EXHIBIT 10.28
EXECUTION COPY
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NN, INC.
$40,000,000
4.89% Senior Notes, Series A, due April 26, 2014
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NOTE PURCHASE AGREEMENT
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Dated April 26, 2004
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TABLE OF CONTENTS
(Not a part of the Agreement)
SECTION
HEADING
PAGE
SECTION 1.
AUTHORIZATION OF NOTES....................................1
SECTION 2.
SALE AND PURCHASE OF NOTES................................1
Section 2.1. Sale and Purchase of Series A
Notes.......................1
Section 2.2. Additional Series of
Notes................................2
SECTION 3.
CLOSING...................................................3
SECTION 4.
CONDITIONS TO CLOSING.....................................3
Section 4.1. Representations and
Warranties............................3
Section 4.2. Performance; No
Default...................................3
Section 4.3. Compliance
Certificates...................................3
Section 4.4. Opinions of
Counsel.......................................4
Section 4.5. Purchase Permitted by Applicable Law,
etc.................4
Section 4.6. Sale of Other
Notes.......................................4
Section 4.7. Payment of Certain
Fees...................................4
Section 4.8. Private Placement
Number..................................4
Section 4.9. Changes in Corporate
Structure............................5
Section 4.10.Funding
Instructions......................................5
Section 4.11.Other Financing
Agreements................................5
Section 4.12.Proceedings and
Documents.................................5
Section 4.13.Conditions to Issuance of Additional
Notes................5
Section 4.14.Acceptance of Appointment to Receive Service of
Process...6
SECTION 5.
REPRESENTATIONS AND WARRANTIES OF THE OBLIGORS............6
Section 5.1. Organization; Power and
Authority.........................6
Section 5.2. Authorization,
etc........................................6
Section 5.3.
Disclosure................................................6
Section 5.4. Organization and Ownership of Shares of
Subsidiaries;
Affiliates..............................................7
Section 5.5. Financial
Statements......................................7
Section 5.6. Compliance with Laws, Other Instruments,
etc..............8
Section 5.7. Governmental Authorizations,
etc..........................8
Section 5.8. Litigation; Observance of Agreements, Statutes and
Orders.8
Section 5.9.
Taxes.....................................................9
Section 5.10.Title to Property;
Leases.................................9
Section 5.11.Licenses, Permits,
etc....................................9
Section 5.12.Compliance with
ERISA....................................10
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Section 5.13.Private Offering by the
Company..........................11
Section 5.14.Use of Proceeds; Margin
Regulations......................11
Section 5.15.Existing Debt; Future
Liens..............................11
Section 5.16.Foreign Assets Control Regulations,
etc..................12
Section 5.17.Status under Certain
Statutes............................12
Section 5.18.Environmental
Matters....................................12
Section
5.19.Solvency.................................................13
Section 5.20.Collateral
Documents.....................................13
Section 5.21.Ranking of
Notes.........................................13
SECTION 6.
REPRESENTATIONS OF THE PURCHASER.........................14
Section 6.1. Purchase for
Investment..................................14
Section 6.2. Source of
Funds..........................................14
SECTION 7.
INFORMATION AS TO OBLIGORS...............................15
Section 7.1. Financial and Business
Information.......................15
Section 7.2. Officer's
Certificate....................................18
Section 7.3.
Inspection...............................................19
SECTION 8.
PREPAYMENT OF THE SERIES A NOTES.........................19
Section 8.1. Required
Prepayments.....................................19
Section 8.2. Optional Prepayments with Series A Make-Whole
Amount.....19
Section 8.3. Change in
Control........................................20
Section 8.4. Allocation of Partial
Prepayments........................22
Section 8.5. Maturity; Surrender,
etc.................................22
Section 8.6. Purchase of
Notes........................................22
Section 8.7. Series A Make-Whole
Amount...............................23
SECTION 9.
AFFIRMATIVE COVENANTS....................................24
Section 9.1. Compliance with
Law......................................24
Section 9.2.
Insurance................................................24
Section 9.3. Maintenance of
Properties................................25
Section 9.4. Payment of Taxes and
Claims..............................25
Section 9.5. Corporate Existence,
etc.................................25
Section 9.6. Notes to Rank Pari
Passu.................................25
Section 9.7. Post-Closing
Requirements................................25
SECTION 10.
NEGATIVE COVENANTS.......................................26
Section 10.1.Transactions with
Affiliates.............................26
Section 10.2.Merger, Consolidation,
etc...............................26
Section
10.3.Liens....................................................27
Section 10.4.Incurrence of Certain Additional
Debt....................29
Section 10.5.Consolidated Adjusted Net
Worth..........................30
Section 10.6.Fixed Charges Coverage
Ratio.............................30
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Section 10.7.Sale of Assets,
etc......................................30
Section 10.8.Maintenance of
Parity....................................31
Section 10.9.Nature of
Business.......................................32
Section 10.10.Leverage
Ratio..........................................32
SECTION 11.
EVENTS OF DEFAULT........................................32
SECTION 12.
REMEDIES ON DEFAULT, ETC.................................35
Section
12.1.Acceleration.............................................35
Section 12.2.Other
Remedies...........................................35
Section
12.3.Rescission...............................................36
Section 12.4.No Waivers or Election of Remedies, Expenses,
etc........36
SECTION 13.
TAX INDEMNIFICATION......................................36
SECTION 14.
REGISTRATION; EXCHANGE; SUBSTITUTION OF NOTES............39
Section 14.1.Registration of
Notes....................................39
Section 14.2.Transfer and Exchange of
Notes...........................39
Section 14.3.Replacement of
Notes.....................................39
SECTION 15.
PAYMENTS ON NOTES........................................40
Section 15.1.Place of
Payment.........................................40
Section 15.2.Home Office
Payment......................................40
SECTION 16.
EXPENSES, ETC............................................40
Section 16.1.Transaction
Expenses.....................................40
Section 16.2.Certain
Taxes............................................41
Section
16.3.Survival.................................................41
SECTION 17.
SURVIVAL OF REPRESENTATIONS AND WARRANTIES;
ENTIRE AGREEMENT.........................................41
SECTION 18.
AMENDMENT AND WAIVER.....................................41
Section
18.1.Requirements.............................................41
Section 18.2.Solicitation of Holders of
Notes.........................42
Section 18.3.Binding Effect,
etc......................................42
Section 18.4.Notes Held by Company,
etc...............................43
SECTION 19.
NOTICES..................................................43
SECTION 20.
REPRODUCTION OF DOCUMENTS................................44
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SECTION 21.
CONFIDENTIAL INFORMATION.................................44
SECTION 22.
SUBSTITUTION OF PURCHASER................................45
SECTION 23.
SUBSIDIARY GUARANTEE.....................................45
Section 23.1.Subsidiary
Guarantee.....................................45
Section 23.2.Maximum Subsidiary Guarantee
Liability...................46
Section
23.3.Contribution.............................................47
Section 23.4.Subsidiary Guarantee
Unconditional.......................47
Section 23.5.Discharge Only Upon Payment in Full;
Reinstatement in Certain Circumstances...................48
Section
23.6.Waiver...................................................48
Section 23.7.Waiver of Reimbursement, Subrogation,
Etc................48
Section 23.8.Stay of
Acceleration.....................................48
Section 23.9.Subordination of
Indebtedness............................49
Section
23.10.Certain
Releases........................................49
Section 23.11.Third Party
Beneficiary.................................49
SECTION 24.
MISCELLANEOUS............................................49
Section 24.1.Successors and
Assigns...................................49
Section 24.2.Jurisdiction and Process; Waiver of Jury
Trial...........49
Section 24.3.Obligation to Make Payment in
Dollars....................50
Section 24.4.Payments Due on Non-Business
Days........................51
Section
24.5.Severability.............................................51
Section 24.6
Construction.............................................51
Section 24.7
Counterparts.............................................51
Section 24.8.Governing
Law............................................51
Signature....................................................................52
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SCHEDULE A
--
Information Relating to Purchasers
SCHEDULE B
-- Defined
Terms
SCHEDULE 5.4
--
Subsidiaries of the Company and Ownership
of Subsidiary Stock
SCHEDULE 5.5
-- Financial
Statements
SCHEDULE 5.15
-- Existing
Debt
EXHIBIT 1
-- Form of
4.89% Senior Note, Series A,
due April 26, 2014
Exhibit 4.4(a)(1) -- Form of
Opinion of Counsel for the U.S. Obligors
Exhibit 4.4(a)(2) -- Form of
Opinion of local Counsel to
certain Obligors
EXHIBIT 4.4(b)
-- Form of
Opinion of Special Counsel for the
Purchasers
EXHIBIT 10.8(a) -- Form of
Italian Subsidiary Guarantee
EXHIBIT 10.8(b) --
Form of
Joinder Agreement
EXHIBIT S
-- Form of
Supplement
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NN, INC.
2000 WATERS EDGE DRIVE
JOHNSON CITY, TENNESSEE 57604
4.89% Senior Notes, Series A, due April 26, 2014
Dated as of
April 26, 2004
TO EACH OF THE PURCHASERS LISTED IN
THE ATTACHED SCHEDULE A:
Ladies and Gentlemen:
NN, INC., a
Delaware corporation
(the "Company") and
the Guarantors named
in the definition of such term (other than NN
Italy), jointly and
severally,
agree with you as follows:
SECTION 1. AUTHORIZATION OF NOTES.
The Company
will authorize the issue and sale of $40,000,000 aggregate
principal amount of its 4.89% Senior
Notes, Series A, due April 26, 2014
(the
"Series A Notes"). The Series A Notes together with each series of Additional
Notes which may from time to time be issued pursuant to the provisions of
Section 2.2 are collectively referred to as the "Notes"
(such term shall
also
include any such notes issued in
substitution therefor pursuant to Section 14 of
this Agreement or the Other Agreements (as hereinafter
defined). The Series A
Notes shall be substantially in the form
set out in Exhibit 1, with such changes
therefrom, if any, as may be approved by you and the Company. Certain
capitalized terms used in this Agreement are
defined in Schedule B;
references
to a "Schedule" or an "Exhibit" are, unless
otherwise specified,
to a Schedule
or an Exhibit attached to this
Agreement.
SECTION 2. SALE AND PURCHASE OF NOTES.
Section 2.1.
Sale and Purchase of Series A Notes. Subject to the terms and
conditions of this Agreement, the Company will issue and sell to you and
you
will purchase from the Company, at the
Closing provided for in Section 3, Series
A Notes in the principal amount specified opposite your name in Schedule A
at
the purchase price of 100% of the principal
amount thereof. Contemporaneously
with entering into this Agreement, the Company is entering into
separate Note
Purchase Agreements (the "Other
Agreements") identical
with this Agreement with
each of the other purchasers named in Schedule A (the "Other Purchasers"),
providing for the sale at such Closing to
each of the Other Purchasers of Series
A Notes in the principal amount specified
opposite its name in
Schedule A. Your
obligation hereunder, and the obligations of the Other
Purchasers
under the
Other Agreements, are several and not joint
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obligations, and you shall have no obligation
under any Other
Agreement and no
liability to any Person for the performance or nonperformance by any Other
Purchaser thereunder. The Series A Notes and each other
series of Notes issued
hereunder are each herein sometimes
referred to as Notes of a "series."
The performance and payment of the Company
hereunder and under
the Notes
and the other Financing Agreements shall be guaranteed by the Guarantors
pursuant to the Subsidiary Guarantees. The
obligations of the Obligors under and
pursuant to the Financing Agreements shall be secured by the Collateral
Agreements.
Section 2.2.
Additional
Series of Notes.
The Company
may, from time to
time, in its sole discretion, but subject to the terms hereof,
issue and sell
one or more additional series of its
unsecured
unsubordinated
promissory notes
under the provisions of this Agreement
pursuant to a supplement (a "Supplement")
substantially in the form of Exhibit S. Each additional series of Notes (the
"Additional Notes") issued pursuant to a Supplement shall be subject to the
following terms and conditions:
(i) each series of Additional Notes, when so issued, shall be
differentiated
from
all previous series by sequential alphabetical
designation
inscribed thereon;
(ii) each series of Additional Notes shall be dated the date of
issue,
bear
interest at such rate or rates, mature on such date or dates,
be
subject to such
mandatory and optional
prepayment on the
dates and at the
premiums, if
any, have such additional or different conditions precedent to
closing,
such representations
and warranties and such additional covenants
as shall be
specified in the Supplement under which such Additional
Notes
are issued and
upon execution of any such Supplement, this Agreement shall
be deemed
amended to reflect
such additional
covenants without further
action on the
part of the holders
of the Notes outstanding under this
Agreement,
provided, that any
such additional covenants shall inure to the
benefit of all
holders of Notes so long as any
Additional
Notes issued
pursuant to such
Supplement
remain outstanding and any such additional
covenants
shall not impair, diminish or modify any existing covenants
contained
herewith;
(iii) each series of
Additional Notes
issued under this Agreement
shall be in
substantially
the form of Exhibit 1
to Exhibit S hereto
with
such
variations,
omissions and insertions as are necessary or
permitted
hereunder;
(iv) the minimum
principal amount of any series of Notes issued under
a Supplement
shall be $7,500,000, except as may be necessary to
evidence
the outstanding
amount of any Note
originally issued in a
denomination of
$250,000 or
more;
(v) all Additional
Notes shall mature more than one year after
the
issuance
thereof and shall
constitute
Debt of the Company
and shall rank
pari passu with
all other outstanding Notes; and
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(vi) no Additional
Notes shall be issued
hereunder if at the time of
issuance thereof
and after giving effect to the application of the proceeds
thereof,
any Default or Event of Default shall have occurred and be
continuing.
SECTION 3. CLOSING.
The sale and
purchase of the Series
A Notes to be purchased by you and the
Other Purchasers shall occur at the
offices of Chapman and Cutler LLP, 111 West
Monroe Street, Chicago, Illinois 60603, at
10:00 A.M. Chicago time, at a closing
(the "Closing") on April 26, 2004 or on
such other Business
Day thereafter as
may be agreed upon by the Company and you and the Other Purchasers. At the
Closing the Company will deliver to you the Series A Notes
to be purchased by
you in the form of a single Series A Note (or such
greater number of Series A
Notes in denominations of at least $250,000 as you may
request) dated the date
of the Closing and registered in your name (or in the name of
your nominee),
against delivery by you to the Company or its order
of immediately
available
funds in the amount of the purchase price therefor by wire transfer of
immediately available funds for the account of the
Company to account
number
7000 287541 at AmSouth Bank, AmSouth Center, 315 Deaderick Street, Nashville,
Tennessee 37237, ABA# 062000019. If at the Closing the Company
shall fail to
tender such Series A Notes to you as
provided above in this Section 3, or any of
the conditions specified in Section 4 shall not have been
fulfilled to your
satisfaction, you shall, at your election, be relieved of all further
obligations under this Agreement, without thereby waiving any rights you
may
have by reason of such failure or such
nonfulfillment.
SECTION 4. CONDITIONS TO CLOSING.
Your obligation
to purchase and pay for the Series A Notes to be sold
to you at the Closing is subject to the
fulfillment to your satisfaction, prior
to or at the Closing, of the following
conditions:
Section
4.1. Representations and Warranties. The representations and
warranties of the Obligors in the
Financing Agreements shall be correct when
made and at the time of the Closing.
Section 4.2.
Performance; No Default. Each Obligor shall have performed and
complied with all agreements and conditions contained in each Financing
Agreement required to be performed or complied with by it prior to or at the
Closing, and after giving effect to the issue and sale of
the Series A Notes
(and the application of the proceeds
thereof as
contemplated by Section 5.14),
no Default or Event of Default shall have occurred and be
continuing.
Neither
the Company nor any Subsidiary shall have
entered into any transaction since the
date of the Memorandum that would have been prohibited by
Section 10 hereof had
such Section applied since such date.
Section 4.3.
Compliance Certificates.
(a) Officer's Certificate. Each Obligor shall have delivered to you an
Officer's Certificate, dated the date of the Closing, certifying that the
conditions specified in Sections 4.1, 4.2
and 4.9 have been fulfilled.
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(b) Secretary's Certificate. Each Obligor shall have
delivered to you a
certificate, dated the date of Closing, certifying as to the resolutions
attached thereto and other corporate
proceedings relating
to the authorization,
execution and delivery of the Series A
Notes and the other Financing Agreements
to which it is a party.
Section 4.4.
Opinions of Counsel.
You shall have received opinions in form
and substance satisfactory to you, dated the date of the Closing (a)
(i) from
Blackwell Sanders Peper Martin LLP, counsel
for the U.S. Obligors,
covering the
matters set forth in Exhibit 4.4(a)(i) and (ii) from Kromann
Reumert as Danish
counsel, Pavia e Ansaldo Studio Legale as
Italian counsel ("Italian Counsel"),
Beiten Burkhardt as German counsel,
Houthoff Buruma as Dutch counsel,
McCann
FitzGerald Solicitors as Irish counsel and
Cechova Rakovsky as Slovakian counsel
for various Obligors, covering the matters set forth in
Exhibit 4.4(a)(ii), and
each covering such other matters incident to the transactions contemplated
hereby as you or your counsel may
reasonably
request (and the Company hereby
instructs its counsel to deliver
such opinion to you)
and (b) from Chapman and
Cutler LLP, your 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
you may reasonably request.
Section 4.5.
Purchase Permitted by
Applicable Law, etc. On the date of the
Closing your purchase of Series A Notes shall
(i) be permitted by the laws and
regulations of each jurisdiction to which you are
subject, without
recourse to
provisions (such as Section 1405(a)(8) of
the New York Insurance Law) permitting
limited investments by insurance companies without restriction as to the
character of the particular investment, (ii) not violate any applicable
law or
regulation (including, without limitation,
Regulation T, U or X
of the Board of
Governors of the Federal Reserve System) and (iii) not subject you
to any tax,
penalty or liability under or pursuant to any
applicable
law or regulation,
which law or regulation was not in effect on the date
hereof. If requested
by
you, you shall have received an Officer's Certificate certifying as to such
matters of fact as you may reasonably
specify to enable you to determine whether
such purchase is so permitted.
Section 4.6.
Sale of Other Notes.
Contemporaneously with
the Closing, the
Company shall sell to the Other Purchasers, and the Other Purchasers shall
purchase, the Series A Notes to be
purchased by them at the Closing as specified
in Schedule A.
Section 4.7.
Payment of Certain
Fees. Without
limiting the
provisions of
Section 16.1, the Company shall have paid on or before the
Closing the fees,
charges and disbursements of (i) the
Noteholder Collateral
Agent and (ii) your
special counsel referred to in Section
4.4(b)(i),
in each case, to the
extent
reflected in a statement of such Person rendered to the Company at least
one
Business Day prior to the Closing.
Section 4.8.
Private Placement Number. A Private Placement Number issued by
Standard & Poor's CUSIP Service Bureau (in cooperation with the Securities
Valuation Office of the National
Association of
Insurance
Commissioners) shall
have been obtained for the Series A
Notes.
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Section 4.9.
Changes in Corporate Structure. No Obligor shall have changed
its jurisdiction of incorporation or
organization or been a party to any merger
or consolidation and no Obligor shall 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.
Section 4.10.
Funding Instructions.
At least three
Business Days prior to
the date of the Closing, you shall have
received written
instructions
executed
by a Responsible Officer directing the manner of the payment of funds and
setting forth (i) the name and address of the transferee bank, (ii) such
transferee bank's ABA number and (iii) the
account name and number into which
the purchase price for the Series A Notes
is to be deposited.
Section
4.11. Other Financing Agreements. (a) Each Obligor shall have
executed and delivered each Financing Agreement to which it is to be a
party,
which Financing Agreements shall be satisfactory in form and
substance to you
and the Other Purchasers and shall provide such security and/or Subsidiary
Guarantees which cause the Notes and the
other Financing
Agreements to be pari
passu with the Obligors' obligations under the Bank
Indebtedness
after giving
effect to the Intercreditor Agreement.
(b) Each party thereto shall have executed and delivered the
Intercreditor
Agreement which shall
be satisfactory in form and
substance to the Purchasers.
Section
4.12. Proceedings and Documents. All corporate and other
proceedings in connection with the transactions contemplated by the Financing
Agreements and all documents and
instruments incident to such transactions shall
be satisfactory to you and your special counsel, and you and your special
counsel shall have received all such
counterpart originals or certified or other
copies of such documents as you or they may
reasonably request.
Section 4.13.
Conditions to Issuance
of Additional Notes.
The obligations
of the Additional Purchasers to purchase any
Additional Notes shall
be subject
to the following conditions precedent, in addition to the conditions
specified
in the Supplement pursuant to which such
Additional Notes may be issued:
(a) Compliance
Certificate.
A duly authorized Senior Financial
Officer of
the Company shall execute and deliver to each
Additional Purchaser
and each holder of Notes an Officer's
Certificate dated the
date of issue of such series of Additional
Notes stating that
such officer has reviewed the provisions of
this Agreement
(including any
Supplements
hereto) and
setting
forth the information
and computations
(in sufficient
detail)
required in order
to establish whether the Company and its
Subsidiaries is in compliance with the requirements of Section
10
on such date.
(b) Execution and
Delivery of
Supplement. The
Company and each such
Additional Purchaser
shall execute and deliver a Supplement
substantially in the form of Exhibit S hereto.
(c) Representations
of Additional Purchasers. Each Additional
Purchaser shall
have confirmed in the Supplement that the
representations set
forth in Section 6 are
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true with respect to such Additional
Purchaser on and as of the date of issue of
the Additional Notes.
(d) Closing
Conditions. The closing conditions set forth in Section 4
shall have been updated and performed as of the date of
issuance
of each series of Additional Notes with respect to such series
of
Additional Notes
(regardless of whether such closing conditions
initially apply only to the Series A Notes).
Section 4.14.
Acceptance of
Appointment to Receive Service of Process. You
shall have received evidence of the
acceptance by Corporation Service Company of
the appointment and designation provided for by Section 24.2(e), by the
comparable section in the Italian
Subsidiary
Guarantee and in the
Collateral
Agreements for the period from the date of the Closing to April 26, 2015 (and
the payment in full of all fees in respect
thereof).
SECTION 5. REPRESENTATIONS AND WARRANTIES
OF THE OBLIGORS.
Each of the
Obligors (other than
NN Italy), as to
itself, represents
and
warrants to you that:
Section
5.1. Organization; Power and Authority. Each Obligor is a
corporation or other legal business entity
duly organized,
validly existing and
in good standing under the laws of its
jurisdiction
of incorporation, and is
duly qualified as a foreign corporation or other legal entity and is in
good
standing in each jurisdiction in which such
qualification
is required by
law,
other than those jurisdictions as to which the
failure to be so qualified or in
good standing could not, individually or in the aggregate, reasonably be
expected to have a Material Adverse Effect. Each Obligor has the corporate
or
other 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 Agreements to which it is a
party and to perform the provisions hereof
and thereof.
Section 5.2.
Authorization,
etc. The Financing
Agreements have been
duly
authorized by all necessary corporate or other action on the part of each
Obligor party thereto and each Financing Agreement constitutes, and upon
execution and delivery thereof each Note will
constitute,
a legal, valid and
binding obligation of the Obligor party
thereto enforceable against such Obligor
in accordance with its terms, except as such enforceability may be limited by
(i) applicable bankruptcy, insolvency, reorganization, moratorium or other
similar laws affecting the enforcement of
creditors' rights
generally and (ii)
general principles of equity (regardless of whether such enforceability is
considered in a proceeding in equity or at
law). The Financing
Agreements have
been prepared, executed and delivered
outside Ireland and Italy.
Section
5.3. Disclosure. The Company, through its agent, SPP Capital
Partners, LLC, has delivered to you and
each Other Purchaser a copy of a Private
Placement Memorandum, dated February, 2004 (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 Company and its Subsidiaries. This Agreement, the Memorandum and the
financial statements listed in Schedule 5.5, taken as a
whole, do not
contain
any untrue
6
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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. Since December 31, 2003,
there has been no
change in the
financial condition, operations, business, properties or prospects of the
Company or any Subsidiary except changes that individually or in the
aggregate
could not reasonably be expected to have a
Material Adverse Effect. There is no
fact known to the Company that could
reasonably
be expected to have a
Material
Adverse Effect that has not been set forth
herein or in the Memorandum or in the
other documents, certificates and other writings delivered to you by or on
behalf of the Company specifically for use in connection with the
transactions
contemplated hereby.
Section
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, and the
percentage of shares of each class of its capital stock or similar equity
interests outstanding owned by the Company
and each other
Subsidiary, (ii)
of
the Company's Affiliates, other than Subsidiaries,
and (iii) of the
Company'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 its Subsidiaries have been validly issued,
are
fully paid and
nonassessable
and are owned by the
Company or
another Subsidiary
free and clear of any Lien (except as
otherwise disclosed in Schedule 5.4).
(c) Each Subsidiary identified in Schedule 5.4 is a
corporation or
other legal entity duly organized, validly existing and in good
standing under the laws of its jurisdiction of organization,
or,
in the case of each
Subsidiary organized
outside of the
United
States, such
Subsidiary
is in possession of all material
governmental or public
approvals necessary
for the unrestricted
conduct of its
business, and is duly qualified as a foreign
corporation or other legal entity and is in good standing in
each
jurisdiction in which
such qualification
is required by law,
other than those
jurisdictions as to
which the failure to be so
qualified or in good standing could not, individually or in the
aggregate, reasonably
be expected to have a Material Adverse
Effect. Each such Subsidiary has the corporate or other power
and
authority to own or hold under lease the properties it purports
to own or
hold under
lease and to transact the business it
transacts and proposes to transact.
(d) No Subsidiary
is a party to, or
otherwise subject to,
any legal
restriction or any
agreement (other than this Agreement, the
agreements listed
on Schedule 5.4 and customary limitations
imposed by corporate
law statutes)
restricting
the ability of
such Subsidiary to pay dividends out of profits or make any
other
similar distributions
of profits
to the Company or any of its
Subsidiaries that owns
outstanding
shares of capital
stock or
similar equity interests of such Subsidiary except for the legal
restriction provided
by Art. 2433 of the Italian Civil Code
applicable to NN Italy.
Section
5.5. Financial Statements. The Company has delivered to each
Purchaser copies of the financial
statements of the Company and its Subsidiaries
listed on Schedule 5.5. All of said
financial statements (including in each case
the related schedules and notes) fairly present in all
7
<PAGE>
material respects the consolidated financial position of the Company and
its
Subsidiaries as of the respective dates specified in such Schedule and the
consolidated results of their operations and cash flows for the respective
periods so specified and have been prepared
in accordance with GAAP consistently
applied throughout the periods involved
except as set forth in the notes thereto
(subject, in the case of any interim
financial statements,
to normal year-end
adjustments).
Section 5.6.
Compliance with Laws,
Other Instruments,
etc. The execution,
delivery and performance by the Obligors of the
Financing Agreements
will not
(i) contravene, result in any breach of, or
constitute
a default under, or
result in the creation of any Lien in respect of
any property of any Obligor or
any Subsidiary under, any indenture,
mortgage, deed of
trust, loan, purchase or
credit agreement, lease, corporate charter
or by-laws, or any other agreement or
instrument to which any Obligor or any Subsidiary is bound or by which any
Obligor or any Subsidiary or any of their
respective properties
may be bound or
affected, (ii) conflict with or result in a breach of any of the terms,
conditions or provisions of any order,
judgment, decree, or ruling of any court,
arbitrator or Governmental Authority
applicable to any Obligor or any Subsidiary
or (iii) violate any provision of any
statute or other rule or regulation of any
Governmental Authority applicable to any
Obligor or any Subsidiary.
Section
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 any Obligor of any Financing Agreement to which it is a party,
including
without limitation any thereof required in connection with the obtaining of
Dollars to make payments under the
Financing Agreements
and the payment of such
Dollars to Persons resident in the United
States of America. It is not necessary
to ensure the legality, validity,
enforceability or
admissibility into evidence
in any jurisdiction in which any Obligor
conducts its business or which asserts
jurisdiction over any properties of such Obligor of the
Financing Agreements
that any thereof or any other document be filed, recorded or enrolled with any
Governmental Authority, or that any such agreement or
document be stamped with
any stamp, registration or similar transaction tax other than (x) in
Ireland,
where (i) registration fees of, in aggregate,
EUR60 will be payable
in respect
of registration of certain of the Pledge
Agreements and (ii)
stamp duties will
be payable in respect of (a) the Pledge
Agreement by NN Ireland, at the rate of
.1% of the amounts secured thereby up to a maximum of EUR630,
(b) the Pledge
Agreement by the Company in respect of its
shares in NN Europe ApS, at the rate
of EUR12.50 and (c) any counterpart of the
Pledge Agreements at
(a) and (b), at
the rate of EUR12.50 and (y) in Italy,
where registration fees may be
required
in connection with the enforcement and/or
admissibility into
evidence of either
the Pledge Agreement by NN Ireland related
to NN Italy share certificates or the
Italian Subsidiary Guarantee. The amount of
the Italian Registration Duty has to
be assessed by the relevant Italian tax authorities and
currently is, as to the
Italian Subsidiary Guarantee, 0.50% of Euro 20 million
and, as to the
Pledge
Agreement entered into by NN Ireland, 0.50%
of the value of such pledge.
Section 5.8.
Litigation; Observance of Agreements, Statutes and Orders. (a)
There are no actions, suits or proceedings pending or, to the knowledge of
the
Company, threatened against or affecting the Company
or any Subsidiary or
any
property of the Company or any Subsidiary in any court or before
any arbitrator
of any kind or before or by any
Governmental Authority that, individually or in
the aggregate, could reasonably be expected
to have a Material Adverse Effect.
8
<PAGE>
(b) Neither the
Company nor any Subsidiary is in default under any term
of any agreement or instrument to which it
is a party or by which it is bound,
or any order, judgment, decree or ruling of
any court, arbitrator or
Governmental Authority or is in violation
of any applicable law, ordinance, rule
or regulation (including without limitation
Environmental Laws) of any
Governmental Authority, which default or
violation, individually or in the
aggregate, could reasonably be expected to
have a Material Adverse Effect.
Section 5.9.
Taxes. The Company and its Subsidiaries have filed all tax
returns that are required to have been
filed in any jurisdiction, and have paid
all taxes shown to be due and payable on such returns and all other taxes
and
assessments levied upon them or their
properties, assets,
income or franchises,
to the extent such taxes and assessments
have become due and
payable and before
they have become delinquent, except for any
taxes and assessments (i) the amount
of which is not individually or in the aggregate Material or (ii) the amount,
applicability or validity of which is
currently being contested in good faith by
appropriate proceedings and with respect to which the
Company or a Subsidiary,
as the case may be, has established
adequate reserves in accordance with
GAAP.
The Company knows of no basis for any other tax or assessment that could
reasonably be expected to have a Material
Adverse Effect. The charges, accruals
and reserves on the books of the Company
and its Subsidiaries in respect of
Federal, state or other taxes for all
fiscal periods are adequate. The Federal
income tax liabilities of the Company and
its Subsidiaries have
been determined
by the Internal Revenue Service and paid for all fiscal years up to and
including the fiscal year ended December 31, 2002. No liability for any Tax,
directly or indirectly, imposed, assessed, levied or collected by or for
the
account of any Governmental Authority or any political
subdivision thereof will
be incurred by an Obligor or any holder of a
Note as a result of the execution
or delivery of the Financing Agreements and no deduction or withholding in
respect of Taxes imposed by or for the account of
any Taxing
Jurisdiction, is
required to be made from any payment by the Obligors under the Financing
Agreements except for any such liability, withholding or deduction imposed,
assessed, levied or collected by or for the account of any such
Governmental
Authority arising out of circumstances described in clause (a), (b) or
(c) of
Section 13.
Section 5.10.
Title to Property;
Leases. The Company
and its Subsidiaries
have good and sufficient title to their
respective properties
that individually
or in the aggregate are Material, including
all such properties reflected in the
most recent audited balance sheet referred to in Section 5.5 or
purported to
have been acquired by the Company or any
Subsidiary
after said date
(except as
sold or otherwise disposed of in the
ordinary course of business), in each case
free and clear of Liens prohibited by this Agreement. All leases that
individually or in the aggregate are Material
are valid and
subsisting and are
in full force and effect in all material
respects.
Section 5.11.
Licenses, Permits,
etc. (a) The Company and its Subsidiaries
own or possess all licenses, permits, franchises, authorizations, patents,
copyrights, service marks, trademarks and trade names, or
rights thereto, that
individually or in the aggregate are Material,
without known conflict
with the
rights of others;
(b) To the best
knowledge of the
Company, no product of
the Company
or any of its Subsidiaries infringes in any Material respect
any
license, permit,
franchise,
authorization,
9
<PAGE>
patent, copyright,
service mark, trademark, trade name or other
right owned by any other Person; and
(c) To the
best knowledge of the Company, there is no Material
violation by any Person of any right of the Company or any of
its
Subsidiaries with respect to any patent, copyright, service
mark,
trademark, trade name or other right owned or used by the
Company
or any of its Subsidiaries.
Section
5.12. Compliance with ERISA. (a) The Company and each ERISA
Affiliate have operated and administered each Plan in compliance with all
applicable laws except for such instances
of noncompliance as
have not resulted
in and could not reasonably be expected to
result in a Material
Adverse Effect.
Neither the Company nor any ERISA Affiliate
has incurred any liability pursuant
to Title I or IV of ERISA or the
penalty or excise tax
provisions
of the Code
relating to employee benefit plans (as defined in section 3 of
ERISA), and no
event, transaction or condition has
occurred or exists that could reasonably be
expected to result in the incurrence of any
such liability by the Company or any
ERISA Affiliate, or in the imposition of any Lien on any of the rights,
properties or assets of the Company or any ERISA Affiliate, in either case
pursuant to Title I or IV of ERISA or to
such penalty or excise
tax provisions
or to section 401(a)(29) or 412 of the Code, other than such liabilities or
Liens as would not be individually or in
the aggregate Material.
(b)
With respect to each Plan (if any)
subject to Title IV of ERISA,
the present value of the aggregate benefit liabilities under
each
of the Plans (other than Multiemployer Plans), determined as of
the end of such Plan's most recently ended plan year on the
basis
of the actuarial
assumptions specified
for funding purposes
in
such Plan's most
recent actuarial valuation report, did not
exceed the
aggregate current value of the assets of such
Plan
allocable to such benefit liabilities. The present value of the
accrued benefit
liabilities
(whether or not
vested) under each
Foreign Plan that is
funded, determined as of the end of each
Obligor's most
recently ended fiscal year on the basis of
reasonable actuarial
assumptions,
did not exceed
the current
value of the
assets of such Foreign Plan allocable to such
benefit liabilities.
The term "benefit liabilities" has the
meaning specified in section 4001 of ERISA and the terms
"current
value" and "present value" have the meanings specified in
section
3 of ERISA.
(c) The Company and its ERISA Affiliates have not incurred (i)
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 or (ii) any obligation in connection
with
the termination of or withdrawal from any Foreign Plan.
(d) The expected
post-retirement benefit obligation (determined as of
the last day of the Company's most recently ended fiscal year
in
accordance with
Financial Accounting
Standards Board
Statement
No.
106, without regard to liabilities attributable to
continuation coverage
mandated by section
4980B of the Code) of
the Company and its Subsidiaries is not Material .
(e) The execution and
delivery of this Agreement and the issuance and
sale of the Notes hereunder will not involve any transaction
that
is subject to the
prohibitions
of section 406 of ERISA or in
connection with which a tax could be imposed pursuant to
10
<PAGE>
section
4975(c)(1)(A)-(D) of the Code. The representation by the
Company in the first sentence of this Section 5.12(e) is made in
reliance upon and subject to the accuracy of your representation
in Section
6.2 as to the
sources of the funds used to pay the
purchase price of the Notes to be purchased by you.
(f) All Foreign Plans
have been established,
operated,
administered
and maintained
in compliance with all laws, regulations and
orders applicable
thereto, except where failure so to comply
could not be
reasonably
expected to have a Material Adverse
Effect. All
premiums, contributions and any other amounts
required by applicable
Foreign Plan documents or applicable laws
to be paid or accrued by the Company and its Subsidiaries have
been paid or accrued as required, except where failure so to pay
or accrue could not be
reasonably
expected to have a Material
Adverse Effect.
Section
5.13. Private Offering by the Company. Neither the Company nor
anyone acting on its behalf nor any other
Obligor has
offered the Notes,
the
Subsidiary Guarantees or any similar
securities
for sale to, or
solicited any
offer to buy any of the same from,
or otherwise
approached
or negotiated in
respect thereof with, any Person other than you, the
Other Purchasers and
not
more than seventeen (17) other
Institutional
Investors, each of
which has been
offered the Notes and the Subsidiary Guarantees at a private sale for
investment. Neither the Company nor anyone acting on its behalf nor any
other
Obligor has taken, or will take, any action that would subject the
issuance or
sale of the Notes or the Subsidiary
Guarantees to the registration requirements
of Section 5 of the Securities Act.
Section 5.14.
Use of Proceeds;
Margin Regulations.
The Company will apply
the proceeds of the sale of the Notes to pay down bank revolving, term and
bridge loans and for general corporate purposes. 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 Federal
Reserve System (12 CFR 221), or for
the purpose of buying or carrying or trading in any securities under such
circumstances as to involve the Company in a
violation of
Regulation X of said
Board (12 CFR 224) or to involve any broker or dealer in a violation of
Regulation T of said Board (12 CFR 220).
Margin stock does not
constitute more
than 1.00% of the value of the consolidated assets of the Company and its
Subsidiaries and the Company does not have any present
intention that margin
stock will constitute more than 1.00% 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.
Section 5.15.
Existing Debt; Future Liens. (a) Schedule 5.15 sets forth
a complete and correct list of all
outstanding Debt of the Company and its
Subsidiaries as of April 1, 2004, since
which date there has been no Material
change in the amounts, interest rates,
sinking funds, installment payments or
maturities of the Debt of the Company or
its Subsidiaries except as specifically
set forth on such Schedule 5.15. Neither
the Company nor any Subsidiary is in
default and no waiver of default is
currently in effect, in the payment of any
principal or interest on any Debt of the
Company or such Subsidiary and no event
or condition exists with respect to any
Debt of the Company or any Subsidiary
that would permit (or that with notice or
the lapse of
11
<PAGE>
time, or both, would permit) one or more Persons to
cause such Debt to become
due and payable before its stated maturity or before its
regularly scheduled
dates of payment.
(b) Except as
disclosed in Schedule 5.15, neither the Company nor any
Subsidiary has
agreed or consented to cause or permit in the
future (upon the happening of a contingency or otherwise) any of
its property,
whether now owned or
hereafter acquired, to be
subject to a Lien not permitted by Section 10.3.
Section 5.16.
Foreign Assets Control Regulations, etc. Neither the sale of
the Notes by the Company hereunder nor its use of the proceeds thereof will
violate the Trading with the Enemy Act, as
amended, or any of the foreign assets
control regulations of the United States
Treasury Department
(31 CFR, Subtitle
B, Chapter V, as amended) or any enabling legislation or executive order
relating thereto. Without limiting the
foregoing, neither the Company nor any of
its Subsidiaries (a) is a person whose property or interests in property
are
blocked pursuant to Section 1 of Executive
Order 13224 of
September 23, 2001
Blocking Property and Prohibiting
Transactions With Persons Who Commit, Threaten
to Commit, or Support Terrorism (66 Fed. Reg.
49079 (2001)) or (b)
engages in
any Material dealings or transactions, or
is otherwise associated, with any such
person. The Company and its Subsidiaries are in compliance, in all material
respects, with the Uniting and Strengthening
America by Providing
Appropriate
Tools Required to Intercept and Obstruct
Terrorism (USA Patriot Act of 2001). No
part of the proceeds from the sale of the
Notes hereunder will
be used, for any
payments to any governmental official or
employee, political
party, official of
a political party, candidate for political
office, or anyone else
acting in an
official capacity, in order to obtain, retain or direct business or
obtain any
improper advantage, in violation of the United States
Foreign Corrupt Practices
Act of 1977, as amended.
Section 5.17. Status under Certain Statutes. Neither the Company
nor any
Subsidiary is an "investment company"
registered or required to be registered
under the Investment Company Act of 1940,
as amended, or is subject to
regulation under the Public Utility Holding
Company Act of 1935, as amended, the
ICC Termination Act of 1995, as amended, or
the Federal Power Act, as amended.
Section 5.18.
Environmental Matters. Neither the Company nor any Subsidiary
has knowledge of any claim or has received any notice of any claim, and no
proceeding has been instituted raising any claim against the
Company or any of
its Subsidiaries or any of their respective real properties now or formerly
owned, leased or operated by any of them or
other assets, alleging any damage to
the environment or violation of any
Environmental
Laws, except, in each case,
such as could not reasonably be expected to
result in a Material Adverse Effect.
Except as otherwise disclosed to you in
writing:
(a) neither the
Company nor any Subsidiary has knowledge of any facts
which would
give rise to any claim, public or private, of
violation of
Environmental
Laws or damage
to the environment
emanating from,
occurring on or in any way related to real
properties now or
formerly owned,
leased or operated by
any of
them or to other assets or their use, except, in each case, such
as could not
reasonably be
expected to result in a Material
Adverse Effect;
12
<PAGE>
(b) neither the
Company nor any of its
Subsidiaries
has stored any
Hazardous Materials on
real properties
now or formerly
owned,
leased or operated by any of them or has disposed of any
Hazardous Materials
in a manner
contrary to any
Environmental
Laws in each case in any manner that could reasonably be
expected
to result in a Material Adverse Effect; and
(c) all buildings on all real properties now owned, leased or
operated by
the Company or any of its Subsidiaries are in
compliance with
applicable
Environmental
Laws, except where
failure to comply could not reasonably be expected to result in
a
Material Adverse Effect.
Section 5.19.
Solvency.
(a) Assets Greater
Than Liabilities.
The fair value of the
business
and assets of the Company and its Subsidiaries, taken as a whole
on a consolidated
basis, exceeds,
as of, and immediately
after
giving effect to the transactions consummated on the date of the
Closing, the
liabilities
of the Company and its
Subsidiaries,
taken as a whole on a consolidated basis, as of such time.
(b) Meeting
Liabilities.
Immediately
after giving effect to the
transactions
contemplated by this
Agreement, the Notes
and the
other Financing Agreements, no Obligor:
(i) will be engaged in any business or transaction, or about to
engage
in any
business or transaction, for which its assets would constitute
unreasonably
small capital
(within the meaning of
the Uniform
Fraudulent
Transfer Act,
the Uniform Fraudulent
Conveyance Act and section 548 of the
Bankruptcy Code,
in each case, of the United States of America); or
(ii) will be unable to pay its debts as such debts mature.
(c) Intent. No Obligor
is entering into the Agreement, the Notes and
the other Financing Agreements with any intent to hinder,
delay,
or defraud either current creditors or future creditors of such
Obligor.
Section 5.20.
Collateral Documents.
The Collateral Documents will create a
valid Lien in and to the Collateral in
favor of the Collateral Agent, subject to
no prior Liens except Liens permitted under
Section 10.3.
Section
5.21. Ranking of Notes. The Company's obligations under the
Financing Agreements will, upon issuance of
the Notes, rank in right of payment
at least pari passu, without preference or priority, with all of its other
outstanding unsubordinated Debt and all
unsubordinated trade obligations, except
for Debt which is preferred as a result of
being priority secured (but then only
to the extent of such security) or by operation of law. Each Guarantor's
obligations under the Subsidiary Guarantees
will, upon issuance thereof, rank in
right of payment pari passu, without preference or priority,
with all of such
Guarantor's other outstanding unsubordinated Debt and all
unsubordinated
trade
obligations, except for Debt which is
preferred
13
<PAGE>
as a result of being priority secured (but then only to the extent of such
security) or by operation of law.
Upon the issuance of
the Notes on the date of
Closing, NN Mexico, LLC and NN Arte S. de R.L. de C.V.
will not be obligors or
guarantors in respect of the Bank
Indebtedness
and no equity
interests or note
obligations thereof have been pledged to
secure the Bank Indebtedness.
SECTION 6. REPRESENTATIONS OF THE
PURCHASER.
Section 6.1.
Purchase for Investment. You represent that you are purchasing
the Notes for your own account or for one
or more separate
accounts
maintained
by you or for the account of one or more
pension or trust funds
and not with a
view to the distribution thereof, provided
that the disposition of your or their
property shall at all times be within your
or their control. You understand that
the Notes and the Subsidiary Guarantees 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 Company is not
required to register
the Notes or
the Subsidiary Guarantees.
Section 6.2. Source of Funds. You represent that at least one of
the
following statements is an accurate
representation as to each source of funds (a
"Source") to be used by you to pay the
purchase price of the Notes to be
purchased by you hereunder:
(a) the Source is an
"insurance company
general account"
within the
meaning of Department of Labor Prohibited Transaction Exemption
("PTE") 95-60
(issued July 12, 1995) and there is no employee
benefit plan, treating
as a single plan, all plans maintained by
the same employer or employee organization, with respect to
which
the amount of the general account reserves and liabilities for
all contracts
held by or on behalf
of such plan, exceed ten
percent (10%) of the
total reserves and liabilities of such
general account (exclusive of separate account liabilities) plus
surplus, as set forth
in the NAIC Annual
Statement filed with
your state of domicile; or
(b) the Source is
either (i) an
insurance company
pooled separate
account, within the
meaning of PTE 90-1 (issued January 29,
1990), or (ii) a bank
collective
investment
fund, within the
meaning of the PTE 91-38 (issued July 12, 1991) and, except as
you have disclosed
to the Company in writing pursuant to this
paragraph (b),
no employee benefit plan or group of plans
maintained by
the same employer or employee organization
beneficially owns more
than 10% of all assets
allocated to such
pooled separate account or collective investment fund; or
(c) the Source
constitutes assets of an "investment fund" (within the
meaning of Part V of the QPAM Exemption) managed by a "qualified
professional asset manager" or "QPAM" (within the meaning of
Part
V of the QPAM
Exemption), no
employee benefit plan's assets that
are included in such
investment fund,
when combined with the
assets of all other employee benefit plans established or
maintained by the same
employer or by an
affiliate (within
the
meaning of
Section V(c)(1) of the QPAM Exemption) of such
employer or by the same employee organization and managed by
such
QPAM, exceed 20% of the total client assets managed by such
QPAM,
the
14
<PAGE>
conditions of
Part I(c) and (g) of the QPAM Exemption are
satisfied,
neither the
QPAM nor a person controlling or
controlled by the QPAM
(applying the
definition of "control" in
Section V(e) of the QPAM Exemption) owns a 5% or more interest
in
the Company and (i) the identity of such QPAM and (ii) the
names
of all employee
benefit plans whose
assets are included in such
investment fund have
been disclosed
to the Company in writing
pursuant to this paragraph (c); or
(d) the Source is a
governmental plan; or
(e) the Source is one
or more employee
benefit plans, or a
separate
account or trust fund
comprised of one or more employee benefit
plans, each of
which has been identified to the Company in
writing pursuant to this paragraph (e); or
(f) the Source does
not include assets of any employee benefit plan,
other than a plan exempt from the coverage of ERISA.
If you or any
subsequent transferee of the Notes indicates that you or such
transferee are relying on any
representation
contained in paragraph (b), (c) or
(e) above, the Company shall deliver on the date of
Closing and on the date of
any applicable transfer a certificate,
which shall either
state that (i) it is
neither a party in interest nor a
"disqualified
person" (as defined in
section
4975(e)(2) of the Internal Revenue Code of 1986, as amended), with respect to
any plan identified pursuant to paragraphs (b) or (e) above, or (ii) with
respect to any plan, identified pursuant to paragraph
(c) above, neither it nor
any "affiliate" (as defined in Section V(c) of the
QPAM Exemption) has at such
time, and during the immediately
preceding one year,
exercised the authority to
appoint or terminate said QPAM as manager of any plan identified in writing
pursuant to paragraph (c) above or to negotiate the terms of said QPAM's
management agreement on behalf of any such identified plan. As used in this
Section 6.2, the terms "employee benefit
plan", "governmental
plan", "party in
interest" and "separate account" shall have
the respective
meanings assigned to
such terms in section 3 of ERISA.
SECTION 7. INFORMATION AS TO OBLIGORS.
Section 7.1.
Financial and Business
Information. The
Obligors (other than
NN Italy) shall deliver to each holder of Notes that is an Institutional
Investor:
(a) Quarterly Statements -- within the earlier of (x) 60 days after
the
end of each quarterly fiscal period in each fiscal year of the
Company
(other than the last quarterly fiscal period of each such fiscal
year)
or (y) the date, if any, when the quarterly statements set forth
below
are delivered to any other lender to the Company, duplicate copies
of:
(i) a consolidated
balance sheet of the
Company and its consolidated
Subsidiaries as at the end of such quarter, and
(ii) consolidated
statements of
income, changes in shareholders'
equity and
cash flows of the Company and its consolidated
Subsidiaries for such
quarter
15
<PAGE>
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
(i) the above described financial
statements shall be
with respect to the
Company and its
Restricted
Subsidiaries (and not
the Company and its consolidated Subsidiaries)
for any such quarterly
fiscal period with respect to which the
aggregate assets
of all Unrestricted Subsidiaries exceed 5% of
Consolidated Total
Assets as of the end of such quarterly fiscal
period, and (ii) so
long as the
requirements of the foregoing clause
(i) are not
applicable, 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 the earlier of (x) 105 days after the
end of each fiscal
year of the Company or (y) the date, if any,
when the annual
statements set forth
below are delivered to any
other lender to the Company, duplicate copies of:
(i) a consolidated balance sheet of the Company and its
consolidated Subsidiaries, as at the end of such year, and
(ii) consolidated
statements of income,
changes in consolidated
shareholders' equity
and cash flows of the
Company and its
consolidated 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 consolidated financial position of the
companies being reported upon and their results of operations and
cash
flows and have been
prepared in conformity
with GAAP,
and that the
examination of such
accountants
in connection
with such financial
statements has
been made in accordance with generally accepted
auditing standards,
and that such audit
provides a reasonable
basis
for such opinion in
the circumstances,
provided that (i) the above
described financial
statements
shall be with respect
to the Company
and its Restricted Subsidiaries (and not the Company and its
consolidated
Subsidiaries) for any
such annual
fiscal period with
respect to which the aggregate assets of all Unrestricted
Subsidiaries
exceed 5% of
Consolidated
Total Assets as of the end of such
annual
fiscal period, and
(ii) so long as the
requirements of the foregoing
clause (i) are not
applicable, the
delivery within the time period
specified above of the
Company's Annual
Report on Form 10-K for such
fiscal year
(together
with
the Company's annual report to
shareholders, if any,
prepared pursuant to Rule 14a-3 under the
Exchange Act)
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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 or proxy statement
sent
by the Company or any Subsidiary to public securities holders
generally,
and (ii) each
regular or periodic
report, each registration
statement
(without exhibits except as expressly requested by such holder),
and each
prospectus and all amendments thereto filed by the Company or
any
Subsidiary
with the Securities
and Exchange
Commission (excluding
those
pertaining
solely to Plans) and
of all press releases and other statements
made
available generally by the Company or any
Subsidiary
to the public
concerning
developments that are Material;
(d) Notice of Default
or Event of Default
-- promptly, and in any
event within
five 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 five days
after
a Responsible
Officer becoming aware of any of the
following,
a written
notice
setting forth the
nature thereof and the
action, if any, that
the
Company or an
ERISA Affiliate proposes to take with respect thereto:
(i) with respect to
any Plan, any reportable event, as defined
in section 4043(b) of ERISA and the regulations thereunder,
for which notice
thereof has not been
waived pursuant to
such regulations as in effect on the date hereof; or
(ii) the taking
by the PBGC of steps to institute, or the
threatening by the PBGC of the institution of, proceedings
under section 4042 of ERISA for the termination of, or the
appointment of a
trustee to administer,
any Plan, or the
receipt by the Company
or any ERISA Affiliate
of a notice
from a Multiemployer Plan that such action has been taken by
the PBGC with respect to such Multiemployer Plan; or
(iii)any event,
transaction or
condition that could result in
the incurrence of any
liability by the Company or any ERISA
Affiliate pursuant to
Title I or IV of ERISA or the penalty
or excise tax
provisions of the Code
relating to
employee
benefit plans,
or in the imposition of any Lien on any
of
the rights, properties or assets of the Company or any ERISA
Affiliate pursuant to Title I or IV of ERISA or such penalty
or excise tax provisions, if such liability or Lien,
taken
together with any
other such liabilities or Liens then
existing, could
reasonably
be expected to have a
Material
Adverse Effect; or
17
<PAGE>
(iv) receipt of notice of the imposition of a Material financial
penalty (which for this purpose shall mean any tax, penalty
or other liability, whether by way of indemnity or
otherwise) with respect to one or more Foreign Plans;
(f) Notices from Governmental Authority -- promptly,
and in any
event within 30 days of receipt thereof, copies of any notice to the
Company or any
Subsidiary
from any Federal or state Governmental
Authority relating
to any order, ruling, statute or other law or
regulation that
could reasonably be expected to have a Material
Adverse Effect;
(g) Supplements
-- promptly and in any event within five (5)
Business Days after the execution and delivery of any Supplement, a
copy thereof; and
(h) Requested
Information -- with
reasonable promptness,
such
other data and
information
relating to the business, operations,
affairs, financial
condition, assets or
properties of the Company or
any of its
Subsidiaries or
relating to the
ability of an Obligor to
perform its or their
obligations
hereunder and under the Notes or
under any other Financing Agreement as from time to time may be
reasonably requested by any such holder of Notes.
Section
7.2. Officer's Certificate. 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
setting forth:
(a) Covenant
Compliance
-- the information (including detailed
calculations)
required in order to establish whether the Company was in
compliance
with the requirements of Section 10.3 through Section 10.7
hereof,
inclusive, and Section
10.10 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);
(b) Event of Default -- a statement that such officer has reviewed
the
relevant terms
hereof and has made, or caused to be made, under his or her
supervision, a
review of the transactions and conditions of the Company and
its 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 the Company 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;
and
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<PAGE>
(c) Restricted
Subsidiaries
-- a list indicating which of the
Company's
Subsidiaries
were Restricted
Subsidiaries as of the
end of the
period covered
by the financial statements then being furnished.
Section 7.3.
Inspection.
The Obligors
(other than NN Italy)
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 Company,
to visit the
principal executive office of the Company, to discuss the
affairs,
finances and accounts of the Company and its Subsidiaries with
the
Company's
officers, and (with the consent of the
Company, which
consent
will not be
unreasonably withheld) its independent public accountants,
and
(with the
consent of the Company, which consent will not be unreasonably
withheld) to
visit the other offices and properties of the Company and each
Subsidiary,
all at such reasonable
times and as often as may be reasonably
requested in
writing; and
(b) Default -- if a Default or Event of Default then exists, at
the expense of the Company, to visit and inspect any of the offices
or
properties of the
Company or any
Subsidiary,
to examine
all their
respective books of
account, records,
reports and other
papers, to
make copies and extracts therefrom, and to discuss their respective
affairs, finances and
accounts with their respective officers and
independent public
accountants
(and by this
provision the Company
authorizes said
accountants
to discuss the
affairs, finances and
accounts of the Company and its Subsidiaries pursuant to this Section
7.3(b)), all at
such times and as often as may be reasonably
requested.
SECTION 8. PREPAYMENT OF THE SERIES A
NOTES.
Section 8.1.
Required Prepayments.
On April 26, 2008 and
on each April 26
thereafter to and including April 26, 2013
the Company will prepay $5,714,285.71
principal amount (or such lesser principal
amount as shall then be outstanding)
of the Series A Notes at par and without
payment of the Make-Whole Amount or any
premium, provided that upon any partial prepayment of the Series A Notes
pursuant to Section 8.2 or Section 8.3 the
principal amount of each required
prepayment of the Series A Notes becoming due under this Section 8.1 on and
after the date of such prepayment shall be
reduced in the same proportion as the
aggregate unpaid principal amount of the Series A
Notes is reduced as a result
of such prepayment.
Section 8.2.
Optional Prepayments with Series A Make-Whole
Amount. The
Company may, at its option, upon notice as provided
below, prepay at any time
all, or from time to time any part of, the
Series A Notes, in an amount not less
than 10% of the aggregate principal amount of the Series A Notes then
outstanding in the case of a partial
prepayment, at 100% of the principal amount
so prepaid, together with interest accrued thereon to the date of such
prepayment, plus the Series A Make-Whole
Amount determined for the prepayment
date with respect to such principal amount.
The Company will give each holder of
Series A 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
19
<PAGE>
date, the aggregate principal amount of the
Series A Notes to be prepaid on such
date, the principal amount of each Series A Note held by such holder to be
prepaid (determined in accordance with
Section 8.4), 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 Series A 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 Company shall deliver to each holder of Series A Notes a
certificate of a Senior Financial Officer specifying the calculation of such
Series A Make-Whole Amount as of the
specified prepayment date.
Section 8.3.
Change in Control. (a)
Notice of Change in Control or Control
Event. The Company will, within five (5) Business
Days after any
Responsible
Officer has knowledge of the occurrence of any Change in Control or
Control
Event, give written notice (the "Change of Control
Notice") of such
Change in
Control or Control Event to each holder of Notes unless notice in respect of
such Change in Control (or the Change of
Control contemplated
by such Control
Event) shall have been given pursuant to
subparagraph
(c) of this Section
8.3.
Such Change of Control Notice shall contain and constitute an offer to prepay
the Series A Notes as described in Section 8.3(c) hereof and shall be
accompanied by the certificate described in
Section 8.3(g).
(b) Condition to
Company Action. The
Company will not take any action that
consummates or finalizes a Change in Control
unless (i) at least 30
days prior
to such action it shall have given to each holder of Series A Notes
written
notice containing and constituting an offer to prepay Series A Notes as
described in subparagraph (c) of this Section 8.3, accompanied by the
certificate described in subparagraph (g) of this Section 8.3, and (ii)
contemporaneously with such action, it
prepays all Series A Notes required to be
prepaid in accordance with this Section
8.3.
(c) Offer to
Prepay Notes. The offer to prepay Series A Notes contemplated
by paragraph (a) and (b) of this Section 8.3 shall be an offer to
prepay, in
accordance with and subject to this Section
8.3, all, but not less than all, the
Series A Notes held by each holder (in this case only,
"holder" in respect of
any Series A Note registered in the name of
a nominee for a disclosed beneficial
owner shall mean such beneficial owner) on a date specified in such Change of
Control Notice (the "Proposed Prepayment Date"). If such Proposed Prepayment
Date is in connection with an offer
contemplated
by subparagraph (a) of this
Section 8.3, such date shall be not less
than 30 days and not more than 120 days
after the date of such offer (if the Proposed Prepayment Date shall not be
specified in such offer, the Proposed Prepayment Date shall be the first
Business Day after the 45th day after the
date of such offer).
(d) Acceptance. A holder of Series A Notes may
accept the offer to prepay
made pursuant to this Section 8.3 by
causing a notice of such acceptance to be
delivered to the Company not later than 15
days after receipt by
such holder of
the most recent offer of prepayment.
A failure by a holder
of Series A Notes to
respond to an offer to prepay made
pursuant to this
Section 8.3 shall be deemed
to constitute a rejection of such offer by
such holder.
20
<PAGE>
(e) Prepayment.
Prepayment of the
Series A Notes to be prepaid pursuant to
this Section 8.3 shall be at 100% of the
principal amount of
the Series A Notes
together with accrued and unpaid interest
thereon. The
prepayment shall be made
on the Proposed Prepayment Date except as provided
in subparagraph (f) of
this
Section 8.3.
(f) Deferral
Pending Change in Control. The obligation of the Company
to
prepay Series A Notes pursuant to the
offers required by
subparagraph
(c) and
accepted in accordance with subparagraph (d) of this Section 8.3 is subject
to
the occurrence of the Change in Control in respect of which such
offers and
acceptances shall have been made. In the event that such Change in
Control has
not occurred on the Proposed Prepayment
Date in respect thereof, the prepayment
shall be deferred until, and shall be made on, the date on
which such Change in
Control occurs. The Company shall keep each holder
of Series A Notes reasonably
and timely informed of (i) any such
deferral of the date of prepayment, (ii) the
date on which such Change in Control and
the prepayment
are expected to
occur,
and (iii) any determination by the Company
that efforts to effect such Change in
Control have ceased or been abandoned (in
which case the offers and acceptances
made pursuant to this Section 8.3 in
respect of such Change in Control shall be
deemed rescinded).
(g) Officer's
Certificate. Each offer to prepay the Series A Notes pursuant
to this Section 8.3 shall be accompanied by a certificate, executed by the
Senior Financial Officer of the Company and dated the date of such offer,
specifying: (i) the Proposed Prepayment Date; (ii) that such offer is made
pursuant to this Section 8.3; (iii) the principal amount of each Series A Note
offered to be prepaid (which shall be 100%
of each such Series A Note); (iv) the
interest that would be due on each Series A
Note offered to be prepaid, accrued
to the Proposed Prepayment Date; (v) that the conditions of this Section 8.3
have been fulfilled; and (vi) in reasonable detail, the nature and date or
proposed date of the Change in Control.
(h) Certain
Definitions. "Change
in Control" shall mean an event or series
of events by which (a) any "person" or "group" (within the meaning of
Sections
13(d) and 14(d)(2) of the Exchange
Act), shall become the "beneficial owner"
(within the meaning of Rule 13d-3
and/or Rule 13d-5 under the Exchange Act,
except that a Person shall be deemed to have "beneficial ownership" of all
shares or other ownership interests, as the case may be, that such
Person has
the right to acquire without condition,
other than the passage
of time, whether
such right is exercisable immediately or only after the passage of time),
directly or indirectly, of thirty-five percent (35%) or more of the
combined
voting power of all securities of the Company
entitled to vote in
the election
of directors, other than securities having such power only by reason of
the
happening of a contingency (other than the passage of time),
or (b) during any
period of up to twelve (12) consecutive
months, individuals who at the beginning
of such period were directors or managers of the Company
shall cease for
any
reason to constitute a majority of the Board of
Directors or managers of the
Company. The foregoing definition shall be
deemed amended to the extent that the
provisions of Section 11.1.18 (or any
successor provision thereto) of the Credit
Agreement is amended from time to time (but not
merely waived). During any
period when the Bank Indebtedness does not grant remedies to the lenders
thereunder in the event of a change in
control, and during
any period in which
no Bank Indebtedness exists, the rights of the holders of the
Notes to require
prepayment pursuant to this Section 8.3 shall
be suspended until
21
<PAGE>
such time, if any, as a replacement provision is included in the Bank
Indebtedness, in which event such provision shall be incorporated herein by
reference.
"Control Event"
means:
(i) the execution by the Company or an Affiliate of any agreement or
letter of intent with respect to any proposed transaction or event or
series of transactions or events which, individually or in the
aggregate, may
reasonably
be expected to result in a Change in
Control,
(ii) the
execution of any written agreement which, when fully
performed by
the parties thereto, would result in a Change in Control, or
(iii)the
making of any
written offer by any person (as such term
is used
in Section 13(d) and Section 14(d)(2) of the Exchange Act as in
effect
on the date of the Closing) or related persons constituting a group
(as such term is used
in Rule 13d-5
under the Exchange Act as in
effect on the date of the Closing) to the holders of the
outstanding
equity of the Company,
which offer, if accepted by the requisite
number of holders, would result in a Change in Control.
(i) All
calculations contemplated in this Section 8.3 involving the
capital
stock or other equity interest of any Person shall be
made with the
assumption
that all convertible securities of such Person then outstanding and all
convertible securities issuable upon the
exercise of any warrants, options and
other rights outstanding at such time were converted at
such time and that all
options, warrants and similar rights to
acquire shares of capital stock or other
equity interest of such Person were
exercised at such time.
Section 8.4.
Allocation of Partial
Prepayments In the case of each partial
prepayment of the Series A Notes pursuant
to Sections 8.1 and 8.2, the principal
amount of the Series A Notes to be prepaid
shall be allocated
among all of the
Series A Notes at the time outstanding in
proportion, as nearly
as practicable,
to the respective unpaid principal amounts
thereof.
Section 8.5.
Maturity; Surrender, etc In the case of each
prepayment of
Series A Notes pursuant to Section 8.1 and 8.2,
the principal amount of each
Series A 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, in the case of
prepayment pursuant to Section 8.2, the
applicable Series A Make-Whole Amount, if any. From and after
such date, unless
the Company shall fail to pay such
principal amount when so due and
payable,
together with the interest and Series A
Make-Whole Amount, if any, as aforesaid,
interest on such principal amount shall
cease to accrue. Any
Series A Note paid
or prepaid in full shall be surrendered to the Company and cancelled and
shall
not be reissued, and no Series A Note shall be issued in lieu of any
prepaid
principal amount of any Series A Note.
Section 8.6.
Purchase of Notes. Each Obligor (other than NN Italy) will not
and will not permit any Affiliate to purchase, redeem, prepay or otherwise
acquire, directly or indirectly,
any of the outstanding
Series A Notes
except
upon the payment or prepayment of the
Series A Notes
22
<PAGE>
in accordance with the terms of this
Agreement and the Series A Notes.
Such
Obligor will promptly cancel all Series A Notes acquired
by it or any Affiliate
pursuant to any payment, prepayment or purchase of Series A Notes
pursuant to
any provision of this Agreement and no Series A Notes may be issued in
substitution or exchange for any such
Series A Notes.
Section
8.7. Series A Make-Whole Amount. The term "Series A Make-Whole
Amount" means, with respect to any Series A
Note, an amount equal to the excess,
if any, of the Discounted Value of the
Remaining Scheduled Payments with respect
to the Called Principal of such Series A Note over the amount of
such Called
Principal, provided that the Series A
Make-Whole Amount may in no event be less
than zero. For the purposes of determining
the Series A Make-Whole Amount, the
following terms have the following
meanings:
"Called Principal"
means, with respect to any Series A Note, the
principal of such
Series A 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 Series A Note, the amount obtained by discounting all Remaining
Scheduled Payments
with respect to such Called Principal from their
respective scheduled
due dates to the Settlement Date with respect to
such Called Principal,
in accordance with accepted financial practice
and at a discount
factor (applied on the
same periodic basis as that
on which interest
on the Series A Notes is payable) equal to the
Reinvestment Yield with respect to such Called Principal.
"Reinvestment Yield"
means, with respect to the Called Principal
of any Series A Note,
0.50% over the yield to maturity implied by (i)
the yields
reported, as of 10:00 A.M. (New York City time) on the
second Business Day preceding the Settlement Date with respect to
such
Called Principal, on
the display designated as "PX1" on the Bloomberg
Financial Markets
Services Screen (or such other display as may
replace page "PX1" on the Bloomberg Financial Markets Services
Screen)
for on-the-run
actively traded U.S. Treasury securities having a
maturity equal to the Remaining Average Life of such Called
Principal
as of such Settlement Date, or (ii) if such yields are not reported
as
of such time or the yields reported as of such time are not
ascertainable, the
Treasury Constant Maturity Series Yields reported,
for the latest day for which such yields have been so reported as of
the second
Business Day preceding
the Settlement Date with respect to
such Called Principal,
in Federal Reserve
Statistical
Release H.15
(519) (or any comparable successor publication) for actively traded
U.S. Treasury
securities
having a constant maturity equal to the
Remaining Average Life
of such series of such Called Principal as of
such Settlement
Date. Such implied yield will be determined, if
necessary, by
(a) converting U.S. Treasury bill quotations to
bond-equivalent yields
in accordance with accepted financial practice
and (b) interpolating
linearly between (1) the actively traded
(and
on-the-run, in the
case of page
"PX1" on the Bloomberg Financial
Markets Services
Screen) U.S. Treasury security with a maturity
closest to and greater
than the Remaining
Average Life and (2) the
actively traded
(and on-the-run, in the case
23
<PAGE>
of page PX1 on the Bloomberg Financial Markets Services Screen) U.S.
Treasury security
with a maturity closest to and less than the
Remaining Average Life.
"Remaining Average
Life" means, with respect to any Called
Principal, the number
of years (calculated to the nearest one-twelfth
year) obtained by dividing (i) such Called Principal into (ii) the
sum
of the products obtained by multiplying (a) the principal component
of
each Remaining Scheduled Payment with respect to such Called
Principal
by (b) the number of
years (calculated
to the nearest one-twelfth
year) 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 Series A Note, all payments of such Called
Principal
and interest thereon
that would be due after the Settlement Date with
respect to
such Called Principal if no payment of such Called
Principal were made prior to its scheduled due date, provided that if
such Settlement Date is not a date on which interest payments are due
to be made under the terms of the Series A Notes, then the amount of
the next succeeding
scheduled interest payment will be reduced by the
amount of interest
accrued to such Settlement Date and required to be
paid on such Settlement Date pursuant to Section 8.2 or 12.1.
"Settlement Date"
means, with respect to the Called Principal of
any Series A 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.
SECTION 9. AFFIRMATIVE COVENANTS.
The Obligors
(other than NN Italy), jointly and severally, covenant that so
long as any of the Notes are
outstanding:
Section 9.1.
Compliance with Law.
The Company will, and will cause each of
its Subsidiaries to, comply with all laws,
ordinances or
governmental rules
or
regulations to which each of them is subject,
including,
without limitation,
Environmental Laws, and will obtain and maintain in effect all licenses,
certificates, permits, franchises and other governmental authorizations
necessary to the ownership of their
respective
properties or to the
conduct of
their respective businesses, in each case
to the extent necessary to ensure that
non-compliance with such laws, ordinances or governmental rules
or regulations
or failures to obtain or maintain in effect such licenses, certificates,
permits, franchises and other governmental authorizations could not,
individually or in the aggregate, reasonably be expected to have a Material
Adverse Effect.
Section
9.2. Insurance. The Company will, and will cause each of its
Subsidiaries 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.
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<PAGE>
Section 9.3.
Maintenance of
Properties.
The Company will, and
will cause
each of its Subsidiaries 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 the Company 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 the Company has concluded that such
discontinuance could not, individually or in the aggregate, reasonably be
expected to have a Material Adverse
Effect.
Section 9.4.
Payment of Taxes and Claims. The Company will, and will
cause
each of its Subsidiaries to, file all tax returns
required to be filed
in any
jurisdiction and to pay and discharge all taxes shown to be
due and payable on
such returns and all other taxes,
assessments,
governmental charges,
or levies
imposed on them or any of their properties,
assets, income or franchises, to the
extent such taxes and assessments have become due and payable and
before they
have become delinquent and all claims for
which sums have become due and payable
that have or might become a Lien on
properties
or assets of the
Company or any
Subsidiary, provided that neither the Company
nor any Subsidiary
need pay any
such tax or assessment or claims if (i) the
amount, applicability
or validity
thereof is contested by the Company or such
Subsidiary on a timely basis in good
faith and in appropriate proceedings, and the Company or a Subsidiary has
established adequate reserves therefor in accordance
with GAAP on the books of
the Company or such Subsidiary or (ii) the nonpayment of all such taxes,
assessments and claims in the aggregate
could not reasonably be expected to have
a Material Adverse Effect.
Section
9.5. Corporate Existence, etc. The Company will at all times
preserve and keep in full force and effect
its corporate
existence. Subject
to
Sections 10.2 and 10.7, the Company will at all times
preserve and keep in full
force and effect the corporate existence of each of its
Subsidiaries
and all
rights and franchises of the Company and
its Subsidiaries
unless, in the good
faith judgment of the Company,
the termination of or failure to preserve and
keep in full force and effect such
corporate existence, right or franchise could
not, individually or in the aggregate, have
a Material Adverse Effect.
Section 9.6.
Notes to Rank Pari Passu. The Notes and all other obligations
under the Financing Agreements of the
Obligors are and at all times shall remain
direct and unsubordinated obligations of
the Obligors party thereto ranking pari
passu as against the assets of the related Obligor with all other Notes from
time to time issued and outstanding hereunder without any preference among
themselves and pari passu with all other
present and future
unsubordinated Debt
of the related Obligor (including Bank
Indebtedness)
which is not expressed
to
be subordinate or junior in rank to any other unsubordinated Debt of the
Company.
Section
9.7. Post-Closing Requirements. Within 30 days after the
Intercreditor Agent, in accordance with instructions from Italian counsel,
delivers the NN Italy share certificate to an appropriate
civil law notary
for
notation, the Company shall (i) cause the Lien in favor of the
Noteholder
Collateral Agent on the shares of capital stock of NN Italy granted by NN
Ireland to be noted upon the certificates
representing such shares in accordance
with Italian law, and (ii) deliver a legal opinion which is reasonably
satisfactory to the holders from McCann
25
<PAGE>
FitzGerald Solicitors with respect to perfecting Liens under Ireland law and
Pavia e Ansaldo Studio Legale with respect to the
perfection of such Lien under
Italian law.
Within thirty days
after the date of Closing, the Company shall have caused
the Lenders and the Administrative Agent under the Credit
Agreement to enter
into such agreements as may be reasonably
required by the
Required Holders
to
cause the certificate of deposit in the
face amount of [GRAPHIC OMITTED]100,000
Deposit No. 4058980, issued by ABN AMRO,
N.V., to the Company and subject to the
provisions of the Certificate of Deposit
Control Agreement dated July 23, 2003
to be subject to the Intercreditor Agreement for the pari passu
benefit of the
Lenders, as defined in the Intercreditor
Agreement.
SECTION 10. NEGATIVE COVENANTS.
The Obligors
(other than NN Italy), jointly and severally, covenant that so
long as any of the Notes are
outstanding:
Section 10.1.
Transactions with
Affiliates. The
Company will not and will
not permit any Subsidiary to enter into
directly or indirectly
any transaction
or group of related transactions (including without limitation the purchase,
lease, sale or exchange of properties of any kind or the rendering of any
service) with any Affiliate (other than the Company or another Subsidiary),
except in the ordinary course and pursuant
to the reasonable requirements of the
Company's or such Subsidiary's business and upon fair and
reasonable terms
no
less favorable to the Company or such
Subsidiary
than would be
obtainable in a
comparable arm's-length transaction with a
Person not an Affiliate.
Section 10.2.
Merger, Consolidation,
etc. The Company shall not, and shall
not permit any Restricted Subsidiary to, consolidate with or merge with any
other corporation, limited liability company or
limited partnership or
convey,
transfer or lease substantially all of its assets in a single
transaction
or
series of transactions to any Person
unless:
(a) in the case of any such transaction involving an Obligor, the
successor
formed by such
consolidation
or the survivor of
such merger or
the Person that
acquires by conveyance, transfer or lease substantially all
of the assets of
the Company as an entirety, as the case may be, shall be a
solvent
corporation,
limited liability company or limited partnership
organized
and existing under the laws of the United
States or any
State
thereof
(including the District of Columbia) or, in the case of any
Obligor
other than the
Company, the jurisdiction of such Obligor's organization or
any Permitted
Jurisdiction
and, if such Obligor
is not such
corporation,
limited
liability company or limited partnership, (i) such corporation,
limited
liability company or limited partnership shall have executed
and
delivered
to each holder of any Notes its assumption of the due and
punctual
performance and
observance of each covenant and condition of each
respective
Financing Agreement by which Obligor was bound and (ii)
shall
have
caused to be
delivered to each holder of any Notes an
opinion of
nationally
recognized
independent
counsel, or other independent counsel
reasonably
satisfactory
to the Required
Holders, to the effect that all
agreements or
instruments
effecting such
26
<PAGE>
assumption are
enforceable in
accordance with their
terms and comply with
the terms
hereof;
(b) in the case
of any such transactions involving a Restricted
Subsidiary and
not an Obligor, the
successor formed by such consolidation
or the survivor
of such merger or the Person that acquires by conveyance,
transfer
or lease substantially all of the assets of such Restricted
Subsidiary
as an entirety, as the case may be, shall be a Restricted
Subsidiary
organized and existing under the laws of the United
States or
any State thereof (including the District of Columbia) or in the
jurisdiction
of such Restricted Subsidiary's organization or any other
Permitted Jurisdiction;
and
(c) in all cases, immediately after giving effect to such
transaction,
no Default or
Event of Default shall have occurred and be continuing.
No such conveyance, transfer or lease of substantially
all of the assets of
an
Obligor shall have the effect of releasing such Obligor or any successor
corporation that shall theretofore have become such in
the manner prescribed in
this Section 10.2 from its liability under
this Agreement or the Notes.
The provisions
of this Section 10.2 shall not prohibit an Asset Disposition
permitted by Section 10.7.
Section 10.3.
Liens. The Company will not, and will not
permit any of its
Restricted Subsidiaries to, directly or indirectly
create, incur, assume or
permit to exist (upon the happening of a
contingency or
otherwise) any Lien
on
or with respect to any property or asset
(including,
without limitation, any
document or instrument in respect of goods or accounts receivable) of the
Company or any such Restricted Subsidiary which do not constitute
Collateral,
whether now owned or held or hereafter acquired, or any income or profits
therefrom or assign or otherwise
convey any right to
receive income or
profits
(unless it makes, or causes to be made,
effective provision whereby the Notes
will be equally and ratably secured with
any and all other
obligations
thereby
secured, such security to be pursuant to an
agreement reasonably satisfactory to
the Required Holders and, in any such case,
the Notes shall have the benefit, to
the fullest extent that, and with such
priority as, the holders of the Notes may
be entitled under applicable law, of an equitable Lien on such property),
except:
(a) Liens for taxes, assessments or other governmental charges
which
are not yet due and payable or the payment
of which is not at the time required
by Section 9.4;
(b) statutory Liens of landlords and Liens of carriers,
warehousemen,
mechanics, materialmen and other similar
Liens, in each case, incurred in the
ordinary course of business for sums not
yet due and payable or the payment of
which is not at the time required by
Section 9.4;
(c) Liens (other
than any Liens imposed by ERISA) incurred or deposits made
in the ordinary course of business (i) in
connection with workers' compensation,
unemployment insurance and other types of social security or retirement
benefits, or (ii) to secure (or obtain letters of credit that secure) the
performance of tenders, statutory
obligations, surety bonds,
27
<PAGE>
appeal bonds, bids, leases (other than Capital Leases), performance bonds,
purchase, construction or sales contracts
and other similar obligations, in each
case not incurred or made in connection with the borrowing of money, the
obtaining of advances or credit or the
payment of the deferred purchase price of
property;
(d) any
attachment or judgment
Lien, unless the
judgment it secures shall
not, within 60 days after the entry
thereof, have been
discharged or execution
thereof stayed pending appeal, or shall not have been discharged
within 60 days
after the expiration of any such stay
(unless the underlying
claim which is the
subject of such attachment or judgment Lien is fully covered by a solvent
insurer which has acknowledged liability
therefor in writing);
(e) leases or subleases granted to others, easements, rights-of-way,
restrictions and other similar charges or
encumbrances, in each
case incidental
to, and not interfering with, the ordinary conduct of the business of the
Company or any of its Restricted
Subsidiaries, provided
that such Liens do not,
in the aggregate, materially detract from
the value of such property;
(f) Liens on
property or assets of the Company or any of its Restricted
Subsidiaries securing Debt owing to the
Company or to another Obligor;
(g) Liens
existing on the date
of this Agreement and
securing the Debt of
the Company and its Restricted Subsidiaries
referred to in Schedule 5.15;
(h) any Lien
created to secure all or any part of the purchase price, or to
secure Debt incurred or assumed to pay all
or any part of the purchase price or
cost of construction, of property (or any improvement thereon) constituting
fixed or capital assets acquired or constructed by the
Company or a Restricted
Subsidiary after the date of the Closing,
provided that
(i) any such Lien
shall extend solely to the item or items of
such
property
(or improvement thereon) so acquired or constructed and, if
required
by the terms of the
instrument
originally
creating such Lien,
other
property (or
improvement
thereon) which is an
improvement to or is
acquired for
specific use in connection with such acquired or constructed
property (or
improvement thereon)
or which is real property being improved
by such acquired
or constructed property (or improvement thereon),
(ii) the principal
amount of the Debt
secured by any such Lien shall
at no time
exceed an amount equal to 100% of the fair
market value (as
determined
in good faith by the
board of directors of the Company) of such
property
(or improvement thereon) at the time of such acquisition or
construction,
and
(iii) any such Lien shall be created contemporaneously with or
within
the period ending 180 days after days after, the acquisition or
construction of
such property;
(i) any Lien
existing on property constituting fixed or capital assets of a
Person immediately prior to its being consolidated with or merged into the
Company or a Restricted Subsidiary or its
becoming a Restricted
Subsidiary, or
any Lien existing on any property
28
<PAGE>
constituting fixed or capital assets
acquired by the
Company or any Restricted
Subsidiary at the time such property is so acquired (whether or not the Debt
secured thereby shall have been assumed),
provided that (i) no
such Lien shall
have been created or assumed in
contemplation of such consolidation or merger or
such Person's becoming a Restricted
Subsidiary or such
acquisition of property,
and (ii) each such Lien shall extend
solely to the item or
items of property so
acquired and, if required by the terms of
the instrument
originally
creating
such Lien, other property which is an
improvement to or is acquired for specific
use in connection with such acquired
property;
(j) any
Lien renewing, extending or refunding any Lien permitted by
paragraphs (g), (h) or (i) of this Section
10.3, provided that (i) the principal
amount of Debt secured by such Lien
immediately prior to such extension, renewal
or refunding is not increased or the
maturity thereof reduced, (ii) such Lien is
not extended to any other property,
and (iii) immediately
after such extension,
renewal or refunding no Default or Event of
Default would exist;
(k) other
Liens not otherwise permitted by paragraphs (a) through (j)
securing Debt of the Company or a
Restricted Subsidiary,
provided that at
the
time of incurrence of such Lien and
immediately after or any effect thereto, the
Debt secured thereby is permitted by
Section 10.4.
The Company will
not, and will not
permit any Restricted
Subsidiary
to,
directly or indirectly, create, incur, assume or permit to exist
(upon the
happening of a contingency or otherwise) any Lien on or with respect to
any
Collateral other than the Lien of the Bank
Security and the Noteholder Security,
in each case in accordance with, and
subject to, the Intercreditor Agreement.
Section 10.4.
Incurrence of Certain Additional Debt.
(a) Limitation on Funded Debt. The Company will not, and will not
permit
any Restricted Subsidiary to, directly or
indirectly, create,
incur, assume,
guarantee, or otherwise become directly or indirectly
liable with respect
to,
any Funded Debt, other than:
(i) the Series A Notes;
(ii) Funded Debt
of the Company and its Restricted Subsidiaries outstanding
as of March 31, 2004 and described on Schedule 5.15 together with
renewals, extensions
and refundings thereof without increase in
principal amount; and
(iii)additional
Funded Debt of the Company and its Restricted Subsidiaries
(including any additional series of Notes) provided that, on
the date
the Company or such Restricted Subsidiary becomes liable with
respect
to any such additional Funded Debt and immediately after giving
effect
thereto and the concurrent retirement of any other Debt of the
Company
or any such Restricted
Subsidiary, (x)
Consolidated Funded Debt does
not exceed 60% of Consolidated Total Capitalization and (y) any
such
additional Funded Debt
constituting
Priority Debt is permitted by
Section 10.4(b).
29
<PAGE>
(b) Limitation on Priority Debt. The
Company will not, and will not permit
any Restricted Subsidiary to, directly or
indirectly, create,
incur, assume,
guarantee, or otherwise become directly or indirectly
liable with respect
to,
any Priority Debt, unless on the date the
Company or such Restricted Subsidiary
becomes liable with respect to any such
Debt and immediately after giving effect
thereto and the concurrent retirement of any other Debt of the Company
or any
such Restricted Subsidiary, Priority Debt would not exceed 20%
of Consolidated
Adjusted Net Worth.
(c) Time of
Incurrence of Debt.
For the purposes of this Section 10.4, any
Person becoming a Restricted Subsidiary after the date hereof shall be
deemed,
at the time it becomes a Restricted
Subsidiary, to have incurred all of its then
outstanding Debt, and any Person extending,
renewing or refunding any Debt shall
be deemed to have incurred such Debt at the
time of such
extension, renewal
or
refunding.
Section 10.5.
Consolidated Adjusted Net Worth. The Company will not, at any
time, permit Consolidated Adjusted Net Worth to be less than the sum of
(a)
$70,000,000, plus (b) 25% of its aggregate
Consolidated Net Income (but only if
a positive number) for the period beginning
on January 1, 2004 ending at the end
of the then most recently completed fiscal
quarter.
Section 10.6.
Fixed Charges Coverage Ratio. The Company will not permit the
Fixed Charges Coverage Ratio to be less
than 2.00 to 1.00, determined at the end
of each quarterly fiscal period of the Company for the four fiscal quarter
period ending on such date of determination, taken as a single accounting
period.
Section
10.7. Sale of Assets, etc. The Company will not, and will not
permit any of its Restricted Subsidiaries
to, make any Asset Disposition unless:
(a) in the good faith opinion of the Company or Restricted
Subsidiary
making the Asset
Disposition,
the Asset Disposition is in exchange for
consideration
having a fair
market value at least equal to that of the
property
exchanged;
(b) immediately
after giving effect to the Asset Disposition, no
Default or Event
of Default would exist; and
(c) immediately
after giving effect to
such Asset
Disposition, the
Company
could incur at least
$1.00 of additional
Funded Debt pursuant
to
Section 10.4(a);
and
(d) the sum of (i) the
Disposition Value of
the property subject
to
such Asset
Disposition, plus (ii)
the aggregate
Disposition Value for all
other
property that was the subject of an Asset Disposition during the
period of 365
days immediately
preceding such Asset
Disposition would not
exceed 25% of
Consolidated
Total Assets
determined
as of the end of
the
most recently
ended calendar month preceding such Asset Disposition.
30
<PAGE>
To the extent that the Net Proceeds
Amount consisting of cash for any
Transfer
to a Person other than an Affiliate of the
Company or Subsidiary is applied to a
Debt Prepayment Application or applied or
committed to be applied to a Property
Reinvestment Application and is in fact applied within one year after such
Transfer, then such Transfer (or, if less
than all such Net Proceeds Amount is
applied as contemplated hereinabove, the pro rata percentage thereof which
corresponds to the Net Proceeds Amount so applied), only for the purpose of
determining compliance with subsection (d) of
this Section 10.7 as of any date,
shall be deemed not to be an Asset
Disposition.
Section 10.8.
Maintenance of Parity.
(a) In the event the
Company has any
Subsidiary which is a direct obligor of, or bound by or subject to a
Guaranty
for the benefit of, any lender,
the Company shall
cause such Subsidiary (except
for NN Europe), concurrently with such Subsidiary
becoming liable as an Obligor
or under such other Guaranty, to execute and deliver a
Subsidiary Guarantee and
to deliver a Pledged Note, together with appropriate
instruments of
assignment
attached thereto, duly executed in blank by the
Company, as applicable, or the
appropriate Guarantor, as the case may be;
provided, however, that no Subsidiary
shall be obligated to execute and deliver a
Subsidiary Guarantee
to the extent
that, and so long as, (i) such Subsidiary
Guarantee would not be permitted under
applicable law and (ii) such Subsidiary has not delivered a Guaranty for the
benefit of the Bank Indebtedness. In the event (i) changes in
applicable
law
permit NN Europe to become a Guarantor hereunder and (ii) NN Europe has
guaranteed other Bank Indebtedness, NN
Europe shall promptly execute and deliver
a Subsidiary Guarantee hereunder and, thus, become party
to this Agreement and
to the Intercreditor Agreement.
Each Guarantor shall
be and remain a Restricted
Subsidiary.
(b) In the event
the Company
has any Subsidiary which has pledged or
granted any lien in respect of any of its
assets or properties
to secure any of
the Bank Indebtedness, the Company shall cause such
Subsidiary (except for
NN
Europe), concurrently with such Subsidiary pledging or granting such Lien,
to
execute and deliver a Pledge Agreement,
provided, however,
that such Subsidiary
shall not be so obligated to execute and deliver a Pledge Agreement to the
extent that, and so long as, (i) such Pledge
Agreement would not be permitted
under applicable law and (ii) such Subsidiary has not delivered a Pledge
Agreement for the benefit of the Bank
Indebtedness. In the
event (i) changes in
applicable law permit NN Europe to become a
Pledgor hereunder and (ii) NN Europe
has delivered a Pledge Agreement for the
benefit of other Bank Indebtedness, NN
Europe shall promptly execute and deliver a Pledge
Agreement hereunder and,
thus, become party to this Agreement and
to the Intercreditor
Agreement. Each
Pledgor shall be and remain a Restricted Subsidiary. Notwithstanding the
foregoing provisions of this Section
10.8(b), in the event the Company requests,
at the expense of the Company, the holders
of the Notes to release the Lien of a
Pledge Agreement, the holders of the Notes shall
enter into such instruments of
direction, reasonably requested by the Company, directing the Noteholder
Collateral Agent to release the lien of
such Pledge Agreement if, at the time of
any such release and immediately after
giving effect thereto, (i) the Collateral
subject to such Pledge Agreement shall not be subject to any Liens
and (ii) no
Default or Event of Default shall
exist.
(c) The
Company shall not, at any time, permit NN Europe to have any
material assets or operations other than the ownership by NN Europe of the
outstanding equity of Subsidiaries of NN Europe and activities reasonably
related to such ownership.
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<PAGE>
Section 10.9.
Nature of Business.
The Company will not and will not permit
any of its Subsidiaries to, engage in any business if, as
a result, when
taken
as a whole, the general nature of the businesses in which the Company
and the
Subsidiaries are engaged would be
substantially changed from a general nature of
the business in which the Company
and the Subsidiaries are engaged in on the
date of this Agreement.
Section 10.10.
Leverage Ratio.
The Obligors shall not
permit the Leverage
Ratio to be greater than 3.5 to 1.00,
determined
at the end of each
quarterly
fiscal period of the Company for the four
fiscal quarter
period ending on
such
date of determination, taken as a single
accounting period.
SECTION 11. EVENTS OF DEFAULT.
An "Event of
Default" shall exist
if any of the
following conditions
or
events shall occur and be continuing:
(a) the Company defaults in the payment of any principal or
Make-Whole
Amount, if any,
on any Note when the same becomes due and payable, whether
at maturity or at a date fixed for prepayment or by declaration or
otherwise;
or
(b) the Company defaults in the payment of any interest on any Note
or
any amount
payable pursuant to
Section 13 for more than five Business Days
after the same
becomes due and payable; or
(c) (i) the Company
defaults in the performance of or compliance with
any term
contained in Sections 10.2 through 10.7, inclusive or Section
10.10 or (ii)
any Guarantor defaults
in the performance of any term in any
Subsidiary
Guarantee; or
(d) any Obligor
defaults in the performance of or compliance with any
term contained
herein or any other
Financing Agreement
(other than those
referred to in
paragraphs
(a), (b) and (c) of this Section 11) and such
default is not
remedied within 30
Business Days after the earlier of (i) a
Responsible
Officer obtaining actual knowledge of such default and (ii) the
Company
receiving written
notice of such default from any holder of a Note
(any such
written notice to be
identified as a
"notice of default" and to
refer
specifically to this paragraph (d) of Section 11) provided,
however,
that the period
to cure any such default of, or non-compliance with, the
requirements
of Section 7.1(a) or (b) resulting from the Company's
inability to
file any quarterly or
annual report with the
Securities and
Exchange
Commission
shall be the earlier
of (x) sixty (60)
Business Days
after the
earlier of (i) a Responsible Officer obtaining actual knowledge
of such default
and (ii) the Company receiving a notice of default from any
holder of a Note
or (y) the date, if
any, when the
financial statements
meeting the
requirements
set forth in Section
7.1(a) or (b) are delivered
to any other
lender to the Company; or
(e) any representation
or warranty made in writing by or on behalf of
any Obligor or
by any officer of an Obligor in any Financing Agreement or
in any writing
32
<PAGE>
furnished
in connection with the transactions contemplated hereby or
thereby
proves to have been
false or incorrect in any material respect on
the date as of
which made; or
(f) (i) the Company or
any Restricted
Subsidiary
is in default (as
principal or as
guarantor or other
surety) in the payment of any principal
of or
premium or make-whole amount or interest on any Debt that is
outstanding in
an aggregate principal amount of at least $5,000,000 (or its
equivalent in
the relevant currency
of payment) beyond any period of grace
provided
with respect thereto, or (ii) the Company or any Restricted
Subsidiary is in
default in the
performance of or compliance with any term
of any evidence
of any Debt in an aggregate outstanding principal amount of
at least
$5,000,000 (or its equivalent in the relevant currency of
payment)
or of any
mortgage, indenture or
other agreement
relating thereto or
any
other condition
exists, and as a consequence of such
default or condition
such Debt has
become, or has been declared due and payable before its
stated
maturity or before its
regularly scheduled dates of payment, or
(iii) as a
consequence of the
occurrence or
continuation of any
event or
condition
(other than the passage of time or the right of the holder
of
Debt to convert
such Debt into equity
interests),
(x) the Company or
any
Restricted Subsidiary
has become obligated to purchase or repay Debt before
its regular
maturity or before its regularly scheduled dates of payment in
an aggregate
outstanding
principal amount of at least $5,000,000 (or
its
equivalent in
the relevant currency of payment), or (y) one or more Persons
have the right
to require the Company or any Restricted Subsidiary so to
purchase
or repay such Debt as
a result of the failure by the Company or a
Restricted
Subsidiary to pay
principal, premium or
interest on such Debt;
or
(g) any Financing
Agreement shall cease to be a legal, valid and
binding
agreement enforceable against the Obligor thereunder, in
accordance
with the
respective
terms thereof or shall in any way be
terminated
or
become
or be declared ineffective or inoperative or shall in any way
whatsoever
cease to give or provide the respective rights, titles,
interest,
remedies, powers or privileges intended to be created
thereby
including,
without
limitation,
a determination by any Governmental
Authority
or court that such Financing Agreement is invalid, void or
unenforceable in
any material respect or any party thereto shall contest or
deny the
validity or
enforceability of any
of its obligations
under such
Financing
Agreement; or
(h) the Company or any
Restricted Subsidiary
(i) is generally not
paying, or
admits in writing its inability to pay, its debts as they
become
due, (ii) files,
or consents by answer
or otherwise to the filing against
it of, a
petition for relief or
reorganization or arrangement or any other
petition
in bankruptcy, for liquidation or to take advantage of any
bankruptcy,
insolvency, reorganization, moratorium or other similar law
of
any jurisdiction, (iii) makes an assignment for the benefit of its
creditors,
(iv) consents to the appointment of a custodian, receiver,
trustee or other
officer with similar powers with respect to it or
with
respect to any
substantial
part of its property,
(v) is adjudicated as
insolvent
or to be liquidated, or (vi) takes corporate action for the
purpose of any
of the foregoing; or
33
<PAGE>
(i) a court or gove
