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Exhibit 10.12
Execution Version
CRAWFORD & COMPANY
CRAWFORD & COMPANY INTERNATIONAL, INC.
-------------------------------------
NOTE PURCHASE AGREEMENT
-------------------------------------
DATED AS OF SEPTEMBER 30, 2003
$50,000,000 6.08% SENIOR GUARANTIED NOTES DUE OCTOBER 10, 2010
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TABLE OF CONTENTS
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PAGE
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1. AUTHORIZATION OF
NOTES....................................................
1
2. SALE AND PURCHASE OF
NOTES................................................ 1
3.
CLOSING...................................................................
2
4. CONDITIONS TO
CLOSING.....................................................
2
4.1. REPRESENTATIONS AND
WARRANTIES......................................... 2
4.2. PERFORMANCE; NO
DEFAULT................................................
2
4.3. COMPLIANCE
CERTIFICATES................................................
3
4.4. OPINIONS OF
COUNSEL....................................................
3
4.5. PURCHASE PERMITTED BY APPLICABLE
LAW, ETC.............................. 3
4.6. SALE OF OTHER
NOTES....................................................
4
4.7. PAYMENT OF SPECIAL COUNSEL
FEES........................................ 4
4.8. PRIVATE PLACEMENT
NUMBER............................................... 4
4.9. CHANGES IN CORPORATE
STRUCTURE......................................... 4
4.10. SUBSIDIARY GUARANTY
AGREEMENT....................................... 4
4.11. PLEDGE
AGREEMENT....................................................
5
4.12. BANK CREDIT
AGREEMENT...............................................
5
4.13. SHARING
AGREEMENT...................................................
5
4.14. PROCEEDINGS AND
DOCUMENTS........................................... 5
4.15. OFFEREE
LETTER......................................................
5
5. REPRESENTATIONS AND
WARRANTIES OF THE ISSUERS............................. 5
5.1. ORGANIZATION; POWER AND
AUTHORITY...................................... 6
5.2. AUTHORIZATION,
ETC.....................................................
6
5.3.
DISCLOSURE.............................................................
6
5.4. ORGANIZATION AND OWNERSHIP OF
SHARES OF SUBSIDIARIES; AFFILIATES....... 7
5.5. FINANCIAL
STATEMENTS...................................................
8
5.6. COMPLIANCE WITH LAWS, OTHER
INSTRUMENTS, ETC........................... 8
5.7. GOVERNMENTAL AUTHORIZATIONS,
ETC....................................... 9
5.8. LITIGATION; OBSERVANCE OF
AGREEMENTS, STATUTES AND ORDERS.............. 9
5.9.
TAXES..................................................................
9
5.10. TITLE TO PROPERTY;
LEASES........................................... 10
5.11. LICENSES, PERMITS,
ETC.............................................. 10
5.12. COMPLIANCE WITH
ERISA............................................... 10
5.13. PRIVATE OFFERING BY
THE ISSUERS..................................... 11
5.14. USE OF PROCEEDS;
MARGIN REGULATIONS................................. 11
5.15. EXISTING INDEBTEDNESS;
FUTURE LIENS................................. 12
5.16. FOREIGN ASSETS CONTROL
REGULATIONS, ETC............................. 12
5.17. STATUS UNDER CERTAIN
STATUTES....................................... 13
5.18. ENVIRONMENTAL
MATTERS............................................... 13
5.19. PARI PASSU
RANKING..................................................
13
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5.20. NOT SUBJECT TO
IMMUNITY............................................. 13
5.21. DORMANT
COMPANIES...................................................
14
5.22. BANK CREDIT AGREEMENT
REPRESENTATIONS............................... 14
6. REPRESENTATIONS OF THE
PURCHASERS......................................... 14
6.1. PURCHASE FOR
INVESTMENT................................................
14
6.2. SOURCE OF
FUNDS........................................................
14
6.3. PURCHASER
ACTION.......................................................
16
7. INFORMATION AS TO
ISSUERS.................................................
16
7.1. FINANCIAL AND BUSINESS
INFORMATION..................................... 16
7.2. OFFICER'S
CERTIFICATES.................................................
19
7.3.
INSPECTION.............................................................
20
8. PREPAYMENT OF THE
NOTES...................................................
21
8.1. REQUIRED
PREPAYMENTS...................................................
21
8.2. OPTIONAL PREPAYMENTS WITH
MAKE-WHOLE AMOUNT............................ 21
8.3. ALLOCATION OF PARTIAL
PREPAYMENTS...................................... 22
8.4. MATURITY; SURRENDER,
ETC............................................... 22
8.5. PURCHASE OF
NOTES......................................................
22
8.6. MAKE-WHOLE
AMOUNT......................................................
22
9. AFFIRMATIVE
COVENANTS.....................................................
24
9.1. COMPLIANCE WITH
LAW....................................................
24
9.2.
INSURANCE..............................................................
24
9.3. MAINTENANCE OF
PROPERTIES..............................................
25
9.4. PAYMENT OF TAXES AND
CLAIMS............................................ 25
9.5. CORPORATE EXISTENCE,
ETC............................................... 25
9.6. NEW SUBSIDIARY GUARANTOR;
ADDITIONAL PLEDGED STOCK..................... 26
9.7. PARI PASSU
RANKING.....................................................
26
9.8. MOST FAVORED LENDER
PROVISIONS......................................... 27
9.9. COVENANT TO SECURE NOTES
EQUALLY....................................... 28
9.10. POST-CLOSING
REQUIREMENTS...........................................
29
9.11. DORMANT
COMPANIES...................................................
29
10. NEGATIVE
COVENANTS........................................................
30
10.1. TRANSACTIONS WITH
AFFILIATES; DORMANT COMPANIES..................... 31
10.2. MERGER, CONSOLIDATION,
ETC.......................................... 31
10.3. LIMITATION ON
LIENS................................................. 32
10.4. SALE OF ASSETS,
ETC................................................. 35
10.5. LEVERAGE
RATIO......................................................
35
10.6. FIXED CHARGES COVERAGE
RATIO........................................ 36
10.7. CONSOLIDATED NET
WORTH.............................................. 36
10.8. PRIORITY
DEBT.......................................................
37
10.9. LINE OF
BUSINESS....................................................
37
10.10. RESTRICTED PAYMENTS AND
RESTRICTED INVESTMENTS; ACQUISITIONS........ 37
10.11. LIMITATIONS ON CERTAIN
SUBSIDIARY ACTIONS........................... 39
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10.12. HEDGING
ARRANGEMENTS.........................................................
40
10.13. ACCOUNTING CHANGES; CHANGE
OF FISCAL YEAR....................................
40
10.14. MINIMUM
CASH.................................................................
40
10.15.
LITIGATION...................................................................
40
10.16. AMENDMENTS TO ORGANIZATIONAL
DOCUMENTS.......................................
41
10.17. NO LIMITATION ON PREPAYMENTS
OR AMENDMENTS TO CERTAIN FINANCING DOCUMENTS....
41
11. EVENTS OF
DEFAULT...................................................................
41
12. REMEDIES ON DEFAULT,
ETC............................................................
44
12.1.
ACCELERATION..................................................................
44
12.2. OTHER
REMEDIES................................................................
45
12.3.
RESCISSION....................................................................
45
12.4. NO WAIVERS OR ELECTION
OF REMEDIES, EXPENSES, ETC.............................
45
13. REGISTRATION; EXCHANGE;
SUBSTITUTION OF NOTES.......................................
46
13.1. REGISTRATION OF
NOTES.........................................................
46
13.2. TRANSFER AND EXCHANGE
OF NOTES................................................
46
13.3. REPLACEMENT OF
NOTES..........................................................
47
14. PAYMENTS ON
NOTES...................................................................
48
14.1. PLACE OF
PAYMENT..............................................................
48
14.2. HOME OFFICE
PAYMENT...........................................................
48
15. EXPENSES,
ETC.......................................................................
48
15.1. TRANSACTION
EXPENSES..........................................................
48
15.2.
SURVIVAL......................................................................
49
16. SURVIVAL OF REPRESENTATIONS
AND WARRANTIES; ENTIRE AGREEMENT........................
49
17. AMENDMENT AND
WAIVER................................................................
50
17.1.
REQUIREMENTS..................................................................
50
17.2. SOLICITATION OF
HOLDERS OF NOTES..............................................
50
17.3. BINDING EFFECT,
ETC...........................................................
51
17.4. NOTES HELD BY THE
ISSUERS, ETC................................................
51
18.
NOTICES.............................................................................
51
19. REPRODUCTION OF
DOCUMENTS...........................................................
52
20. CONFIDENTIAL
INFORMATION............................................................
52
21. SUBSTITUTION OF
PURCHASER...........................................................
53
22.
MISCELLANEOUS.......................................................................
54
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22.1. SUCCESSORS AND
ASSIGNS........................................................
54
22.2. PAYMENTS DUE ON
NON-BUSINESS DAYS.............................................
54
22.3.
SEVERABILITY..................................................................
54
22.4.
CONSTRUCTION..................................................................
54
22.5.
COUNTERPARTS..................................................................
55
22.6. JURISDICTION; SERVICE
OF PROCESS..............................................
55
22.7. GOVERNING
LAW.................................................................
56
22.8. WAIVER OF TRIAL BY
JURY.......................................................
56
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SCHEDULE A -- Information Relating to
Purchasers
SCHEDULE B -- Defined Terms
SCHEDULE C -- Investment Guidelines
SCHEDULE 4.9 -- Changes in Corporate Structure
SCHEDULE 5.3 -- Disclosure Materials
SCHEDULE 5.4 -- Subsidiaries of the Company and
Ownership of Subsidiary Stock
SCHEDULE 5.5 -- Financial Statements
SCHEDULE 5.8 -- Certain Litigation
SCHEDULE 5.14 -- Use of Proceeds
SCHEDULE 5.15 -- Existing Indebtedness
SCHEDULE 5.18 -- Environmental Matters
SCHEDULE 5.21 -- Assets of Dormant Companies
SCHEDULE 10.3 -- Existing Liens
SCHEDULE 10.10 -- Existing Investments
SCHEDULE 10.11 -- Existing Restrictive
Agreements
EXHIBIT 1 --
Form of 6.08% Senior
Guarantied Note due October 10,2010
iv
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EXHIBIT 4.3(a) -- Form of Officer's Certificate for
Company
EXHIBIT 4.3(b) -- Form of Officer's Certificate for
Co-Issuer
EXHIBIT 4.3(c) -- Form of Secretary's Certificate
for each Issuer and
each Initial Guarantor
EXHIBIT 4.4(a) -- Form of Opinion of Special Counsel
for the Obligors
EXHIBIT 4.4(b) -- Form of Opinion of Special Counsel
for the Purchasers
EXHIBIT 4.10 -- Form of Guaranty Agreement
EXHIBIT 4.11 -- Form of Pledge Agreement
EXHIBIT 4.13 -- Form of Sharing Agreement
v
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CRAWFORD & COMPANY
CRAWFORD & COMPANY INTERNATIONAL, INC.
5620 GLENRIDGE DRIVE, N.E.
ATLANTA, GA 30342
$50,000,000 6.08% SENIOR GUARANTIED NOTES DUE OCTOBER 10, 2010
September 30, 2003
To Each of the Persons Listed in
the Attached Schedule A (the
"PURCHASERS"):
Ladies and Gentlemen:
Crawford
& Company, a Georgia corporation (together with its
successors
and assigns, the "COMPANY"), and Crawford
& Company International, Inc., a
Georgia corporation (together with its
successors and assigns, the "CO-ISSUER"
and together with the Company, the
"ISSUERS"), jointly and severally agree with
each Purchaser as follows:
1. AUTHORIZATION OF
NOTES.
The
Issuers will authorize the joint and several issue and sale of
$50,000,000 aggregate principal amount of
their joint and several 6.08% Senior
Guarantied Notes due October 10, 2010 (the
"NOTES", such term to include any
such notes issued in substitution therefor
pursuant to Section 13 of this
Agreement). The Notes shall be
substantially in the form set out in Exhibit 1,
with such changes therefrom, if any, as may
be approved by the Purchasers and
the Issuers. Certain capitalized terms used
in this Agreement are defined in
Schedule B; references to a "Schedule" or
an "Exhibit" are, unless otherwise
specified, references to a Schedule or an
Exhibit attached to this Agreement;
references to Sections are, unless
otherwise specified, references to Sections
of this Agreement.
2. SALE AND PURCHASE OF
NOTES.
Subject to
the terms and conditions of this Agreement, the Issuers will
issue and sell to each Purchaser and each
Purchaser will purchase from the
Issuers, at the Closing provided for in
Section 3, Notes in the principal amount
specified
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opposite each Purchaser's name in Schedule
A at the purchase price of 100% of
the principal amount thereof. The
obligations of the Purchasers hereunder are
several and not joint and no Purchaser
shall have any liability to any Person
for the performance or non-performance by
any other Purchaser hereunder.
3. CLOSING.
The sale
and purchase of the Notes to be purchased by each of the
Purchasers shall occur at the offices of
Bingham McCutchen LLP, One State
Street, Hartford, CT 06103, at 10:00 a.m.,
local time, at a closing (the
"CLOSING") on October 10, 2003 or on such
other Business Day thereafter on or
prior to October 31, 2003 as may be agreed
upon by the Issuers and the
Purchasers. At the Closing the Issuers will
deliver to each Purchaser the Notes
to be purchased by it in the form of a
single Note (or such greater number of
Notes in denominations of at least $100,000
as each such Purchaser may request)
dated the date of the Closing and
registered in such Purchaser's name (or in the
name of its nominee), against delivery by
such Purchaser to the Issuers or their
order of immediately available funds in the
amount of the purchase price
therefor by wire transfer of immediately
available funds for the account of the
Issuers to account number ___________ at
SunTrust Bank, Atlanta, GA, ____
________________________________ for the
benefit of Crawford & Company. If at
the Closing either Issuer shall fail to
tender such Notes to any Purchaser as
provided above in this Section 3, or any of
the conditions specified in Section
4 shall not have been fulfilled to each
Purchaser's satisfaction, such Purchaser
shall, at its election, be relieved of all
further obligations under this
Agreement, without thereby waiving any
rights each such Purchaser may have by
reason of such failure or such
nonfulfillment.
4. CONDITIONS TO
CLOSING.
Each
Purchaser's obligation to purchase and pay for the Notes to be
sold
to it at the Closing is subject to the
fulfillment to each such Purchaser's
satisfaction, prior to or at the Closing,
of the following conditions:
4.1.
REPRESENTATIONS AND
WARRANTIES.
The
representations and warranties of each Obligor contained in the
Financing Documents shall be correct when
made and at the time of the Closing.
4.2.
PERFORMANCE; NO
DEFAULT.
Each
Obligor shall have performed and complied with all agreements
and
conditions contained in the Financing
Documents required to be performed or
complied with by it prior to or at the
Closing and after giving effect to the
issuance and sale of the Notes (and the
application of the proceeds thereof as
contemplated
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by Schedule 5.14) no Default or Event of
Default shall have occurred and be
continuing. Neither of the Issuers nor any
Subsidiary shall have entered into
any transaction since the date of the
Memorandum that would have been prohibited
by Sections 10.1, 10.2, 10.3, 10.4, 10.8,
10.10, 10.11, 10.12, 10.13 or 10.15
hereof had such Sections applied since such
date.
4.3.
COMPLIANCE
CERTIFICATES.
(a) Officer's
Certificate. The Company shall have delivered to
each Purchaser an Officer's Certificate, dated the date of the
Closing, certifying that the conditions specified in Sections
4.1, 4.2 and 4.9 have been fulfilled, substantially in the
form of Exhibit 4.3(a)
hereto.
(b) Officer's
Certificate. The Co-Issuer shall have delivered to
each Purchaser an Officer's Certificate, dated the date of the
Closing, certifying that the conditions specified in Sections
4.1, 4.2 and 4.9 have been fulfilled, substantially in the
form of Exhibit 4.3(b) hereto.
(c) Secretary's
Certificates. Each Issuer and each Initial
Guarantor shall have delivered to each Purchaser a certificate
of its secretary or its assistant secretary (or, in the case
of certain Initial Guarantors, a certificate of the secretary
of its sole shareholder or general partner, as the case may
be) dated the date of the Closing certifying as to the
resolutions attached thereto and other corporate proceedings
relating to the authorization, execution and delivery of the
Financing Documents to which such Person is a party,
substantially in the form of Exhibit 4.3(c) hereto.
4.4.
OPINIONS OF
COUNSEL.
Each
Purchaser shall have received opinions in form and substance
satisfactory to it, dated the date of the
Closing (a) from King & Spalding LLP
counsel for the Obligors, covering the
matters set forth in Exhibit 4.4(a) and
covering such other matters incident to the
transactions contemplated hereby as
such Purchaser or its counsel may
reasonably request (and the Issuers hereby
instruct their counsel to deliver such
opinion to each Purchaser) and (b) from
Bingham McCutchen LLP, the Purchasers'
special counsel in connection with such
transactions, substantially in the form set
forth in Exhibit 4.4(b) and covering
such other matters incident to such
transactions as any Purchaser may reasonably
request.
4.5.
PURCHASE PERMITTED BY
APPLICABLE LAW, ETC.
On the
date of the Closing, each Purchaser's purchase of Notes shall
(a)
be permitted by the laws and regulations of
each jurisdiction to which it is
subject,
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without recourse to provisions (such as
section 1405(a)(8) of the New York
Insurance Law) permitting limited
investments by insurance companies without
restriction as to the character of the
particular investment, (b) not violate
any applicable law or regulation
(including, without limitation, Regulation T, U
or X of the Board of Governors of the
United States Federal Reserve System) and
(c) not subject any Purchaser to any tax,
penalty or liability under or pursuant
to any applicable law or regulation, which
law or regulation was not in effect
on the date hereof. If requested by any
Purchaser, such Purchaser shall have
received an Officer's Certificate
certifying as to such matters of fact as such
Purchaser may reasonably specify to enable
such Purchaser to determine whether
such purchase is so permitted.
4.6.
SALE OF OTHER
NOTES.
Contemporaneously with the Closing the Issuers shall sell to
each
Purchaser and each such Purchaser shall
purchase the Notes to be purchased by it
at the Closing as specified in Schedule
A.
4.7.
PAYMENT OF SPECIAL
COUNSEL FEES.
Without
limiting the provisions of Section 15.1, the Issuers shall have
paid on or before the Closing the fees,
charges and disbursements of the
Purchasers' special counsel referred to in
Section 4.4(b) to the extent
reflected in a statement of such counsel
rendered to the Issuers at least one
Business Day prior to the Closing.
4.8.
PRIVATE PLACEMENT
NUMBER.
A Private
Placement number issued by the CUSIP Service Bureau of Standard
& Poor's, a division of The McGraw-Hill
Companies (in cooperation with the
Securities Valuation Office of the National
Association of Insurance
Commissioners (the "SVO")) shall have been
obtained for the Notes.
4.9.
CHANGES IN CORPORATE
STRUCTURE.
Except as
specified in Schedule 4.9, neither Issuer shall have changed
its
jurisdiction of incorporation or been a
party to any merger or consolidation and
shall not have succeeded to all or any
substantial part of the liabilities of
any other entity, at any time following the
date of the most recent financial
statements referred to in Schedule 5.5.
4.10.
SUBSIDIARY GUARANTY AGREEMENT.
Each Initial Guarantor shall have executed and delivered to the
Purchasers a guaranty agreement (as may be
amended, restated or modified from
time to time, the "GUARANTY AGREEMENT"),
substantially in the form of Exhibit
4.10.
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4.11.
PLEDGE AGREEMENT.
The
Company shall have executed and delivered to the Purchasers a
pledge
agreement (as may be amended, restated or
modified from time to time, the
"PLEDGE AGREEMENT"), substantially in the
form of Exhibit 4.11.
4.12. BANK
CREDIT AGREEMENT.
The
Issuers shall have delivered to each Purchaser true and correct
copies
of each of the documents constituting the
Bank Credit Agreement as in effect on
the date of the Closing, certified as true
and correct by a Senior Financial
Officer.
4.13.
SHARING AGREEMENT.
The Agent,
on behalf of itself and the other lenders under the Bank Credit
Agreement and as collateral agent for the
holders of Notes, shall have entered
into a collateral sharing agreement with
the Purchasers, in form and substance
satisfactory to each of the Purchasers,
substantially in the form of Exhibit
4.13 (as may be amended, restated or
modified from time to time, the "SHARING
AGREEMENT").
4.14.
PROCEEDINGS AND DOCUMENTS.
All
corporate and other proceedings in connection with the
transactions
contemplated by this Agreement, the other
Financing Documents and all documents
and instruments incident to such
transactions shall be satisfactory to each
Purchaser and its special counsel, and each
Purchaser and its special counsel
shall have received all such counterpart
originals or certified or other copies
of such documents as such Purchaser or its
counsel may reasonably request.
4.15.
OFFEREE LETTER.
Sun Trust Capital Markets, Inc. shall have delivered to the
Issuers,
their counsel, each of the Purchasers and
the Purchasers' special counsel an
offeree letter, in form and substance
satisfactory to each Purchaser, confirming
the manner of the offering of the Notes by
Sun Trust Capital Markets, Inc.
5. REPRESENTATIONS AND
WARRANTIES OF THE ISSUERS.
Each of
the Issuers represents and warrants, as of the date hereof and
as
of the date of the Closing, to each
Purchaser that:
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5.1.
ORGANIZATION; POWER
AND AUTHORITY.
The
Company is a corporation duly organized, validly existing and in
good
standing under the laws of its jurisdiction
of incorporation, and is duly
qualified as a foreign corporation and is
in good standing in each jurisdiction
in which such qualification is required by
law, other than those jurisdictions
as to which the failure to be so qualified
or in good standing could not,
individually or in the aggregate,
reasonably be expected to have a Material
Adverse Effect. The Company has the
corporate power and authority to own or hold
under lease the properties it purports to
own or hold under lease, to transact
the business it transacts and proposes to
transact, to execute and deliver the
Financing Documents to which it is a party
and to perform the provisions hereof
and thereof.
5.2.
AUTHORIZATION,
ETC.
(a) This Agreement, the Notes and the other Financing Documents
to
which
either Issuer is a party have been duly authorized by all
necessary
corporate
action on the part of such Issuer, and the Financing Documents
to which
such Issuer is a party constitute, and upon execution and
delivery thereof
each Note will constitute, a legal, valid and binding
obligation
of such Issuer enforceable against such Issuer in accordance
with its
terms, except as such enforceability may be limited by (i)
applicable
bankruptcy, insolvency, reorganization, moratorium or other
similar
laws affecting the enforcement of creditors' rights generally
and
(ii)
general principles of equity (regardless of whether such
enforceability is considered in a proceeding in equity or at
law).
(b) The Guaranty Agreement has been duly authorized by all
necessary
corporate
action on the part of each Initial Guarantor, and the Guaranty
Agreement
constitutes a legal, valid and binding obligation of each
Initial
Guarantor enforceable against each Initial Guarantor in
accordance
with its
terms, except as such enforceability may be limited by (i)
applicable
bankruptcy, insolvency, reorganization, moratorium or other
similar
laws affecting the enforcement of creditors' rights generally
and
(ii)
general principles of equity (regardless of whether such
enforceability is considered in a proceeding in equity or at
law).
5.3.
DISCLOSURE.
The
Issuers, through their agent, SunTrust Capital Markets, Inc.
have
delivered to each Purchaser a copy of a
Confidential Private Placement
Memorandum, dated July 2003 (the
"MEMORANDUM"), relating to the transactions
contemplated hereby. The Memorandum fairly
describes, in all material respects,
the general nature of the business and
principal properties of the Issuers and
their Subsidiaries. Except as disclosed in
Schedule 5.3, this Agreement, the
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Memorandum, the documents, certificates or
other writings delivered to each
Purchaser by or on behalf of the Obligors
in connection with the transactions
contemplated hereby and the financial
statements listed in Schedule 5.5, taken
as a whole, do not contain any untrue
statement of a material fact or omit to
state any material fact necessary to make
the statements therein not misleading
in light of the circumstances under which
they were made. Except as disclosed in
the Memorandum or as expressly described in
Schedule 5.3, or in one of the
documents, certificates or other writings
identified therein, or in the
financial statements listed in Schedule
5.5, since December 31, 2002, there has
been no change in the financial condition,
operations, business, properties or
prospects of either of the Issuers or any
Subsidiary except changes that
individually or in the aggregate could not
reasonably be expected to have a
Material Adverse Effect. There is no fact
known to the Issuers that could
reasonably be expected to have a Material
Adverse Effect that has not been set
forth herein or in the Memorandum or in the
other documents, certificates and
other writings delivered to each Purchaser
by or on behalf of the Issuers
specifically for use in connection with the
transactions contemplated hereby.
5.4.
ORGANIZATION AND
OWNERSHIP OF SHARES OF SUBSIDIARIES; AFFILIATES.
(a) Schedule 5.4 contains (except as noted therein) complete
and
correct
lists (i) of the Company's Subsidiaries, showing, as to each
Subsidiary, the correct name thereof, the jurisdiction of its
organization, the percentage of shares of each class of its capital
stock
or similar
equity interests outstanding owned by the Company and each
other
Subsidiary and whether or not such Subsidiary is a Dormant
Company,
(ii) of
the Company's Affiliates, other than Subsidiaries, and (iii) of
each of
the Issuer's directors and senior officers.
(b) All of the outstanding shares of capital stock or similar
equity
interests
of each Subsidiary shown in Schedule 5.4 as being owned by the
Company
and the Subsidiaries have been validly issued, are fully paid
and
nonassessable and are owned by the Company or another Subsidiary
free and
clear of
any Lien in the case of the capital stock of the Co-Issuer, and
in the
case of the capital stock or other equity interests of all
other
Subsidiaries, free and clear of any Lien except Liens that would
be
permitted
by Section 10.3 or as otherwise disclosed in Schedule 5.4).
(c) Each Subsidiary identified in Schedule 5.4 other than any
Dormant
Company is a corporation or other legal entity duly organized,
validly
existing and (to the extent such concept is recognized in such
jurisdiction) in good standing under the laws of its jurisdiction
of
organization, and (to the extent such concepts are recognized in
such
jurisdictions) is duly qualified as a foreign corporation or other
legal
entity
-7-
<PAGE>
and (to
the extent such concept is recognized in such jurisdictions) is
in
good
standing in each jurisdiction in which such qualification is
required
by law,
other than those jurisdictions as to which the failure to be so
qualified
or in good standing could not, individually or in the
aggregate,
reasonably
be expected to have a Material Adverse Effect. Each such
Subsidiary
has the corporate or other power and authority to own or hold
under
lease the properties it purports to own or hold under lease and
to
transact
the business it transacts and proposes to transact, to execute
and
deliver the Financing Documents to which such Subsidiary is a
party
and to
perform the provisions thereof.
(d) No Subsidiary is a party to, or otherwise subject to any
legal
restriction or any agreement (other than this Agreement, the
agreements
listed on
Schedule 5.4 and customary limitations imposed by corporate law
statutes)
restricting the ability of such Subsidiary to pay dividends out
of profits
or make any other similar distributions of profits to the
Company or
any Subsidiary that owns outstanding shares of capital stock or
similar
equity interests of such Subsidiary.
5.5.
FINANCIAL
STATEMENTS.
The
Company has delivered to each Purchaser copies of the financial
statements of the Company and the
Subsidiaries listed on Schedule 5.5. All of
said financial statements (including in
each case the related schedules and
notes) fairly present in all material
respects the consolidated financial
position of the Company and the
Subsidiaries as of the respective dates
specified in such Schedule and the
consolidated results of their operations and
cash flows for the respective periods so
specified and have been prepared in
accordance with GAAP consistently applied
throughout the periods involved except
as set forth in the notes thereto (subject,
in the case of any interim financial
statements, to normal year-end adjustments)
and additional information set forth
in year-end financial statements.
5.6.
COMPLIANCE WITH LAWS,
OTHER INSTRUMENTS, ETC.
The
execution, delivery and performance by each Obligor of the
Financing
Documents to which such Obligor is a party
will not (a) contravene, result in
any breach of, or constitute a default
under, or result in the creation of any
Lien in respect of any property of the
Company or any Subsidiary under, any
indenture, mortgage, deed of trust, loan,
purchase or credit agreement, lease,
memorandum or articles of association,
corporate charter or by-laws, or any
other agreement or instrument to which the
Company or any Subsidiary is bound or
by which the Company or any Subsidiary or
any of their respective properties may
be bound or affected, (b) conflict with or
result in a breach of any of the
terms, conditions or provisions of any
order, judgment, decree, or ruling of any
court, arbitrator or
-8-
<PAGE>
Governmental Authority applicable to the
Company or any Subsidiary or (c)
violate any provision of any statute or
other rule or regulation of any
Governmental Authority applicable to the
Company or any Subsidiary.
5.7.
GOVERNMENTAL
AUTHORIZATIONS, ETC.
No consent,
approval or authorization of, or registration, filing or
declaration with, any Governmental
Authority is required in connection with the
execution, delivery or performance by (a)
each of the Issuers of the Financing
Documents to which such Issuer is a party
and (b) each Initial Guarantor of the
Guaranty Agreement.
5.8.
LITIGATION; OBSERVANCE
OF AGREEMENTS, STATUTES AND ORDERS.
(a) Except as disclosed in Schedule 5.8, there are no actions,
suits
or
proceedings pending or, to the knowledge of either Issuer,
threatened
against or
affecting either of the Issuers or any Subsidiary or any
property
of either of the Issuers or any Subsidiary in any court or
before
any
arbitrator of any kind or before or by any Governmental
Authority
that,
individually or in the aggregate, could reasonably be expected
to
have a
Material Adverse Effect.
(b) Neither of the Issuers nor any Subsidiary is in default
under
any term
of any agreement or instrument to which it is a party or by
which
it is
bound, or any order, judgment, decree or ruling of any court,
arbitrator
or Governmental Authority or is in violation of any applicable
law,
ordinance, rule or regulation (including without limitation
Environmental Laws) of any Governmental Authority, which default
or
violation,
individually or in the aggregate, could reasonably be expected
to have a
Material Adverse Effect.
5.9.
TAXES.
(a) Each of the Issuers and the Subsidiaries have filed all tax
returns
that are required to have been filed in any jurisdiction except
for any
such returns that may be required to be filed in jurisdictions
other than
the United States and political subdivisions thereof, which
returns,
in the aggregate, would not reflect an amount of Taxes owing
that
would be
Material. Each of the Issuers and the Subsidiaries has paid all
Taxes
required to have been paid on all returns that have been filed
and
all other
Taxes levied upon them or their properties, assets, income or
franchises, to the extent such Taxes have become due and payable
and
before
they have become delinquent, except for any Taxes (i) the amount
of
which is
not individually or in the aggregate Material or (ii) the
amount,
applicability or validity of which is currently being contested in
good
faith by
appropriate proceedings and with respect to which such Issuer
or
a
Subsidiary, as the
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<PAGE>
case may
be, has established adequate reserves in accordance with GAAP.
Neither
Issuer knows of any basis for any other Tax that could
reasonably
be
expected to have a Material Adverse Effect.
(b) The charges, accruals and reserves on the books of the
Issuers
and their
Subsidiaries in respect of all Taxes for all fiscal periods are
adequate.
The Federal income tax liabilities of the Company and the
Subsidiaries have been determined by the Internal Revenue Service
and paid
for all
fiscal years up to and including the fiscal year ended December
31,
1999.
5.10.
TITLE TO PROPERTY; LEASES.
Each of
the Issuers and the Subsidiaries (other than any Dormant
Company)
has good and sufficient title to their
respective properties that individually
or in the aggregate are Material, including
all such properties reflected in the
most recent audited balance sheet referred
to in Section 5.5 or purported to
have been acquired by either of the Issuers
or any Subsidiary after said date
(except as sold or otherwise disposed of in
the ordinary course of business), in
each case free and clear of Liens
prohibited by this Agreement. All leases that
individually or in the aggregate are
Material are valid and subsisting and are
in full force and effect in all material
respects.
5.11.
LICENSES, PERMITS, ETC.
Each of
the Issuers and the Subsidiaries owns, or is licensed, or
otherwise has the right, to use, all
patents, trademarks, service marks,
tradenames, copyrights and other
intellectual property Material to its business,
and the use thereof by the Issuers and the
Subsidiaries does not infringe on the
rights of any other Person, except for any
such infringements that, individually
or in the aggregate, would not have a
Material Adverse Effect.
5.12.
COMPLIANCE WITH ERISA.
(a) The Company and each ERISA Affiliate have operated and
administered each US Plan in compliance with all applicable laws
except
for such
instances of noncompliance as have not resulted in and could
not
reasonably
be expected to result in a Material Adverse Effect. Neither the
Company
nor any ERISA Affiliate has incurred any liability pursuant to
Title I or
IV of ERISA or the penalty or excise tax provisions of the US
Tax Code
relating to employee pension benefit plans (as defined in
section
3 of
ERISA), and no event, transaction or condition has occurred or
exists
that could reasonably be expected
to result in the incurrence of any such
liability
by the Company or any ERISA Affiliate, or in the imposition of
any Lien
on any
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<PAGE>
of the
rights, properties or assets of the Company or any ERISA
Affiliate,
in either
case pursuant to Title I or IV of ERISA or to such penalty or
excise tax
provisions or to section 401(a)(29) or 412 of the US Tax Code,
other than
such liabilities or Liens as would not be individually or in
the
aggregate Material.
(b) As determined by the Company's actuary, the present value of
the
aggregate
projected benefit obligation of all underfunded US Plans
determined
as of January 1, 2003 (based on the assumptions used for
purposes
of Statement of Financial Standards No. 87) did not exceed the
aggregate
fair value of the assets of all such underfunded US Plans by
more than
$67,000,000 as of such date.
(c) The Company and its ERISA Affiliates have not incurred
withdrawal
liabilities (and are not subject to contingent withdrawal
liabilities) under section 4201 or 4204 of ERISA in respect of
Multiemployer Plans that individually or in the aggregate are
Material.
(d) The execution and delivery of this Agreement and the
issuance
and sale
of the Notes to each Purchaser hereunder will not involve any
transaction that is subject to the prohibitions of section
406(a)(1)(A)-(E) of ERISA or in connection with which a tax could
be
imposed by
sections 4975(a) and (b) of the US Tax Code by reason of
section
4975(c)(1)(A)-(D) of the US Tax Code. The representation by the
Company in
the first sentence of this Section 5.12(d) is made in reliance
upon and
subject to the accuracy of the representation in Section 6.2
from
each
Purchaser and each transferee of a Note as to the sources of
the
funds used
to pay the purchase price of the Notes to be purchased by such
Purchaser
or acquired by such transferee.
5.13.
PRIVATE OFFERING BY THE ISSUERS.
Neither
the Issuers nor anyone acting on their behalf has offered the
Notes or any similar securities for sale
to, or solicited any offer to buy any
of the same from, or otherwise approached
or negotiated in respect thereof with,
in each case within one year of the date of
the Closing, any Person other than
the Purchasers, each of whom has been
offered the Notes at a private sale for
investment. Neither the Issuers nor anyone
acting on their behalf has taken, or
will take, any action that would subject
the issuance or sale of the Notes to
the registration requirements of section 5
of the Securities Act or to the
provisions of any securities or Blue Sky
law of any applicable jurisdiction.
5.14. USE
OF PROCEEDS; MARGIN REGULATIONS.
The
Issuers will apply the proceeds of the sale of the Notes as set
forth
in Schedule 5.14 and none of the proceeds
will be used to make any loan or other
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<PAGE>
Investment in any Dormant Company. No part
of the proceeds from the sale of the
Notes hereunder will be used, directly or
indirectly, for the purpose of buying
or carrying any margin stock within the
meaning of Regulation U of the Board of
Governors of the United States Federal
Reserve System (12 CFR 221), or for the
purpose of buying or carrying or trading in
any securities under such
circumstances as to involve the Issuers in
a violation of Regulation X of said
Board (12 CFR 224) or to involve any broker
or dealer in a violation of
Regulation T of said Board (12 CFR 220).
Margin stock does not constitute more
than 5% of the value of the consolidated
assets of the Issuers and their
Subsidiaries and neither Issuer has any
present intention that margin stock will
constitute more than 5% of the value of
such assets. As used in this Section,
the terms "MARGIN STOCK" and "PURPOSE OF
BUYING OR CARRYING" shall have the
meanings assigned to them in said
Regulation U.
5.15.
EXISTING INDEBTEDNESS; FUTURE LIENS.
(a) Except as described therein, Schedule 5.15 sets forth a
complete
and
correct list of all outstanding Indebtedness of the Issuers and
their
Subsidiaries as of August 31, 2003, since which date there has been
no
Material
change in the amounts, interest rates, sinking funds,
installment
payments
or maturities of the Indebtedness of either of the Issuers or
any
Subsidiary. Neither of the Issuers nor any Subsidiary is in default
and no
waiver of
default is currently in effect, in the payment of any principal
or
interest on any Indebtedness of either of the Issuers or any
Subsidiary
and no
event or condition exists with respect to any Indebtedness of
either of
the Issuers or any Subsidiary that would permit (or that with
notice or
the lapse of time, or both, would permit) one or more Persons
to
cause such
Indebtedness to become due and payable before its stated
maturity
or before its regularly scheduled dates of payment.
(b) Except as disclosed in Schedule 5.15, neither of the Issuers
nor
any
Subsidiary has agreed or consented to cause or permit in the
future
(upon the
happening of a contingency or otherwise) any of its property,
whether
now owned or hereafter acquired, to be subject to a Lien that
would not
be permitted by Section 10.3.
5.16.
FOREIGN ASSETS CONTROL REGULATIONS, ETC.
Neither
the sale of the Notes by the Issuers hereunder nor their use of
the proceeds thereof will violate the
Trading with the Enemy Act of the United
States of America, as amended, or any of
the foreign assets control regulations
of the United States Treasury Department
(31 CFR, Subtitle B, Chapter V, as
amended) or any enabling legislation or
executive order relating thereto.
-12-
<PAGE>
5.17.
STATUS UNDER CERTAIN STATUTES.
Neither of
the Issuers nor any Subsidiary:
(a) is subject to regulation under the Investment Company Act
of
1940 of
the United States of America, as amended, the Public Utility
Holding
Company Act of 1935 of the United States of America, as
amended,
or the
Federal Power Act of 1920 of the United States of America, as
amended;
(b) is or will become a Person or entity described by section 1
of
Executive
Order 13224 of September 24, 2001 Blocking Property and
Prohibiting Transactions With Persons Who Commit, Threaten To
Commit, or
Support
Terrorism, 31 CFR Part 595 et seq., and, to the best knowledge
and
belief of
each Issuer, neither of the Issuers nor any Subsidiary does or
will
engage in any dealings or transactions, or be otherwise
associated,
with any such
Persons or entities; or
(c) is in violation of the USA Patriot Act.
5.18.
ENVIRONMENTAL MATTERS.
Except as
disclosed in Schedule 5.18 and except for matters which could
not reasonably be expected to have a
Material Adverse Effect, neither of the
Issuers nor any Subsidiary (a) has failed
to comply with any Environmental Law
or to obtain, maintain or comply with any
permit, license or other approval
required under any Environmental Law, (b)
has become subject to any
Environmental Liability, (c) has received
notice of any claim with respect to
any Environmental Liability or (d) knows of
any basis for any Environmental
Liability in each case.
5.19. PARI
PASSU RANKING.
Each of
the Issuer's obligations under the Notes and this Agreement do
and
will, upon issuance of the Notes, rank at
least pari passu, without preference
or priority, with all of its other
outstanding unsecured and unsubordinated
obligations, except for those obligations
that are mandatorily preferred by law
and not by reason of contract (other than
as provided in the Sharing Agreement).
5.20. NOT
SUBJECT TO IMMUNITY.
Each of
the Issuers represents and warrants that neither it nor any
other
Obligor is entitled to immunity from
judicial proceedings and agrees that, if
judicial proceedings are brought by any
holder of Notes to enforce any right or
remedy under any Financing Documents, no
immunity from such proceedings will be
claimed by or on behalf of any Obligor or
with respect to it or its respective
properties.
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<PAGE>
5.21.
DORMANT COMPANIES.
Except as
set forth in Schedule 5.21, no Dormant Company owns any
Material
assets or has any outstanding Indebtedness
or other Material liabilities. The
aggregate revenues and assets of the
Dormant Companies are less than 1% of the
aggregate revenue and assets of the Company
and its Consolidated Subsidiaries.
5.22. BANK
CREDIT AGREEMENT REPRESENTATIONS.
Each of
the representations and warranties set forth in section 4 of
the
Bank Credit Agreement is true and correct
in all Material respects on and as of
the date of the Closing.
6. REPRESENTATIONS OF THE
PURCHASERS.
6.1.
PURCHASE FOR
INVESTMENT.
Each
Purchaser represents that (a) it is a Qualified Institutional
Buyer
and (b) it is purchasing the Notes for its
own account or for one or more
separate accounts or investment funds
maintained or managed by such Purchaser or
for the account of one or more pension or
trust funds and not with a view to the
distribution thereof, provided that the
disposition of such Purchaser's property
shall at all times be within such
Purchaser's control. Each Purchaser
understands that the Notes have not been
registered under the Securities Act and
may be resold only if registered pursuant
to the provisions of the Securities
Act or if an exemption from registration is
available, except under
circumstances where neither such
registration nor such an exemption is required
by law, and that the Issuers are not
required to register the Notes.
6.2.
SOURCE OF FUNDS.
Each
Purchaser represents 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 Notes to be purchased by it
hereunder:
(a) the Source is an "insurance company general account" (as
the
term is
defined in the United States Department of Labor's Prohibited
Transaction Exemption ("PTE") 95-60 (issued July 12, 1995) in
respect of
which the
reserves and liabilities (as defined by the annual statement
for
life
insurance companies approved by the National Association of
Insurance
Commissioners (the "NAIC ANNUAL STATEMENT")) for the general
account
contract(s) held by or on behalf of any employee benefit plan
together
with the
amount of the reserves and liabilities for the general account
contract(s)
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<PAGE>
held by or
on behalf of any other employee benefit plans maintained by the
same
employer (or affiliate thereof as defined in PTE 95-60) or by
the
same
employee organization in the general account do not exceed 10% of
the
total reserves and
liabilities of the 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 a separate account that is maintained solely
in
connection
with such Purchaser's fixed contractual obligations under which
the
amounts payable, or credited, to any employee benefit plan (or
its
related
trust) that has any interest in such separate account (or to
any
participant or beneficiary of such plan (including any annuitant))
are not
affected
in any manner by the investment performance of the separate
account;
or
(c) 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 PTE 91-38
(issued
July 1,
1991, as corrected November 25, 1991) and, except as disclosed
by
such
Purchaser to the Issuers in writing prior to the Closing (or, in
the
case of a
transferee of Notes, prior to its acquisition of such Notes)
pursuant
to this clause (c), 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
(d) the Source constitutes assets of an "investment fund"
(within
the
meaning of Part V of PTE 84-14 (issued March 13, 1984, as
corrected
October
10, 1985) (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 and
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 either 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
Issuers in writing pursuant to this clause (d); or
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<PAGE>
(e) the Source
constitutes assets of a "plan(s)" (within the meaning
of Section
IV of PTE 96-23 (issued April 10, 1996) (the "INHAM
EXEMPTION")) managed by an "in-house asset manager" or "INHAM"
(within the
meaning of
Part IV of the INHAM exemption), the conditions of Part I(a),
(g) and
(h) of the INHAM Exemption are satisfied, neither the INHAM nor
a
person
controlling or controlled by the INHAM (applying the definition
of
"control"
in Section IV(h) of the INHAM Exemption) owns a 5% or more
interest
in either Issuer and (i) the identity of such INHAM and (ii)
the
name(s) of
the employee benefit plan(s) whose assets constitute the Source
have been
disclosed to the Issuers in writing pursuant to this clause
(e);
or
(f) the Source is a governmental plan and the purchase of the
Notes
is not
otherwise restricted by applicable law; or
(g) 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 Issuers in writing prior to
the
Closing
(or, in the case of a transferee of Notes, prior to its
acquisition of such Notes) pursuant to this clause (g); or
(h) the Source does not include assets of any employee benefit
plan,
other than
a plan exempt from the coverage of ERISA.
As used in this Section 6.2, the terms
"EMPLOYEE BENEFIT PLAN," "GOVERNMENTAL
PLAN," AND "SEPARATE ACCOUNT" shall have
the respective meanings assigned to
such terms in section 3 of ERISA.
6.3.
PURCHASER ACTION.
No
Purchaser has taken or will take any action that would subject
the
issuance or sale of the Notes to the
registration requirements of section 5 of
the Securities Act or to the provisions of
any securities or Blue Sky law of any
applicable jurisdiction.
7. INFORMATION AS TO
ISSUERS.
7.1.
FINANCIAL AND BUSINESS
INFORMATION.
The
Company shall deliver to each holder of Notes that is an
Institutional
Investor:
(a) Quarterly Statements -- within 45 days after the end of
each
quarterly
fiscal period in each Fiscal Year (other than the last
quarterly
fiscal
period of each such Fiscal Year), duplicate copies of,
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<PAGE>
(i) an unaudited consolidated balance sheet of the Company and
the
Subsidiaries as at the end of such quarter, and
(ii) unaudited consolidated statements of income, changes in
shareholders' equity and cash flows of the Company and its
Consolidated
Subsidiaries, for such quarter and (in the case of the second and
third
quarters)
for the portion of the fiscal year ending with such quarter,
setting forth in each case in comparative
form the figures for the corresponding
periods in the previous fiscal year, all in
reasonable detail, prepared in
accordance with GAAP applicable to
quarterly financial statements generally, and
certified by a Senior Financial Officer as
fairly presenting, in all material
respects, the financial position of the
companies being reported on and their
results of operations and cash flows,
subject to changes resulting from year-end
adjustments, provided that delivery within
the time period specified above of
copies of the Company's Quarterly Report on
Form 10-Q prepared in compliance
with the requirements therefor and filed
with the Securities and Exchange
Commission shall be deemed to satisfy the
requirements of this Section 7.1(a);
(b) Annual
Statements -- within 90 days after the end of each Fiscal Year,
duplicate copies of,
(i) a consolidated balance sheet of the Company and the
Subsidiaries, as at the end of such year, and
(ii) consolidated statements of income, changes in
shareholders'
equity and
cash flows of the Company and the Subsidiaries, for such year,
setting forth in each case in comparative
form the figures for the previous
fiscal year, all in reasonable detail,
prepared in accordance with GAAP, and
accompanied by an opinion thereon of
independent certified public accountants of
recognized national standing, which opinion
shall state that such financial
statements present fairly, in all material
respects, the financial position of
the companies being reported upon and their
results of operations and cash flows
and have been prepared in conformity with
GAAP, and that the examination of such
accountants in connection with such
financial statements has been made in
accordance with generally accepted auditing
standards, and that such audit
provides a reasonable basis for such
opinion in the circumstances (without a
"going concern" or like qualification,
exception or explanation and without any
qualification or exception as to scope of
such audit), and provided that the
delivery within the time period
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<PAGE>
specified
above of the Company's Annual Report on Form 10-K for such
Fiscal
Year (together with the Company's annual report to shareholders,
if
any,
prepared pursuant to Rule 14a-3 under the Exchange Act) prepared
in
accordance
with the requirements therefor and filed with the Securities
and
Exchange Commission shall be deemed to satisfy the requirements
of
this
Section 7.1(b);
(c) SEC and Other Reports -- promptly upon their becoming
available,
one copy
of (i) each financial statement, report, notice, proxy
statement
or
circular sent by the Company to public securities holders generally
or
its
creditors generally (or any class thereof generally), and (ii)
each
regular or
periodic report, each registration statement (without exhibits
except as
expressly requested by such holder), and each prospectus and
all
amendments
thereto filed by the Company with the Securities and Exchange
Commission;
(d) Notice of Default or Event of Default -- promptly, and in
any
event
within five Business Days after a Responsible Officer becoming
aware
of the
existence of any Default or Event of Default or that any Person
has
given any
notice or taken any action with respect to a claimed default
hereunder
or that any Person has given any notice or taken any action
with
respect to
a claimed default of the type referred to in Section 11(f), a
written
notice specifying the nature and period of existence thereof
and
what
action the Company is taking or proposes to take with respect
thereto;
(e) ERISA Matters - promptly, and in any event within fifteen
days
after a
Responsible Officer becoming aware of any of the following, a
written
notice setting forth the nature thereof and the action, if any,
that the
Company or an ERISA Affiliate proposes to take with respect
thereto:
(i) with respect to any US Plan, any reportable event, as
defined in section 4043(b) of ERISA and the regulations
thereunder,
for which notice thereof has not been waived; or
(ii) the taking by the PBGC of steps to institute, or the
threatening by the PBGC of the institution of, proceedings
under
section 4042 of ERISA for the termination of, or the appointment
of
a trustee to
administer, any US Plan, or the receipt by the Company
or any ERISA Affiliate of a notice from a Multiemployer Plan
that
such action has been taken by the PBGC with respect to such
Multiemployer Plan; or
(iii) any event, transaction or condition that could result in
the incurrence of any liability by the Company or any ERISA
Affiliate
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<PAGE>
pursuant to Title I or IV of ERISA or the penalty or excise tax
provisions of the US Tax Code relating to employee pension
benefit
plans, or in the imposition of any Lien on any of the rights,
properties or assets of the Company or any ERISA Affiliate
pursuant
to Title I or IV of ERISA or such penalty or excise tax
provisions,
if such liability or Lien, taken together with any other such
liabilities or Liens then existing, could reasonably be expected
to
have a Material Adverse Effect;
(f) Notices from Governmental Authority -- promptly, and in any
event
within 30 days of receipt thereof, copies of any notice to either
of
the
Issuers or any Subsidiary from any Governmental Authority relating
to
any order,
ruling, statute or other law or regulation that could
reasonably
be expected to have a Material Adverse Effect;
(g) Rule 144A - promptly after any holder of Notes so requests,
such
information regarding the Issuers required to satisfy the
requirements of
17 C.F.R.
Section 230.144A, as amended from time to time, in connection
with any
contemplated transfer of the Notes, provided that the delivery
of
the
Company's Annual Report on Form 10-K pursuant to Section 7.1(b)
for
the most
recent Fiscal Year shall be deemed to satisfy the requirements
of
this
Section 7.1(g);
(h) Bank Credit Agreement -- to the extent not provided above
in
this
Section 7.1, all reports, statements, certificates, notices or
other
writings
required to be delivered pursuant to section 5.2 of the Bank
Credit
Agreement only so long as the Bank Credit Agreement (or any
equivalent
provision following any amendment or refinancing of the
original
Bank Credit Agreement) remains operative within the times
required
therein; and
(i) Requested Information -- with reasonable promptness, such
other
data and
information relating to the business, operations, affairs,
financial
condition, assets or properties of either of the Issuers or any
Subsidiary
or relating to the ability of any Obligor to perform its
obligations hereunder and under the Financing Documents to which
such
Obligor is
a party, as from time to time may be reasonably requested by
any such
holder of Notes.
7.2.
OFFICER'S
CERTIFICATES.
Each set
of financial statements delivered to a holder of Notes pursuant
to Section 7.1(a) or Section 7.1(b) hereof
shall be accompanied by a certificate
of a Senior Financial Officer of the
Company setting forth:
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(a) Covenant Compliance -- the information (including detailed
calculations) required in order to establish whether the Issuers
were in
compliance
with the requirements of Section 10.3 through Section 10.8,
inclusive,
Section 10.10 and Section 10.14 hereof, during the quarterly or
annual
period covered by the statements then being furnished
(including
with
respect to each such Section, where applicable, the calculations
of
the
maximum or minimum amount, ratio or percentage, as the case may
be,
permissible under the terms of such Sections, and the calculation
of the
amount,
ratio or percentage then in existence); and
(b) Event of Default -- a statement that such officer has
reviewed
the
relevant terms hereof and has made, or caused to be made, under his
or
her
supervision, a review of the transactions and conditions of the
Issuers
and their Subsidiaries from the beginning of the quarterly or
annual
period covered by the statements then being furnished to the
date
of the
certificate and that such review shall not have disclosed the
existence
during such period of any condition or event that constitutes a
Default or
an Event of Default or, if any such condition or event existed
or exists
(including, without limitation, any such event or condition
resulting
from the failure of either of the Issuers or any Subsidiary to
comply
with any Environmental Law), specifying the nature and period
of
existence
thereof and what action the Company shall have taken or
proposes
to take with respect
thereto.
7.3.
INSPECTION.
Each of
the Issuers shall permit the representatives of each holder of
Notes that is an Institutional
Investor:
(a) No Default -- if no Default or Event of Default then exists,
at
the
expense of such holder and upon reasonable prior notice to the
applicable
Issuer, to visit the principal executive office of such Issuer,
to discuss
the affairs, finances and accounts of such Issuer and its
Subsidiaries with such Issuer's officers, and (with the consent of
such
Issuer,
which consent will not be unreasonably withheld) its
independent
public
accountants, and (with the consent of such Issuer, which
consent
will not
be unreasonably withheld) to visit the other offices and
properties
of such Issuer and each Subsidiary, all at such reasonable
times and
as often as may be reasonably requested in writing; and
(b) Default -- if a Default or Event of Default then exists, at
the
expense of the Issuers
to visit and inspect any of the offices or
properties
of either of the Issuers 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
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their
respective officers and independent public accountants (and by
this
provision
each of the Issuers authorizes said accountants to discuss the
affairs,
finances and accounts of such Issuer and its Subsidiaries), all
at such
times and as often as may be requested.
8. PREPAYMENT OF THE NOTES.
8.1.
REQUIRED PREPAYMENTS.
On October
10, 2006 and on April 10, 2007 and each October 10 and April 10
thereafter to and including April 10, 2010,
the Issuers will prepay
$5,555,555.56 principal amount (or such
lesser principal amount as shall then be
outstanding) of the Notes at par and
without payment of the Make-Whole Amount or
any premium, provided that upon any partial
prepayment of the Notes pursuant to
Section 8.2 the principal amount of each
required prepayment of the Notes
becoming due under this Section 8.1 on and
after the date of such prepayment or
any purchase thereof pursuant to Section
8.5 shall be reduced in the same
proportion as the aggregate unpaid
principal amount of the Notes is reduced as a
result of such prepayment or purchase.
Subject to Section 12.1, any remaining
principal of, and the interest then accrued
and unpaid on, the Notes shall be
due and payable on October 10, 2010.
8.2.
OPTIONAL PREPAYMENTS WITH MAKE-WHOLE AMOUNT.
The
Issuers may, at their option, upon notice as provided below, prepay
at
any time all, or from time to time any part
of, the Notes, in an aggregate
principal amount of not less than
$1,000,000 in the case of a partial
prepayment, at 100% of the principal amount
so prepaid, plus the Make-Whole
Amount determined for the prepayment date
with respect to such principal amount.
The Issuers will give each holder of Notes
written notice of each optional
prepayment under this Section 8.2 not less
than 30 days and not more than 60
days prior to the date fixed for such
prepayment. Each such notice shall specify
such date, the aggregate principal amount
of the Notes to be prepaid on such
date, the principal amount of each Note
held by such holder to be prepaid
(determined in accordance with Section
8.3), and the interest to be paid on the
prepayment date with respect to such
principal amount being prepaid, and shall
be accompanied by a certificate of a Senior
Financial Officer as to the
estimated Make-Whole Amount due in
connection with such prepayment (calculated
as if the date of such notice were the date
of the prepayment), setting forth
the details of such computation. Two
Business Days prior to such prepayment, the
Issuers shall deliver to each holder of
Notes a certificate of a Senior
Financial Officer specifying the
calculation of such Make-Whole Amount as of the
specified prepayment date.
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8.3.
ALLOCATION OF PARTIAL PREPAYMENTS.
In the
case of each partial prepayment of the Notes pursuant to
Section
8.2 and each purchase of Notes pursuant to
Section 8.5, the principal amount of
the Notes to be prepaid shall be allocated
among all of the Notes at the time
outstanding in proportion, as nearly as
practicable, to the respective unpaid
principal amounts thereof not theretofore
called for prepayment.
8.4.
MATURITY; SURRENDER, ETC.
In the
case of each prepayment of Notes pursuant to this Section 8,
the
principal amount of each Note to be prepaid
shall mature and become due and
payable on the date fixed for such
prepayment, together with interest on such
principal amount accrued to such date and
the applicable Make-Whole Amount, if
any. From and after such date, unless the
Issuers shall fail to pay such
principal amount when so due and payable,
together with the interest and
Make-Whole Amount, if any, as aforesaid,
interest on such principal amount shall
cease to accrue. Any Note paid or prepaid
in full shall be surrendered to the
Issuers and cancelled and shall not be
reissued, and no Note shall be issued in
lieu of any prepaid principal amount of any
Note.
8.5.
PURCHASE OF NOTES.
Neither
Issuer will, and neither Issuer will permit any Affiliate to,
purchase, redeem, prepay or otherwise
acquire, directly or indirectly, any of
the outstanding Notes except (a) upon the
payment or prepayment of the Notes in
accordance with the terms of this Agreement
and the Notes or (b) pursuant to an
offer to purchase made by the Issuers or an
Affiliate pro rata to the holders of
all Notes at the time outstanding upon the
same terms and conditions. Any such
offer shall provide each holder with
sufficient information to enable it to make
an informed decision with respect to such
offer, and shall remain open for at
least 30 days. If the holders of more than
50% of the principal amount of the
Notes then outstanding accept such offer,
the Issuers shall promptly notify the
remaining holders of such fact and the
expiration date for the acceptance by
holders of Notes of such offer shall be
extended by the number of days necessary
to give each such remaining holder at least
five (5) Business Days from its
receipt of such notice to accept such
offer. The Issuers will promptly cancel
all Notes acquired by it or any Affiliate
pursuant to any payment, prepayment or
purchase of Notes pursuant to any provision
of this Agreement and no Notes may
be issued in substitution or exchange for
any such Notes.
8.6.
MAKE-WHOLE AMOUNT.
The term
"MAKE-WHOLE AMOUNT" means, with respect to any Note, an amount
equal to the excess, if any, of the
Discounted Value of the Remaining
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Scheduled Payments with respect to the
Called Principal of such Note over the
amount of such Called Principal, provided
that the Make-Whole Amount may in no
event be less than zero. For the purposes
of determining the Make-Whole Amount,
the following terms have the following
meanings:
"CALLED PRINCIPAL" means, with respect to any Note, the principal
of
such Note
that is to be prepaid pursuant to Section 8.2 or has become or
is
declared to be immediately due and payable pursuant to Section
12.1, as
the
context requires.
"DISCOUNTED VALUE" means, with respect to the Called Principal
of
any Note,
the amount obtained by discounting all Remaining Scheduled
Payments
with respect to such Called Principal from their respective
scheduled
due dates to the Settlement Date with respect to such Called
Principal,
in accordance with accepted financial practice and at a
discount
factor (applied on the same periodic basis as that on which
interest
on such Note is payable) equal to the Reinvestment Yield with
respect to
such Called Principal.
"REINVESTMENT YIELD" means, with respect to the Called Principal
of
any Note,
0.50% over the yield to maturity implied by (a) the yields
reported,
as of 10:00 A.M. (New York City time) on the second Business
Day
preceding
the Settlement Date with respect to such Called Principal on
the
display
designated as "Page 678" on the Moneyline Telerate Service (or
such other
display as may replace Page 678 on the Moneyline Telerate
Service)
for actively traded on the run US Treasury securities having a
maturity
equal to the Remaining Average Life of such Called Principal as
of such
Settlement Date, or (b) if such yields are not reported as of
such
time or
the yields reported as of such time are not ascertainable, the
Treasury
Constant Maturity Series Yields reported, for the latest day
for
which such
yields have been so reported as of the second Business Day
preceding
the Settlement Date with respect to such Called Principal, in
Federal
Reserve Statistical Release H.15 (519) (or any comparable
successor
publication) for actively traded US Treasury securities having
a
constant
maturity equal to the Remaining Average Life of such Called
Principal
as of such Settlement Date. Such implied yield will be
determined, if necessary, by (i) converting US Treasury bill
quotations to
bond-equivalent yields in accordance with accepted financial
practice and
(ii)
interpolating linearly between (x) the actively traded US
Treasury
Security
with the maturity closest to and greater than the Remaining
Average
Life and (y) the actively traded US Treasury Security with the
maturity
closest to and less than the Remaining Average Life.
"REMAINING AVERAGE LIFE" means, with respect to the Called
Principal
of any
Note, the number of years (calculated to the nearest one-
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<PAGE>
twelfth
year) obtained by dividing (a) such Called Principal into (b)
the
sum of the
products obtained by multiplying (i) the principal component of
each
Remaining Scheduled Payment with respect to such Called Principal
by
(ii) the
number of years (calculated to the nearest one-twelfth year)
that
will
elapse between the Settlement Date with respect to such Called
Principal and the scheduled
due date of such Remaining Scheduled Payment.
"REMAINING SCHEDULED PAYMENTS" means, with respect to the
Called
Principal
of any Note, all payments of such Called Principal and interest
thereon
that would be due after the Settlement Date with respect to
such
Called
Principal if no payment of such Called Principal were made prior
to
its
scheduled due date, provided that if such Settlement Date is not
a
date on
which interest payments are due to be made under the terms of
such
Note, then
the amount of the next succeeding scheduled interest payment
will be
reduced by the amount of interest accrued to such Settlement
Date
and
required to be paid on such Settlement Date pursuant to Section 8.2
or
Section
12.1.
"SETTLEMENT DATE" means, with respect to the Called Principal of
any
Note, the
date on which such Called Principal is to be prepaid pursuant
to
Section
8.2 or has become or is declared to be immediately due and
payable
pursuant
to Section 12.1, as the context requires.
9. AFFIRMATIVE COVENANTS.
Each of
the Issuers covenants that so long as any of the Notes are
outstanding:
9.1.
COMPLIANCE WITH LAW.
Each of
the Issuers will and will cause each Subsidiary to comply with
all
laws, ordinances or governmental rules or
regulations to which each of them is
subject, including, without limitation,
ERISA and Environmental Laws, and will
obtain and maintain in effect all licenses,
certificates, permits, franchises
and other governmental authorizations
necessary to the ownership of their
respective properties or to the conduct of
their respective businesses, in each
case to the extent necessary to ensure that
non-compliance with such laws,
ordinances or governmental rules or
regulations or failures to obtain or
maintain in effect such licenses,
certificates, permits, franchises and other
governmental authorizations could not,
individually or in the aggregate,
reasonably be expected to have a Material
Adverse Effect.
9.2.
INSURANCE.
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Each of
the Issuers will and will cause each Subsidiary to maintain,
with
financially sound and reputable insurers,
insurance with respect to their
respective properties and businesses
against such casualties and contingencies,
of such types, on such terms and in such
amounts (including deductibles,
co-insurance and self-insurance, if
adequate reserves are maintained with
respect thereto) as is customary in the
case of entities of established
reputations engaged in the same or a
similar business and similarly situated.
9.3.
MAINTENANCE OF PROPERTIES.
Each of
the Issuers will and will cause each Subsidiary other than any
Dormant Company to maintain and keep, or
cause to be maintained and kept, their
respective properties in good repair,
working order and condition (other than
ordinary wear and tear), so that the
business carried on in connection therewith
may be properly conducted at all times,
provided that this Section shall not
prevent either of the Issuers or any
Subsidiary from discontinuing the operation
and the maintenance of any of its
properties if such discontinuance is desirable
in the conduct of its business and such
Issuer has concluded that such
discontinuance could not, individually or
in the aggregate, reasonably be
expected to have a Material Adverse
Effect.
9.4.
PAYMENT OF TAXES AND CLAIMS.
Each of
the Issuers will and will cause each Subsidiary to file all tax
returns required to be filed in any
jurisdiction and to pay and discharge all
taxes required to be paid on such returns
and all other taxes, assessments,
governmental charges, or levies imposed on
them or any of their properties,
assets, income or franchises, to the extent
such taxes and assessments have
become due and payable and before they have
become delinquent and all claims for
which sums have become due and payable that
have or might become a Lien on
properties or assets of either of the
Issuers or any Subsidiary, provided that
neither of the Issuers nor any Subsidiary
need pay any such tax or assessment or
claims if (a) the amount, applicability or
validity thereof is contested by such
Issuer or such Subsidiary on a timely basis
in good faith and in appropriate
proceedings, and such Issuer or a
Subsidiary has established adequate reserves
therefor in accordance with GAAP on the
books of such Issuer or such Subsidiary
or (b) the nonpayment of all such taxes and
assessments in the aggregate could
not reasonably be expected to have a
Material Adverse Effect.
9.5.
CORPORATE EXISTENCE, ETC.
Each of
the Issuers will at all times preserve and keep in full force
and
effect its corporate existence. Subject to
Sections 9.3, 10.2 and 10.4, each of
the Issuers will at all times preserve and
keep in full force and effect the
corporate existence of
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each Subsidiary other than any Dormant
Company (unless merged into an Issuer or
a Subsidiary (other than a Dormant
Company)) and all rights and franchises of
such Issuer and its Subsidiaries (other
than a Dormant Company) unless, in the
good faith judgment of such Issuer, the
termination of or failure to preserve
and keep in full force and effect such
corporate existence, right or franchise
could not, individually or in the
aggregate, have a Material Adverse Effect.
9.6. NEW
SUBSIDIARY GUARANTOR; ADDITIONAL PLEDGED STOCK.
(a) The Issuers will (i) cause each Person that, after the date
of
the
Closing, becomes a Domestic Subsidiary that is a "significant
subsidiary" within the meaning of Regulation S-X of the Exchange
Act, and
each
Subsidiary that ceases to be a Dormant Company pursuant to
Section
9.11, to
become, promptly and in any event within fifteen (15) Business
Days of
becoming a Domestic Subsidiary or ceasing to be a Dormant
Company,
as the
case may be, an additional guarantor pursuant to the terms of
the
Guaranty
Agreement and (ii) deliver to each of the holders of Notes, to
the extent
reasonably requested by the Required Holders, copies of
authorizing resolutions, bylaws and other constitutive documents
and
financial
information of such Person, as well as an opinion of
independent
counsel
reasonably satisfactory to the Required Holders, as to the due
execution,
delivery and enforceability of such Person's obligations as a
Guarantor,
in form and substance reasonably satisfactory to the Required
Holders.
(b) The Company will promptly, and in any event within fifteen
(15)
Business
Days of any Person becoming (i) a Foreign Subsidiary of the
Company or
(ii) a Foreign Subsidiary that is not a Wholly-Owned Subsidiary
of either
Issuer that, in each case, is a "significant subsidiary" within
the
meaning of Regulation S-X of the Exchange Act, after the date of
the
Closing,
(A) pledge, or cause to be pledged, the Applicable Pledge
Amount
of any
equity interests of such Foreign Subsidiary pursuant to the
Pledge
Agreement,
and (B) deliver or cause to be delivered to the Agent, on
behalf of
the holders of Notes, the original stock or membership
certificate(s) evidencing such equity interests and undated stock
powers
executed
in blank.
9.7. PARI
PASSU RANKING.
Each of
the Issuers shall ensure that its payment obligations under
this
Agreement and the Notes rank and will at
all times rank at least pari passu in
all respects with the claims of all of its
other unsecured and unsubordinated
creditors, respectively, except as may be
otherwise provided for in the Sharing
Agreement with respect to the Debt under
the Bank Credit Agreement, save those
whose claims are preferred by any
bankruptcy, insolvency, liquidation,
administration or other similar laws of
general application.
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<PAGE>
9.8. MOST
FAVORED LENDER PROVISIONS.
(a) NEW AND AMENDED COVENANTS. If at any time and from time to
time
on or
after the date of the Closing either of the Issuers or any
Subsidiary
enters into, assumes or otherwise becomes bound or obligated
under, or
agrees to any new agreement with the lenders under the Bank
Credit
Agreement or, without derogating from any of the restrictions
contained
herein, any amendment, modification of or supplement to the
Bank
Credit
Agreement or any agreement which relates to the Bank Credit
Agreement
in any manner the effect of which would be (i) to create, amend
or add
covenants or obligations of the Issuers and the Subsidiaries
which
are in
addition to those contained in the Bank Credit Agreement (as in
effect on
the date of the Closing) or (ii) more restrictive on the
Issuers
or any
Subsidiary than are the equivalent covenants (other than the
Specified
Financial Covenants) contained herein (the "NEW/AMENDED
COVENANT
PROVISIONS"), then this Agreement shall, without any further action
on the
part of
either Issuer, any Subsidiary or any holder of Notes, be deemed
to
be amended
automatically to include each such New/Amended Covenant
Provision,
effective as of the effective date of such New/Amended Covenant
Provision;
provided, that the Required Holders and the Issuers may agree
in writing
not to so amend this Agreement. For the purposes of clause (ii)
above, in
the event that (A) any such amendment, modification or
supplement
reduces a sum certain dollar amount in the Bank Credit
Agreement,
which reduction has the effect of making a covenant in the Bank
Credit
Agreement more restrictive than a covenant contained herein and
(B)
the
corresponding covenant contained herein is a percentage rather than
a
sum
certain dollar amount, then such percentage contained herein shall
be
reduced
and shall thereafter be equal to the product (expressed as a
percentage) of (x) such percentage herein immediately before giving
effect
to such amendment, modification or
supplement, multiplied by (y) a
fraction,
the numerator of which is the sum certain dollar amount in the
Bank
Credit Agreement immediately after giving effect to such
amendment,
modification or supplement and the denominator of which is the sum
certain
dollar
amount stated in the Bank Credit Agreement immediately prior to
giving
effect to such amendment, modification or supplement. By way of
example,
if the definition of the "Permitted Acquisition Basket" in the
Bank
Credit Agreement were amended to reduce the sum certain dollar
amount
from
$15,000,000 to $9,000,000 (a 40% reduction), then the percentage
in
the
definition of Permitted Acquisition herein would be reduced to 6%
from
10% (a 40%
reduction).
(b) SPECIFIED FINANCIAL COVENANTS. If at any time and from time
to
time after
the date of the Closing, either Issuer or any Subsidiary enters
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<PAGE>
into, assumes or
otherwise becomes bound or obligated under, or agrees to,
any
modification of or amendment or supplement to the Bank Credit
Agreement
in respect of or that contains provisions (the "SPECIFIED
PROVISIONS") that are the same as or similar to the covenants set
forth in
Sections
10.5, 10.6 or 10.7 (as in effect from time to time after giving
effect to
this Section 9.8, the "SPECIFIED FINANCIAL COVENANTS"), and one
or more of
such Specified Provisions is more restrictive on the Issuers or
any
Subsidiary than the equivalent Specified Financial Covenants,
then
such
equivalent Specified Financial Covenants shall, without any
further
action on
the part of either Issuer, any Subsidiary or any holder of
Notes, be
deemed to be amended automatically to be as restrictive as the
relevant
Specified Provision as of the effective date of such Specified
Provision;
provided, however, that at all times subsequent to the date of
the DOJ
Settlement Payment, the required ratios of Consolidated Funded
Debt to
Consolidated EBITDA set forth in Section 10.5 shall each have a
numerator
that is the lesser of (i) the relevant numerator set forth in
such
section (as of the date of the Closing) or (ii) a numerator that
is
0.25
higher than that specified in the Bank Credit Agreement (after
giving
effect to
any applicable Specified Provision) for the relevant time
period
(after
converting, if necessary, the ratios in the Bank Credit
Agreement
to the
method of presentation in Section 10.5).
(c) WRITTEN AMENDMENT; SUCCESSIVE CHANGES. Each of the Issuers
further
covenants to promptly, and in any event within 30 days, execute
and
deliver at its expense (including, without limitation, the fees
and
expenses
of counsel for the holders of the Notes) a document which
amends
this
Agreement in form and substance satisfactory to the Required
Holders
to reflect
any change to this Agreement made effective by this Section
9.8,
provided that the execution and delivery of such document shall
not
be a
precondition to the effectiveness of such amendment, waiver or
termination. The provisions of this Section 9.8 shall apply
successively
to each
New/Amended Covenant Provision and each change in a Specified
Provision.
9.9.
COVENANT TO SECURE NOTES EQUALLY.
Each
Issuer covenants that, if it or any Subsidiary shall create or
assume
any Lien to secure the Debt under the Bank
Credit Agreement upon any of its
property or assets, whether now owned or
hereafter acquired, it will make or
cause to be made effective provision
whereby the Notes will be secured by such
Lien equally and ratably with any and all
Debt under the Bank Credit Agreement
thereby secured so long as any such other
Debt shall be so secured.
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9.10.
POST-CLOSING REQUIREMENTS.
No later
than 60 days following the date of the Closing, the Issuers
will
deliver or cause to be delivered to the
holders of Notes (a) certificates of
good standing from the office of the
Secretary of State from each jurisdiction
where the ownership of property or the
conduct of its business requires the
Company to be qualified to transact
business as a foreign corporation and (b)
certificates of good standing from the
office of the Secretary of State of the
jurisdiction of incorporation of Qirra
Custom Software, Inc. and the
jurisdiction where such Subsidiary
maintains its principal place of business. No
later than 75 days following the date of
the Closing, the Issuers will cause the
following Subsidiaries to be dissolved and
shall provide the Required Holders
with reasonably satisfactory evidence of
such dissolution: (i) Brocklehursts,
Inc., (ii) Brocklehurst Holdings, Inc. and
(iii) Graham Miller, Inc. No later
than 30 days following the date of the
Closing, the Issuers will cause all Liens
in favor of the Royal Bank of Canada set
forth on Schedule 10.3 to be terminated
and released of record, and will promptly
provide each holder of Note written
evidence of such termination and release.
The Issuers will, within 30 days
following a request therefore by the
Required Holders, cause the documents and
instruments described on Schedule 10.11 as
item 1, to be terminated, or
otherwise cause the restrictive agreements
or arrangements therein requiring
such items to be disclosed pursuant to
Section 10.11 to be terminated and
released, and will promptly provide the
holders of Notes written evidence of
such termination and release.
9.11.
DORMANT COMPANIES.
(a) If, at any time after the date of the Closing, the Company
decides
that any Subsidiary that is a Dormant Company at such time
shall
cease being a Dormant Company,
such Subsidiary shall cease to be a Dormant
Company
for all purposes of this Agreement and the other Financing
Documents
upon the satisfaction of the following conditions:
(i) the Company shall notify the holders of Notes of the
proposed change in the status of such Subsidiary, which notice
shall
contain a certification by a Responsible Officer to the effect
that
(A) such Subsidiary is in full compliance with all provisions
of
this Agreement applicable to it as a Subsidiary that is not a
Dormant Company, (B) each of the representations and warranties
set
forth in S
