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$150,000,000
TEREX CORPORATION
8-7/8% Senior Subordinated Notes due 2008
PURCHASE AGREEMENT
March 24, 1998
CREDIT SUISSE FIRST BOSTON CORPORATION
CIBC OPPENHEIMER CORP.
XXXXXX XXXXXXX & CO. INCORPORATED
SALOMON BROTHERS INC
BANCBOSTON SECURITIES INC.
c/o Credit Suisse First Boston Corporation,
Eleven Madison Avenue,
New York, N.Y. 10010-3629
Dear Sirs:
1. Introductory. Terex Corporation, a Delaware corporation (the
"Company"), proposes, subject to the terms and conditions stated herein, to
issue and sell to the several initial purchasers named in Schedule A hereto (the
"Purchasers") U.S.$150,000,000 principal amount of its 8-7/8% Senior
Subordinated Notes due 2008 ("Notes") to be issued under an indenture, to be
dated as of March 31, 1998 (the "Indenture"), between the Company, the
guarantors named therein and United States Trust Company of New York, as
Trustee, which Notes will be unconditionally guaranteed by Koehring Cranes,
Inc., M&M Enterprises of Baraga, Inc., Payhauler Corp., PPM Cranes, Inc., Terex
Aerials, Inc., Terex Baraga Products, Inc., Terex Cranes, Inc., Terex Mining
Equipment, Inc., Terex-RO Corporation, and Terex-Telelect, Inc. (the
"Guarantors," and together with the Company, the "Issuers"). For purposes of
this agreement, (i) the term "Offered Securities" means the Notes, together with
the guarantees (the "Guarantees") thereof by the Guarantors and (ii) references
to "Subsidiaries" or "subsidiaries" of the Company shall include O&K Mining GmbH
and its subsidiaries. The United States Securities Act of 1933 is herein
referred to as the "Securities Act."
Pursuant to the agreement dated as of December 18, 1997 (the
"Acquisition Agreement"), by and among Terex Mining Equipment Inc. and O&K
Xxxxxxxxx & Xxxxxx Aktiengesellshaft ("Xxxxxxxxx & Xxxxxx"), among other things,
(i) the Company will indirectly acquire all of the outstanding stock of O&K
Mining GmbH ("O&K Mining") and (ii) O&K Mining will become a wholly owned
indirect subsidiary of the Company (the above transactions are herein referred
to as the "Acquisition"). The net proceeds of the offering of the Notes will be
used, together with a portion of the borrowings under the New Credit Facility
(as defined below), to finance the Acquisition. At or prior to the issuance and
sale of the Notes, the Issuers intend to complete a refinancing plan (the
"Refinancing Plan"). The principal elements of the Refinancing Plan are: (i) the
issuance and sale of the Notes; (ii) the offer to purchase any and all of the
outstanding 13 1/4% Senior Secured Notes due May 15, 2002 (the "Existing Notes")
and the solicitation of consents from holders of such Existing Notes (together
with offer to purchase the Existing Notes, the "Offer") pursuant to an Offer to
Purchase and Consent Solicitation dated February 2, 1998 (the "Offer to
Purchase"); (iii) entering into a new secured global credit facility consisting
of up to approximately an aggregate of $375 million of term loan facilities and
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up to approximately an aggregate of $125 million of revolving credit facilities
(the "New Credit Facility") with the agents and lenders named therein; and (iv)
the repayment in full of indebtedness under the Company's existing domestic and
certain of its foreign secured revolving credit facilities (the "Existing Credit
Facilities") and the termination of such facilities.
Holders (including subsequent transferees) of the Notes will have the
registration rights set forth in the Registration Rights Agreement (the
"Registration Rights Agreement"), to be dated the Closing Date (as hereinafter
defined), in substantially the form of Exhibit A hereto. Pursuant to the
Registration Rights Agreement, the Company and the Guarantors will agree to file
with the Securities and Exchange Commission (the "Commission") under the
circumstances set forth therein, (i) a registration statement under the
Securities Act (the "Exchange Offer Registration Statement") registering an
issue of senior subordinated notes identical in all material respects to the
Notes (the "Exchange Notes") to be offered in exchange for the Notes (the
"Exchange Offer") and (ii) under the circumstances set forth therein, a
registration statement pursuant to Rule 415 under the Securities Act (the "Shelf
Registration Statement").
This Agreement, the Indenture, the Offered Securities, the Registration
Rights Agreement, the Acquisition Agreement, the Offer to Purchase and the
supplemental indenture entered into in connection therewith (the "Supplemental
Indenture"), the New Credit Facility and the agreements creating security
interests in the assets of the Company for the benefit of the holders of
indebtedness arising under the New Credit Facility (together with the New Credit
Facility, the "Bank Agreement") are sometimes referred to in this Agreement,
individually, as a "Transaction Document" and, collectively, as the "Transaction
Documents," and the Acquisition, the Offer, the execution and delivery of the
Bank Agreements, the repayment and termination of the Existing Credit
Facilities, the execution and delivery of the Indenture and the issuance and
sale of the Offered Securities are sometimes referred to herein, individually,
as a "Transaction" and collectively, as the "Transactions."
Each of the Issuers, jointly and severally, hereby agrees with the
several Purchasers as follows:
2. Representations and Warranties of the Company. Each of the Issuers,
jointly and severally, represents and warrants to, and agrees with, the several
Purchasers that:
(a) A preliminary offering circular dated March 5, 1998, and
an offering circular relating to the Offered Securities to be offered
by the Purchasers have been prepared by the Company. Such preliminary
offering circular and offering circular (including material
incorporated by reference therein), as supplemented as of the date of
this Agreement, together with any other document approved by the
Company for use in connection with the contemplated resale of the
Offered Securities are hereinafter collectively referred to as the
"Offering Document". On the date of this Agreement, the Offering
Document does not include any untrue statement of a material fact or
omit to state any material fact necessary in order to make the
statements therein, in the light of the circumstances under which they
were made, not misleading. The preceding sentence does not apply to
statements in or omissions from the Offering Document based upon
written information furnished to the Company by any Purchaser through
Credit Suisse First Boston Corporation ("CSFBC") specifically for use
therein, it being understood and agreed that the only such information
is that described as such in Section 7(b). Except as disclosed in the
Offering Document, the Company's Annual Report on Form 10-K most
recently filed with the Securities and Exchange Commission (the
"Commission") and all subsequent reports (collectively, the "Exchange
Act Reports") which have been filed by the Company with the Commission
or sent to stockholders pursuant to the Securities Exchange Act of 1934
(the "Exchange Act") did not include, as of their respective dates, any
untrue statement of a material fact or omit to state any material fact
necessary to make the statements therein, in light of the circumstances
under which they were made, not misleading. Such documents, when they
were filed with the Commission, conformed in all material respects to
the requirements of the Exchange Act and the rules and regulations of
the Commission thereunder.
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(b) Each of the Issuers has been duly incorporated and is an
existing corporation in good standing under the laws of the
jurisdiction of its incorporation, with the corporate power and
authority to own its properties and conduct its business as described
in the Offering Document; and each of the Issuers is duly qualified to
do business as a foreign corporation in good standing in all other
jurisdictions in which its ownership or lease of property or the
conduct of its business requires such qualification, except where the
failure to be so qualified and in good standing could not reasonably be
expected, individually or in the aggregate, to have a material adverse
effect on the condition (financial or other), business, properties or
results of operations of the Company and its subsidiaries taken as a
whole (a "Material Adverse Effect").
(c) Each subsidiary of the Company other than the Guarantors
that (i) generated 5% or more of the revenues, (ii) generated 5% or
more of the operating income, or (iii) held 5% or more of the assets,
in each case, of the Company and its subsidiaries on a consolidated
basis as reflected in the financial statements included in the Offering
Document under the heading "Pro Forma Financial Information" (each, a
"Significant Non-Guarantor Subsidiary," and, together with the
Guarantors, each a "Significant Subsidiary"), has been duly
incorporated and is an existing corporation in good standing under the
laws of the jurisdiction of its incorporation, with the corporate power
and authority to own its properties and conduct its business as
described in the Offering Document; and each Significant Non-Guarantor
Subsidiary of the Company is duly qualified to do business as a foreign
corporation in good standing in all other jurisdictions in which its
ownership or lease of property or the conduct of its business requires
such qualification, except where the failure to be so qualified and in
good standing could not reasonably be expected, individually or in the
aggregate, to have a Material Adverse Effect; all of the issued and
outstanding capital stock of the Company and of each Significant
Subsidiary has been duly authorized and validly issued and is fully
paid and nonassessable; and, except as expressly disclosed or
incorporated by reference in the Offering Document and except for
pledges in favor of Credit Suisse First Boston, as collateral agent,
under the New Credit Facility, the capital stock of each Significant
Subsidiary owned by the Company, directly or through subsidiaries, is
owned free from liens, encumbrances and defects.
(d) The Indenture has been duly authorized by all necessary
corporate action; the Offered Securities have been duly authorized by
each of the Issuers by all necessary corporate action; and when the
Offered Securities are delivered and paid for pursuant to this
Agreement and the Indenture on the Closing Date (as defined below), the
Indenture will have been duly executed and delivered by each of the
Issuers, such Offered Securities will have been duly executed,
authenticated, issued and delivered by each of the Issuers and will
conform in all material respects to the description thereof contained
in the Offering Document and the Indenture and such Offered Securities
will constitute valid and legally binding obligations of each of the
Issuers, enforceable in accordance with their terms, subject to
bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium
and similar laws of general applicability relating to or affecting
creditors' rights and to general equity principles.
(e) Except as disclosed or reflected in the fees and expenses
set forth in the Offering Document, there are no contracts, agreements
or understandings between the Company and any person that would give
rise to a valid claim against the Company or any Purchaser for a
brokerage commission, finder's fee or other like payment in connection
with the Transactions.
(f) Except for (a) that certain Registration Rights Agreement,
dated as of December 9, 1994, by and among Xxxxxxxx X. Xxxx, Xxxxx X.
Xxxxxxxx, Xxxxxx X. Xxxxxxxxx and the Company, (b) that certain Warrant
Registration Rights Agreement, dated as of December 20, 1993, by and
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among the Company and the parties signatory thereto, (c) that certain
Registration Rights Agreement, dated May 9, 1995, between the Company,
Xxxxxxxxx & Company, Inc., and Xxxxxx, Read & Co. Inc., and (d) that
certain Agreement, dated as of November 2, 1995, between the Company
and Xxxxxxxx X. Xxxx, there are no contracts, agreements or
understandings between the Company and any person granting such person
the right to require the Company to file a registration statement under
the Securities Act with respect to any securities of the Company owned
or to be owned by such person or to require the Company to include such
securities in any securities being registered pursuant to any other
registration statement filed by the Company under the Securities Act.
(g) Except for those which have been previously obtained or as
to which the failure to obtain would not, individually or in the
aggregate, have a material adverse effect on the consummation of the
Transactions by the Issuers, no consent, approval, authorization, or
order of, or filing with, any governmental agency or body or any court
is required for the consummation of the Transactions as contemplated by
(i) this Agreement in connection with the issuance and sale of the
Offered Securities by the Issuers, or (ii) any other Transaction
Documents in connection with the consummation of the transactions
contemplated therein.
(h) The execution, delivery and performance by each of the
Company and its subsidiaries (to the extent each is a party thereto) of
each of the Transaction Documents and compliance with the terms and
provisions thereof will not result in a breach or violation of any of
the terms and provisions of, or constitute a default under, (i) any
statute, any rule, regulation or order of any governmental agency or
body or any court, domestic or foreign, having jurisdiction over the
Company or any Significant Subsidiary of the Company or any of their
properties, or (ii) any agreement or instrument to which the Company or
any such Significant Subsidiary is a party or by which the Company or
any such Significant Subsidiary is bound or to which any of the
properties of the Company or any such Significant Subsidiary is
subject, or (iii) the charter or by-laws of the Company or any such
Significant Subsidiary, except (A) in each case, that any rights to
indemnity and contribution may be limited by federal and state
securities laws and public policy considerations and (B) in the case of
clauses (i) and (ii) for such breaches, violations or defaults as would
not, individually or in the aggregate, have a material adverse effect
on the consummation of the Transactions by such parties; and each of
the Issuers has full corporate power and authority to authorize, issue
and sell the Offered Securities as contemplated by this Agreement.
(i) This Agreement has been duly authorized, executed and
delivered by the Company. Each of the other Transaction Documents has
been, or as of the Closing Date will have been, duly authorized,
executed and delivered by each of the Company and its subsidiaries (to
the extent each is a party thereto) and each Transaction Document
conforms or will conform in all material respects to the descriptions
thereof contained in the Offering Document and each Transaction
Document (other than this Agreement) is or will constitute valid and
legally binding obligations of the Company and its subsidiaries (to the
extent each is a party thereto), enforceable in accordance with its
respective terms, except that any rights to indemnity and contribution
may be limited by federal and state securities laws and public policy
considerations and subject to bankruptcy, insolvency, fraudulent
transfer, reorganization, moratorium and similar laws of general
applicability relating to or affecting creditors' rights and to general
equity principles.
(j) Except as disclosed in the Offering Document, the Company
and its Significant Subsidiaries have good title to all real properties
and all other properties and assets owned by them that are material to
the Company and its subsidiaries taken as a whole, in each case free
from liens and encumbrances that would materially affect the value
thereof or materially interfere with the use made or to be made thereof
by them; and except as disclosed in the Offering Document, the Company
and its Significant Subsidiaries hold any leased real or personal
property that is material to the Company and its subsidiaries taken as
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a whole under valid and enforceable leases with no exceptions that
would materially interfere with the use made or to be made thereof by
them.
(k) The Company and its subsidiaries possess all certificates,
authorities or permits issued by appropriate governmental agencies or
bodies necessary to conduct the business now operated by them and have
not received any notice of proceedings relating to the revocation or
modification of any such certificate, authority or permit that, if
determined adversely to the Company or any of its subsidiaries, would
reasonably be expected, individually or in the aggregate, to have a
Material Adverse Effect.
(l) Except as disclosed in the Offering Document, no labor
strike, slowdown, stoppage or dispute (except for routine disciplinary
and grievance matters) with the employees of the Company or any
subsidiary exists or, to the knowledge of the Company, is imminent,
that would reasonably be expected, individually or in the aggregate, to
have a Material Adverse Effect.
(m) The Company and its subsidiaries own, possess, have the
right to use, or can acquire on reasonable terms, adequate trademarks,
trade names and other rights to inventions, know-how, patents,
copyrights, confidential information and other intellectual property
(collectively, "intellectual property rights") used in the conduct of
the business now operated by them, except for such failures to so own,
possess or have the right to use or acquire such intellectual property
rights which would not reasonably be expected, individually or in the
aggregate, to have a Material Adverse Effect, and have not received any
notice of infringement of or conflict with asserted rights of others
with respect to any intellectual property rights that, if determined
adversely to the Company or any of its subsidiaries, would,
individually or in the aggregate, have a Material Adverse Effect.
(n) Except as disclosed in the Offering Document, neither the
Company nor any of its subsidiaries (i) is in violation of any statute,
any rule, regulation, decision or order of any governmental agency or
body or any court, domestic or foreign, relating to the use, disposal
or release of hazardous or toxic substances or relating to the
protection or restoration of the environment or human exposure to
hazardous or toxic substances (collectively, "environmental laws"),
(ii) owns or operates any real property that to the knowledge of the
Company is contaminated with any substance that is subject to any
environmental laws, (iii) is to the knowledge of the Company liable for
any off-site disposal or contamination pursuant to any environmental
laws, or (iv) is to the knowledge of the Company subject to any claim
relating to any environmental laws, in each case, which violation,
contamination, liability or claim would individually or in the
aggregate have a Material Adverse Effect; and the Company is not aware
of any pending investigation which might lead to such a claim.
(o) Except as disclosed in the Offering Document, there are no
pending actions, suits or proceedings against or affecting the Company,
any of its subsidiaries or any of their respective properties that have
a reasonable likelihood of being adversely determined and, if
determined adversely to the Company or any of its subsidiaries, would
individually or in the aggregate have a Material Adverse Effect, or
would materially and adversely affect the ability of the Company to
perform its obligations under the Transaction Documents, or which are
otherwise material in the context of the sale of the Offered Securities
and the consummation of the other Transactions; and no such actions,
suits or proceedings are threatened in writing or, to the Company's
knowledge, contemplated.
(p) The financial statements included or incorporated by
reference in the Offering Document present fairly in all material
respects the financial position, as applicable, (a) of the Company and
its consolidated subsidiaries, (b) of PPM Cranes, Inc. and its
consolidated subsidiaries, (c) of the Simon Access Companies (as
defined in the Offering Document), and (d) of O&K Mining GmbH and its
consolidated subsidiaries, in each case as of the dates shown and their
results of operations and cash flows for the periods shown (subject in
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the case of interim financial statements to normal year-end
adjustments), and such financial statements have been prepared in
conformity with generally accepted accounting principles in the United
States applied on a consistent basis and the schedules included or
incorporated by reference in the Offering Document present fairly the
information required to be stated therein. The assumptions used in
preparing the pro forma financial statements included in the Offering
Document provide a reasonable basis for presenting the significant
effects directly attributable to the transactions or events described
therein, the related pro forma adjustments give appropriate effect to
those assumptions, and the pro forma columns therein reflect the proper
application of those adjustments to the corresponding historical
financial statement amounts.
(q) Except as disclosed in the Offering Document, since the
date of the latest financial statements included in the Offering
Document, there has been no material adverse change, nor any
development or event that could reasonably be expected to result in a
material adverse change, in the condition (financial or other),
business, properties or results of operations of the Company and its
subsidiaries taken as a whole, and, except as disclosed in or
contemplated by the Offering Document, there has been no dividend or
distribution of any kind declared, paid or made by the Company on any
class of its capital stock.
(r) None of the Issuers is an open-end investment company,
unit investment trust or face-amount certificate company that is or is
required to be registered under Section 8 of the United States
Investment Company Act of 1940 (the "Investment Company Act"); and each
of the Issuers is not and, after giving effect to the offering and sale
of the Offered Securities and the application of the proceeds thereof
as described in the Offering Document and the consummation of the other
Transactions, will not be an "investment company" as defined in the
Investment Company Act.
(s) No securities of the Company or any of its subsidiaries
the same class (within the meaning of Rule 144A(d)(3) under the
Securities Act) as the Offered Securities are listed on any national
securities exchange registered under Section 6 of Exchange Act or
quoted in a U.S. automated inter-dealer quotation system.
(t) Assuming the representations of the Purchasers set forth
in Section 4 below are true and correct in all material respects and
that the Purchasers comply in all material respects with applicable
federal and state securities laws and regulations in connection with
the initial resale of the Offered Securities, the offer and sale of the
Offered Securities in the manner contemplated by this Agreement will be
exempt from the registration requirements of the Securities Act by
reason of Section 4(2) thereof and Regulation S thereunder; and it is
not necessary to qualify an indenture in respect of the Offered
Securities under the United States Trust Indenture Act of 1939, as
amended (the "Trust Indenture Act").
(u) Neither the Company, nor any of its affiliates, nor any
person acting on its or their behalf (i) has, within the six-month
period prior to the date hereof, offered or sold in the United States
or to any U.S. person (as such terms are defined in Regulation S under
the Securities Act) the Offered Securities or any security of the same
class or series as the Offered Securities or (ii) has offered or will
offer or sell the Offered Securities (A) in the United States by means
of any form of general solicitation or general advertising within the
meaning of Rule 502(c) under the Securities Act or (B) with respect to
any such securities sold in reliance on Rule 903 of Regulation S
("Regulation S") under the Securities Act, by means of any directed
selling efforts within the meaning of Rule 902(b) of Regulation S. The
Company, its affiliates and any person acting on its or their behalf
have complied in all material respects and will comply in all material
respects with the offering restrictions requirement of Regulation S.
The Company has not entered and will not enter into any contractual
arrangement with respect to the distribution of the Offered Securities
except for this Agreement.
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(v) The Company is subject to Section 13 or 15(d) of the
Exchange Act.
3. Purchase, Sale and Delivery of Offered Securities. On the basis of
the representations, warranties and agreements herein contained, but subject to
the terms and conditions herein set forth, the Company agrees to sell to the
Purchasers, and the Purchasers agree, severally and not jointly, to purchase
from the Company, at a purchase price of 96.576% of the principal amount thereof
plus accrued interest from March 31, 1998 to the Closing Date (as hereinafter
defined), the respective principal amounts of Securities set forth opposite the
names of the several Purchasers in Schedule A hereto.
The Company will deliver against payment of the purchase price the
Offered Securities in the form of one or more permanent global securities in
definitive form (the " Global Securities") deposited with the Trustee as
custodian for The Depository Trust Company ("DTC") and registered in the name of
Cede & Co., as nominee for DTC. Interests in any permanent Global Securities
will be held only in book-entry form through DTC, except in the limited
circumstances described in the Offering Document. Payment for the Offered
Securities shall be made by the Purchasers in Federal (same day) funds by
official check or checks drawn to the order of Terex Corporation or wire
transfer to an account at a bank designated by the Company and reasonably
acceptable to CSFBC at the office of Skadden, Arps, Slate, Xxxxxxx & Xxxx LLP at
9:00 A.M. (New York time), on March 31, 1998, or at such other time not later
than seven full business days thereafter as CSFBC and the Company determine,
such time being herein referred to as the "Closing Date," against delivery to
the Trustee as custodian for DTC of the Global Securities representing all of
the Securities. The Global Securities will be made available for checking at the
above office at least 24 hours prior to the Closing Date.
4. Representations by Purchasers; Resale by Purchasers.
(a) Each Purchaser severally represents and warrants to the
Company that it is a "qualified institutional buyer" within the meaning
of Rule 144A under the Securities Act.
(b) Each Purchaser severally agrees that it and each of its
affiliates has not entered and will not enter into any contractual
arrangement with respect to the distribution of the Offered Securities
except for any such arrangements with the other Purchasers or
affiliates of the other Purchasers or with the prior written consent of
the Company.
(c) Each Purchaser severally agrees that it and each of its
affiliates will not offer or sell the Offered Securities in the United
States by means of any form of general solicitation or general
advertising within the meaning of Rule 502(c) under the Securities Act,
including, but not limited to (i) any advertisement, article, notice or
other communication published in any newspaper, magazine or similar
media or broadcast over television or radio, or (ii) any seminar or
meeting whose attendees have been invited by any general solicitation
or general advertising. Each Purchaser severally agrees, with respect
to resales made in reliance on Rule 144A of any of the Offered
Securities, to deliver either with the confirmation of such resale or
otherwise prior to settlement of such resale a notice to the effect
that the resale of such Offered Securities has been made in reliance
upon the exemption from the registration requirements of the Securities
Act provided by Rule 144A.
(d) Each of the Purchasers severally represents and agrees
that (i) it has not offered or sold and prior to the date six months
after the date of issue of the Offered Securities will not offer or
sell any Offered Securities to persons in the United Kingdom except to
persons whose ordinary activities involve them in acquiring, holding,
managing or disposing of investments (as principal or agent) for the
purposes of their businesses or otherwise in circumstances which have
not resulted and will not result in an offer to the public in the
United Kingdom within the meaning of the Public Offers of Securities
Regulations 1995; (ii) it has complied and will comply with all
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applicable provisions of the Financial Services Xxx 0000 with respect
to anything done by it in relation to the Offered Securities in, from
or otherwise involving the United Kingdom; and (iii) it has only issued
or passed on and will only issue or pass on in the United Kingdom any
document received by it in connection with the issue of the Offered
Securities to a person who is of a kind described in Article 11(3) of
the Financial Services Xxx 0000 (Investment Advertisements)
(Exemptions) Order 1996 or is a person to whom such document may
otherwise lawfully be issued or passed on.
(e) Each Purchaser understands that the Offered Securities are
being sold to it hereunder in a transaction not involving a public
offering in the United States within the meaning of the Securities Act,
that the Offered Securities have not been, and except as described in
the Registration Rights Agreement, will not be registered under the
Securities Act, and that such Purchaser will only offer such Offered
Securities for resale only (i) inside the United States to persons whom
such Purchaser reasonably believes is a "qualified institutional buyer"
meeting the requirements of Rule 144A under the Securities Act, (ii)
outside the United States in a transaction complying with Rule 904
under the Securities Act, (iii) pursuant to an exemption from
registration under the Securities Act provided by Rule 144 (if
available), or (iv) pursuant to an effective registration statement
under the Securities Act, and, in each case of clauses (i) through
(iv), in accordance with any applicable securities laws of any state of
the United States, and such Purchaser will notify any subsequent
purchaser from it of such Offered Securities of the resale restrictions
applicable to the Offered Securities referred to in the Indenture.
(f) Each Purchaser represents and agrees that it is not
acquiring the Offered Securities with a view to any distribution
thereof in a transaction that would violate the Securities Act or the
securities laws of any state of the United States or any other
applicable jurisdiction.
(g) Each Purchaser understands and acknowledges that the
availability of an exemption from registration under the Securities Act
of the offer and sale of the Offered Securities depends in part on, and
the Issuers and, for the purposes of the opinions to be delivered to
the Purchasers pursuant to Section 6 hereof, counsel for the Issuers
and counsel for the Purchasers will rely upon, the accuracy of the
foregoing representations, and such Purchaser hereby consents to such
reliance.
5. Certain Agreements of the Company. Each of the Issuers, jointly and
severally, agrees with the several Purchasers that:
(a) The Company will advise CSFBC promptly of any proposal to
amend or supplement the Offering Document and will not effect such
amendment or supplementation without CSFBC's consent, which consent
shall not be unreasonably withheld or delayed. If, at any time prior to
the completion of the resale of the Offered Securities by the
Purchasers, any event occurs as a result of which the Offering Document
as then amended or supplemented would include an untrue statement of a
material fact or omit to state any material fact necessary to make the
statements therein, in the light of the circumstances under which they
were made, not misleading, the Company promptly will notify CSFBC of
such event and promptly will prepare, at its own expense, an amendment
or supplement which will correct such statement or omission or effect
such compliance. Neither CSFBC's consent to, nor the Purchasers'
delivery of, any such amendment or supplement shall constitute a waiver
of any of the conditions set forth in Section 6.
(b) The Company will furnish to CSFBC copies of any
preliminary offering circular, the Offering Document and all amendments
and supplements to such documents, in each case in such quantities as
CSFBC reasonably requests. At any time when the Company is not subject
to Section 13 or 15(d) of the Exchange Act, the Company will promptly
furnish or cause to be furnished to CSFBC (and, upon request, to each
of the other Purchasers) and, upon request of holders and prospective
9
purchasers of the Offered Securities, to such holders and purchasers,
copies of the information required to be delivered to holders and
prospective purchasers of the Offered Securities pursuant to Rule
144A(d)(4) under the Securities Act (or any successor provision
thereto) in order to permit compliance with Rule 144A in connection
with resales by such holders of the Offered Securities. The Company
will pay the expenses of printing and distributing to the Purchasers
all such documents.
(c) The Company will arrange for the qualification of the
Offered Securities for sale and the determination of their eligibility
for investment under the laws of such jurisdictions as CSFBC reasonably
designates and will continue such qualifications in effect so long as
required for the resale of the Offered Securities by the Purchasers.
(d) During the period of two years hereafter, the Company will
furnish to CSFBC and, upon request, to each of the other Purchasers, as
soon as practicable after the end of each fiscal year, a copy of its
annual report to stockholders for such year; and the Company will
furnish to CSFBC and, upon request, to each of the other Purchasers as
soon as available, a copy of each report and any definitive proxy
statement of the Company filed with the Commission under the Exchange
Act, or mailed to stockholders.
(e) During the period of two years after the Closing Date, the
Company will, upon request, furnish to CSFBC and the other Purchaser
and any holder of Offered Securities a copy of the restrictions on
transfer applicable to the Offered Securities.
(f) During the period of two years after the Closing Date, the
Company will not, and will not permit any of its affiliates (as defined
in Rule 144 under the Securities Act) to, resell any of the Offered
Securities that have been reacquired by any of them.
(g) During the period of two years after the Closing Date,
each of the Issuers will not be or become, an open-end investment
company, unit investment trust or face-amount certificate company that
is or is required to be registered under Section 8 of the Investment
Company Act.
(h) The Company will pay all expenses incidental to the
performance of its obligations under this Agreement and the Indenture,
including (i) the fees and expenses of the Trustee and its professional
advisers; (ii) all expenses in connection with the execution, issue,
authentication, packaging and initial delivery of the Offered
Securities, the preparation and printing of this Agreement, the
Indenture, the Offered Securities, the Offering Document and amendments
and supplements thereto, and any other document relating to the
issuance, offer, sale and delivery of the Offered Securities; (iii) the
cost of listing the Offered Securities and qualifying the Offered
Securities for trading in The PortalSM Market ("PORTAL") and any
expenses incidental thereto; (iv) the cost of any advertising approved
by the Company in connection with the issue of the Offered Securities;
(v) for any expenses (including reasonable fees and disbursements of
counsel) incurred in connection with qualification of the Offered
Securities for sale under the laws of such jurisdictions as CSFBC
designates and the printing of memoranda relating thereto; (vi) for any
fees charged by investment rating agencies for the rating of the
Securities; and (vii) for expenses incurred in distributing preliminary
offering circulars and the Offering Document (including any amendments
and supplements thereto) to the Purchasers. The Company will also pay
for any travel expenses of the Company's officers and employees and any
other expenses of the Company in connection with attending or hosting
meetings with prospective purchasers of the Offered Securities.
(i) In connection with the offering, until CSFBC shall have
notified the Company and the other Purchasers of the completion of the
resale of the Offered Securities, neither the Company nor any of its
affiliates has or will, either alone or with one or more other persons,
bid for or purchase for any account in which it or any of its
affiliates has a beneficial interest any Offered Securities or attempt
to induce any person to purchase any Offered Securities; and neither it
nor any of its affiliates will make bids or purchases for the purpose
10
of creating actual, or apparent, active trading in, or of raising the
price of, the Offered Securities.
(j) During the period beginning on the date hereof and
continuing to and including the Closing Date, none of the Issuers will
offer, sell, contract to sell, announce their intention to sell, pledge
or otherwise dispose of, directly or indirectly, any United States
dollar- or Deutsche Xxxx- denominated debt securities issued or
guaranteed by any of the Issuers and having a maturity of more than one
year from the date of issue. None of the Issuers will at any time
offer, sell, contract to sell, pledge or otherwise dispose of, directly
or indirectly, any securities under circumstances where such offer,
sale, pledge, contract or disposition would cause the exemption
afforded by Section 4(2) of the Securities Act or the safe harbor of
Regulation S thereunder to cease to be applicable to the offer and sale
of the Offered Securities.
6. Conditions of the Obligations of the Purchasers. The obligations of
the Purchasers to purchase and pay for the Offered Securities will be subject to
the accuracy in all material respects of the representations and warranties on
the part of the Issuers herein, to the accuracy in all material respects of the
statements of officers of the Issuers made pursuant to the provisions hereof, to
the performance by the Issuers of their respective obligations hereunder and to
the following additional conditions precedent:
(a) (I) The Purchasers shall have received a letter, dated the
date of this Agreement, of Price Waterhouse LLP confirming that they
are independent public accountants within the meaning of the Securities
Act and the applicable published rules and regulations thereunder
("Rules and Regulations") and stating to the effect that:
(i) in their opinion the financial statements and
schedules examined by them and included or incorporated by
reference in the Offering Document comply as to form in all
material respects with the applicable accounting requirements
of the Securities Act and the related published Rules and
Regulations;
(ii) they have performed the procedures specified by
the American Institute of Certified Public Accountants for a
review of interim financial information as described in
Statement of Auditing Standards No. 71, Interim Financial
Information, on the unaudited financial statements included in
or incorporated by reference in the Offering Document;
(iii) on the basis of the review referred to in
clause (ii) above, a reading of the latest available interim
financial statements of the Company, and of all subsidiaries
of the Company for which such interim financial statements are
provided, inquiries of officials of the Company, and of such
subsidiaries, who have responsibility for financial and
accounting matters and other specified procedures, nothing
came to their attention that caused them to believe that:
(A) with respect to the unaudited financial
statements included in or incorporated by reference
in the Offering Document, that any material
modifications should be made to such unaudited
financial statements for them to be in conformity
with generally accepted accounting principles;
(B) at the date of the latest available
balance sheet read by such accountants, or at a
subsequent specified date not more than three
business days prior to the date of this Agreement,
there was any change in the capital stock or any
increase in long-term debt of the Company and its
consolidated subsidiaries or, as compared with
amounts shown on the latest balance sheet included in
the Offering Document; or
11
(C) for the period from the closing date of
the latest income statement included in the Offering
Document to the closing date of the latest available
income statement read by such accountants there were
any decreases, as compared with the corresponding
period of the previous year and with the period of
corresponding length ended the date of the latest
income statement included in the Offering Document,
in consolidated net sales or in the total amounts of
consolidated net income;
except in all cases set forth in clauses (B) and (C) above for
changes, increases or decreases which the Offering Document
disclose have occurred or may occur or which are described in
such letter;
(iv) they have performed the procedures specified
therein on the pro forma financial statements included in or
incorporated by reference in the Offering Document;
(v) on the basis of the review referred to in clause
(iv) above, nothing came to their attention that caused them
to believe that the pro forma financial statements included in
or incorporated by reference in the Offering Document do not
comply as to form in all material respects with the applicable
accounting requirements of the Act and the related published
Rules and Regulations or that the pro forma adjustments have
not been properly applied to the historical amounts in the
compilation of those statements; and
(vi) they have compared specified dollar amounts (or
percentages derived from such dollar amounts) and other
financial information contained in the Offering Document (in
each case to the extent that such dollar amounts, percentages
and other financial information are derived from the general
accounting records of the Company and its subsidiaries subject
to the internal controls of the Company's accounting system or
are derived directly from such records by analysis or
computation) with the results obtained from inquiries, a
reading of such general accounting records and other
procedures specified in such letter and have found such dollar
amounts, percentages and other financial information to be in
agreement with such results, except as otherwise specified in
such letter.
(II) The Purchasers shall have received a letter,
dated the date of this Agreement, of C&L Treuhand-Vereinigung
confirming that they are independent public accountants within the
meaning of the Securities Act and the Rules and Regulations and stating
to the effect that:
(i) in their opinion the financial statements and
schedules examined by them and included in the Offering
Document comply as to form in all material respects with the
applicable accounting requirements of the Securities Act and
the related published Rules and Regulations;
(ii) they have performed the procedures specified by
the American Institute of Certified Public Accountants for a
review of interim financial information as described in
Statement of Auditing Standards No. 71, Interim Financial
Information, on the unaudited financial statements included in
the Offering Document;
(iii) on the basis of the review referred to in
clause (ii) above, a reading of the latest available interim
financial statements of O&K Mining GmbH, and of all
subsidiaries of O&K Mining GmbH for which such interim
financial statements are provided, inquiries of officials of
O&K Mining GmbH, and of such subsidiaries, who have
responsibility for financial and accounting matters and other
specified procedures, nothing came to their attention that
caused them to believe that:
12
(A) the unaudited financial statements
included in the Offering Document do not comply as to
form in all material respects with the applicable
accounting requirements of the Securities Act and the
related published Rules and Regulations or any
material modifications should be made to such
unaudited financial statements for them to be in
conformity with generally accepted accounting
principles;
(B) at the date of the latest available
balance sheet read by such accountants, or at a
subsequent specified date not more than three
business days prior to the date of this Agreement,
there was any change in the capital stock or any
material increase in long-term debt of O&K Mining
GmbH and its consolidated subsidiaries or, as
compared with amounts shown on the latest balance
sheet included in the Offering Document; or
(C) for the period from the closing date of
the latest income statement included in the Offering
Document to the closing date of the latest available
income statement read by such accountants there were
any decreases, as compared with the corresponding
period of the previous year and with the period of
corresponding length ended the date of the latest
income statement included in the Offering Document,
in consolidated net sales or in the total or per
share amounts of consolidated net income or in the
ratio of earnings to fixed charges of O&K Mining GmbH
and its subsidiaries;
except in all cases set forth in clauses (B) and (C) above for
changes, increases or decreases which the Offering Document
disclose have occurred or may occur or which are described in
such letter; and
(iv) they have compared specified dollar amounts (or
percentages derived from such dollar amounts) and other
financial information contained in the Offering Document (in
each case to the extent that such dollar amounts, percentages
and other financial information are derived from the general
accounting records of O&K Mining GmbH and its subsidiaries
subject to the internal controls of O&K Mining GmbH's
accounting system or are derived directly from such records by
analysis or computation) with the results obtained from
inquiries, a reading of such general accounting records and
other procedures specified in such letter and have found such
dollar amounts, percentages and other financial information to
be in agreement with such results, except as otherwise
specified in such letter.
(III) The Purchasers shall have received a letter,
dated the date of this Agreement, of KPMG Peat Marwick LLP confirming
that they are independent public accountants within the meaning of the
Securities Act and the Rules and Regulations and stating to the effect
that:
They have compared specified dollar amounts (or
percentages derived from such dollar amounts) and other
financial information contained in the Offering Document (in
each case to the extent that such dollar amounts, percentages
and other financial information are derived from the general
accounting records of the Payhauler Corp. subject to the
internal controls of Payhauler Corp.'s accounting system or
are derived directly from such records by analysis or
computation) with the results obtained from inquiries, a
reading of such general accounting records and other
procedures specified in such letter and have found such dollar
amounts, percentages and other financial information to be in
agreement with such results, except as otherwise specified in
such letter.
13
(b) Subsequent to the execution and delivery of this
Agreement, there shall not have occurred (A) any change, or any
development or event that could reasonably be expected to result in a
change, in the condition (financial or other), business, properties or
results of operations of the Company and its subsidiaries taken as a
whole, which, in the judgment of a majority in interest of the
Purchasers including CSFBC, is material and adverse to the Company and
its subsidiaries taken as a whole and makes it impractical or
inadvisable to proceed with completion of the offering or the sale of
and payment for the Offered Securities; (B) any downgrading in the
rating of any debt securities of the Company by any "nationally
recognized statistical rating organization" (as defined for purposes of
Rule 436(g) under the Securities Act), or any public announcement that
any such organization has under surveillance or review its rating in
effect on the date of this Agreement of any debt securities of the
Company (other than an announcement with positive implications of a
possible upgrading, and no implication of a possible downgrading, of
such rating); (C) any suspension or material limitation of trading in
securities generally on the New York Stock Exchange, or any setting of
minimum prices for trading on such exchange, or any suspension of
trading of any securities of the Company on any exchange or in the
over-the-counter market; (D) any banking moratorium declared by U.S.
Federal or New York authorities; or (E) any outbreak or escalation of
major hostilities in which the United States is involved, any
declaration of war by Congress or any other substantial national or
international calamity or emergency if, in the judgment of a majority
in interest of the Purchasers including CSFBC, the effect of any such
outbreak, escalation, declaration, calamity or emergency makes it
impractical or inadvisable to proceed with completion of the offering
or sale of and payment for the Offered Securities.
(c) The Purchasers shall have received an opinion, dated such
Closing Date, of Xxxxxxxx Xxxxxxxxx Xxxxxx Xxxxxxxx & Xxxxxx LLP,
counsel for the Company, that:
(i) The Issuers organized under the laws of the State
of Delaware and each Significant Subsidiary organized under
the laws of the State of Delaware have been duly incorporated
and are existing corporations in good standing under the laws
of their respective jurisdictions of incorporation, with
corporate power and authority to own their respective
properties and conduct their respective businesses as
described in the Offering Document;
(ii) Each of this Agreement, the Indenture, the
Offered Securities, the Registration Rights Agreement, the
Supplemental Indenture and any documents delivered to the
holders of Existing Notes in connection with the Offer to
Purchase (collectively, the "Closing Documents") has been duly
authorized, executed and delivered by each of the Company and
its subsidiaries (to the extent each is a party thereto); the
Offered Securities have been duly authorized, executed,
authenticated, issued and delivered by each of the Issuers and
each of the Closing Documents conforms in all material
respects to the description thereof contained in the Offering
Document; and each of the Closing Documents (other than this
Agreement) constitutes valid and legally binding obligations
of the each of the Company and its subsidiaries (to the extent
each is a party thereto) enforceable in accordance with its
respective terms, except that any rights to indemnity and
contribution thereunder may be limited by federal and state
securities laws and public policy consideration and subject to
bankruptcy, insolvency, fraudulent transfer, reorganization,
moratorium and similar laws of general applicability relating
to or affecting creditors' rights and to general equity
principles;
(iii) Each of the Issuers is not and, after giving
effect to the offering and sale of the Offered Securities and
the application of the proceeds thereof as described in the
14
Offering Document and the consummation of the other Closing
Transactions (as defined below), will not be an "investment
company" as defined in the Investment Company Act;
(iv) Except for (a) filing under the
Xxxx-Xxxxx-Xxxxxx Antitrust Improvements Act of 1976, as
amended, (b) the filing made with the German Federal Cartel
Office, (c) the telephonic no-action position expressed on
January 30, 1998, by the Securities and Exchange Commission in
connection with the Offer, and (d) those consents as to which
the failure to obtain would not, individually or in the
aggregate, have a material adverse effect on the consummation
of the relevant Closing Transaction, no consent, approval,
authorization or order of, or filing with, any governmental
agency or body or any court is required to be obtained or made
by the Company or any Significant Subsidiary incorporated
under the laws of the State of New York or the State of
Delaware ("Domestic Significant Subsidiaries") under any
Applicable Law (as defined) for the consummation of the
transactions contemplated by the Closing Documents or
otherwise in connection with the Offer, the execution and
delivery of the Indenture and the issuance and sale of the
Offered Securities (the "Closing Transactions"), except such
as may be required under state securities laws (with respect
to which such counsel need express no opinion);
(v) The execution and delivery by the Company and its
subsidiaries (to the extent each is a party thereto) of, and
performance by such parties of their respective obligations
under, each of the Closing Documents (including the issuance
and sale of the Offered Securities) and compliance with the
terms and provisions thereof will not result in a breach or
violation of any of the terms and provisions of, or constitute
a default under, any Applicable Law or order known to such
counsel of any governmental agency or body or any court having
jurisdiction over the Company or any Domestic Significant
Subsidiary or any material portion of their respective
properties (except that any rights to indemnity and
contribution herein may be limited by federal and state
securities laws and public policy considerations), or any
agreement or instrument filed as an exhibit to the Company's
Exchange Act Reports, or the charter or by-laws of the Company
or any Domestic Significant Subsidiary;
(vi) While such counsel is not passing upon and does
not assume responsibility for, and shall not be deemed to have
independently verified the accuracy, completeness or fairness
of the statements contained in any of the Closing Documents or
in the Bank Agreements (except statements made under the
caption "Description of the Notes" and "Description of the New
Bank Credit Facility" of the Offering Document insofar as they
relate to legal matters), such counsel shall state that no
facts have come to such counsel's attention in the course of
participating with officers and representatives of the Company
in the preparation of the Offering Document (except for
financial statements and schedules and other financial and
statistical data contained therein, as to which such counsel
need express no opinion) to lead it to believe that any part
of the Offering Document, as of the Closing Date, contained
any untrue statement of a material fact or omitted to state
any material fact required to be stated therein or necessary
to make the statements therein not misleading; or that the
Offering Document, as of its date or as of the Closing Date,
contained any untrue statement of a material fact or omitted
to state any material fact necessary in order to make the
statements therein, in the light of the circumstances under
which they were made, not misleading; the descriptions in the
Offering Document of statutes, legal and governmental
proceedings and contracts and other documents are accurate in
all material respects and fairly present the information
required to be shown; and such counsel do not know of any
legal or governmental proceedings that were required to be
described in any of the Exchange Act Reports as of their
15
respective dates which are not described as required or of any
contracts or documents of a character that were required to be
described in any of the Exchange Act Reports as of their
respective dates or to be filed as exhibits to the respective
Exchange Act Reports as of their respective dates which are
not described and filed as required.
(vii) Assuming that the representations of the
Purchasers set forth in Section 4 of this Agreement are true
and correct in all material respects and that the Purchasers
comply in all material respects with applicable federal and
state securities laws and regulations in connection with the
initial resale of the Offered Securities, it is not necessary
in connection with (i) the offer, sale and delivery of the
Offered Securities by the Company to the several Purchasers
pursuant to this Agreement or (ii) the resales of the Offered
Securities by the several Purchasers in the manner
contemplated by this Agreement, to register the Offered
Securities under the Securities Act or to qualify an indenture
in respect thereof under the Trust Indenture Act.
Such counsel may state that, as it relates to
enforceability, the opinions expressed in clause (v) are
limited by (1) bankruptcy, insolvency, fraudulent conveyance
and similar laws affecting creditors' rights generally and (2)
equitable principles of general applicability. Such counsel
may also qualify such opinion in other respects reasonably
acceptable to the Purchasers.
(d) The Underwriter shall have received an opinion, dated such
Closing Date, of Xxxx X Xxxxx, general counsel of the Company, to the
effect that:
(i) The Issuers and each Significant Subsidiary
incorporated within the United States of America (the
"Domestic Significant Subsidiaries") have been duly
incorporated and are existing corporations in good standing
under the laws of their respective jurisdictions of
incorporation, with corporate power and authority to own their
respective properties and conduct their respective businesses
as described in the Offering Documents; and the Issuers and
each Domestic Significant Subsidiary are duly qualified to do
business as foreign corporations in good standing in all other
jurisdictions in which their ownership or lease of property or
the conduct of their business requires such qualifications,
except to the extent that the failure to be so qualified and
in good standing could not reasonably be expected,
individually or in the aggregate, to have a Material Adverse
Effect. Based on my review of organizational documents (or
English translations thereof) of each Significant Subsidiary
incorporated outside the United States of America (the
"Foreign Significant Subsidiaries") and interviews and
statements of persons who are informed as to the formation and
status of the Foreign Significant Subsidiaries, the Foreign
Significant Subsidiaries have been duly incorporated and are
existing corporations in good standing under the laws of their
respective countries of organization, with corporate power and
authority to own their respective properties and conduct their
respective businesses as described in the Offering Document;
based on my review of organizational documents (or English
translations thereof) of the Foreign Significant Subsidiaries
and interviews and statements of persons who are informed as
to the formation and status of the Foreign Significant
Subsidiaries, the Foreign Significant Subsidiaries are duly
qualified to do business as foreign corporations in good
standing in all other jurisdictions in which their ownership
or lease of property or the conduct of their business requires
such qualifications, except to the extent that the failure to
be so qualified and in good standing could not reasonably be
expected, individually or in the aggregate, to have a Material
Adverse Effect.
16
(ii) Based upon my examination of the corporate stock
books and records of each of the Domestic Significant
Subsidiaries and the corporate stock books and records (or
English translations thereof) of the Foreign Significant
Subsidiaries and interviews and statements of persons who are
informed as to the status of the Foreign Significant
Subsidiaries, all outstanding shares of the capital stock of
the Company and each Significant Subsidiary have been duly
authorized and validly issued, are fully paid and
nonassessable and conform in all material respects to the
description thereof contained in the Exchange Act Reports; and
the securityholders of each the Issuers have no preemptive
rights with respect to the Offered Securities;
(iii) Except for those agreements referred to in the
representation set forth in Section 2(f) hereof, there are no
contracts, agreements or understandings known to such counsel
between any of the Issuers and any person granting such person
the right to require any of the Issuers to file a registration
statement under the Act with respect to any securities of any
of the Issuers owned or to be owned by such person or to
require any of the Issuers to include such securities in
securities being registered pursuant to any other registration
statement filed by any of the Issuers under the Securities
Act;
(iv) Except for (a) filing under the
Xxxx-Xxxxx-Xxxxxx Antitrust Improvements Act of 1976, as
amended, (b) the filing made with the German Federal Cartel
Office, (c) the telephonic no-action position expressed on
January 30, 1998, by the Securities and Exchange Commission in
connection with the Offer, and (d) those consents as to which
the failure to obtain would not, individually or in the
aggregate, have a material adverse effect on the consummation
of the relevant Transaction, no consent, approval,
authorization or order of, or filing with, any governmental
agency or body or any court is required to be obtained or made
by the Company or any Significant Subsidiary under any
Applicable Law for the consummation of the Transactions or
otherwise in connection with the sale of the Offered
Securities, except such as may be required under state
securities laws (with respect to which such counsel need
express no opinion);
(v) The execution and delivery of, and performance
by, each of the Company and its subsidiaries (to the extent
each is a party thereto) of its obligation under, each of the
Transaction Documents (including the issuance and sale of the
Offered Securities) will not result in a breach or violation
of any of the terms and provisions of, or constitute a default
under, any Applicable Law or order known to such counsel of
any governmental agency or body or any court having
jurisdiction over the Company or any Significant Subsidiary or
any of their respective properties (except that any rights to
indemnity and contribution herein may be limited by federal
and state securities laws and public policy considerations),
or any agreement or instrument to which the Company or any
Significant Subsidiary is a party or by which the Company or
any Significant Subsidiary is bound or to which any of the
properties of the Company or any Significant Subsidiary is
subject, or the charter or by-laws of the Company or any
Significant Subsidiary, and each of the Issuers has full power
and authority to authorize, issue and sell the Offered
Securities as contemplated by this Agreement;
(vi) This Agreement has been duly authorized,
executed and delivered by each of the Issuers. Each of the
other Transaction Documents has been duly authorized, executed
and delivered by each of the Company and its subsidiaries (to
the extent each is a party thereto); the Offered Securities
have been duly authorized, executed, authenticated, issued and
delivered by each of the Issuers and each of the Transaction
Documents conforms in all material respects to the description
thereof contained in the Offering Document; and each of the
Transaction Documents (other than this Agreement and the
Acquisition Agreement) constitutes valid and legally binding
obligations of the each of the Company and its subsidiaries
17
(to the extent each is a party thereto) enforceable in
accordance with its respective terms, except that any rights
to indemnity and contribution thereunder may be limited by
federal and state securities laws and public policy
considerations and subject to bankruptcy, insolvency,
fraudulent transfer, reorganization, moratorium and similar
laws of general applicability relating to or affecting
creditors' rights and to general equity principles;
(vii)While such counsel is not passing upon and does
not assume responsibility for, and shall not be deemed to have
independently verified the accuracy, completeness or fairness
of the statements contained in any of the Transaction
Documents (except statements made under the caption
"Description of the Notes" and "Description of the New Bank
Credit Facility" of the Offering Document insofar as they
relate to legal matters), such counsel shall state that no
facts have come to such counsel's attention in the course of
participating with officers and representatives of the Company
in the preparation of the Offering Document (except for
financial statements and schedules and other financial and
statistical data contained therein, as to which such counsel
need express no opinion) to lead it to believe that any part
of the Offering Document, as of the Closing Date, contained
any untrue statement of a material fact or omitted to state
any material fact required to be stated therein or necessary
to make the statements therein not misleading; or that the
Offering Document, as of its date or as of the Closing Date,
contained any untrue statement of a material fact or omitted
to state any material fact necessary in order to make the
statements therein, in the light of the circumstances under
which they were made, not misleading; the descriptions in the
Offering Document of statutes, legal and governmental
proceedings and contracts and other documents are accurate and
fairly present the information required to be shown; and such
counsel does not know of any legal or governmental proceedings
that were required to be described in any of the Exchange Act
Reports as of their respective dates which are not described
as required or of any contracts or documents of a character
that were required to be described in any of the Exchange Act
Reports as of their respective dates or to be filed as
exhibits to the respective Exchange Act Reports as of their
respective dates which are not described or filed as required.
Such counsel may state that, as it relates to
enforceability, the opinions expressed in clause (vi) are
limited by (1) bankruptcy, insolvency, fraudulent conveyance
and similar laws affecting creditors' rights generally and (2)
equitable principles of general applicability. Such counsel
may also qualify such opinion in other respects reasonably
acceptable to the Purchasers.
(e) The Purchasers shall have received from Skadden, Arps,
Slate, Xxxxxxx & Xxxx LLP, counsel for the Purchasers, such opinion or
opinions, dated such Closing Date, with respect to the incorporation of
the Company, the validity of the Offered Securities, the Offering
Document, the exemption from registration for the offer and sale of the
Offered Securities by the Company to the several Purchasers and the
resales by the several Purchasers as contemplated hereby and other
related matters as CSFBC may require, and the Company shall have
furnished to such counsel such documents as they request for the
purpose of enabling them to pass upon such matters.
(f) The Purchasers shall have received a certificate, dated
the Closing Date, of the President or any Vice President and a
principal financial or accounting officer of the each of the Issuers in
which such officers, to the best of their knowledge after reasonable
investigation, shall state that the representations and warranties of
such Issuer in this Agreement are true and correct, that such Issuer
has complied with all agreements and satisfied all conditions on its
part to be performed or satisfied hereunder at or prior to the Closing
Date, and that, subsequent to the date of the most recent financial
18
statements in the Offering Document, there has been no material adverse
change, nor any development or event involving a prospective material
adverse change, in the condition (financial or other), business,
properties or results of operations of the Company and its
subsidiaries, taken as a whole, except as set forth in or contemplated
by the Offering Document or as described in such certificate.
(g) The Purchasers shall have received letters, dated the
Closing Date, of Price Waterhouse LLP which meets the requirements of
subsection (a)(I) of this Section, of C&L Treuhand-Vereinigung which
meets the requirements of subsection (a)(II) of this Section, and of
KPMG Peat Marwick LLP which meets the requirements of subsection
(a)(III) of this Section, except that, in each case, the specified date
referred to in such subsections will be a date not more than three
business days prior to the Closing Date for the purposes of this
subsection.
(h) The Company, the Guarantors and the Trustee shall have
entered into the Indenture and you shall have received counterparts,
conformed as executed, thereof.
(i) The Company and the Guarantors shall have entered into the
Registration Rights Agreement and you shall have received counterparts,
conformed as executed, thereof.
(j) The Offered Securities shall have been designated PORTAL
securities in accordance with the rules and regulations adopted by the
NASD relating to trading in the PORTAL market.
(k) On or prior to the Closing Date, (i)(a) the Issuers shall
have entered into the Bank Agreements and all conditions precedent to
the effectiveness thereof shall have been satisfied or waived and (b)
each of the Transactions shall have been consummated; (ii) such
transactions described in the foregoing clause (i) shall continue to be
in full force and effect in accordance with the terms thereof; and
(iii) the Company shall have provided to each of the Purchasers and
counsel to the Purchasers copies of all Transaction Documents delivered
to the parties relating to the Transactions (including but not limited
to legal opinions relating thereto).
(l) The Purchasers shall have been furnished with a copy of
the opinions delivered on behalf of Issuers in connection with the
Transactions, which opinions shall expressly state that the Purchasers
are justified in relying upon the opinions therein.
(m) The Purchasers shall have received an opinion, dated such
Closing Date, of Xxxxxxx & Xxxxxxxxxx-Xxxxxxx, special German counsel
for the Company, regarding the enforceability of the Acquisition
Agreement and such other matters as reasonably requested by the
Purchasers, which opinion shall be in form and substance reasonably
satisfactory to counsel for the Purchasers.
The Company will furnish the Purchasers with such conformed copies of
such opinions, certificates, letters and documents as the Purchasers reasonably
request. CSFBC may in its sole discretion waive on behalf of the Purchasers
compliance with any conditions to the obligations of the Purchasers hereunder.
7. Indemnification and Contribution. (a) Each of the Issuers, jointly
and severally, will indemnify and hold harmless each Purchaser against any
losses, claims, damages or liabilities, joint or several, to which such
Purchaser 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 any untrue statement or alleged untrue statement
of any material fact contained in the Offering Document, or any amendment or
supplement thereto, or any related preliminary offering circular, or arise out
of or are based upon the omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make the statements
therein not misleading, and will reimburse each Purchaser for any legal or other
19
expenses reasonably incurred by such Purchaser in connection with investigating
or defending any such loss, claim, damage, liability or action as such expenses
are incurred; provided, however, that the Company will not be liable in any such
case to the extent that any such loss, claim, damage or liability (or actions in
respect thereof) arises out of or is based upon an untrue statement or alleged
untrue statement in or omission or alleged omission from any of such documents
in conformity with written information furnished to the Company by any Purchaser
through CSFBC specifically for use therein, it being understood and agreed that
the only such information consists of the information described as such in
subsection (b) below.
(b) Each Purchaser will severally and not jointly indemnify
and hold harmless each of the Issuers against any losses, claims, damages or
liabilities to which such Issuers 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 any untrue statement or
alleged untrue statement of any material fact contained in the Offering
Document, or any amendment or supplement thereto, or any related preliminary
offering circular, or arise out of or are based upon the omission or alleged
omission to state therein a material fact required to be stated therein or
necessary in order to make the statements therein not misleading, in each case
to the extent, but only to the extent, that such untrue statement or alleged
untrue statement or omission or alleged omission was made in conformity with
information furnished to the Company by such Purchaser through CSFBC
specifically for use therein, and will reimburse each Issuer for any legal or
other expenses reasonably incurred by the Issuers in connection with
investigating or defending any such loss, claim, damage, liability or action as
such expenses are incurred, it being understood and agreed that the only such
information furnished by any Purchaser consists of (i) the following information
in the Offering Document furnished on behalf of each Purchaser: the last
paragraph at the bottom of the cover page concerning the terms of the offering
by the Purchasers, the legend concerning over-allotments and stabilizing on the
inside front cover page, and the information concerning over-allotments and
stabilizing appearing in the seventh paragraph under the caption of "Plan of
Distribution";
(ii) the following information in the Offering
Document furnished on behalf of CSFBC, CIBC Xxxxxxxxxxx Corp.,
BancBoston Securities Inc. and Salomon Brothers Inc, as
applicable:
Credit Suisse First Boston and its affiliates
provide, and have in the past provided, certain
financial and investment advisory services to the
Company. In July 1997, Credit Suisse First Boston
Corporation and Salomon Brothers Inc acted as
underwriters in connection with a public offering by
the Company and certain selling stockholders of
shares of common stock of the Company. In December
1997, Credit Suisse First Boston Corporation acted as
the underwriter for a public offering by certain
selling stockholders of the Company of shares of
common stock of the Company. Credit Suisse First
Boston Corporation is also acting as a financial
advisor to the Company in connection with the O&K
Acquisition, and Credit Suisse First Boston, an
affiliate of Credit Suisse First Boston Corporation,
will be a lender and the Administrative Agent under
the New Bank Credit Facility. Canadian Imperial Bank
of Commerce, an affiliate of CIBC Xxxxxxxxxxx Corp.,
will be a lender and a Co-Documentation Agent under
the New Bank Credit Facility, and BankBoston, N.A.,
an affiliate of BancBoston Securities Inc., was the
Agent and a lender under one of the Existing Credit
Facilities and will be a lender and the Syndication
Agent under the New Bank Credit Facility. Credit
Suisse First Boston Corporation and Salomon Brothers
Inc are acting as Dealer Managers and Solicitation
Agents in connection with the Offer to Purchase and
the Consent Solicitation.
20
and (iii) the following information in the Offering
Document furnished on behalf of CIBC Xxxxxxxxxxx Corp.:
Xxxxx X. Xxxxx, a director of the Company, is a
managing director of CIBC Xxxxxxxxxxx Corp., one of
the Initial Purchasers.
(c) Promptly after receipt by an indemnified party under this
Section of notice of the commencement of any action, such indemnified party
will, if a claim in respect thereof is to be made against the indemnifying party
under subsection (a) or (b) above, notify the indemnifying party 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 party
otherwise than under subsection (a) or (b) above. In case any such action is
brought against any indemnified party and it notifies the indemnifying party of
the commencement thereof, the indemnifying party will be entitled to participate
therein and, to the extent that it may wish, jointly with any other indemnifying
party similarly notified, to assume the defense thereof, with counsel
satisfactory to such indemnified party (who shall not, except with the consent
of the indemnified party, be counsel to the indemnifying party), and after
notice from the indemnifying party to such indemnified party of its election so
to assume the defense thereof, the indemnifying party will not be liable to such
indemnified party under this Section for any legal or other expenses
subsequently incurred by such indemnified party in connection with the defense
thereof other than reasonable costs of investigation. In no event shall an
indemnifying party be liable for fees and expenses of more than one counsel (in
addition to any local counsel) separate from their own counsel for all
indemnified parties in connection with any one action or separate but similar or
related actions in the same jurisdiction arising out of the same general
allegations or circumstances. No indemnifying party shall, without the prior
written consent of the indemnified party, effect any settlement of any pending
or threatened action in respect of which any indemnified party is or could have
been a party and indemnity could have been sought hereunder by such indemnified
party unless such settlement includes an unconditional release of such
indemnified party from all liability on any claims that are the subject matter
of such action. An indemnifying party shall not be liable for any settlement of
any proceeding effected without its prior written consent; provided, however,
that if at any time an indemnified party shall have requested an indemnifying
party to reimburse the indemnified party for fees and expenses of counsel, such
indemnifying party agrees it shall be liable for any settlement effected without
its written consent if (i) such settlement is entered into more than 45 days
after receipt by such indemnifying party of the aforesaid request, (ii) such
indemnifying party shall have received notice of the terms of such settlement at
least 30 days prior to such settlement being entered into and (iii) such
indemnifying party shall not have reimbursed such indemnified party in
accordance with such request prior to the date of such settlement.
(d) If the indemnification provided for in this Section is
unavailable or insufficient to hold harmless an indemnified party under
subsection (a) or (b) above, then each indemnifying party shall contribute to
the amount paid or payable by such indemnified party as a result of the losses,
claims, damages or liabilities referred to in subsection (a) or (b) above (i) in
such proportion as is appropriate to reflect the relative benefits received by
the Issuers on the one hand and the Purchasers on the other from the offering of
the Offered Securities or (ii) if the allocation provided by clause (i) above is
not permitted by applicable law, in such proportion as is appropriate to reflect
not only the relative benefits referred to in clause (i) above but also the
relative fault of the Issuers on the one hand and the Purchasers on the other in
connection with the statements or omissions which resulted in such losses,
claims, damages or liabilities as well as any other relevant equitable
considerations. The relative benefits received by the Issuers on the one hand
and the Purchasers on the other shall be deemed to be in the same proportion as
the total net proceeds from the offering (before deducting expenses) received by
the Issuers bear to the total discounts and commissions received by the
Purchasers from the Issuers under this Agreement. 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 Issuers or the Purchasers
and the parties' relative intent, knowledge, access to information and
21
opportunity to correct or prevent such untrue statement or omission. The amount
paid by an indemnified party as a result of the losses, claims, damages or
liabilities referred to in the first sentence of this subsection (d) shall be
deemed to include any legal or other expenses reasonably incurred by such
indemnified party in connection with investigating or defending any action or
claim which is the subject of this subsection (d). Notwithstanding the
provisions of this subsection (d), no Purchaser shall be required to contribute
any amount in excess of the amount by which the total price at which the Offered
Securities purchased by it were resold exceeds the amount of any damages which
such Purchaser has otherwise been required to pay by reason of such untrue or
alleged untrue statement or omission or alleged omission. The Purchasers'
obligations in this subsection (d) to contribute are several in proportion to
their respective purchase obligations and not joint. 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.
(e) The obligations of the Issuers under this Section shall be
in addition to any liability which the Issuers may otherwise have and shall
extend, upon the same terms and conditions, to each person, if any, who controls
any Purchaser within the meaning of the Securities Act or the Exchange Act; and
the obligations of the Purchasers under this Section shall be in addition to any
liability which the respective Purchasers may otherwise have and shall extend,
upon the same terms and conditions to each person, if any, who controls the
Issuers within the meaning of the Securities Act or the Exchange Act.
8. Default of Purchasers. If any Purchaser or Purchasers default in
their obligations to purchase Offered Securities hereunder and the aggregate
principal amount of Offered Securities that such defaulting Purchaser or
Purchasers agreed but failed to purchase does not exceed 10% of the total
principal amount of Offered Securities, CSFBC may make arrangements satisfactory
to the Company for the purchase of such Offered Securities by other persons,
including any of the Purchasers, but if no such arrangements are made by the
Closing Date, the non-defaulting Purchasers shall be obligated severally, in
proportion to their respective commitments hereunder, to purchase the Offered
Securities that such defaulting Purchasers agreed but failed to purchase. If any
Purchaser or Purchasers so default and the aggregate principal amount of Offered
Securities with respect to which such default or defaults occur exceeds 10% of
the total principal amount of Offered Securities and arrangements satisfactory
to CSFBC and the Company for the purchase of such Offered Securities by other
persons are not made within 36 hours after such default, this Agreement will
terminate without liability on the part of any non-defaulting Purchaser or the
Company, except as provided in Section 9. As used in this Agreement, the term
"Purchaser" includes any person substituted for a Purchaser under this Section.
Nothing herein will relieve a defaulting Purchaser from liability for its
default.
9. Survival of Certain Representations and Obligations. The respective
indemnities, agreements, representations, warranties and other statements of
each of the Issuers or its officers and of the several Purchasers set forth in
or made pursuant to this Agreement will remain in full force and effect,
regardless of any investigation, or statement as to the results thereof, made by
or on behalf of any Purchaser, the Issuers or any of their respective
representatives, officers or directors or any controlling person, and will
survive delivery of and payment for the Offered Securities. If this Agreement is
terminated pursuant to Section 8 or if for any reason the purchase of the
Offered Securities by the Purchasers is not consummated, the Issuers shall
remain responsible for the expenses to be paid or reimbursed by them pursuant to
Section 5 and the respective obligations of the Issuers and the Purchasers
pursuant to Section 7 shall remain in effect; if any Offered Securities have
been purchased hereunder, the Issuers shall remain responsible for the expenses
to be paid or reimbursed by them pursuant to Section 5 and the respective
obligations of the Issuers and the Purchasers pursuant to Section 7 shall remain
in effect, and the representations and warranties in Section 2 and all other
obligations under Section 5 shall also remain in effect. If the purchase of the
Offered Securities by the Purchasers is not consummated other than solely
because of the termination of this Agreement pursuant to Section 8 or the
occurrence of any event specified in clause (C), (D) or (E) of Section 6(b)(ii),
the Company will reimburse the Purchasers for all out-of-pocket expenses
(including fees and disbursements of counsel) reasonably incurred by them in
connection with the offering of the Offered Securities.
22
10. Notices. All communications hereunder will be in writing and, if
sent to the Purchasers will be mailed, delivered or telegraphed and confirmed to
the Purchasers, c/o Credit Suisse First Boston Corporation, Eleven Madison
Avenue, New York, N.Y. 10010-3629, Attention: Investment Banking Department -
Transactions Advisory Group, or, if sent to the Company, will be mailed,
delivered or telegraphed and confirmed to it at Terex Corporation, 000 Xxxx Xxxx
Xxxx, Xxxxxxxx, XX 00000, Attention: Xxxx X Xxxxx; provided, however, that any
notice to a Purchaser pursuant to Section 7 will be mailed, delivered or
telegraphed and confirmed to such Purchaser.
11. Successors. This Agreement will inure to the benefit of and be
binding upon the parties hereto and their respective successors and the
controlling persons referred to in Section 7, and no other person will have any
right or obligation hereunder, except that holders of Offered Securities shall
be entitled to enforce the agreements for their benefit contained in the second
and third sentences of Section 5(b) hereof against the Company as if such
holders were parties thereto.
12. Representation of Purchasers. You will act for the several
Purchasers in connection with the transactions contemplated by this Agreement,
and any action under this Agreement taken by the Purchasers jointly or by CSFBC
will be binding on all of the Purchasers.
13. Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be deemed to be an original, but all such
counterparts shall together constitute one and the same Agreement.
14. Applicable Law. This Agreement shall be governed by, and construed
in accordance with, the laws of the State of New York without regard to
principles of conflicts of laws.
EACH OF THE ISSUERS HEREBY SUBMITS TO THE NON-EXCLUSIVE JURISDICTION OF
THE FEDERAL AND STATE COURTS IN THE BOROUGH OF MANHATTAN IN THE CITY OF NEW YORK
IN ANY SUIT OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE
TRANSACTIONS CONTEMPLATED HEREBY.
23
If the foregoing is in accordance with the Purchasers' understanding of
our agreement, kindly sign and return to us one of the counterparts hereof,
whereupon it will become a binding agreement between the Issuers and the several
Purchasers in accordance with its terms.
Very truly yours,
TEREX CORPORATION
By.......................
Name:
Title:
KOEHRING CRANES, INC.
By.......................
Name:
Title:
M&M ENTERPRISES OF BARAGA, INC.
By.......................
Name:
Title:
PAYHAULER CORP.
By........................
Name:
Title:
PPM CRANES, INC.
By.......................
Name:
Title:
24
TEREX AERIALS, INC.
By.......................
Name:
Title:
TEREX BARAGA PRODUCTS, INC.
By.......................
Name:
Title:
TEREX CRANES, INC.
By......................
Name:
Title:
TEREX MINING EQUIPMENT, INC.
By......................
Name:
Title:
TEREX-RO CORPORATION
By......................
Name:
Title:
TEREX-TELELECT, INC.
By......................
Name:
Title:
25
The foregoing Purchase Agreement is hereby confirmed and accepted as of the date
first above written.
CREDIT SUISSE FIRST BOSTON CORPORATION
CIBC XXXXXXXXXXX CORP.
XXXXXX XXXXXXX & CO. INCORPORATED
SALOMON BROTHERS INC
BANCBOSTON SECURITIES INC.
By: CREDIT SUISSE FIRST BOSTON CORPORATION
By..............................
Name:
Title:
26
SCHEDULE A
Principal Amount of
Initial Purchaser Offered Securities
---------------------- -----------------------
Credit Suisse First Boston Corporation.......... $75,000,000
CIBC Xxxxxxxxxxx Corp........................... 22,500,000
Xxxxxx Xxxxxxx & Co. Incorporated............... 22,500,000
Salomon Brothers Inc............................ 22,500,000
BancBoston Securities Inc....................... 7,500,000
------------
Total....................... $150,000,000
============
