemption by or pursuant to this
Agreement.
"REDEMPTION PRICE", when used with respect to any Note to
be redeemed, means the price at which it is to be redeemed pursuant to this
Agreement.
"REGISTRATION RIGHTS AGREEMENT" is defined in the third
recital to this Agreement.
"REGULATION S" means Regulation S under the Securities Act
(or any successor provision), as it may be amended from time to time.
"RELEASE" means any release, spill, emission, leaking,
pumping, injection, deposit, disposal, discharge, dispersal, leaching or
migration into the environment.
"RESPONSIBLE OFFICER" has the meaning ascribed to such term
in the Indenture.
"RESTRICTED SUBSIDIARY" has the meaning ascribed to such
term in the Indenture.
"RULE 144" means Rule 144 under the Securities Act (or any
successor provision), as it may be amended from time to time.
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"RULE 144A" means Rule 144A under the Securities Act (or
any successor provision), as it may be amended from time to time.
"SECURITIES" is defined in the first recital to this
Agreement.
"SECURITIES ACT" mean the Securities Act of 1933, as
amended, and the rules and regulations promulgated by the Commission
thereunder.
"SECURITY" means any of the Notes or the Shares.
"SERIES A COMMON STOCK" is defined in the first recital to
this Agreement.
"SERIES B COMMON STOCK" is defined in the first recital to
this Agreement.
"SERIES A SHARES" is defined in the first recital to this
Agreement.
"SERIES B SHARES" is defined in the first recital to this
Agreement.
"SHARES" is defined in the first recital to this Agreement.
"SIGNIFICANT SUBSIDIARY" means (i) any Restricted
Subsidiary (as defined in the Indenture) that, together with its Restricted
Subsidiaries, would be a "Significant Subsidiary" of the Issuer within the
meaning of Rule 1-02 under Regulation S-X promulgated by the Commission and
(ii) for purposes of Section 12.01, any other Restricted Subsidiary that when
aggregated with all other Restricted Subsidiaries that are not Significant
Subsidiaries as to which an event described under clauses (h), (i) or (j)
under Section 12.01 has occurred, together with their Restricted
Subsidiaries, would constitute a Significant Subsidiary pursuant to clause
(i) above (using a 5% threshold under Rule 1-02 rather than the 10% threshold
provided in Rule 1-02).
"SOLVENT" and "SOLVENCY" means, for any Person on a
particular date, that on such date (a) the fair value of the Property of such
Person is greater than the total amount of liabilities, including, without
limitation, contingent liabilities, of such Person, (b) the present fair
salable value of the assets of such Person is not less than the amount that
will be required to pay the probable liability of such Person on its debts as
they become absolute and matured, (c) such Person does not intend to, and
does not believe that it will, incur debts and liabilities beyond such
Person's ability to pay as such debts and liabilities mature, (d) such Person
is not engaged in a business or a transaction, and is not about to engage in
a business or a transaction, for which such Person's Property would
constitute an unreasonably small capital and (e) such Person is able to pay
its debts as they become due and payable.
"SOURCE" is defined in Section 5.02.
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"SPECIAL INTEREST" is defined in the Exchange and
Registration Rights Agreement.
"STATED MATURITY" means, with respect to any security, the
date specified in such security as the fixed date on which the payment of
principal of such security is due and payable, including pursuant to any
mandatory redemption provision.
"SUBSIDIARY" means, with respect to any Person, any
corporation, partnership or other entity of which at least a majority of the
securities or other ownership interests having by the terms thereof ordinary
voting power to elect a majority of the board of directors or other persons
performing similar functions of such corporation, partnership or other entity
(irrespective of whether or not at the time securities or other ownership
interests of any other class or classes of such corporation, partnership or
other entity shall have or might have voting power by reason of the happening
of any contingency) is at the time directly or indirectly owned or controlled
by such Person or one or more Subsidiaries of such Person or by such Person
and one or more Subsidiaries of such Person. Unless the context clearly
requires otherwise, all references to any Subsidiary shall mean a Subsidiary
of the Issuer. All references to any Subsidiary of the Issuer shall include
all those Persons that become Subsidiaries upon consummation of the Xxxxxxx
Acquisition.
"TAX RETURNS" means all returns, declarations, reports,
estimates, information returns and statements required to be filed in respect
of any Taxes.
"TAXES" means any and all taxes, imposts, duties, charges,
fees, levies or other charges or assessments of whatever nature, including
income, gross receipts, excise, real or personal property, sales,
withholding, social security, retirement, unemployment, occupation, use,
service, license, net worth, payroll, franchise, and transfer and recording,
imposed by the Internal Revenue Service or any taxing authority (whether
domestic or foreign, including any federal, state, U.S. possession, county,
local or foreign government or any subdivision or taxing agency thereof),
whether computed on a separate, consolidated, unitary, combined or any other
basis, including interest, fines, penalties or additions to tax attributable
to or imposed on or with respect to any such taxes, charges, fees, levies or
other assessments.
"TRANSACTION DOCUMENTS" means, collectively, this
Agreement, the Exchange and Registration Rights Agreement, the Indenture, the
Registration Rights Agreement, the Notes, the Xxxxxxx Acquisition Agreement,
the Credit Agreement and all certificates, instruments, financial and other
statements and other documents made or delivered in connection herewith and
therewith.
"TRANSACTIONS" means, collectively, the transactions
provided for in, or contemplated by, the Transaction Documents.
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"UCC" means the Uniform Commercial Code as in effect in the
applicable state or jurisdiction.
"UNITED STATES" shall have the meaning assigned to such
term in Regulation S.
1.02. COMPUTATION OF TIME PERIODS. For purposes of
computation of periods of time hereunder, the word "from" means "from and
including" and the words "to" and "until" each mean "to but excluding."
1.03. ACCOUNTING TERMS. Accounting terms used but not
otherwise defined herein shall have the meanings provided by, and be
construed in accordance with, GAAP.
SECTION 2
AUTHORIZATION, ISSUANCE and sale OF SECURITIES
2.01. AUTHORIZATION OF ISSUE. The Issuer has authorized the
issue and sale of (i) $36,500,000 initial aggregate principal amount of the
Notes and such additional amount of Notes as may be paid as interest on the
Notes, each Note to be in the form of Exhibit A hereto, (ii) 13,168,922
shares of Series A Common Stock and (iii) 3,292,231 shares of Series B Common
Stock pursuant to this Agreement.
2.02. SALE. On the basis of the representations and
warranties herein contained and subject to the terms and conditions herein
set forth, the Issuer agrees to sell to each Purchaser, and each Purchaser,
acting severally and not jointly, agrees to purchase from the Issuer, the
aggregate principal amount of Notes and the aggregate number of Shares, in
each case, set forth in Schedule A opposite the name of such Purchaser at a
purchase price (the "Purchase Price") of $1,000 for each $1,000 principal
amount of Notes and 328.94 Series A Shares and 82.24 Series B Shares. Each
Purchaser's obligation to close is conditioned upon each of the other
Purchasers fulfilling its obligation to close.
2.03. CLOSING. The purchase and sale of Securities pursuant
to this Agreement shall occur at the offices of Xxxxxx Xxxxxx & Xxxxxxx, at
10:00 A.M. (New York City time), on October 25, 2000, or such other time as
shall be agreed upon by the Purchasers and the Issuer (such time and date of
payment and delivery being herein called the "CLOSING TIME"). At the Closing
Time, the Issuer will deliver to each Purchaser certificates for the
Securities to be purchased by such Purchaser at the Closing Time, in such
denominations (in the case of the Notes in integral multiples of $1,000) as
such Purchaser may request, dated the Closing Time and registered in such
Purchaser's name, against payment by such Purchaser to the Issuer by wire
transfer of immediately available funds in the amount of the Purchase Price
to be paid by
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such Purchaser therefor to such bank account or accounts as the Issuer may
request in writing at least two Business Days prior to the Closing Time.
2.04. ALLOCATION OF PURCHASE PRICE. For all income tax
purposes, the Issuer and the Purchasers agree that the Purchase Price paid by
each Purchaser shall be allocable as follows: $572.38 to each $1,000
principal amount of Notes, $427.62 to each share of Class A Common Stock and
$0 to each share of Class B Common Stock. The tax and reporting basis of the
Securities under the Code by the Issuer and the Purchasers shall be
consistent with the foregoing.
SECTION 3
CONDITIONS TO CLOSING
Each Purchaser's several obligation to purchase and pay for
the Securities to be purchased by it at the Closing Time is subject to the
satisfaction or waiver by each Purchaser prior to or at the Closing Time of
each of the conditions specified below in this Section 3:
A. At or before the Closing Time, all corporate and other
proceedings taken or to be taken in connection with the transactions
contemplated hereby and all documents incidental thereto not previously found
acceptable by the Purchasers shall be reasonably satisfactory in form and
substance to the Purchasers, and the Purchasers shall have received the
following items, each of which shall be in form and substance reasonably
satisfactory to the Purchasers and, unless otherwise noted, dated the Closing
Time:
1. a copy of the Issuer's charter, certified as of the Closing
Time by one of its Officers, together with a certificate of status,
compliance, good standing or like certificate with respect to the
Issuer issued by the appropriate government officials of the
jurisdiction of its incorporation, each to be dated a recent date prior
to the Closing Time;
2. a copy of the Issuer's bylaws, certified as of the Closing
Time by one of its Officers;
3. resolutions of the Issuer's Board of Directors approving
and authorizing the execution, delivery and performance of this
Agreement, each of the other Transaction Documents to which it is a
party and any other documents, instruments and certificates required to
be executed by the Issuer in connection herewith and therewith and
approving and authorizing the execution and delivery of the Transaction
Documents and the consummation of the Transactions, each certified as
of the Closing
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Time by one of its Officers as being in full force and effect without
modification or amendment;
4. an originally executed copy of the written opinion of Paul,
Hastings, Xxxxxxxx & Xxxxxx, LLP, counsel for the Issuer, substantially
in the form of Exhibit E hereto and addressed to the Purchasers;
5. an originally executed copy of the written opinion of
Xxxxxx Xxxxxx & Xxxxxxx, counsel to the Purchasers, substantially in
the form of Exhibit F hereto and addressed to the Purchasers;
6. a solvency certificate addressed to the Purchasers and
dated the Closing Time from the chief financial officer of the Issuer,
which solvency certificate shall be in the form of Exhibit G
(appropriately completed) to the Credit Agreement, expressing opinions
of value and other appropriate factual information regarding the
solvency of the Issuer and its Subsidiaries (on a consolidated basis)
after giving effect to the Transactions and the incurrence of all
financings contemplated herein;
7. true and correct copies of the Xxxxxxx Acquisition
Agreement, which shall not have been amended since October 13, 2000 in
any material respect without the Purchasers' consent (which consent
shall not be unreasonably withheld or delayed), and which shall be in
full force and effect and each of the conditions to purchase contained
therein shall have been performed or complied with substantially on the
terms set forth therein and not materially waived without the
Purchasers' consent (which consent shall not be unreasonably withheld
or delayed);
8. (i) executed or conformed copies of the Credit Agreement
and any amendments thereto made at or prior to the Closing Time and a
copy of each legal opinion delivered in connection with the Credit
Agreement, and the terms and provisions of the Credit Agreement and all
documents and instruments relating thereto shall be reasonably
satisfactory to the Purchasers, (ii) an Officers' Certificate from the
Issuer certifying that the Credit Agreement is in full force and effect
at the Closing Time and (iii) an Officers' Certificate from the Issuer
to the effect that such party has performed or complied with all
agreements and conditions contained in the Credit Agreement, except
where such agreements or conditions would not reasonably be expected to
have a Material Adverse Effect; and the Issuer shall have received
$38.0 million in cash at or before the Closing Time from borrowings
under the Credit Agreement; and
9. a certificate of the Chief Financial Officer of the Issuer
certifying that the Issuer's pro forma EBITDA for the twelve-months
ended August 31, 2000 was at least $71 million.
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B. At or before the Closing Time, the Issuer shall have
filed with the Secretary of State of the State of Delaware the Amended and
Restated Certificate of Incorporation of the Issuer in the form attached
hereto as Exhibit H.
C. At or before the Closing Time, the Issuer shall have
paid or caused Atrium to pay to the Purchasers the fees set forth in that
certain Fee Letter dated July 28, 2000 and that certain Supplemental Fee
Letter dated October 25, 2000.
D. Simultaneously with the issuance of the Securities, the
Issuer shall have delivered to the Purchasers an Officers' Certificate from
the Issuer in form and substance reasonably satisfactory to the Purchasers to
the effect that (i) the representations and warranties in Section 4 are true,
correct and complete at and as of the Closing Time to the same extent as
though made at and as of that date, (ii) at or prior to the Closing Time, the
Issuer has performed and complied with in all material respects all covenants
and conditions to be performed and observed by the Issuer hereunder at or
prior to the Closing Time and (iii) all conditions to the consummation of the
Acquisition in the Xxxxxxx Acquisition Agreement have been satisfied
substantially on the terms set forth therein and have not been waived or
materially amended without the Purchasers' prior written consent.
E. Other than the Notes, the Credit Agreement and as set
forth in Schedule 3D hereto, neither the Issuer nor any Subsidiary, after
giving effect to, and upon consummation of, the Transactions, shall have any
outstanding indebtedness for money borrowed.
F. The Purchasers and their counsel shall be satisfied that
the consummation of the Acquisition and the related financing shall be in
compliance with all applicable Law (including without limitation Regulation
T, U or X of the Board of Governors of the Federal Reserve System). At or
prior to the Closing Time, (A) all necessary material governmental (domestic
and foreign), regulatory and third party approvals in connection with the
Transaction Documents and otherwise referred to herein or therein shall have
been obtained and remain in full force and effect and evidence thereof shall
have been provided to the Purchasers and (B) all necessary material
governmental (domestic and foreign), regulatory and third party approvals in
connection with any existing indebtedness that is to remain outstanding after
the Closing Time and the consummation of the Transactions shall have been
obtained and remain in full force and effect and evidence thereof shall have
been provided to the Purchasers. At the Closing Time, no litigation by any
entity (private or governmental) shall be pending or threatened in writing
with respect to the Transactions or any documentation executed in connection
therewith or the transactions contemplated thereby or with respect to any
existing indebtedness.
G. The Acquisition shall be consummated simultaneously with
the issuance of the Securities.
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H. The Purchasers shall have received certificates
evidencing their respective Notes and Shares.
I. The Purchasers shall have received executed copies of
the Exchange and Registration Rights Agreement and the Registration Rights
Agreement.
J. The Purchasers shall have received a schedule (the
"AHYDO SCHEDULE") calculating the Estimated AHYDO Amount based on each
possibility with respect to the number of cash interest payments made and
assuming none of the Notes are redeemed on or prior to April 24, 2006, and
the Purchasers shall be reasonably satisfied that the Estimated AHYDO Amount
has been calculated in accordance with the definition of AHYDO Amount.
SECTION 4
REPRESENTATIONS AND WARRANTIES OF THE ISSUER
The Issuer represents and warrants to each of the
Purchasers as of the date hereof and as of the Closing Time that:
4.01. CORPORATE EXISTENCE. The Issuer (a) is a corporation
duly organized, validly existing and in good standing under the laws of
Delaware; (b) has all requisite corporate or other power and authority, and
has all governmental licenses, authorizations, consents and approvals
necessary to own its Property and carry on its business as now being
conducted, except as would not, individually or in the aggregate, be
reasonably likely to have a Material Adverse Effect; and (c) is qualified to
do business and is in good standing in all jurisdictions in which the nature
of the business conducted by it makes such qualification necessary and where
failure to be so qualified and in good standing, individually or in the
aggregate, is reasonably likely to have a Material Adverse Effect.
4.02. FINANCIAL CONDITION.
(a) The Issuer has heretofore delivered to the Purchasers
(A) the audited consolidated balance sheets of Atrium and its subsidiaries as
of December 31, 1997, December 31, 1998 and December 31, 1999, and the
related statements of earnings, changes in stockholders' equity and cash
flows for the fiscal years ended on those dates, together with reports
thereon by PricewaterhouseCoopers LLP, certified public accountants, (B) the
unaudited consolidated balance sheets of Atrium and its subsidiaries as of
August 31, 2000 and the related statements of earnings and cash flows for the
fiscal periods ended on those dates and (C) the audited consolidated balance
sheets of Xxxxxxx as of December 31, 1998 and December 31, 1999, and the
related statements of earnings, changes in stockholders' equity and cash
flows for the fiscal years ended on those dates, together with reports
thereon by KPMG LLP,
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certified public accountants. All of said financial statements, including in
each case the related schedules and notes, are true, complete (in the case of
year-end financial statements) and correct in all material respects, have
been prepared in accordance with GAAP consistently applied (other than the
omission of footnotes with respect to interim statements) and present fairly
the financial position of the Issuer and its Subsidiaries or Xxxxxxx and its
Subsidiaries, as the case may be, as of the respective dates of said balance
sheets and the results of their operations for the respective periods covered
thereby, subject (in the case of interim statements) to period-end audit
adjustments.
(b) Except as set forth in the financial statements or
other information referred to in Section 4.02(a), as of the Closing Time
there are no material liabilities of the Issuer of any kind, whether accrued,
contingent, absolute, determined, determinable or otherwise, and there is no
existing condition, situation or set of circumstances that is reasonably
likely to result in such a liability, other than:
(i) liabilities incurred in the ordinary course of business
consistent with past practice since December 31, 1999 that,
individually or in the aggregate, would not be reasonably likely to
have a Material Adverse Effect; and
(ii) liabilities under this Agreement or liabilities incurred
in connection with the transactions contemplated hereby.
(c) Except as set forth in the financial statements referred
to in Section 4.02(a), since December 31, 1999, there has been no Material
Adverse Effect or any event, change or circumstance which could reasonably be
expected to cause or evidence, either individually or together with any other
events, changes and circumstances, a Material Adverse Effect.
(d) The pro forma balance sheet of the Issuer and its
Subsidiaries (the "Pro Forma Balance Sheet"), certified by the chief financial
officer of the Issuer, copies of which have been heretofore furnished to each
Purchaser, together with the notes thereto, accurately reflects in all material
respects all adjustments necessary to give effect to the Transactions, was
prepared based on good faith assumptions and presents fairly in all material
respects on a pro forma basis the consolidated financial position of Issuer and
its Subsidiaries as of August 31, 2000, adjusted as described above.
4.03. LITIGATION. Except as disclosed in Schedule 4.03,
there is no Proceeding pending against, or to the knowledge of the Issuer,
threatened in writing against or affecting the Issuer, its Subsidiaries or
any of their respective Properties before any Governmental Authority that, if
determined or resolved adversely to the Issuer or any such Subsidiary, is
reasonably likely to have, individually or in the aggregate, a Material
Adverse Effect.
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4.04. NO BREACH; NO DEFAULT.
(a) The execution, delivery and performance by the Issuer
of any Transaction Document to which it is a party and the consummation of
the transactions herein and therein contemplated (including the Transactions)
will not (i) conflict with or result in a breach of, or require any consent
(which has not been obtained and is in full force and effect) under, any
Organic Document of the Issuer or any of its Subsidiaries, any applicable Law
or any order, writ, injunction or decree of any Governmental Authority
binding on the Issuer or any of its Subsidiaries, or any term or provision of
any Contractual Obligation of the Issuer or any of its Subsidiaries, (ii)
constitute (with due notice or lapse of time or both) a default under any
such Contractual Obligation or (iii) result in the creation or imposition of
any Lien (except for the Liens created pursuant to the Credit Agreement) upon
any Property of the Issuer or any of its Subsidiaries pursuant to the terms
of any such Contractual Obligation, except with respect to each of the
foregoing that is not, individually or in the aggregate, reasonably likely to
have a Material Adverse Effect.
(b) Neither the Issuer nor any of its Subsidiaries is in
default under or with respect to any Contractual Obligation (including any
Transaction Document) or any order, award or decree of any Governmental
Authority or arbitrator binding upon it or any of its Property, except for
such defaults that would not, individually or in the aggregate, be reasonably
likely to have a Material Adverse Effect.
4.05. ACTION. The Issuer has all necessary corporate power,
authority and legal right to execute, deliver and perform its obligations
under each Transaction Document to which it is a party and to consummate the
transactions herein and therein contemplated; the execution, delivery and
performance by the Issuer of each Transaction Document to which it is a party
and the consummation of the transactions herein and therein contemplated have
been duly authorized by all necessary corporate action on its part; and this
Agreement has been duly and validly executed and delivered by the Issuer and
constitutes, and each of the other Transaction Documents to which it is a
party when executed and delivered by the Issuer will constitute, a legal,
valid and binding obligation, enforceable against the Issuer in accordance
with its terms, except as such enforceability may be limited by (a)
bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium or
similar laws of general applicability from time to time in effect affecting
the enforcement of creditors' rights and remedies, (b) the application of
general principles of equity (regardless of whether such enforceability is
considered in a proceeding in equity or at law) and (c) laws and public
policy considerations that may limit the enforceability of the
indemnification provisions, if any, contained in the Transaction Documents
(the "ENFORCEABILITY EXCEPTIONS").
4.06. AUTHORIZATION OF THIS AGREEMENT. This Agreement has
been duly authorized, executed and delivered by the Issuer and constitutes a
valid and legally binding
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obligation of the Issuer, enforceable against the Issuer in accordance with
its terms, subject to the Enforceability Exceptions.
4.07. AUTHORIZATION OF THE INDENTURE. The Indenture has
been duly authorized by the Issuer and, upon its execution and delivery by
the Issuer as contemplated in the Exchange and Registration Rights Agreement
and assuming due execution and delivery by the trustee thereunder, will
constitute a valid and binding agreement of the Issuer, enforceable against
the Issuer, in accordance with its terms, except as the enforcement thereof
may be limited by the Enforceability Exceptions.
4.08. AUTHORIZATION OF THE NOTES AND EXCHANGE NOTES. The
Notes to be purchased by the Purchasers from the Issuer are in the form
contemplated by this Agreement, have been duly authorized for issuance and
sale pursuant to this Agreement and, when issued and delivered by the Issuer
at the Closing Time as provided herein, will have been duly executed, issued
and delivered by the Issuer and will constitute valid and legally binding
obligations of the Issuer, enforceable against it in accordance with their
terms, subject to the Enforceability Exceptions. If and when the Exchange
Notes are issued pursuant to the Exchange and Registration Rights Agreement
and this Agreement in accordance with the terms thereof and hereof, the
Exchange Notes will have been duly authorized for issuance by the Issuer,
will have been duly executed, issued and delivered by the Issuer and will
constitute valid and legally binding obligations of the Issuer, enforceable
against it in accordance with their terms, subject to the Enforceability
Exceptions.
4.09. AUTHORIZATION OF THE EXCHANGE AND REGISTRATION RIGHTS
AGREEMENT. The Exchange and Registration Rights Agreement has been duly
authorized, executed and delivered by the Issuer and constitutes a valid and
binding agreement of the Issuer, enforceable against the Issuer in accordance
with its terms, except, as enforcement thereof may be limited by the
Enforceability Exceptions.
4.10. AUTHORIZATION OF COMMON STOCK. The Issuer has
authorized the issuance and delivery of 13,168,922 shares of its Series A
Common Stock, constituting 6.72% of the outstanding shares of Common Stock of
the Issuer (determined on a Fully Diluted basis), and 3,292,231 shares of its
Series B Common Stock, constituting 1.68% of the outstanding shares of Common
Stock of the Issuer (determined on a Fully Diluted basis), such Shares having
the rights, restrictions, privileges and preferences set forth in the
Certificate of Incorporation of the Issuer and holders of such Shares will
have the benefit of and be subject to the terms and conditions of the
Registration Rights Agreement. Upon issuance of the Shares in accordance with
the terms of this Agreement, such Shares will be validly issued, fully paid
and nonassessable and free of preemptive rights. A detailed calculation of
the Fully Diluted shares of Common Stock of the Issuer, after giving effect
to the Transactions, is set forth on Schedule 4.10.
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4.11. AUTHORIZATION OF THE REGISTRATION RIGHTS AGREEMENT.
The Registration Rights Agreement has been duly authorized, executed and
delivered by the Issuer and constitutes a valid and legally binding
obligation of the Issuer, enforceable against the Issuer in accordance with
its terms, except as enforcement thereof may be limited by the Enforceability
Exceptions.
4.12. [INTENTIONALLY OMITTED]
4.13. APPROVALS. No authorizations, approvals or consents
of, and no filings or registrations with, any Governmental Authority or any
securities exchange are necessary for the execution, delivery or performance
by the Issuer of the Transaction Documents to which it is a party or for the
legality, validity or enforceability hereof or thereof or for the
consummation of the transactions herein and therein contemplated, except for
filings and recordings in respect of the Liens created pursuant to the Credit
Agreement and, in connection with the Transactions, except for (i) consents,
filings and authorizations that have been maintained or made and are in full
force and effect, (ii) in connection with the registration of the Exchange
Notes, Series A Shares and Series B Shares under the Securities Act or the
qualification of the Indenture under the Trust Indenture Act of 1939, as
amended, or (iii) pursuant to state securities or "blue sky" laws.
4.14. REPRESENTATIONS AND WARRANTIES IN TRANSACTION
DOCUMENTS. The representations and warranties of the Issuer and each of its
Subsidiaries (other than Xxxxxxx), as applicable, set forth in each
Transaction Document were, in each case, true and correct in all material
respects as of the time such representations and warranties were made or
deemed made and at the Closing Time. To the best knowledge of the Issuer, the
representations and warranties of each party, including Xxxxxxx, other than
the Issuer or its Subsidiaries to each Transaction Document contained therein
were true and correct in all material respects as of the time such
representations and warranties were made or deemed made and at the Closing
Time.
4.15. ERISA.
(a) None of the Issuer or any of its Subsidiaries has
incurred any liability for any prohibited transaction or funding deficiency
or any complete or partial withdrawal liability with respect to any pension,
profit sharing or other plan that is subject to ERISA to which the Issuer or
any of its Subsidiaries makes or ever has made a contribution and in which
any employee of the Issuer or any Subsidiary is or has ever been a
participant, that, individually or in the aggregate, is reasonably likely to
have or result in a Material Adverse Effect. With respect to such plans, each
of the Issuer and its Subsidiaries is in compliance in all respects with all
applicable provisions of ERISA, except where the failure to so comply could
not, individually or in the aggregate, reasonably be likely to have or result
in a Material Adverse Effect.
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(b) 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 Issuer in the first sentence of this
Section 4.15(b) is made in reliance upon and subject to the accuracy of the
representations made by the Purchasers in Section 5.02 as to the sources of
the funds used to pay the purchase price of the Securities to be purchased.
4.16. TAXES. The Issuer has filed or caused to be filed all
U.S. federal income tax returns and all other material returns, statements,
forms and reports for taxes (the "RETURNS"), domestic or foreign, required to
be filed by it and has paid all taxes payable by it that have become due or
any assessments made against it or any of its Property and all other material
taxes, fees or other charges imposed on it or any of its Property by any
Governmental Authority (other than those that, in the aggregate, are not
substantial in amount or those the amount or validity of which is currently
being contested in good faith by appropriate proceedings and with respect to
which reserves in conformity with GAAP have been provided on the books of the
Issuer, as the case may be); the Returns accurately reflect in all material
respects all liability for taxes of the Issuer for the periods covered
thereby; and no tax lien has been filed (except with respect to taxes not yet
due and payable) and, to the best knowledge of the Issuer, no action, suit,
proceeding, investigation, audit or claim is being asserted or has been
threatened in writing or otherwise by any authority with respect to any such
tax, fee or other charge, except as would not, individually or in the
aggregate, be reasonably likely to have a Material Adverse Effect. The Issuer
has not entered into an agreement or waiver extending any statute of
limitations relating to the payment or collection of taxes.
4.17. INVESTMENT COMPANY ACT; PUBLIC UTILITY HOLDING
COMPANY ACT; OTHER RESTRICTIONS. Neither the Issuer nor any of its
Subsidiaries is an "investment company", or a company "controlled" by an
"investment company", within the meaning of the United States Investment
Company Act of 1940, as amended. Neither the Issuer nor any of its
Subsidiaries is a "holding company", or an "affiliate" of a "holding company"
or a "subsidiary company" of a "holding company", within the meaning of the
United States Public Utility Holding Company Act of 1935, as amended. Neither
the Issuer nor any of its Subsidiaries is subject to regulation under any law
or regulation that limits its ability to incur indebtedness, other than
Regulation X of the Board of Governors of the Federal Reserve System.
4.18. ENVIRONMENTAL MATTERS. Except for such matters as
would not, individually or in the aggregate, be reasonably likely to have a
Material Adverse Effect, (A) neither the Issuer nor any of its Subsidiaries
is in violation of any Environmental Laws relating to Hazardous Materials or
to the manufacture, processing, distribution, use, treatment, storage,
disposal, transport or handling of Hazardous Materials, (B) the Issuer and
its Subsidiaries have all permits, authorizations and approvals required
under any applicable Environmental Laws and are each in compliance with their
requirements, (C) there are no pending or, to the
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Issuer's knowledge, threatened administrative, regulatory or judicial
actions, suits, demands, demand letters, claims, liens, notices of
noncompliance or violation, investigations or proceedings relating to any
Environmental Law against the Issuer or any of its Subsidiaries, (D) there
are no events or circumstances that would reasonably be expected to form the
basis of an order for clean-up or remediation, or an action, suit or
proceeding by any private party or governmental body or agency, against or
affecting the Issuer or any of its Subsidiaries relating to Hazardous
Materials or Environmental Laws and (E) neither the Issuer nor any of its
Subsidiaries has assumed by contract or agreement any liabilities or
obligations arising under any Environmental Law, including, without
limitation, any such liabilities or obligations with respect to formerly
owned, leased or operated real property or facilities, or former divisions or
subsidiaries.
4.19. SUBSIDIARIES. As of the Closing Time (after giving
effect to the Transactions), the Issuer has no Subsidiaries or interests in
partnerships, joint ventures or business trusts other than the entities set
forth on Schedule 4.19. The Issuer owns as of the Closing Time, the
percentage of the issued and outstanding Equity Interests or other evidences
of the ownership of each of its Subsidiaries, partnerships or joint ventures
listed on Schedule 4.19 as set forth on such Schedule.
4.20. PROPERTIES. The Issuer and each of its Subsidiaries
have good title to and beneficial ownership of all Property owned by it,
including all the Property reflected in the most recent financial statements
provided hereunder (except Property sold or otherwise disposed of since the
date thereof in the ordinary course of business), or acquired after the date
thereof.
4.21. LICENSES AND PERMITS; COMPLIANCE WITH LAWS. The
Issuer and each of its Subsidiaries hold all governmental permits, licenses,
authorizations, consents and approvals necessary for the Issuer and each of
its Subsidiaries to own, lease, and operate their respective Properties and
to operate their respective businesses as now being conducted (collectively,
the "PERMITS"), except for Permits the failure of which to obtain is not
reasonably likely to have a Material Adverse Effect. None of the Permits has
been modified in any way that is reasonably likely to have a Material Adverse
Effect. All Permits are in full force and effect, except where the failure to
be in full force and effect would not be reasonably likely to have a Material
Adverse Effect.
Each of the Issuer and its Subsidiaries is in material
compliance with all applicable statutes, laws, ordinances, rules, orders and
regulations of any Governmental Authority in all jurisdictions in which it is
presently doing business, and each of the Issuer and its Subsidiaries will
comply with all such laws and regulations which may be imposed in the future
in jurisdictions in which it may then be doing business, in each case other
than those the noncompliance with which would not, individually or in the
aggregate, reasonably be expected to have a Material Adverse Effect. There
does not exist any judgment, order or injunction pro-
-22-
hibiting or imposing material adverse conditions upon any of the Transactions
or the performance by the Issuer or any of its Subsidiaries of its
obligations under the Transaction Documents and all applicable laws.
4.22. TRUE AND COMPLETE DISCLOSURE. The information,
reports, financial statements, exhibits and schedules furnished in writing by
or on behalf of the Issuer to any Purchaser in connection with the
negotiation, preparation or delivery of this Agreement or included herein or
delivered pursuant hereto, but excluding all projections, when taken as a
whole, do not, as of the date such information was furnished, contain any
untrue statement of material fact or omit to state a material fact necessary
in order to make the statements herein or therein, in light of the
circumstances under which they were made, not materially misleading. The
projections and pro forma financial information furnished at any time by the
Issuer to any Purchaser pursuant to this Agreement have been prepared in good
faith based on assumptions believed by the Issuer to be reasonable at the
time made, it being recognized by the Purchasers that such financial
information as it relates to future events is not to be viewed as fact and
that actual results during the period or periods covered by such financial
information may differ from the projected results set forth therein by a
material amount and the Issuer, however, makes no representation as to the
ability of the Issuer to achieve the results set forth in any such
projections. The Issuer understands that all such statements, representations
and warranties shall be deemed to have been relied upon by the Purchasers as
a material inducement to enter into this Agreement.
4.23. SOLVENCY; ETC. As of the Closing Time after giving
effect to the Transaction, the Issuer will be Solvent.
4.24. LABOR MATTERS. Except as set forth in Schedule 4.24,
there are no strikes or other labor disputes against the Issuer or any of its
Subsidiaries pending or, to the knowledge of the Issuer, threatened.
4.25. PRIVATE OFFERING; NO INTEGRATION OR GENERAL
SOLICITATION.
(a) Subject to compliance by the Purchasers with the
representations and warranties set forth in Section 5 hereof and with the
procedures set forth in Section 9 hereof, it is not necessary in connection
with the offer, sale and delivery of the Securities to the Purchasers and to
any Person to whom any Purchaser sells any of such Securities (each, a
"SUBSEQUENT PURCHASER") in the manner contemplated by Section 9.01 of this
Agreement to register the Securities under the Securities Act.
(b) The Issuer has not, directly or indirectly, offered,
sold or solicited any offer to buy and will not, directly or indirectly,
offer, sell or solicit any offer to buy, any security of a type or in a
manner that would be integrated with the sale of the Securities and require
the Securities to be registered under the Securities Act. None of the Issuer
or its Affiliates or any Person acting on its or any of their behalf (other
than the Purchasers, as to whom the Issuer makes no representation or
warranty) has engaged or will engage in any form of general solicitation or
general advertising (within the meaning of Rule 502(c) under the Securities
Act) in connection with the offering of the Securities. With respect to the
Securities, if any, sold in reliance upon the exemption afforded by
Regulation S: (i) none of the Issuer, its Affiliates or any Person acting on
its or their behalf (other than the Purchasers, as to whom
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the Issuer makes no representation or warranty) has engaged or will engage in
any directed selling efforts within the meaning of Regulation S and (ii) each
of the Issuer and its Affiliates and any Person acting on its or their behalf
(other than the Purchasers, as to whom the Issuer make no representation or
warranty) has complied and will comply with the offering restrictions set
forth in Regulation S.
4.26. ELIGIBILITY FOR RESALE UNDER RULE 144A. The
Securities are eligible for resale pursuant to Rule 144A and will not, at the
Closing Time, be of the same class as securities listed on a national
securities exchange registered under Section 6 of the Exchange Act or quoted
on a U.S. automated interdealer quotation system.
4.27. NO BROKERS. None of the Issuer or its Subsidiaries
has employed any broker, finder or intermediary, other xxxx Xxxxxxx Lynch,
Pierce, Xxxxxx & Xxxxx Incorporated, in connection with the transactions
contemplated by this Agreement who might be entitled to a fee or any
commission the receipt of which is conditioned upon consummation of the
transactions contemplated by this Agreement.
4.28. SOURCES OF FUNDS. All sources of funds to be used in
connection with the transactions contemplated in the Xxxxxxx Acquisition
Agreement are set forth on Schedule 4.28.
SECTION 5
REPRESENTATIONS OF THE PURCHASERS
Each Purchaser severally and not jointly represents and
warrants to the Issuer as of the date hereof and as of the Closing Time as
follows:
5.01. PURCHASE FOR INVESTMENT.
(a) Such Purchaser is acquiring the Securities for its own
account, for investment and not with a view to any distribution thereof
within the meaning of the Securities Act.
(b) Such Purchaser understands that (i) the Securities have
not been registered under the Securities Act and are being issued by the
Issuer in transactions exempt from
-24-
the registration requirements of the Securities Act and applicable state
securities laws and (ii) the Securities may not be offered or sold except
pursuant to an effective registration statement under the Securities Act and
applicable state securities laws or pursuant to an applicable exemption from
registration under the Securities Act and applicable state securities laws.
(c) Such Purchaser further understands that the exemption
from registration afforded by Rule 144 (the provisions of which are known to
such Purchaser) promulgated under the Securities Act depends on the
satisfaction of various conditions and that, if applicable, Rule 144 may
afford the basis for sales only in limited amounts.
(d) Such Purchaser did not, and is not obligated to, pay
any broker or finder in connection with the transactions contemplated by this
Agreement.
(e) Such Purchaser is a Qualified Institutional Buyer.
(f) Such Purchaser is aware of the Issuer's and its
Subsidiaries' business affairs and financial condition and has such knowledge
and experience in financial and business matters so as to be capable of
evaluating the merits and risks of its investment in the Securities and such
Purchaser is capable of bearing the economic risks of such investment for an
indefinite period of time.
(g) Such Purchaser understands the lack of liquidity and
restrictions on transfer of the Securities and that this investment is
suitable only for a person or entity of adequate financial means that has no
need for liquidity of this investment and that can afford a total loss of its
investment. Such Purchaser understands that no public market now exists for
any of the Securities and that there is no assurance that a public market
will ever exist for the Securities.
(h) Such Purchaser has had the opportunity to make all
inquiries of the Issuer and its Subsidiaries and management for the purpose
of evaluating its investment in the Securities and the risk factors attendant
to an investment such as this and is satisfied with the scope and extent of
its investigations and the responses to such inquiries and requires no
additional information to make an informed decision. Such Purchaser
acknowledges that it is not relying upon any Person other than itself in
making its investment decision and is fully accountable therefor, subject to
the accuracy of the representations and warranties of the Issuer contained
herein.
(i) Such Purchaser is not purchasing Securities as a result
of or subsequent to any advertisement, article, notice or other communication
published in any newspaper, magazine or similar media or broadcast over
television or radio, any seminar or meeting, or any solicitation by a person
not previously known to such Purchaser in connection with investments in
securities generally.
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5.02. SOURCE OF FUNDS. Each Purchaser represents, severally
and not jointly, that at least one of the following statements is an accurate
representation as to each source of funds (a "Source") to be used by such
Purchaser to pay the purchase price of the Securities to be purchased by such
Purchaser hereunder:
(a) the Source is an "insurance company general account"
within the meaning of Department of Labor Prohibited Transaction
Exemption ("PTE") 95-60 (issued July 12, 1995) and there is no employee
benefit plan, treating as a single plan, all plans maintained by the
same employer or employee organization, with respect to which the
amount of the general account reserves and liabilities for all
contracts held by or on behalf of such plan, exceeds 10% of the total
reserves and liabilities of such general account (exclusive of separate
account liabilities) plus surplus, as set forth in the NAIC Annual
Statement filed with such Purchaser's 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
the PTE 91-38 (issued July 12, 1991) and, except as such Purchaser has
disclosed to the Issuer 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
Issuer 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 Issuer 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 Issuer in
writing pursuant to this paragraph (e); or
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(f) 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 5.02, the terms "employee benefit
plan," "governmental plan" and "separate account" shall have the respective
meanings assigned to such terms in Section 3 of ERISA.
SECTION 6
COVENANTS TO PROVIDE INFORMATION
The Issuer covenants and agrees that while any Shares (but
only if any applicable Holder of Shares owns at least 50% of the Series A
Shares originally purchased by such Holder on the date hereof pursuant to
this Agreement) or any Notes or Exchange Notes shall remain outstanding:
6.01. FUTURE REPORTS TO HOLDERS. The Issuer shall deliver
to each Holder, but with respect to Holders of Exchange Notes or Shares, only
to the extent requested by such Holders; PROVIDED, that the envelope
containing such information shall contain a legend substantially in the form
of Exhibit I hereto:
(a) MONTHLY AND QUARTERLY STATEMENTS. As soon as available,
but in any event within thirty (30) days after the end of each month
(unless such month is also the end of a fiscal quarter, in which case
within forty-five (45) days (or, if SEC Form 12b-25 is filed in respect
of the fiscal quarter then ended, 50 days)) and within forty-five (45)
days (or , if SEC Form 12b-25 is filed in respect of such fiscal
quarter, 50 days) after the end of each quarter, duplicate copies of:
(i) consolidated balance sheets of the Issuer and its
Subsidiaries as at the end of such month or quarter,
(ii) consolidated statements of income of the Issuer
and its Subsidiaries for such month or quarter and for the
portion of the fiscal year ending with such month or quarter
as applicable, and
(iii) consolidated statements of stockholders' equity
and cash flows of the Issuer and its Subsidiaries, for such
quarter and for the portion of the fiscal year ending with
such quarter,
in each case setting forth in comparative form the figures for the
corresponding periods in the prior fiscal year, all in reasonable
detail, prepared in accordance with GAAP
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applicable to periodic financial statements generally, and fairly
presenting, in all material respects, the financial position of the
Persons being reported on and their results of operations and cash
flows, subject to changes resulting from normal year-end adjustments
that will not be material in amount or effect, and accompanied by a
certificate of the chief financial officer of the Issuer to the
foregoing effect.
(b) ANNUAL STATEMENTS. As soon as available, but in any event
within ninety (90) days (or, if SEC Form 12b-25 is filed in respect of
such fiscal year, 105 days) days after the end of each fiscal year of
the Issuer, duplicate copies of:
(i) consolidated and consolidating balance sheets of
the Issuer and its Subsidiaries as at the end of such year,
and
(ii) consolidated and consolidating statements of
income, stockholders' equity and cash flows of the Issuer and
its Subsidiaries for such year,
in each case setting forth in comparative form the figures for the
prior fiscal year, all in reasonable detail, prepared in accordance
with GAAP, fairly presenting, in all material respects, the financial
position of the Persons being reported on and their results of
operations and cash flows, and accompanied by:
(A) an opinion thereon of PricewaterhouseCoopers LLP
or other comparable independent certified public accountants
of recognized national standing, which opinion shall state
that such financial statements (other than consolidating
statements) present fairly, in all material respects, the
financial position of the Persons 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
(other than consolidating statements) has been made in
accordance with GAAP, and that such examination provides a
reasonable basis for such opinion in the circumstances, and
(B) a certificate of the chief financial officer of
the Issuer stating that such financial statements have been
prepared in accordance with GAAP applicable to periodic
financial statements generally and fairly present, in all
material respects, the financial position of the Persons being
reported on and their results of operations and cash flows;
PROVIDED, HOWEVER, that if the Issuer is then subject to the reporting
requirements under Section 13 or Section 15(d) of the Exchange Act, the
delivery by the Issuer to such Holder of an Annual Report on Form 10-K
or any successor form within the time periods above described shall
satisfy the requirements of this Section 6.01(b). The consolidating
balance sheet and statements of income, stockholders' equity and cash
flows
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required by this paragraph may be in the form contained in the notes
to the financial statements included in a Form 10-K.
(c) COMPLIANCE CERTIFICATE.
(i) concurrently with the delivery of the financial
statements referred to in Section 6.01(b), a certificate of
the independent certified public accountants reporting on such
financial statements stating that in making the examination
necessary therefor no knowledge was obtained of any Event of
Default relating to Section 7.08 and 7.09, except as specified
in such certificate; and
(ii) at the time it furnishes each set of financial
statements pursuant to paragraph (a) or (b) above, a
certificate of a senior financial officer of the Issuer (A) to
the effect that no Default has occurred and is continuing (or,
if any Default has occurred and is continuing, describing the
same in reasonable detail and describing the action that
Issuer has taken and proposes to take with respect thereto)
and (B) setting forth in reasonable detail the computations
necessary (to the extent applicable) to determine whether the
Issuer is in compliance with Section 7 and the covenants
incorporated from the Indenture pursuant to Section 8 as of
the end of the respective quarterly fiscal period or fiscal
year.
(d) OTHER INFORMATION. Promptly upon their becoming available,
copies of all financial statements, reports, notices and proxy
statements sent to any of its securityholders in their capacity as such
or made available generally by the Issuer or any of its Subsidiaries
and all regular and periodic reports and all registration statements
and final prospectuses, if any, filed by the Issuer or any of its
Subsidiaries with any securities exchange or with the Commission or any
Governmental Authority succeeding to any of its functions.
(e) NOTICE OF DEFAULT. Promptly, but in any event within three
(3) Business Days, after any Officer of the Issuer becomes aware of a
Default or Event of Default with respect to the Notes or that any
Person has given any notice or taken any other action with respect to a
claimed Default or Event of Default, a written notice thereof to the
Holders specifying the nature and existence thereof and what action the
Issuer is taking or proposes to take with respect thereto.
(f) ADDITIONAL INFORMATION TO HOLDERS OF OTHER INDEBTEDNESS.
Simultaneously with the furnishing of such information to any other
holder of Debt Securities of the Issuer or any of its Restricted
Subsidiaries, (i) copies of all other financial statements, reports or
projections with respect to the Issuer or its Subsidiaries which are
broader in scope or on a more frequent basis than the Issuer is
otherwise required to provide under this Agreement and (ii) copies of
all studies, reviews, reports or assess-
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ments relating to environmental matters that reveal circumstances,
events or other matters that would reasonably be likely to have a
Material Adverse Effect.
(g) CREDIT AGREEMENT. Promptly after the occurrence thereof,
copies of any amendment, waiver or other modification of the terms of
the Credit Agreement.
(h) CALCULATION OF ORIGINAL ISSUE DISCOUNT. At the end of each
fiscal quarter, (i) a written notice specifying the amount, if any, of
original issue discount (including daily rates and accrual periods)
accrued on the Notes as of the end of such quarter and (ii) such other
specific information relating to such original issue discount as may
then be relevant under the Code and any other applicable law.
(i) ANNUAL BUDGETS. As soon as practicable and in any event
within 60 days after the beginning of each fiscal year of the Issuer, a
consolidated plan and financial forecast for such fiscal year,
including without limitation (A) a forecasted consolidated balance
sheet and forecasted consolidated statements of income and cash flows
of the Issuer and its Subsidiaries for such fiscal year, together with
an officer's certificate demonstrating pro forma compliance for such
fiscal year with Sections 7.08 and 7.09 of this Agreement and an
explanation of the assumptions on which such forecasts are based, and
(B) forecasted consolidated statements of income and cash flows of the
Issuer and its Subsidiaries for each month of each such fiscal year,
together with an explanation of the assumptions on which such forecasts
are based.
(j) REQUESTED INFORMATION. With reasonable promptness, such
other data and information relating to the business, operations,
affairs, financial condition, assets or properties of the Issuer or any
of the Subsidiaries or relating to the ability of the Issuer to perform
its obligations hereunder and under the Notes, all as from time to time
may be reasonably requested by any such holder of Notes.
6.02. INFORMATION TO BE PROVIDED PURSUANT TO RULE
144A(D)(4). As long as the Securities are "restricted securities" (within
Rule 144 of the Securities Act), for the benefit of Holders and beneficial
owners from time to time of such Securities, the Issuer shall, upon the
request of any such holder or beneficial owner, furnish, at its expense, to
holders and beneficial owners of such Securities and prospective purchasers
thereof information satisfying the requirements of subsection (d)(4) of Rule
144A.
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SECTION 7
OTHER AFFIRMATIVE COVENANTS
The Issuer covenants and agrees that until and while any
Notes and, with respect to Sections 7.05, 7.07 and 7.10 only, Exchange Notes
shall remain outstanding:
7.01. PRESERVATION OF CORPORATE EXISTENCE AND FRANCHISES.
Subject to provisions in the Indenture, the Issuer shall do or cause to be
done all things necessary to preserve and keep in full force and effect the
corporate existence, rights (charter and statutory), licenses and franchises
of the Issuer and each of its Subsidiaries; PROVIDED, HOWEVER, that the
Issuer shall not be required to preserve any such right, license or franchise
or existence of any of its Subsidiaries if the Board of Directors of the
Issuer shall determine that the preservation thereof is no longer desirable
in the conduct of the business of the Issuer and its Subsidiaries as a whole
and that the loss thereof is not adverse in any material respect to the
Holders; PROVIDED, FURTHER, that the foregoing shall not prohibit a sale,
transfer or conveyance of a Subsidiary of the Issuer or any of its assets in
compliance with the terms of the Indenture.
7.02. MAINTENANCE OF PROPERTIES. The Issuer shall cause all
material properties used or useful in the conduct of its business or the
business of any of its Subsidiaries to be maintained and kept in good
condition, repair and working order and supplied with all necessary equipment
and shall cause to be made all necessary repairs, renewals, replacements,
betterments and improvements thereof, all as in the judgment of the Issuer
may be necessary so that the business carried on in connection therewith may
be properly and advantageously conducted at all times; PROVIDED, HOWEVER,
that the foregoing shall not prevent the Issuer from discontinuing the
operation or maintenance of any of such properties if (i) the Board of
Directors determines that such discontinuance is desirable in the conduct of
its business or the business of any Subsidiary and (ii) such discontinuance
would not result in a Material Adverse Effect and would not be adverse in any
material respect to any Holder.
7.03. TAXES. The Issuer shall pay or discharge or cause to
be paid or discharged, before the same shall become delinquent, (a) all
taxes, assessments and governmental charges levied or imposed (i) upon the
Issuer or any of its Subsidiaries or (ii) upon the income, profits or
property of the Issuer or any of its Subsidiaries and (b) all lawful claims
for labor, materials and supplies, which, if unpaid, could reasonably be
expected to become a Lien upon the property of the Issuer or any of its
Subsidiaries; PROVIDED, HOWEVER, that the Issuer shall not be required to pay
or discharge or cause to be paid or discharged any such tax, assessment,
charge or claim (x) whose amount, applicability or validity is being
contested in good faith by appropriate proceedings properly instituted and
diligently conducted and for which appropriate provision has been made in
accordance with GAAP or (y) if the failure to so pay, discharge or cause to
be paid or discharged could not reasonably be expected to have, individually
or in the aggregate, a Material Adverse Effect.
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7.04. BOOKS AND RECORDS. The Issuer and its Subsidiaries
shall keep complete and accurate books and records of their transactions in
accordance with good accounting practices on the basis of GAAP (including the
establishment and maintenance of appropriate reserves).
7.05. COMPLIANCE WITH LAW. The Issuer shall, and shall
cause each of its Subsidiaries to, comply with all requirements of Law and
shall obtain and maintain, and shall cause each of its Subsidiaries to obtain
and maintain, all Permits 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 any such noncompliance with any
requirements of Law or any failure to obtain or maintain such Permits,
individually or in the aggregate, would not be reasonably likely to have a
Material Adverse Effect.
7.06. INSURANCE. The Issuer shall maintain, and shall cause
its Subsidiaries to maintain, insurance with responsible carriers against
such risks and in such amounts, and with such deductibles, retentions,
self-insured amounts and co-insurance provisions, as are customarily carried
by similar businesses of similar size and type, including property and
casualty loss, and workers' compensation insurance.
7.07. MANDATORY AHYDO REDEMPTION. The Issuer covenants and
agrees that the AHYDO Amount shall be calculated in accordance with the
methodology set forth in the Code, which is represented in the formula in the
form of Note attached hereto as Exhibit A. The Issuer further covenants and
agrees that based upon the formula referred to in the immediately preceding
sentence the AHYDO Amount payable on April 25, 2006 shall be the amount
required by the Code to be paid in order to avoid the disallowance of an
interest deduction to the Company. An estimated calculation of such amount is
in the AHYDO Schedule (the "ESTIMATED AHYDO AMOUNT"), assuming that the
Issuer has not redeemed any of the Notes on or prior toApril 24, 2006.
7.08. MAXIMUM TOTAL LEVERAGE RATIO. The Total Leverage
Ratio shall not, as of any Test Date during any period set forth in the table
below, exceed the ratio set forth opposite such period in the table below:
Period Ratio
------ -----
From the Issue Date until 12/30/01 5.75:1
12/31/01 - 12/30/02 5.50:1
12/31/02 - 12/30/03 5.00:1
12/31/03 - 12/30/04 4.50:1
12/31/04 - 12/30/05 4.25:1
12/31/05 and thereafter 4.00:1
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Capitalized terms in this Section 7.08 have the meanings
ascribed to them in the form of Credit Agreement, attached hereto as Annex A;
PROVIDED, that the Indebtedness represented by the Notes and all Preferred
Stock (valued at the greater of (x) the aggregate liquidation value thereof
or (y) the aggregate mandatory redemptions payable with respect thereto) of
the Issuer or any of its Subsidiaries shall be included in Total Debt, and
interest paid on the Notes in cash only and any mandatory dividend payments
with respect to any Preferred Stock of the Issuer or any of its Subsidiaries
shall be included in EBITDA.
7.09. MINIMUM INTEREST COVERAGE RATIO. The Interest
Coverage Ratio shall not, as of any Test Date during any period set forth in
the table below, be less than the ratio set forth opposite such period in the
table below:
Period Ratio
------ -----
From the Issue Date until 12/30/01 1.40x
12/31/01 - 12/30/02 1.65x
12/31/02 - 12/30/03 1.90x
12/31/03 - 12/30/04 2.15x
12/31/04 and thereafter 2.40x
Capitalized terms in this Section 7.09 have the meanings
ascribed to them in the form of Credit Agreement, attached hereto as Annex A;
PROVIDED, that interest paid on the Notes in cash only and any mandatory
dividend payments with respect to any Preferred Stock of the Issuer or any of
its Subsidiaries shall be included in EBITDA.
7.10. INSPECTION. So long as any of the Notes, Exchange
Notes or Shares remain outstanding (but only if the requesting Holder owns
Notes, Exchange Notes or at least 50% of the Series A Shares originally
purchased by such Holder on the date hereof pursuant to this Agreement), the
Issuer shall permit the representatives of each such Holder that is an
Institutional Investor to, and upon reasonable prior notice to the Issuer:
(a) if no Default or Event of Default then exists, at the
expense of such Holder, visit the principal executive office of the
Issuer to discuss the affairs, finances and accounts of the Issuer and
the Subsidiaries with the Issuer's officers, all at such reasonable
times and as often as may be reasonably requested in writing; and
(b) if a Default or Event of Default then exists, at the
expense of the Issuer, visit and inspect any of the offices or
properties of the Issuer 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
chartered accountants (and by this provision the Issuer authorizes said
accountants to discuss the affairs, finances and accounts of the Issuer
and the Subsidiaries), all at such reasonable times, with reason-
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able notice so as to afford the Issuer adequate opportunity to have an
executive officer of the Issuer present at any such examination,
visitation, inspection or discussion, and as often as may be requested.
Anything in this Section 7.10 to the contrary
notwithstanding, the Issuer shall not be required to disclose, discuss or
permit the inspection or examination of any information (i) which is subject
to a bona fide confidentiality agreement entered into in good faith with a
customer, supplier, joint venture affiliate or other Person in the ordinary
course of business, or (ii) with respect to which Paul, Hastings, Xxxxxxxx &
Xxxxxx LLP or other recognized independent counsel for the Issuer has, within
five Business Days after an Institutional Investor Holder's request
hereunder, affirmatively stated to the Issuer that disclosure of such
information to such Holder is prohibited by law.
SECTION 8
COVENANTS
8.01. INCORPORATION OF COVENANTS. The provisions of
Sections 8.01, 8.02, 10.11, 10.12, 10.14 through 10.17, 10.19, 10.20, 10.22
and 10.25 (and the related definitions) of the Indenture, in the form
attached hereto as Exhibit D, are hereby fully incorporated by reference.
SECTION 9
PROVISIONS RELATING TO resales of Securities
9.01. PRIVATE OFFERINGS. The Issuer and the Purchasers
agree that the following provisions will apply to any Private Offerings:
(a) OFFERS AND SALES ONLY TO INSTITUTIONAL ACCREDITED
INVESTORS OR QUALIFIED INSTITUTIONAL BUYERS. Offers and sales of the
Securities will be made only by the Purchasers or Affiliates thereof
qualified to do so in the jurisdictions in which such offers or sales
are made. Prior to the effectiveness of a registration statement with
respect to the Securities, each such offer or sale shall only be made
(i) to persons whom the offeror or seller reasonably believes to be
Qualified Institutional Buyers, (ii) to other institutional accredited
investors referred to in Rule 501(a)(1), (2), (3) or (7) of Regulation
D that the offeror or seller reasonably believes to be and, with
respect to sales and deliveries, that are institutional accredited
investors ("INSTITUTIONAL ACCREDITED INVESTORS") or (iii) to non-U.S.
persons that are financial institutions, investment advisors or
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affiliates of the foregoing or would otherwise be substantially
equivalent to an Institutional Accredited Investor outside the United
States to whom the offeror or seller reasonably believes offers and
sales of the Securities may be made in reliance upon Regulation S under
the Securities Act.
(b) NO GENERAL SOLICITATION. The Securities will be offered by
approaching prospective Subsequent Purchasers on an individual basis.
No general solicitation or general advertising (within the meaning of
Rule 502(c) under the Securities Act) will be used in the United States
and no directed selling efforts (as defined in Regulation S) will be
made outside the United States in connection with the offering of the
Securities.
(c) PURCHASES BY NON-BANK FIDUCIARIES. In the case of a
non-bank Subsequent Purchaser of a Security acting as a fiduciary for
one or more third parties, in connection with an offer and sale to such
purchaser pursuant to this Section 9.01, each third party shall, in the
judgment of the applicable Purchaser, be an Institutional Accredited
Investor or a Qualified Institutional Buyer or a non-U.S. person
outside the United States.
(d) RESTRICTIONS ON TRANSFER; LEGEND. Upon original issuance
by the Issuer, and until such time as the same is no longer required
under the applicable requirements of the Securities Act, the Securities
(and all securities issued in exchange therefor or in substitution
thereof) shall bear such legend as is required under Section 9.05 of
this Agreement.
(e) NO FUTURE LIABILITY. Following the sale of the Securities
by any Purchaser to Subsequent Purchasers in accordance with the terms
of this Section 9, such Purchaser shall not be liable or responsible to
the Issuer for any losses, damages or liabilities suffered or incurred
by the Issuer, including any losses, damages or liabilities under the
Securities Act, arising from or relating to any resale or transfer of
any Security previously sold by such Purchaser in compliance with this
Section 9.01.
(f) SECURITIES ACT RESTRICTIONS.
(i) A Holder selling Securities in a Private Offering to a
transferee that is an Institutional Accredited Investor or a Qualified
Institutional Buyer must satisfy each of the following conditions:
(1) such Holder or transferee must represent that the
transferee is acquiring the Securities for its own account and
that it is not acquiring such Securities with a view to, or
for offer or sale in connection with, any distribution thereof
(within the meaning of the Securities Act) that would be in
violation of the securities laws of the United States or any
state thereof, but subject,
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nevertheless, to the disposition of its property being at all
times within its control; and
(2) such transferee must agree to be bound by the
provisions of this Section 9.01 with respect to any resale of
the Securities.
(ii) A Holder may sell its Securities to a transferee in
accordance with Regulation S under the Securities Act; PROVIDED,
HOWEVER, that each of the following conditions is satisfied:
(1) the offer of Securities must not be made to a
person in the United States;
(2) either:
(A) at the time the buy order is originated,
the transferee is outside the United States or the
Holder and any person acting on its behalf reasonably
believes that the transferee is outside the United
States, or
(B) the transaction must be executed in, on
or through the facilities of a designated offshore
securities market and neither the Holder nor any
person acting on its behalf knows that the
transaction was pre-arranged with a buyer in the
United States;
(3) no directed selling efforts may be made in
contravention of the requirements of Rule 903(b) or 904(b) of
Regulation S under the Securities Act, as applicable; and
(4) the transaction must not be part of a plan or
scheme to evade the registration requirements of the
Securities Act.
(iii) In the event of a sale that does not qualify under either
subclause (i) or (ii) above, a Holder may sell its Securities only if:
(1) such Holder must give written notice to the
Issuer of its intention to exercise or effect such sale, which
notice (A) shall describe the manner and circumstances of the
proposed transaction in reasonable detail and (B) shall
designate the counsel for such Holder, which counsel shall be
reasonably satisfactory to the Issuer;
(2) counsel for the Holder must render an opinion to
the Issuer to the effect that such proposed sale may be
effected without registration under the Securities Act; and
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(3) such Holder or transferee must comply with
subclause (i)(1) and (2) above.
(g) MINIMUM AMOUNT. Any sale or transfer of Notes to any
Person other than an Affiliate of such transferor will be in an
aggregate principal amount equal to the lesser of (x) the aggregate
unpaid principal amount thereof held by such transferor and (y) $1.0
million.
9.02. RESALE OFFERING ASSISTANCE.
(a) At any time following 24 months after the Closing Time
(PROVIDED that the Issuer (or its equivalent from a financial reporting
standpoint), is not then reporting on filings made with the SEC in accordance
with the requirements of Section 13 or 15(d) of the Exchange Act) (the
"ASSISTANCE PERIOD"), the Issuer will, if reasonably requested by a Holder
that is an original Purchaser hereunder, assist the holders of Securities in
completing any private or public resale of any portion thereof (including any
such resales of the Securities pursuant to any Private Offering) in
accordance with the Holders' intended method of distribution. Such assistance
may, in each case, include the following:
(i) direct contact between the Issuer's senior management and
advisors and prospective purchasers and hosting of one or more meetings
of prospective purchasers; and
(ii) responding to reasonable inquiries of, and providing
answers to, each prospective purchaser who so requests concerning the
Issuer and its Subsidiaries (to the extent such information is
available or can be acquired and made available to prospective
purchasers without unreasonable effort or expense and to the extent the
provision thereof is not prohibited by any Law or applicable
confidentiality restrictions) and the terms and conditions of the
applicable distribution; PROVIDED that the Issuer shall not be required
to disclose any confidential information to any party that the Issuer
reasonably and in good faith believes will use such information in a
manner that is materially adverse to the Issuer.
(b) During the Assistance Period, all materials supplied or
available under this Section 9.02 or under Section 6 by the Issuer (including
any materials referred to or incorporated by reference therein, "RESALE
MATERIALS") will not, as of its date, when taken as a whole, include an untrue
statement of a material fact or omit to state a material fact necessary in order
to make the statements therein, in the light of the circumstances under which
they were made, not misleading.
(c) If, prior to the completion of any sale of the
Securities, if applicable, by the selling holders (as evidenced by a notice
in writing from the holders to the Issuer), any event shall occur or
condition exist as a result of which the Resale Materials would contain a
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misstatement of a material fact or an omission of a material fact required to
make the statements therein, in the light of the circumstances, not
misleading, then the Issuer agrees to promptly prepare and furnish at its own
expense to the selling holders, further information so that the statements in
the Resale Materials, taken as a whole, will not contain a misstatement of a
material fact or an omission of a material fact required to make the
statements therein, in the light of the circumstances, not misleading. The
Issuer hereby expressly acknowledges the indemnification and contribution
provisions of Sections 13.02 and 13.03 hereof are specifically applicable and
relate to Resale Materials.
9.03. BLUE SKY COMPLIANCE. In connection with any Private
Offering of the Securities by Holders that were original Purchasers
hereunder, the Issuer shall cooperate with the selling Holders and counsel
for the selling Holders to qualify or register the Securities for sale under
(or to obtain exemptions from the application of) the Blue Sky or state
securities laws of those jurisdictions designated by the selling Holders,
shall comply with such laws and shall continue such qualifications,
registrations and exemptions in effect so long as required for the
distribution of the Securities. The Issuer shall not be required to qualify
as a foreign corporation or to take any action that would subject it to
general service of process in any such jurisdiction where they are not then
qualified or to taxation as a foreign corporation. The Issuer will advise the
selling Holders promptly of the suspension of the qualification or
registration of (or any such exemption relating to) the Securities for
offering, sale or trading in any jurisdiction or any initiation or threat of
any proceeding for any such purpose, and in the event of the issuance of any
order suspending such qualification, registration or exemption, the Issuer
shall, with the cooperation of the selling Holders, use commercially
reasonable efforts to obtain the withdrawal thereof at the earliest possible
moment.
9.04. NO INTEGRATION. The Issuer agrees that it shall not
and (to the extent within its control) it shall cause its Affiliates not to
make any offer or sale of securities of any class of the Issuer if, as a
result of the doctrine of "integration" referred to in Rule 502 under the
Securities Act, such offer or sale would render invalid (for the purpose of
the sale of the Securities by the Issuer to the Purchasers) any applicable
exemption from the registration requirements of the Securities Act provided
by Section 4(2) thereof.
9.05. FORM OF LEGEND FOR THE SECURITIES. Unless otherwise
permitted by Section 9.01(f), every Note issued and delivered hereunder shall
bear a legend in substantially the following form:
THE SECURITY REPRESENTED BY THIS CERTIFICATE HAS NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE
"SECURITIES ACT"), OR QUALIFIED UNDER ANY STATE SECURITIES LAWS AND MAY
NOT BE TRANSFERRED, SOLD OR OTHERWISE DISPOSED OF EXCEPT WHILE A
REGISTRATION STATEMENT IS IN EFFECT OR PUR-
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SUANT TO AN AVAILABLE EXEMPTION FROM REGISTRATION UNDER THE SECURITIES
ACT AND APPLICABLE STATE SECURITIES LAWS. THE HOLDER OF THIS SECURITY
IS SUBJECT TO THE APPLICABLE TERMS OF THE PURCHASE AGREEMENT, DATED AS
OF OCTOBER 25, 2000 AND THE EXCHANGE AND REGISTRATION RIGHTS AGREEMENT,
DATED AS OF OCTOBER 25, 2000, AMONG THE ISSUER AND THE PURCHASERS NAMED
THEREIN. COPIES OF SUCH AGREEMENTS ARE AVAILABLE AT THE OFFICES OF THE
ISSUER.
Unless otherwise permitted by Section 9.01(f), each Share
issued and delivered hereunder shall bear a legend in substantially the
following form:
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE
"SECURITIES ACT"), OR QUALIFIED UNDER ANY STATE SECURITIES LAWS AND MAY
NOT BE TRANSFERRED, SOLD OR OTHERWISE DISPOSED OF EXCEPT WHILE A
REGISTRATION STATEMENT IS IN EFFECT OR PURSUANT TO AN AVAILABLE
EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT AND APPLICABLE
STATE SECURITIES LAWS. THE HOLDER OF THIS SECURITY IS SUBJECT TO THE
APPLICABLE TERMS OF THE PURCHASE AGREEMENT, DATED AS OF OCTOBER 25,
2000 AND THE REGISTRATION RIGHTS AND STOCKHOLDERS AGREEMENT, DATED AS
OF OCTOBER 25, 2000. COPIES OF SUCH AGREEMENTS ARE AVAILABLE AT THE
OFFICES OF THE ISSUER.
SECTION 10
THE NOTES
10.01. FORM AND EXECUTION. The Notes shall be in the form
of Exhibit A hereto. The Notes shall be executed on behalf of the Issuer by
its President or one of its Vice Presidents, under its corporate seal
reproduced thereon attested by its Secretary or one of its Assistant
Secretaries. The signature of any of these officers on the Notes may be
manual or facsimile.
Notes bearing the manual or facsimile signatures of
individuals who were at any time the proper officers of the Issuer shall bind
the Issuer, notwithstanding that such indi-
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viduals or any of them have ceased to hold such offices prior to the
authentication and delivery of such Notes or did not hold such offices at the
date of such Notes.
10.02. TERMS OF THE NOTES. The terms of the Notes shall be
as set forth in Exhibit A. Without limiting the foregoing:
(a) STATED MATURITY. The Stated Maturity of the Notes shall be
as provided in Exhibit A.
(b) INTEREST. The Notes will bear interest, Special Interest,
if any, and Default Interest, if any, on their principal amount and
interest on overdue principal and interest (to the extent lawful) as
provided in Exhibit A.
10.03. DENOMINATIONS. The Notes shall be issuable only in
registered form without coupons and only in denominations of U.S. $1,000 and
any integral multiple thereof.
10.04. PAYMENTS AND COMPUTATIONS. All payments of interest
on the Notes shall be paid to the persons in whose names such Notes are
registered on the Security Register at the close of business on the date
fifteen days prior to the related Interest Payment Date (the "REGULAR RECORD
DATE") and all payments of principal on the Notes shall be paid to the
persons in whose names such Notes are registered on the applicable Redemption
Date or at Maturity, as applicable. Subject to the provisions of Section
10.09, principal on any Note shall be payable only against surrender
therefor. Additional Notes issued as payment of interest on the Notes shall
on or before the due date of such payment be credited to each Holder on the
Security Register or delivered to each Holder at such Holder's address
appearing on the Security Register, as designated by written instructions
from such Holder received by the Issuer no less than 15 days prior to any
applicable Interest Payment Date, which instructions shall continue in effect
until such time as the Holder otherwise notifies the Issuer or such Holder no
longer is the registered owner of such Note or Notes. Cash payments of
interest on Notes shall be made, in accordance with this Agreement and
subject to applicable laws and regulations, by check mailed on or before the
due date for such payment to the person entitled thereto at such person's
address appearing on the Security Register or by wire transfer to such
account as any Noteholder shall designate by written instructions received by
the Issuer no less than 15 days prior to any applicable Interest Payment
Date, which wire instruction shall continue in effect until such time as the
Noteholder otherwise notifies the Issuer or such Holder no longer is the
registered owner of such Note or Notes.
Interest will be computed on the basis of a 360-day year of
twelve 30-day months.
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10.05. REGISTRATION; REGISTRATION OF TRANSFER AND EXCHANGE.
(a) SECURITY REGISTER. The Issuer shall maintain a register
(the "SECURITY REGISTER") for the registration or transfer of the Notes. The
name and address of the Holder of each Note, records of any transfers of the
Notes and the name and address of any transferee of a Note shall be entered
in the Security Register, and the Issuer shall, promptly upon receipt
thereof, update the Security Register to reflect all information received
from a Noteholder. There shall be no more than one Holder for each Note,
including all beneficial interests therein.
(b) REGISTRATION OF TRANSFER. Upon surrender for
registration of transfer of any Note at the office or agency of the Issuer,
the Issuer shall execute and deliver, in the name of the designated
transferee or transferees, one or more new Notes, of any authorized
denominations and like aggregate principal amount.
(c) EXCHANGE. At the option of the Noteholder, Notes may be
exchanged for other Notes, of any authorized denominations and of like
aggregate principal amount, upon surrender of the Notes to be exchanged at
such office or agency. Whenever any Notes are so surrendered for exchange,
the Issuer shall execute and deliver the Notes which the Holder making the
exchange is entitled to receive.
(d) EFFECT OF REGISTRATION OF TRANSFER OR EXCHANGE. All
Notes issued upon any registration of transfer or exchange of Notes shall be
the valid obligations of the Issuer, evidencing the same debt, and entitled
to the same benefits under this Agreement, as the Notes surrendered upon such
registration of transfer or exchange.
(e) REQUIREMENTS; CHARGES. Every Note presented or
surrendered for registration of transfer or for exchange shall (if so
required by the Issuer) be duly endorsed, or be accompanied by a written
instrument of transfer in form satisfactory to the Issuer duly executed, by
the Holder thereof or his attorney duly authorized in writing. No service
charge shall be made for any registration of transfer or exchange of Notes,
but the Issuer may require payment of a sum sufficient to cover any tax or
other governmental charge that may be imposed in connection with any
registration of transfer or exchange of Notes, other than exchanges resulting
from Section 10.16 of the Indenture as incorporated herein pursuant to
Section 8.01 not involving any transfer.
(f) CERTAIN LIMITATIONS. If the Notes are to be redeemed in
part, the Issuer shall not be required (i) to issue, register the transfer of
or exchange any Note during a period beginning at the opening of business 15
days before the day of the mailing of a notice of redemption of any such
Notes selected for redemption under Section 11.03 and ending at the close of
business on the day of such mailing or (ii) to register the transfer of or
exchange any Note so selected for redemption in whole or in part, except the
unredeemed portion of any Note being redeemed in part.
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10.06. MUTILATED, DESTROYED, LOST AND STOLEN NOTES. If any
mutilated Note is surrendered to the Issuer, the Issuer shall execute and
deliver in exchange therefor a new Note of the same principal amount and
bearing a number not contemporaneously outstanding.
If there shall be delivered to the Issuer (a) evidence to
its satisfaction of the destruction, loss or theft of any Note and (b) such
security or indemnity as may be required by it to save each of it and any
agent harmless; PROVIDED, that if the Holder of such Note is or is a nominee
of a Purchaser or another Holder with a minimum net worth of at least
$50,000,000 million, then such Person's own unsecured agreement of indemnity
shall be deemed to be satisfactory, then, in the absence of notice that such
Note has been acquired by a bona fide purchaser, the Issuer shall execute and
deliver, in lieu of any such destroyed, lost or stolen Note, a new Note of a
like principal amount and bearing a number not contemporaneously outstanding.
In case any such mutilated, destroyed, lost or stolen Note
has become or is about to become due and payable, the Issuer in its
discretion may, instead of issuing a new Note, pay such Note.
No service charge shall be made for any registration of
transfer or exchange of Notes, but the Issuer may require payment of a sum
sufficient to cover any tax or other governmental charge that may be imposed
in connection with any registration of transfer or exchange of Notes.
Every new Note issued pursuant to this Section 10.06 in
lieu of any destroyed, lost or stolen Note shall constitute an original
additional contractual obligation of the Issuer, whether or not the
destroyed, lost or stolen Note shall be at any time enforceable by anyone,
and shall be entitled to all the benefits of this Agreement equally and
proportionately with any and all other Notes duly issued hereunder.
The provisions of this Section 10.06 are exclusive and
shall preclude (to the extent lawful) all other rights and remedies with
respect to the replacement or payment of mutilated, destroyed, lost or stolen
Notes.
10.07. PERSONS DEEMED OWNERS. Prior to due presentment of a
Note for registration of transfer, the Issuer and any agent of the Issuer may
treat the Person in whose name such Note is registered as the owner of such
Note for the purpose of receiving payment of principal of and interest on
such Note and for all other purposes whatsoever, and neither the Issuer nor
any agent of the Issuer shall be affected by notice to the contrary.
10.08. CANCELLATION. All Notes surrendered for payment,
redemption, registration of transfer or exchange shall, if surrendered to any
Person other than the Issuer, be delivered to the Issuer and shall be
promptly canceled by it. The Issuer shall cancel any Notes previously issued
and delivered hereunder which the Issuer may have reacquired.
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10.09. HOME OFFICE PAYMENT. So long as any Purchaser or its
nominee shall be the Holder of any Note, and notwithstanding anything
contained in this Agreement or such Note to the contrary, the Issuer will pay
all sums becoming due on such Note for principal, premium, if any, and
interest by such method and at the address set forth under such Purchaser's
name on Schedule A hereto or to such other address as such Purchaser shall
have from time to time specified to the Issuer 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 Issuer made
concurrently with or reasonably promptly after payment or prepayment in full
of any Note, such Purchaser shall surrender such Note for cancellation
reasonably promptly after any such request to the Issuer at its principal
executive office. Prior to any sale or other disposition of any Note held by
such Purchaser or its nominee such Purchaser will, at its 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 Issuer in
exchange for a new Note or Notes pursuant to Section 10.05. The Issuer will
afford the benefits of this Section 10.09 to any direct or indirect
transferee of any Note purchased by such Purchaser under this Agreement which
has made the same agreement relating to such Note as such Purchaser made in
this Section 10.09.
SECTION 11
REDEMPTION
11.01. RIGHT OF REDEMPTION. The Notes may be redeemed at
the election of the Issuer upon such conditions, at such times, in such
amounts and at the Redemption Prices (together with any applicable accrued
interest and any Special Interest and interest on overdue principal and
interest (to the extent lawful) if any, to the Redemption Date) specified in
the form of Note attached as Exhibit A hereto.
11.02. PARTIAL REDEMPTIONS. In case the Issuer is entitled
to, and elects to, redeem less than all of the Notes, the Issuer shall redeem
the Notes PRO RATA from each Noteholder (or as nearly PRO RATA as
practicable). For all purposes of this Agreement, unless the context
otherwise requires, all provisions relating to the redemption of Notes shall
relate, in the case of any Notes redeemed or to be redeemed only in part, to
the portion of the principal amount of such Notes which has been or is to be
redeemed.
11.03. NOTICE OF REDEMPTION. Notice of redemption shall be
given by first-class mail, postage prepaid, mailed not less than 30 nor more
than 60 days prior to the Redemption Date, to each Noteholder to be redeemed,
at his address appearing in the Security Register.
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All notices of redemption shall state:
(a) the Redemption Date;
(b) the Redemption Price;
(c) if less than all the Outstanding Notes are to be redeemed,
the portion of each Note to be redeemed;
(d) that on the Redemption Date the Redemption Price will
become due and payable upon each such Note to be redeemed and that
interest and any Special Interest and interest on overdue principal and
interest (to the extent lawful) thereon will cease to accrue on and
after said date; and
(e) subject to the provisions of Section 10.09, the place or
places where such Notes are to be surrendered for payment of the
Redemption Price.
Notice of redemption of Notes to be redeemed at the election
of the Issuer shall be given by the Issuer and at the expense of the Issuer.
11.04. DEPOSIT OF REDEMPTION PRICE. Prior to any Redemption
Date, the Issuer shall segregate and hold in trust an amount of money
sufficient to pay the Redemption Price of, and (except if the Redemption Date
shall be an Interest Payment Date) any applicable accrued interest, Special
Interest and unpaid interest on, all the Notes, or portion thereof, which are
to be redeemed on that date.
11.05. NOTES PAYABLE ON REDEMPTION DATE. If notice of
redemption shall have been given as provided above, the Notes, or portion
thereof, so to be redeemed shall, on the Redemption Date, become due and
payable at the Redemption Price therein specified, and from and after such
date (unless the Issuer shall default in the payment of the Redemption Price
and any applicable accrued interest, Special Interest) such Notes shall not
bear interest. Such Notes, or portion thereof, shall be paid by the Issuer at
the Redemption Price, together with any applicable accrued interest, Special
Interest and interest on overdue principal and interest (to the extent
lawful) to the Redemption Date; PROVIDED, HOWEVER, that, in the event a
Redemption Date occurs after a Record Date but before the corresponding
Interest Payment Date, installments of interest or Special Interest the
payment of which is due, on or after the Redemption Date, shall be payable to
the Noteholders of such Notes, or one or more Predecessor Notes, registered
as such at the close of business on the relevant Record Dates according to
their terms and the provisions of this Agreement.
If any Note called for redemption shall not be so paid on
the Redemption Date, the principal (and premium, if any) shall, until paid,
bear interest from the Redemption Date at the rate provided by the Note.
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11.06. NOTES REDEEMED IN PART. Subject to the provisions of
Section 10.09, any Note which is to be redeemed only in part shall be
surrendered at the principal offices of the Issuer (with, if the Issuer so
requires, due endorsement by, or a written instrument of transfer in form
satisfactory to the Issuer duly executed by, the Noteholder thereof or his
attorney duly authorized in writing), and the Issuer shall execute and
deliver to the Noteholder of such Note without service charge a new Note or
Notes, of any authorized denomination as requested by such Noteholder, in
aggregate principal amount equal to and in exchange for the unredeemed
portion of the principal of the Note so surrendered.
SECTION 12
EVENTS OF DEFAULT
12.01. EVENTS OF DEFAULT. "Event of Default," wherever used
herein, means any one of the following events (whatever the reason for such
Event of Default and whether it shall be voluntary or involuntary or be
effected by operation of law or pursuant to any judgment, decree or order of
any court or any order, rule or regulation of any administrative or
governmental body):
(a) default in any payment of interest on any Note when the
same becomes due and payable, and such default continues for a period
of 5 days; or
(b) default in the payment of principal of or premium, if any,
on any Note when the same becomes due and payable at its Stated
Maturity, upon optional redemption, upon required repurchase, upon
acceleration or otherwise (including, without limitation, the PIK
Redemption Amount); or
(c) the Issuer or any of its Subsidiaries fails to comply with
any of its obligations described in Sections 6.01(e), 7.08, 7.09 or
7.10 of this Agreement or Article 8 of the Indenture as incorporated
herein pursuant to Section 8.01;
(d) the Issuer fails to comply with any of its obligations
described under Section 6.01 (other than Section 6.01(e)) of this
Agreement or the provisions of the Indenture (other than Article 8
thereof) as incorporated herein pursuant to Section 8.01 hereof (in
each case other than a failure to repurchase Notes when required
pursuant to the provisions incorporated herein pursuant to Section 8.01
hereof, which failure shall constitute an Event of Default under clause
(b) above) and such failure continues for 30 days (other than a failure
to deliver documents required by Sections 6.01(a), 6.01(b) and 6.01(c),
which failure shall constitute an Event of Default if such failure
continues for 3 days) after the earlier of (a) a Responsible Officer
obtaining actual knowledge of such failure and (b) written notice of
such failure requiring the Issuer to
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remedy the same shall have been given to the Issuer by the holders of
at least 25% in aggregate principal amount of the Outstanding Notes; or
(e) the Issuer fails to comply with any of its obligations in
the Notes or this Agreement (other than those referred to in clauses
(a), (b), (c) or (d) above) and such failure continues for 60 days
after the earlier of (a) a Responsible Officer obtaining actual
knowledge of such failure and (b) written notice of such failure
requiring the Issuer to remedy the same shall have been given to the
Issuer by the holders of at least 25% in aggregate principal amount of
the Outstanding Notes; or
(f) there is a default under any Indebtedness in principal
amount in excess of $5.0 million of the Issuer or any Restricted
Subsidiary, whether or not such Indebtedness has been accelerated, and
such default shall not have been cured or waived within the grace
period provided for by the terms of such Indebtedness; or
(g) one or more judgments or decrees for the payment of money
in excess of $5.0 million in the aggregate (to the extent not covered
by insurance maintained with an independent insurer that has
acknowledged its liability in writing) is entered against the Issuer or
any Significant Subsidiary and such judgment or decree remains
undischarged or unstayed for a period of 60 days after such judgment
becomes final and non-appealable; or
(h) the Issuer or any Significant Subsidiary of the Issuer
pursuant to or under or within the meaning of any Bankruptcy Law:
(i) commences a voluntary case or proceeding;
(ii) consents to the making of a Bankruptcy Order in
an involuntary case or proceeding or the commencement of any
case against it;
(iii) consents to the appointment of a Custodian of
it or for any substantial part of its property;
(iv) makes a general assignment for the benefit of
its creditors;
(v) files an answer or consent seeking reorganization
or relief;
(vi) shall admit in writing its inability to pay its
debts generally; or
(vii) consents to the filing of a petition in
bankruptcy; or
(i) a court of competent jurisdiction in any involuntary case
or proceeding enters a Bankruptcy Order against the Issuer or any
Significant Subsidiary, and such Bankruptcy Order remains unstayed and
in effect for 60 consecutive days; or
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(j) a Custodian shall be appointed out of court with respect
to the Issuer or any Significant Subsidiary or with respect to all or
any substantial part of the assets or properties of the Issuer or any
Significant Subsidiary.
(k) any representation, warranty, certification or statement
made or deemed to have been made by or on behalf of the Issuer or by
any officer of the Issuer in respect of any Transaction Document or in
any statement or certificate at any time given by or on behalf of the
Issuer or by any officer of the Issuer in writing pursuant hereto or in
connection herewith or therewith shall be false on the date as of which
made and such falsity shall have or could reasonably be expected to
have a Material Adverse Effect.
12.02. REMEDIES. If an Event of Default (other than an
Event of Default specified in Section 12.01(h), (i) or (j) with respect to
the Issuer) occurs and is continuing, then and in every such case the
Noteholders of 25% or more in principal amount of the then Outstanding Notes
may declare the principal and any accrued interest, Special Interest and
interest on overdue principal and interest (to the extent lawful)
(collectively, the "DEFAULT AMOUNT") of all the Notes to be due and payable
immediately, by a notice in writing to the Issuer, and upon any such
declaration such Default Amount shall become immediately due and payable. For
the avoidance of doubt, if any default pursuant to Section 12.01(a) or (b)
(each, a "PAYMENT DEFAULT") or a Default under Section 12.01(f) shall have
occurred and prior to any acceleration under this Section 12.02 such Payment
Default or other Default shall have been cured or waived, then from and after
such cure or waiver, such Event of Default shall no longer be deemed to be
continuing. If an Event of Default specified in Section 12.01(h), (i) or (j)
with respect to the Issuer occurs and is continuing, the Default Amount on
the Outstanding Notes shall automatically, and without any declaration or
other action on the part of any Noteholder, become immediately due and
payable.
Notwithstanding the foregoing, in the event of a
declaration of acceleration in respect of the Notes because an Event of
Default specified in clause (f) above shall have occurred and be continuing,
such declaration of acceleration shall be automatically annulled if the
Indebtedness that is the subject of such Event of Default has been discharged
or paid or such Event of Default shall have been cured or waived by the
holders of such Indebtedness and written notice of such discharge, cure or
waiver, as the case may be, shall have been given to the Noteholders by the
Issuer or by the requisite holders of such Indebtedness or a trustee,
fiduciary or agent for such holders, within 30 days after such declaration of
acceleration in respect of the Notes, and no other Event of Default shall
have occurred that has not been cured or waived during such 30-day period.
At any time after such a declaration of acceleration has
been made and before a judgment or decree for payment of the money due has
been obtained, the Holders of more
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than 75% in principal amount of the Outstanding Notes, by written notice to
the Issuer, may rescind and annul such declaration and its consequences if:
(a) the Issuer has paid:
(i) all overdue principal and interest (to the extent
lawful) and Special Interest on all Notes;
(ii) the principal amount of (and premium, if any, on)
any Notes which have become due otherwise than by such
declaration of acceleration (including any Notes required to
have been purchased pursuant to an offer to purchase that the
Issuer is required to make hereunder) and any interest and
Special Interest thereon at the rate borne by the Notes; and
(iii) to the extent that payment of such interest is
lawful, interest upon overdue principal and interest (to the
extent lawful) and overdue Special Interest at the rate
provided therefor in the Notes; and
(b) all Events of Default, other than the nonpayment of the
principal amount of (and premium, if any, on) Notes and any interest,
Special Interest and interest on overdue principal and interest (to the
extent lawful) thereon which have become due solely by such declaration
of acceleration, have been cured or waived as provided in Section
12.03.
12.03. WAIVER OF PAST DEFAULTS. The Holders of more than 75%
in aggregate principal amount of Outstanding Notes may on behalf of the
Noteholders waive any past default hereunder and its consequences, except a
default:
(a) in the payment of the principal (or premium, if any) or
any interest, Special Interest or interest on overdue principal and
interest (to the extent lawful) on any Note (including any Note which
is required to have been purchased pursuant to an offer to purchase
that the Issuer is required to make hereunder) or
(b) in respect of a covenant or provision hereof which under
Section 14.04 cannot be modified or amended without the consent of the
Holder of each Outstanding Note affected.
Upon any such waiver, such default shall cease to exist, and
any Event of Default arising therefrom shall be deemed to have been cured, for
every purpose of this Agreement; PROVIDED, HOWEVER, that no such waiver shall
extend to any subsequent or other default or impair any right consequent
thereon.
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SECTION 13
EXPENSES, INDEMNIFICATION AND
CONTRIBUTION AND TERMINATION
13.01. EXPENSES. Whether or not the transactions
contemplated hereby are consummated, the Issuer will pay (a) all reasonable
costs and expenses incurred by the Purchasers (and their Affiliates) in
connection with (x) the Transactions (including reasonable attorneys' and
accountants' fees and disbursements of one special counsel and one firm of
accountants for the Purchasers), including, without limitation, the
preparation of the Transaction Documents, and (y) any amendments,
modifications, supplements and waivers thereto, (b) the Purchasers' reasonable
and documented out-of-pocket expenses in connection with the Purchasers'
examinations and appraisals of the properties, books and records of the Issuer
and its Subsidiaries, and (c) the reasonable costs and expenses incurred in
enforcing (or determining whether or how to enforce any rights under any
Transaction Documents), to the extent the Purchasers and their Affiliates
reasonably believe they may be entitled to so enforce.
13.02. INDEMNIFICATION.
(a) INDEMNIFICATION BY THE ISSUER. The Issuer agrees to
indemnify and hold harmless (i) each Purchaser, (ii) each Person, if any, who
controls (within the meaning of Section 15 of the Securities Act or Section 20
of the Exchange Act) any Purchaser (any of the Persons referred to in this
clause (ii) being referred to herein as a "CONTROLLING PERSON") and (iii) the
respective officers, directors, managing directors, stockholders, partners,
employees, representatives, trustees, fiduciaries, and agents of any Purchaser
or any such Controlling Person (any such Person referred to in clause (i),
(ii) or (iii), a "PURCHASER INDEMNIFIED PERSON") against any losses, claims,
damages or liabilities, joint or several, to which such Purchaser Indemnified
Person may become subject, under the Securities Act or otherwise, insofar as
such losses, claims, damages or liabilities (or actions in respect thereof)
arise out of or are based upon (i) in whole or in part any inaccuracy in any
of the representations and warranties of the Issuer contained herein or (ii)
in whole or in part upon the failure of the Issuer to perform its obligations
hereunder; and will reimburse each such Purchaser Indemnified Person for any
reasonable legal and other expenses incurred by such Purchaser Indemnified
Person in connection with investigating or defending any such action or claims
as such expenses are incurred. The indemnity agreement set forth in this
Section 13.02(a) shall be in addition to any liabilities that the Issuer may
otherwise have. The foregoing indemnification shall apply whether or not such
losses, claims, damages or liabilities are primarily caused, in whole or in
part, by any negligent act or omission of any kind by such Purchaser
Indemnified Person.
(b) INDEMNIFICATION BY THE PURCHASERS. Each Purchaser agrees,
severally and not jointly, to indemnify and hold harmless (i) the Issuer and
(ii) each Controlling Person of an Issuer and (iii) the respective officers,
directors, employees, representatives and agents
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of each Issuer or any such Controlling Person (any such Person referred to in
clause (i), (ii) or (iii), an "Issuer Indemnified Person") against any losses,
claims, damages or liabilities, joint or several, to which such Issuer
Indemnified Person may become subject, under the Securities Act or otherwise
insofar as such losses, claims, damages or liabilities (or actions in respect
thereof) arise out of or are based upon in whole or in part any inaccuracy of
any of such Purchaser's representations and warranties in Section 5 and will
reimburse the Issuer Indemnified Persons for any legal and other expenses
reasonably incurred by the Issuer Indemnified Persons in connection with
investigating or defending any such actions or claims as such expenses are
incurred. The indemnity agreement set forth in this Section 13.02(b) shall be
in addition to any liabilities that each Purchaser may otherwise have.
(c) NOTIFICATIONS AND OTHER INDEMNIFICATION PROCEDURES.
Promptly after receipt by a Purchaser Indemnified Person or an Issuer
Indemnified Person (each, an "INDEMNIFIED PERSON") of notice of the
commencement of any action, such Indemnified Person shall, if a claim in
respect thereof is to be made against an indemnifying party under Section
13.02(a) or 13.02(b), as applicable, notify such indemnifying party in writing
of the commencement thereof, but the omission so to notify the indemnifying
party will not relieve it from any liability which it may have to any
Indemnified Person otherwise than under Section 13.02(a) or 13.02(b), as
applicable, or to the extent it is not materially prejudiced as a proximate
result of such failure. In case any such action is brought against any
Indemnified Person and it shall notify an indemnifying party of the
commencement thereof, the indemnifying party will be entitled to participate
therein and, to the extent that it shall elect within 30 days after receiving
any such notification, jointly with any other indemnifying party similarly
notified, to assume the defense thereof, with counsel reasonably satisfactory
to such Indemnified Person (who shall not, except with the consent of the
Indemnified Person, which consent shall not be unreasonably withheld, be
counsel to the indemnifying party), and, after notice from the indemnifying
party to such Indemnified Person of its election so to assume the defense
thereof, the indemnifying party shall not be liable to such Indemnified Person
under such paragraph for any legal expenses of other counsel or any other
expenses, in each case subsequently incurred by such Indemnified Person, in
connection with the defense thereof other than reasonable costs of
investigation. After notice from the indemnifying party to such Indemnified
Person of its election to so assume the defense thereof and approval by such
Indemnified Person of counsel appointed to defend such action, the
indemnifying party will not be liable for the costs and expenses of any
settlement of such action effected by such Indemnified Person without the
prior written consent of the indemnifying party (which consent shall not be
unreasonably withheld), unless such Indemnified Person waived in writing its
rights under this Section 13, in which case the Indemnified Person may effect
such a settlement without such consent. Notwithstanding the foregoing, any
Indemnified Person shall have the right to employ separate counsel in any such
action and participate in the defense thereof, but the fees and expenses of
such counsel shall be at the expense of the Indemnified Person unless (i) the
Indemnified Person shall have been advised by counsel that representation of
the Indemnified Person by counsel provided by the indemnifying party would be
inappropriate due to actual or
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potential conflicting interests between the indemnifying party and the
Indemnified Person, including situations in which there are one or more legal
defenses available to the Indemnified Person that are different from or
additional to those available to the indemnifying party, (ii) the indemnifying
party shall have authorized in writing the employment of counsel for the
Indemnified Person at the expense of the indemnifying party or (iii) the
indemnifying party shall have failed to assume the defense or retain counsel
reasonably satisfactory to the Indemnified Person; PROVIDED, HOWEVER, that the
indemnifying party shall not, in connection with any one such action or
proceeding or separate but substantially similar actions or proceedings
arising out of the same general allegations, be liable for the fees and
expenses of more than one separate firm of attorneys at any time for all
Indemnified Persons, except to the extent that local or special counsel, in
addition to their regular counsel, is required in order to effectively defend
against such action or proceeding. No indemnifying party shall, without the
written consent of the Indemnified Person, effect the settlement or compromise
of, or consent to the entry of any judgment with respect to, any pending or
threatened action or claim in respect of which indemnification or contribution
may be sought hereunder (whether or not the Indemnified Person is an actual or
potential party to such action or claim) unless such settlement, compromise or
judgment (i) includes an unconditional release of the Indemnified Person from
all liability arising out of such action or claim and (ii) does not include a
statement as to or an admission of fault, culpability or a failure to act, by
or on behalf of any Indemnified Person.
13.03. CONTRIBUTION. If the indemnification provided for in
Section 13.02 is unenforceable and accordingly unavailable to or insufficient
to hold harmless an Indemnified Person under paragraph (a), (b) or (c) of
Section 13.02 in respect of any losses, claims, damages or liabilities (or
actions in respect thereof) referred to therein, then each indemnifying party
shall contribute to the amount paid or payable by such Indemnified Person as a
result of such losses, claims, damages or liabilities (or actions in respect
thereof) in such proportion as is appropriate to reflect the (i) relative
benefits received by the Issuer on the one hand and the Purchasers on the
other hand from the issuance and sale of the Securities; or (ii) if the
allocation provided in clause (i) is not permitted by applicable law, in such
proportion as is appropriate to reflect not only the related benefits referred
to in clause (i) above but also the relative fault of the indemnifying party
on the one hand and the Indemnified Person on the other in connection with the
statements or omissions that resulted in such losses, claims, damages or
liabilities (or actions in respect thereof), as well as any other relevant
equitable considerations. The relative benefits received by the Issuer on the
one hand and the Purchasers on the other hand in connection with the sale of
the Securities pursuant to this Agreement shall be deemed to be in the same
respective proportions as the total net proceeds from the offering of the
Securities pursuant to this Agreement (before deducting expenses) received by
the Issuer and the commitment fee payable to the Purchasers at the Closing
Time. The relative fault shall be determined by reference to, among other
things, whether the untrue or alleged untrue statement of a material fact or
the omission or alleged omission to state a material fact relates to
information supplied by the indemnifying party on the one hand or the
Indemnified Person on the other and the parties' relative intent, knowledge,
access to information and opportunity to
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correct or prevent such statement or omission. The parties agree that it would
not be just and equitable if contributions pursuant to this Section 13.03 were
determined by PRO RATA allocation (even if the Indemnified Persons were
treated as one entity for such purpose) or by any other method of allocation
which does not take account of the equitable considerations referred to above
in this Section 13.03. The amount paid or payable by an Indemnified Person as
a result of the losses, claims, damages or liabilities (or actions in respect
thereof) referred to above in this Section 13.03 shall be deemed to include
any legal or other expenses reasonably incurred by such Indemnified Person in
connection with investigating or defending any such action or claim.
Notwithstanding the provisions of this Section 13.03, no Purchaser shall be
required to contribute any amount which, when taken together with any amounts
paid by such Purchaser under Section 13.02(b) exceeds the commitment fee
payable to the Purchasers at the Closing Time. No Person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Securities Act)
shall be entitled to contribution from any Person who was not guilty of such
fraudulent misrepresentation.
The obligations of the Issuer and the Purchasers under this
Section 13.03 shall be in addition to any liability which the Issuer and the
respective Purchasers may otherwise have.
13.04. SURVIVAL. The obligations of the Issuer under this
Section 13 will survive the payment or transfer of any Security or Exchange
Note, the enforcement, amendment or waiver of any provision of this Agreement
and the termination of this Agreement.
SECTION 14
MISCELLANEOUS
14.01. NOTICES. Except as otherwise expressly provided
herein, all notices and other communications shall have been duly given and
shall be effective (a) when delivered, (b) when transmitted via telecopy (or
other facsimile device) to the number set out below if the sender on the same
day sends a confirming copy of such notice by a recognized overnight delivery
service (charges prepaid), (c) the day following the day on which the same has
been delivered prepaid to a reputable national overnight air courier service
or (d) the third Business Day following the day on which the same is sent by
certified or registered mail, postage prepaid, in each case to the respective
parties at the address set forth below, or at such other address as such party
may specify by written notice to the other party hereto:
(i) if to a Purchaser or its nominee, to the Purchaser or its
nominee at the address specified for such communications in Schedule A,
with a copy to Xxxxxx Xxxxxx & Xxxxxxx, 00 Xxxx Xxxxxx, Xxx Xxxx, Xxx
Xxxx 00000 attention: Xxxxxxxx
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X. Xxxxxxxxx, Esq., or at such other address as the Purchaser or its
nominee shall have specified to the Issuer in writing;
(ii) if to any other Holder to such Holder at the address of
such Holder appearing in the Security Register or such other address as
such other holder shall have specified to the Issuer in writing; or
(iii) if to the Issuer at 0000 Xxxx Xxxxxxxxxxx Xxxx, Xxxxx
0000X, Xxxxxx, Xxxxx 00000, attention of Xxxx Xxxx, with a copy to
Paul, Hastings, Xxxxxxxx & Xxxxxx LLP, 000 Xxxx Xxxxxx, Xxx Xxxx, XX
00000, Attention: Xxxx Xxxxx, Esq. and Xxxxx Xxxxxxxxxx, Esq.
14.02. BENEFIT OF AGREEMENT; ASSIGNMENTS AND PARTICIPATIONS.
Except as otherwise expressly provided herein, all covenants, agreements and
other provisions contained in this Agreement by or on behalf of any of the
parties hereto shall bind, inure to the benefit of and be enforceable by their
respective successors and assigns (including, without limitation, any
subsequent holder of a Security) whether so expressed or not (other than
Section 9.02 as to Persons other than the Purchasers and their Affiliates);
PROVIDED, HOWEVER, that the Issuer may not assign and transfer any of its
rights or obligations without the prior written consent of each Noteholder.
Nothing in this Agreement or in the Securities, express or
implied, shall give to any Person other than the parties hereto, their
successors and assigns and the holders from time to time of the Securities any
benefit or any legal or equitable right, remedy or claim under this Agreement.
14.03. NO WAIVER; REMEDIES CUMULATIVE. No failure or delay
on the part of any party hereto or any Holder in exercising any right, power
or privilege hereunder or under the Securities and no course of dealing
between any Issuer and any other party or Holder shall operate as a waiver
thereof; nor shall any single or partial exercise of any right, power or
privilege hereunder or under the Securities preclude any other or further
exercise thereof or the exercise of any other right, power or privilege
hereunder or thereunder. The rights and remedies provided herein and in the
Securities are cumulative and not exclusive of any rights or remedies which
the parties or Holders would otherwise have. No notice to or demand on the
Issuer in any case shall entitle the Issuer to any other or further notice or
demand in similar or other circumstances or constitute a waiver of the rights
of the other parties hereto or the Holders to any other or further action in
any circumstances without notice or demand.
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14.04. AMENDMENTS. This Agreement may be amended or modified
only upon the mutual written consent of the Issuer and Holders of more than
75% of the principal amount of the Outstanding Notes; PROVIDED, that, after
the Notes have been registered pursuant to the terms of the Exchange and
Registration Rights Agreement, an amendment will only require the mutual
written consent of the Issuer and Holders of a majority of the principal
amount of the Outstanding Notes.
14.05. COUNTERPARTS. This Agreement may be executed in any
number of counterparts, each of which when so executed and delivered shall be
an original, but all of which shall constitute one and the same instrument. It
shall not be necessary in making proof of this Agreement to produce or account
for more than one such counterpart. 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.
14.06. REPRODUCTION. This Agreement, the other Transaction
Documents and all documents relating, hereto and thereto, including, without
limitation, (a) consents, waivers and modifications that may hereafter be
executed, (b) documents received by the Purchasers and the Issuer at the
Closing Time (except the Securities themselves) and (c) financial statements,
certificates and other information previously or hereafter furnished in
connection herewith, may be reproduced by any photographic, photostatic,
microfilm, microcard, miniature photographic or other similar process and any
original document so reproduced may be destroyed. The Issuer and the
Purchasers agree and stipulate that, to the extent permitted by Law, any such
reproduction shall be admissible in evidence as the original itself in any
judicial or administrative proceeding (whether or not the original is in
existence and whether or not such reproduction was made in the regular course
of business) and any enlargement, facsimile or further reproduction of such
reproduction shall likewise be admissible in evidence. This Section 14.06
shall not prohibit the Issuer, the Purchaser or any other party hereto or any
Holder 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.
14.07. HEADINGS. The headings of the sections and
subsections hereof are provided for convenience only and shall not in any way
affect the meaning or construction of any provision of this Agreement.
14.08. GOVERNING LAW; SUBMISSION TO JURISDICTION; VENUE.
(a) THIS AGREEMENT AND THE SECURITIES SHALL BE CONSTRUED AND
ENFORCED IN ACCORDANCE WITH, AND THE RIGHTS OF THE PARTIES SHALL BE GOVERNED
BY, THE LAW OF THE STATE OF NEW YORK, 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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(b) If any action, proceeding or litigation shall be brought
by any Purchaser or any Holder or by the Issuer in order to enforce any right
or remedy under this Agreement or any of the Securities, the Issuer, each
Purchaser and any Holder hereby consent and will submit, and will cause each
of their respective Subsidiaries, if any, to submit, to the jurisdiction of
any state or federal court of competent jurisdiction sitting within the area
comprising the Southern District of New York on the date of this Agreement.
The Issuer, each Purchaser and any Holder hereby irrevocably waive any
objection, including, but not limited to, any objection to the laying of venue
or based on the grounds of FORUM NON CONVENIENS, which they may now or
hereafter have to the bringing of any such action, proceeding or litigation in
such jurisdiction. The Issuer, each Purchaser and any Holder further agree
that they shall not, and shall cause their respective Subsidiaries, if any,
not to, bring any action, proceeding or litigation arising out of this
Agreement, the Securities or any other Transaction Document in any state or
federal court other than any state or federal court of competent jurisdiction
sitting within the area comprising the Southern District of New York on the
date of this Agreement.
(c) The Issuer hereby irrevocably designates CT Corporation
System at an address in New York City designated at the Closing Time as the
designee, appointee and agent of the Issuer to receive, for and on behalf of
the Issuer, service of process in such jurisdiction in any action, proceeding
or litigation with respect to this Agreement, the Securities or any of the
other Transaction Documents. It is understood that a copy of such process
served on such agent will be promptly forwarded by mail to the Issuer at its
address set forth opposite its signature below, but the failure of the Issuer
have received such copy shall not affect in any way the service of such
process. The Issuer irrevocably consents to the service of process of any of
the aforementioned courts in any such action, proceeding or litigation by the
mailing of copies thereof by registered or certified mail, postage prepaid, to
the Issuer address, such service to become effective thirty (30) days after
such mailing.
(d) Nothing herein shall affect the right of any Holder of a
Note to serve process in any other manner permitted by law or to commence
legal proceedings or otherwise proceed against the Issuer in any other
jurisdiction. If service of process is made on a designated agent it should be
made by either (i) personal delivery or (ii) mailing a copy of summons and
complaint to the agent via registered or certified mail, return receipt
requested.
(e) THE ISSUER HEREBY WAIVES ANY AND ALL RIGHTS IT MAY HAVE
TO A TRIAL BY JURY IN RESPECT OF ANY ACTION, PROCEEDING OR LITIGATION DIRECTLY
OR INDIRECTLY ARISING OUT OF, UNDER OR IN CONNECTION WITH, THIS AGREEMENT OR
ANY OF THE SECURITIES.
14.09. SEVERABILITY. If any provision of this Agreement is
determined to be illegal, invalid or unenforceable, such provision shall be
fully severable to the extent of such illegality, invalidity or
unenforceability and the remaining provisions shall remain in full force
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and effect and shall be construed without giving effect to the illegal,
invalid or unenforceable provisions.
14.10. ENTIRETY. This Agreement together with the other
Transaction Documents represents the entire agreement of the parties hereto
and thereto, and supersedes all prior agreements and understandings, oral or
written, if any, relating to the Transaction Documents or the transactions
contemplated herein or therein.
14.11. SURVIVAL OF REPRESENTATIONS AND WARRANTIES. All
representations and warranties and covenants and indemnities made by the
Issuer herein shall survive the execution and delivery of this Agreement, the
issuance and transfer of all or any portion of the Securities and the payment
of principal of the Notes and any other obligations hereunder, regardless of
any investigation made at any time by or on behalf of the Purchasers or any
other Holder that is Affiliated with the Purchasers. All statements contained
in any certificate delivered by or on behalf of the Issuer pursuant to this
Agreement shall be deemed representations and warranties of the Issuer under
this Agreement.
14.12. INCORPORATION. All Exhibits and Schedules attached
hereto are incorporated as part of this Agreement as if fully set forth herein.
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IN WITNESS WHEREOF, each of the parties hereto has caused a
counterpart of this Agreement to be duly executed and delivered as of the date
first above written.
D and W HOLDINGS, INC.
By:
------------------------------------
Name:
Title:
[PURCHASER]
By:
By:
------------------------------------
Name:
Title:
[PURCHASER]
By:
By:
------------------------------------
Name:
Title:
[PURCHASER]
By:
By:
------------------------------------
Name:
Title:
SCHEDULE A
INFORMATION RELATING TO PURCHASERS
Aggregate Number of Number of
Principal Shares of Shares of
Amount of Notes Class A Class B Common
to Common Stock to be Stock to be Aggregate
Name and Address of Purchaser be Purchased Purchased Purchased Purchase Price
Merrill Xxxxx Capital Corporation $21,500,000 7,756,495 1,939,124 $21,500,000
000 Xxxxx Xxxxxx
Xxx Xxxx, XX 00000
The Lincoln National Life Insurance Company $10,000,000 3,608,285 902,071 $10,000,000
c/o Lincoln Investment Management, Inc.
000 Xxxx Xxxxx Xxxxxx;
Xxxxxxxxxxx Xxxxxx
Xxxx Xxxxx, XX 00000
GATX Capital Corporation $5,000,000 1,804,142 451,036 $5,000,000
0 Xxxxxxxxxxx Xxxxxx
Xxx Xxxxxxxxx, XX 00000
EXHIBIT A
[FORM OF NOTE]
THE SECURITY REPRESENTED BY THIS CERTIFICATE HAS NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES
ACT"), OR QUALIFIED UNDER ANY STATE SECURITIES LAWS AND MAY NOT BE
TRANSFERRED, SOLD OR OTHERWISE DISPOSED OF EXCEPT WHILE A REGISTRATION
STATEMENT IS IN EFFECT OR PURSUANT TO AN AVAILABLE EXEMPTION FROM
REGISTRATION UNDER THE SECURITIES ACT AND APPLICABLE STATE SECURITIES LAWS.
THE HOLDER OF THIS SECURITY IS SUBJECT TO THE TERMS OF THE PURCHASE
AGREEMENT, DATED AS OF OCTOBER 25, 2000, AND THE EXCHANGE AND REGISTRATION
RIGHTS AGREEMENT, DATED AS OF OCTOBER 25, 2000, AMONG THE ISSUER AND THE
PURCHASERS NAMED THEREIN. COPIES OF SUCH AGREEMENTS ARE AVAILABLE AT THE
OFFICES OF THE ISSUER.
THIS SECURITY HAS BEEN ISSUED WITH ORIGINAL ISSUE DISCOUNT
FOR U.S. FEDERAL INCOME TAX PURPOSES. FOR FURTHER INFORMATION REGARDING THE
ISSUE PRICE, THE AMOUNT OF ORIGINAL ISSUE DISCOUNT, THE ISSUE DATE AND THE
YIELD TO MATURITY OF THIS SECURITY, THE HOLDER OF THIS SECURITY SHOULD
CONTACT THE OFFICE OF THE CHIEF FINANCIAL OFFICER OF D AND W HOLDINGS, INC.
AT 0000 XXXX XXXXXXXXXXX XXXX, XXXXX 0000X, XXXXXX, XXXXX 00000, TELEPHONE
NUMBER (000) 000-0000.
D and W HOLDINGS, INC.
-----------------
15% Senior Pay-In-Kind Notes due 2010
PPN 23288# AA 9
No. ___________ $
D and W HOLDINGS, INC., a corporation incorporated under
the laws of the State of Delaware (herein called the "COMPANY," which term
includes any successor corporation thereto), for value received, hereby
promises to pay to _______________, or registered assigns, the principal sum
of _______________ Dollars on October 25, 2010, at the office or agency of
the Company referred to below. The Company hereby promises to pay interest
thereon on April 25 and October 25 (each an "INTEREST PAYMENT DATE") of each
year, commencing on April 25, 2001, accruing from the most recent Interest
Payment Date to which
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interest has been paid or duly provided for or, if no interest has been paid,
from the date of issuance at the rate, subject to increase as provided below,
of 15% per annum, until the principal hereof is paid or duly provided for;
PROVIDED, that during any time while a Default or Event of Default has
occurred and remains uncured, the interest rate shall increase to the greater
of (i) the interest rate then in effect plus 1% per annum and (ii) the Prime
Rate then in effect (the "DEFAULT INTEREST").
If the Company's Ratio (as defined in the Indenture) as of
March 31, 2002 (as derived from financial statements prepared on or prior to
May 15, 2002) is not equal to or less than 3.75x, the interest rate on the
Notes shall increase as of March 31, 2002 to 17% per annum; PROVIDED, that
the interest rate on the Notes will return to 15% per annum at such time and
only for such time as the Ratio is equal to or less than 3.75x; PROVIDED,
HOWEVER, that if the Ratio is greater than 3.75x at any time thereafter, the
interest rate will return to 17% per annum, as of the last date of the period
for which the Ratio was calculated, until such time as the Ratio is equal to
or less than 3.75x. Interest shall be computed on the basis of a 360-day year
of twelve 30-day months.
Cash interest will begin to accrue on the Notes on the
issuance date; PROVIDED that with respect to any Interest Payment Date on or
prior to October 25, 2005, the Company will pay interest on such Interest
Payment Date through the issuance of additional Notes (valued at 100% of the
principal amount thereof) in an aggregate amount equal to the interest
otherwise payable on such Interest Payment Date; PROVIDED, HOWEVER, that if
at any time, an Event of Default has occurred and payment on the Notes has
been accelerated pursuant to Section 12.02 of the Purchase Agreement, then
accrued and unpaid interest shall be payable in cash only. Additional Notes
shall be governed by, and entitled to the benefits of, the Purchase Agreement
and shall be subject to the terms of the Purchase Agreement and shall be
subject to the same terms (including the rate of interest from time to time
payable thereon) as this Note (except, as the case may be, with respect to
the issuance date, the aggregate principal amount and the payment of interest
(i) scheduled and paid prior to or on the date of issuance of such additional
Notes or (ii) payable on the first Interest Payment Date following such date
of issuance).
The interest so payable, and punctually paid or duly
provided for, on any Interest Payment Date will, as provided in the Purchase
Agreement referred to on the reverse hereof, be paid to the Person in whose
name this Note (or one or more Predecessor Notes) is registered at the close
of business on April 1 and October 1 (each a "REGULAR RECORD DATE"), whether
or not a Business Day, as the case may be, next preceding such Interest
Payment Date. Any such interest not so punctually paid, or duly provided for,
and interest on such defaulted interest at the then applicable interest rate
borne by the Notes, to the extent lawful, shall forthwith cease to be payable
to the Holder on such Regular Record Date, and may be paid to the Person in
whose name this Note (or one or more Predecessor Notes) is registered at the
close of business on a date for the payment of such defaulted interest to be
fixed by the
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Company (the "Special Record Date"), notice of which shall be given to
Holders not less than 10 days prior to such Special Record Date, or may be
paid at any time in any other lawful manner not inconsistent with the
requirements of any securities exchange on which the Notes may be listed, and
upon such notice as may be required by such exchange, all as more fully
provided in the Purchase Agreement.
Payment of the principal of, premium, if any, and interest
on this Note will be made at the office or agency of the Company maintained
for that purpose in the Borough of Manhattan in The City of New York, State
of New York, or at such other office or agency of the Company as may be
maintained for such purpose, in such coin or currency of the United States of
America as at the time of payment is legal tender for payment of public and
private debts; PROVIDED, HOWEVER, that payment of interest may be made at the
option of the Company by check mailed to the address of the Person entitled
thereto as such address shall appear on the Note Register.
Reference is hereby made to the further provisions of this
Note set forth on the reverse hereof.
[Remainder of Page Intentionally Left Blank]
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IN WITNESS WHEREOF, the Company has caused this instrument to
be duly executed.
Dated: D and W HOLDINGS, INC.
By:
------------------------
Name:
Title:
By:
------------------------
Name:
Title:
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[REVERSE OF SECURITY]
1. Purchase Agreement. This Note is one of a duly
authorized issue of Notes of the Company designated as its 15% Senior
Pay-In-Kind Notes due 2010 (the "NOTES"). The Notes are limited to an
aggregate principal amount of $36,500,000, and such additional amount of
Notes as may be paid as interest pursuant to this Note and the terms hereof,
which may be issued pursuant to the Purchase Agreement (the "PURCHASE
AGREEMENT") dated as of October 25, 2000, by and between the Company and the
purchasers named therein, to which Purchase Agreement reference is hereby
made for a statement of the respective rights, limitations of rights, duties,
obligations and immunities thereunder of the Company and the Holders of the
Notes, and of the terms upon which the Notes are, and are to be, delivered.
All capitalized terms used in this Note that are defined in
the Purchase Agreement and not otherwise defined herein shall have the
meanings assigned to them in the Purchase Agreement.
Except as provided in Section 10.09 of the Purchase
Agreement, no reference herein to the Purchase Agreement and no provisions of
this Note or of the Purchase Agreement shall alter or impair the obligation
of the Company, which is absolute and unconditional, to pay the principal of,
premium, if any, and interest on this Note at the times, place, and rate, and
in the coin or currency, herein prescribed.
2. Redemption. (a) Optional Redemption. The Company may
redeem the Notes, in whole at any time and in part (in a minimum principal
amount of $1,000,000) from time to time, on or before October 25 of each year
and at the redemption prices (expressed as percentages of principal) listed
below, together with accrued and unpaid interest, if any, to the date of
redemption:
YEAR REDEMPTION PRICE
---- ----------------
2001................................................ 108.0%
2002................................................ 107.0%
2003................................................ 106.0%
2004................................................ 105.0%
2005................................................ 104.0%
2006................................................ 103.0%
2007................................................ 102.0%
2008................................................ 101.0%
Thereafter.......................................... 100.0%
(b) AHYDO Redemption. On April 25, 2006 and each Interest
Payment Date thereafter, excluding the Interest Payment Date that falls on
the Stated Maturity Date, the
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Company shall redeem a principal amount of the Outstanding Notes on such date
on a pro rata basis at a redemption price of 100% of the principal amount of
the Notes so redeemed (the amount paid in order to redeem such Notes, the
"PIK REDEMPTION AMOUNT"), such that the sum of the PIK Redemption Amount plus
interest to be paid on such date with respect to all Outstanding Notes equals
the AHYDO Amount. The AHYDO Amount will equal the excess of (i) the aggregate
amount includible in gross income with respect to the Notes (I.E., the amount
of interest, including original issue discount accrued with respect to the
Notes) from the date of issuance of the Notes through and including each
accrual period of the Notes ending after the fifth year of the issuance of
the Notes (each, an "ACCRUAL PERIOD"), determined as set forth in Section
163(i)(2)(A) of the Code, over (ii) the sum of (A) the product of the issue
price of the Notes and their annual yield to maturity (calculated as twice
the semi-annual yield to maturity ), determined as set forth in Section
163(i)(2)(B)(ii) of the Code, plus (B) the aggregate amount of interest
payments paid on the Notes before the close of each such Accrual Period
(excluding the PIK Redemption Amount and current interest payable in such
Accrual Period), determined as set forth in Section 163(i)(2)(B)(i) of the
Code. Notice of redemption will be mailed at least 30 days but not more than
60 days before the redemption date to each holder of Securities to be
redeemed.
If less than all the Notes are to be redeemed pursuant to
the two immediately preceding paragraphs, the Notes shall be redeemed PRO
RATA from each Holder.
3. Offers to Purchase. Section 8 of the Purchase Agreement
by incorporating the Indenture by reference provides that upon the occurrence
of a Change of Control and following certain Asset Sales, and subject to
certain conditions and limitations contained therein, the Company shall make
an offer to purchase all or a portion of the Notes in accordance with the
procedures set forth in the Purchase Agreement.
4. Defaults and Remedies. If an Event of Default occurs and
is continuing, the principal of all of the Outstanding Notes, plus all
accrued and unpaid interest, if any, to and including the date the Notes are
paid, may be declared due and payable in the manner and with the effect
provided in the Purchase Agreement.
5. Amendments and Waivers. The Purchase Agreement permits,
with certain exceptions as provided therein, the amendment thereof and the
modification of the rights and obligations of the Company and the rights of
the Holders under the Purchase Agreement at any time by the Company with the
consent of the Holders of more than 75% in aggregate principal amount of the
Outstanding Notes. The Purchase Agreement also contains provisions permitting
the Holders of specified percentages in aggregate principal amount of the
Outstanding Notes, on behalf of the Holders of all the Notes, to waive
compliance by the Company with certain provisions of the Purchase Agreement
and certain past Defaults under the Purchase Agreement and this Note and
their consequences. Any such consent or waiver by or on behalf of the Holder
of this Note shall be conclusive and binding upon such Holder
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and upon all future Holders of this Note and of any Note issued upon the
registration of transfer hereof or in exchange hereof or in lieu hereof
whether or not notation of such consent or waiver is made upon this Note.
6. Denominations, Transfer and Exchange. The Notes are
issuable only in registered form without coupons in denominations of $1,000,
other than Notes paid as interest in which case such Notes shall be issuable
in denominations of less than $1,000 to the extent necessary to pay all
interest then due, and any integral multiple thereof. As provided in the
Purchase Agreement and subject to certain limitations therein set forth, the
Notes are exchangeable for a like aggregate principal amount of Notes of a
different authorized denomination, as requested by the Holder surrendering
the same.
As provided in the Purchase Agreement and subject to
certain limitations therein set forth, the transfer of this Note is
registrable on the Note Register of the Company, upon surrender of this Note
for registration of transfer at the office or agency of the Company
maintained for such purpose in the Borough of Manhattan in The City of New
York, State of New York, or at such other office or agency of the Company as
may be maintained for such purpose, duly endorsed by, or accompanied by a
written instrument of transfer in form satisfactory to the Company and the
Registrar duly executed by, the Holder hereof or his attorney duly authorized
in writing, and thereupon one or more new Notes, of authorized denominations
and for the same aggregate principal amount, will be issued to the designated
transferee or transferees.
No service charge shall be made for any registration of
transfer or exchange or redemption of Notes, but the Company may require
payment of a sum sufficient to cover any tax or other governmental charge
payable in connection therewith.
7. Persons Deemed Owners. Prior to and at the time of due
presentment of this Note for registration of transfer, the Company and any
agent of the Company may treat the Person in whose name this Note is
registered as the owner hereof for all purposes, whether or not this Note
shall be overdue, and neither the Company, nor any agent shall be affected by
notice to the contrary.
8. Registration Rights. Pursuant to the Exchange and
Registration Rights Agreement, the Company will be obligated to consummate an
exchange offer pursuant to which the Holder of this Note shall have the right
to exchange this Note for the Company's 15% Senior Pay-In-Kind Notes due
2010, Series B, that have been registered under the Securities Act, in like
principal amount and having terms identical in all material respects as the
Notes. The Holders shall be entitled to receive payments of Special Interest
in the event such exchange offer is not consummated and upon certain other
conditions, all pursuant to and in accordance with the terms of the Exchange
and Registration Rights Agreement.
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9. GOVERNING LAW. THE PURCHASE AGREEMENT AND THIS NOTE
SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE
OF NEW YORK WITHOUT GIVING EFFECT TO PRINCIPLES OF CONFLICTS OF LAW.
The Company will furnish to any Holder of a Note upon
written request and without charge a copy of the Purchase Agreement. Requests
may be made to: Atrium Companies, Inc., 0000 Xxxx Xxxxxxxxxxx Xxxx, Xxxxx
0000X, Xxxxxx, Xxxxx 00000, Attention: Chief Financial Officer.
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OPTION OF HOLDER TO ELECT PURCHASE
If you wish to have this Note purchased by the Company
pursuant to Section 10.11 or 10.16 of the Indenture, check the appropriate box:
Section 10.11 / / Section 10.16 / /
If you wish to have a portion of this Note purchased by the
Company pursuant to Section 10.11 or 10.16 of the Indenture, state the amount:
$_______________
Date: Your signature:
-------------- -----------------------------
(Sign exactly as your name
appears on the other side of
this Note)
By:
--------------------------
NOTICE: To be executed by
an executive officer
Signature Guarantee:____________________
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[EXHIBIT B - FORM OF EXCHANGE AND REGISTRATION RIGHTS AGREEMENT]
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[EXHIBIT C - FORM OF REGISTRATION RIGHTS AGREEMENT]
C-1
[EXHIBIT D - FORM OF INDENTURE]
D-1
[EXHIBIT E - FORM OF ISSUER COUNSEL OPINION]
E-1
[EXHIBIT F - FORM OF OPINION OF COUNSEL TO THE PURCHASERS]
F-1
[EXHIBIT G - FORM OF SOLVENCY CERTIFICATE]
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[EXHIBIT H - FORM OF AMENDED AND RESTATED CERTIFICATE OF INCORPORATION]
H-1
[EXHIBIT I - FORM OF LEGEND]
Please Read This Important Notice Before Opening This Envelope
--------------------------------------------------------------------------------
. . .I M P O R T A N T N O T I C E. . .
This envelope may contain non-public information regarding
D and W Holdings, Inc.
and
Atrium Companies, Inc.
The enclosed information has been sent to you, at your
request, pursuant to Section 6.01 of the Purchase Agreement dated October 25,
2000.
WE DRAW YOUR ATTENTION TO THE ANTI-FRAUD PROVISIONS OF THE
FEDERAL AND STATE SECURITIES LAWS AND PARTICULARLY RULE 10B-5 OF THE
SECURITIES AND EXCHANGE COMMISSION WHICH PROHIBIT THE PURCHASE OR SALE OF
SECURITIES ON THE BASIS OF MATERIAL NON-PUBLIC INFORMATION. In light of these
provisions and Rule 10b-5, we advise you that if you read the enclosed
information, you should not purchase or sell or cause to be purchased or sold
any securities of D and W Holdings, Inc. and Atrium Companies, Inc. unless or
until such information has been publicly disclosed. In addition, you should
not disclose any of such information unless and until such information has
been publicly disclosed.
-------------------
ACCORDINGLY, BY OPENING THIS ENVELOPE YOU SUBJECT YOURSELF TO
THE FOREGOING RESTRICTIONS. IF YOU DETERMINE NOT TO OPEN THIS
ENVELOPE, PLEASE RETURN IT TO US PROMPTLY.
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