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EXHIBIT 10.1
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HELEN OF TROY LIMITED (BERMUDA)
HELEN OF
TROY L.P.
HELEN OF TROY LIMITED (BARBADOS)
$100,000,000 Floating Rate Series A Senior Notes
due June 29, 2009
$50,000,000 Floating Rate Series B Senior Notes
due June 29, 2011
$75,000,000 Floating Rate Series C Senior Notes
due June 29, 2014
----------------
NOTE PURCHASE AGREEMENT
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DATED AS OF JUNE 29, 2004
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TABLE OF CONTENTS
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SECTION
HEADING
PAGE
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SECTION 1.
AUTHORIZATION OF
NOTES................................................................
1
Section 1.1.
Description of
Notes..................................................................
1
Section 1.2.
Interest
Rate.........................................................................
2
SECTION 2.
SALE AND PURCHASE OF NOTES; SUBSIDIARY
GUARANTY....................................... 2
Section 2.1.
Sale and Purchase of
Notes............................................................
2
Section 2.2.
Subsidiary
Guaranty...................................................................
2
SECTION 3.
CLOSING...............................................................................
3
SECTION 4.
CONDITIONS TO
CLOSING.................................................................
3
Section 4.1.
Representations and
Warranties........................................................
3
Section 4.2.
Performance; No
Default...............................................................
4
Section 4.3.
Compliance
Certificates...............................................................
4
Section 4.4.
Opinions of
Counsel...................................................................
4
Section 4.5.
Purchase Permitted by Applicable Law, Etc.
........................................... 5
Section 4.6.
Related
Transactions..................................................................
5
Section 4.7.
Payment of Special Counsel
Fees.......................................................
5
Section 4.8.
Private Placement
Number..............................................................
5
Section 4.9.
Changes in Corporate
Structure........................................................
5
Section 4.10.
Subsidiary
Guaranty...................................................................
6
Section 4.11.
Proceedings and
Documents.............................................................
6
Section 4.12. Evidence of Consent 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............................................................................
7
Section 5.4.
Organization and Ownership of Shares of Subsidiaries;
Affiliates...................... 7
Section 5.5.
Financial
Statements..................................................................
8
Section 5.6.
Compliance with Laws, Other Instruments, Etc.
........................................ 8
Section 5.7.
Governmental Authorizations, Etc.
.................................................... 8
Section 5.8.
Litigation; Observance of 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.................................................................
9
Section 5.13.
Private Offering by the
Obligors......................................................
10
Section 5.14. Use
of Proceeds; Margin
Regulations...................................................
10
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Section 5.15.
Existing Debt; Future
Liens...........................................................
11
Section 5.16.
Foreign Assets Control Regulations, Etc.
............................................. 11
Section 5.17.
Status under Certain
Statutes.........................................................
11
Section 5.18.
Environmental
Matters.................................................................
11
Section 5.19.
Notes Rank Pari
Passu.................................................................
12
SECTION 6.
REPRESENTATIONS OF THE
PURCHASER......................................................
12
Section 6.1.
Purchase for
Investment...............................................................
12
Section 6.2.
Accredited
Investor...................................................................
12
Section 6.3.
Source of
Funds.......................................................................
13
SECTION 7.
INFORMATION AS TO
COMPANY.............................................................
14
Section 7.1.
Financial and Business
Information....................................................
14
Section 7.2.
Officer's
Certificate.................................................................
17
Section 7.3.
Inspection............................................................................
17
SECTION 8.
PAYMENT OF THE
NOTES..................................................................
18
Section 8.1.
Required
Payments.....................................................................
18
Section 8.2.
Optional
Prepayments..................................................................
18
Section 8.3.
Allocation of Partial
Prepayments.....................................................
19
Section 8.4.
Maturity; Surrender, Etc.
............................................................
19
Section 8.5.
Purchase of
Notes.....................................................................
19
Section 8.6.
Withholding
Taxes.....................................................................
20
SECTION 9.
AFFIRMATIVE
COVENANTS.................................................................
21
Section 9.1.
Compliance with
Law...................................................................
21
Section 9.2.
Insurance.............................................................................
21
Section 9.3.
Maintenance of
Properties.............................................................
21
Section 9.4.
Payment of Taxes and
Claims...........................................................
22
Section 9.5.
Corporate Existence, Etc.
............................................................
22
Section 9.6.
Additional Subsidiary
Guarantors......................................................
22
SECTION 10.
NEGATIVE
COVENANTS....................................................................
23
Section 10.1.
Consolidated Net
Worth................................................................
23
Section 10.2.
Limitations on Total Capitalization; Consolidated
Debt................................ 23
Section 10.3.
Priority
Debt.........................................................................
24
Section 10.4.
Limitation on
Liens...................................................................
24
Section 10.5.
Sales of
Asset........................................................................
26
Section 10.6.
Merger and
Consolidation..............................................................
27
Section 10.7.
Nature of
Business....................................................................
28
Section 10.8.
Transactions with
Affiliates..........................................................
28
SECTION 11.
EVENTS OF
DEFAULT.....................................................................
28
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SECTION 12.
REMEDIES ON DEFAULT, ETC.
............................................................
31
Section 12.1.
Acceleration..........................................................................
31
Section 12.2.
Other
Remedies........................................................................
31
Section 12.3.
Rescission............................................................................
32
Section 12.4. No
Waivers or Election of Remedies, Expenses, Etc.
................................... 32
SECTION 13.
REGISTRATION; EXCHANGE; SUBSTITUTION OF
NOTES......................................... 32
Section 13.1.
Registration of
Notes.................................................................
32
Section 13.2.
Transfer and Exchange of
Notes........................................................
32
Section 13.3.
Replacement of
Notes..................................................................
33
SECTION 14.
GUARANTY..............................................................................
34
Section 14.1.
Guaranty..............................................................................
34
Section 14.2.
Guaranty of Payment and
Performance...................................................
34
Section 14.3.
General Provisions Relating to the
Guaranty........................................... 34
SECTION 15.
PAYMENTS ON
NOTES.....................................................................
38
Section 15.1.
Place of
Payment......................................................................
38
Section 15.2. Home
Office
Payment...................................................................
39
SECTION 16.
EXPENSES, ETC.
.......................................................................
39
Section 16.1.
Transaction
Expenses..................................................................
39
Section 16.2.
Survival..............................................................................
39
SECTION 17.
SURVIVAL OF REPRESENTATIONS AND WARRANTIES; ENTIRE
AGREEMENT.......................... 40
SECTION 18.
AMENDMENT AND
WAIVER..................................................................
40
Section 18.1.
Requirements..........................................................................
40
Section 18.2.
Solicitation of Holders of
Notes......................................................
40
Section 18.3.
Binding Effect, Etc.
.................................................................
41
Section 18.4.
Notes Held by Company, Etc.
..........................................................
41
SECTION 19.
NOTICES...............................................................................
41
SECTION 20.
REPRODUCTION OF
DOCUMENTS.............................................................
42
SECTION 21.
CONFIDENTIAL
INFORMATION..............................................................
42
SECTION 22.
SUBSTITUTION OF
PURCHASER.............................................................
43
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SECTION 23.
MISCELLANEOUS.........................................................................
44
Section 23.1.
Successors and
Assigns................................................................
44
Section 23.2.
Payments Due on Non-Business
Days.....................................................
44
Section 23.3.
Severability..........................................................................
44
Section 23.4.
Construction..........................................................................
44
Section 23.5.
Counterparts..........................................................................
44
Section 23.6.
Governing
Law.........................................................................
44
Section 23.7.
Consent to Jurisdiction; Service of Process; Judgment Currency;
Waiver
of Jury
Trial.....................................................................
44
Section 23.8.
Process
Agent.........................................................................
46
Section 23.9.
Maximum Interest
Payable..............................................................
46
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SCHEDULE A --
INFORMATION RELATING TO PURCHASERS
SCHEDULE B --
DEFINED TERMS
SCHEDULE 4.9 -- Changes in
Corporate Structure
SCHEDULE 5.4 -- Subsidiaries
of the Parent Guarantor, Ownership of
Subsidiary Stock, Affiliates
SCHEDULE 5.5 -- Financial
Statements
SCHEDULE 5.11 -- Licenses, Permits,
Etc.
SCHEDULE 5.15 -- Existing Debt
SCHEDULE 10.1 -- Existing
Investments
SCHEDULE 10.4 -- Existing Liens
EXHIBIT 1
-- Form of Floating Rate Series A Senior Notes due June 29,
2009
EXHIBIT 2
-- Form of Floating Rate Series B Senior Notes due June 29,
2011
EXHIBIT 3
-- Form of Floating Rate Series C Senior Notes due June 29,
2014
EXHIBIT 2.2 -- Form of
Subsidiary Guaranty
EXHIBIT 4.4(a) -- Form of Opinion of
Special U.S. Counsel to the Company
EXHIBIT 4.4(b) -- Form of Opinion of
Special Barbados Counsel to the Company
EXHIBIT 4.4(c) -- Form of Opinion of
Special Bermuda Counsel to the Company
EXHIBIT 4.4(d) -- Form of Opinion of
Special U.S. Counsel to the Purchasers
EXHIBIT 4.4(e) -- Form of Opinion of
Special Barbados Counsel to the
Purchasers
EXHIBIT 4.4(f) -- Form of Opinion of
Special Bermuda Counsel to the Purchasers
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HELEN OF TROY LIMITED (BERMUDA)
HELEN OF TROY L.P.
HELEN OF TROY LIMITED (BARBADOS)
1 HELEN OF TROY PLAZA
EL PASO, TEXAS 79912
$100,000,000 FLOATING RATE SERIES A SENIOR NOTES
DUE JUNE 29, 2009
$50,000,000 FLOATING RATE SERIES B SENIOR NOTES
DUE JUNE 29, 2011
$75,000,000 FLOATING RATE SERIES C SENIOR NOTES
DUE JUNE 29, 2014
Dated as of
June 29, 2004
TO THE PURCHASERS LISTED IN
THE
ATTACHED SCHEDULE A:
Ladies and Gentlemen:
Each of
HELEN OF TROY LIMITED, a Bermuda company (the "Parent
Guarantor"),
Helen of Troy L.P., a Texas limited
partnership (the "Company"), and Helen of
Troy Limited, a Barbados company ("Troy
Barbados" and, together with the Parent
Guarantor, the "Guarantors"), agrees with
the Purchasers listed in the attached
Schedule A (the "Purchasers") to this Note
Purchase Agreement (this "Agreement")
as follows:
SECTION 1. AUTHORIZATION OF NOTES.
Section
1.1. Description of Notes. The Company will authorize the issue
and sale of (i) $100,000,000 Floating Rate
Series A Senior Notes due June 29,
2009 (the "Series A Notes") (ii)
$50,000,000 Floating Rate Series B Senior Notes
due June 29, 2011 (the "Series B Notes,"),
and (iii) $75,000,000 Floating Rate
Series C Senior Notes due June 29, 2014
(the "Series C Notes," and together with
the Series A Notes and the Series B Notes,
the "Notes", such term shall also
include any such notes issued in
substitution therefor pursuant to Section 13 of
this Agreement). The Series A Notes, the
Series B Notes and the Series C Notes
shall be substantially in the form set out
in Exhibits 1, 2 and 3, respectively,
with such changes therefrom, if any, as may
be approved by the Purchasers and
the Company. The payment of all amounts to
become due under the Notes shall at
all times be unconditionally and absolutely
guaranteed by the Guarantors
pursuant to the terms and provisions of
Section 14 hereof (the Parent Guarantor,
the Company and Troy Barbados are each
individually referred to as an "Obligor"
and collectively referred to as the
"Obligors"). Certain capitalized terms used
in this Agreement are
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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 1.2. Interest
Rate. (a) The Notes shall bear interest (computed on
the basis of a 360-day year and actual days
elapsed) on the unpaid principal
thereof from the date of issuance at a
floating rate equal to the Adjusted LIBOR
Rate from time to time, payable quarterly
on the 29th day of March, June,
September and December and at maturity,
commencing on September 29, 2004, until
such principal sum shall have become due
and payable (whether at maturity, upon
notice of prepayment or otherwise) (each
such date being referred to herein as
an "Interest Payment Date") and interest
(so computed) on any overdue principal
from the due date thereof (whether by
acceleration or otherwise) at the Default
Rate until paid.
(b) The
Adjusted LIBOR Rate for the Notes shall be determined by the
Company, and notice thereof shall be given
to the holders of the Notes, within
three Business Days after the beginning of
each Interest Period, together with a
copy of the relevant screen used for the
determination of LIBOR, a calculation
of Adjusted LIBOR Rate for such Interest
Period, the number of days in such
Interest Period, the date on which interest
for such Interest Period will be
paid and the amount of interest to be paid
to each holder of Notes on such date.
In the event that the holders of more than
50% in aggregate principal amount of
the outstanding Notes do not concur with
such determination by the Company,
within ten Business Days after receipt by
such holders of the notice delivered
by the Company pursuant to the immediately
preceding sentence, such holders of
the Notes shall provide notice to the
Company, together with a copy of the
relevant screen used for the determination
of LIBOR, a calculation of Adjusted
LIBOR Rate for such Interest Period, the
number of days in such Interest Period,
the date on which interest for such
Interest Period will be paid and the amount
of interest to be paid to each holder of
Notes on such date, and any such
determination made in accordance with the
provisions of this Agreement, shall be
presumptively correct absent manifest
error.
SECTION 2. SALE AND PURCHASE OF NOTES;
SUBSIDIARY GUARANTY.
Section 2.1. Sale and
Purchase of Notes. Subject to the terms and conditions
of this Agreement, the Company will issue
and sell to each Purchaser and each
Purchaser will purchase from the Company,
at the Closing provided for in Section
3, the Notes in the principal amount
specified opposite such Purchaser's name in
Schedule A at the purchase price of 100% of
the principal amount thereof. The
obligations of each Purchaser hereunder are
several and not joint obligations
and each Purchaser shall have no obligation
and no liability to any Person for
the performance or nonperformance by any
other Purchaser hereunder.
Section 2.2.
Subsidiary Guaranty. (a) The payment by the Company of all
amounts due with respect to the Notes and
the performance by the Company of its
obligations under this Agreement will be
absolutely and unconditionally
guaranteed by the Subsidiary Guarantors
pursuant to the Subsidiary Guaranty
Agreement dated as of even date herewith,
which shall be substantially in the
form of Exhibit 2.2 attached hereto, and
otherwise in accordance with the
provisions of Section 9.6 hereof (the
"Subsidiary Guaranty").
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(b) The
holders of the Notes agree to discharge and release any
Subsidiary
Guarantor from the Subsidiary Guaranty upon
the written request of the Company,
provided that (i) such Subsidiary Guarantor
has been released and discharged (or
will be released and discharged
concurrently with the release of such Subsidiary
Guarantor under the Subsidiary Guaranty) as
an obligor and guarantor under and
in respect of each Bank Credit Agreement
and the Company so certifies to the
holders of the Notes in a certificate of a
Responsible Officer, (ii) at the time
of such release and discharge, the Company
shall deliver a certificate of a
Responsible Officer to the holders of the
Notes stating that no Default or Event
of Default exists, and (iii) if any fee or
other form of consideration is given
to any holder of Debt of the Company as
consideration for or as an inducement to
consenting to the release and discharge of
such Subsidiary Guarantor as an
obligor or guarantor of such Debt, the
holders of the Notes shall receive
equivalent consideration for granting their
consent to the release and discharge
of such Subsidiary Guarantor from the
Subsidiary Guaranty (a "Collateral
Release").
SECTION 3. CLOSING.
The sale
and purchase of the Notes to be purchased by each Purchaser
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 Date") on
June 29, 2004 or on such other Business Day
thereafter on or prior to July 1,
2004 as may be agreed upon by the Company
and the Purchasers. On the Closing
Date, the Company will deliver to each
Purchaser the Notes to be purchased by
such Purchaser in the form of a single Note
(or such greater number of Notes in
denominations of at least $100,000 as such
Purchaser may request) dated the date
of the Closing Date and registered in such
Purchaser's name (or in the name of
such Purchaser's nominee), against delivery
by such Purchaser 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 004783241250, at
Bank of America, Dallas, Texas, ABA
Number 111-000-025, in the Account Name of
"Helen of Troy L.P." If, on the
Closing Date, the Company shall fail to
tender such Notes to any Purchaser as
provided above in this Section 3, or any of
the conditions specified in Section
4 shall not have been fulfilled to any
Purchaser's satisfaction, such Purchaser
shall, at such Purchaser's election, be
relieved of all further obligations
under this Agreement, without thereby
waiving any rights such Purchaser may have
by reason of such failure or such
nonfulfillment.
SECTION 4. CONDITIONS TO CLOSING.
The
obligation of each Purchaser to purchase and pay for the Notes to
be
sold to such Purchaser at the Closing Date
is subject to the fulfillment to such
Purchaser's satisfaction, prior to or on
the Closing Date, of the following
conditions applicable to the Closing
Date:
Section 4.1.
Representations and Warranties.
(a)
Representations and Warranties of the Obligors. The
representations
and warranties of each Obligor in this
Agreement shall be correct when made and
at the time of the Closing Date.
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(b)
Representations and Warranties of the Subsidiary Guarantors.
The
representations and warranties of the
Subsidiary Guarantors in the Subsidiary
Guaranty shall be correct when made and at
the time of the Closing Date.
Section
4.2. Performance; No Default. The Obligors and each Subsidiary
Guarantor shall have performed and complied
with all agreements and conditions
contained in this Agreement and the
Subsidiary Guaranty required to be performed
or complied with by the Obligors and each
such Subsidiary Guarantor prior to or
on the Closing Date, and after giving
effect to the issue and sale of the 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. None of
the Obligors or 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 of the Obligors. Each Obligor shall have
delivered to such Purchaser an Officer's
Certificate, dated the Closing Date,
certifying that the conditions specified in
Sections 4.1(a), 4.2 and 4.9 have
been fulfilled.
(b)
Secretary's Certificate of the Obligors. Each Obligor shall
have
delivered to such Purchaser a certificate,
dated the Closing Date, certifying as
to the resolutions attached thereto and
other corporate proceedings relating to
the authorization, execution and delivery
of the Notes and this Agreement.
(c) Officer's
Certificate of the Subsidiary Guarantors. Each Subsidiary
Guarantor shall have delivered to such
Purchaser an Officer's Certificate, dated
the Closing Date, certifying that the
conditions specified in Sections 4.1(b),
4.2 and 4.9 have been fulfilled.
(d)
Secretary's Certificate of the Subsidiary Guarantors. Each
Subsidiary
Guarantor shall have delivered to such
Purchaser a certificate, dated the
Closing Date, certifying as to the
resolutions attached thereto and other
corporate proceedings relating to the
authorization, execution and delivery of
the Subsidiary Guaranty.
Section 4.4. Opinions
of Counsel. Such Purchaser shall have received
opinions in form and substance satisfactory
to such Purchaser, dated the Closing
Date (a) from Baker & McKenzie, special
counsel for the Obligors, covering the
matters set forth in Exhibit 4.4(a) and
covering such other matters incident to
the transactions contemplated hereby as
such Purchaser or such Purchaser's
counsel may reasonably request (and the
Parent Guarantor hereby instructs its
counsel to deliver such opinion to such
Purchaser), (b) from Clark, Gittens &
Farmer, special Barbados counsel for Troy
Barbados, covering the matters set
forth in Exhibit 4.4(b) and covering such
other matters incident to the
transactions contemplated hereby as such
Purchaser or such Purchaser's counsel
may reasonably request (and Troy Barbados
hereby instructs its Barbados counsel
to deliver such opinion to such Purchaser),
(c) from Conyers, Dill & Pearman,
special Bermuda counsel for the Parent
Guarantor, covering the matters set forth
in Exhibit 4.4(c) and covering such other
matters incident to the transactions
contemplated hereby as such
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Purchaser or such Purchaser's counsel may
reasonably request (and the Parent
Guarantor hereby instructs its Bermuda
counsel to deliver such opinion to such
Purchaser), (d) from Chapman and Cutler
LLP, the Purchasers' special counsel in
connection with such transactions,
substantially in the form set forth in
Exhibit 4.4(d) and covering such other
matters incident to such transactions as
such Purchaser may reasonably request, (e)
from Chancery Chambers, the
Purchasers' special Barbados counsel in
connection with such transactions,
substantially in the form set forth in
Exhibit 4.4(e) and covering such other
matters incident to such transactions as
such Purchaser may reasonably request,
and (f) from Appleby Spurling Hunter, the
Purchasers' special Bermuda counsel in
connection with such transactions,
substantially in the form set forth in
Exhibit 4.4(f) and covering such other
matters incident to such transactions as
such Purchaser may reasonably request.
Section 4.5. Purchase
Permitted by Applicable Law, Etc. On the Closing each
purchase of Notes shall (a) be permitted by
the laws and regulations of each
jurisdiction to which each Purchaser is
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, (b) 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 (c) not
subject any Purchaser to any tax,
penalty or liability under or pursuant to
any applicable law or regulation,
which law or regulation was not in effect
on the date hereof. If requested by
any Purchaser, such Purchaser shall have
received an Officer's Certificate
certifying as to such matters of fact as
such Purchaser may reasonably specify
to enable such Purchaser to determine
whether such purchase is so permitted.
Section 4.6. Related
Transactions. The Company shall have consummated the
sale of the entire principal amount of the
Notes scheduled to be sold on the
Closing Date pursuant to this
Agreement.
Section 4.7. Payment
of Special Counsel Fees. Without limiting the
provisions of Section 16.1, the Company
shall have paid on or before the Closing
Date, the reasonable fees, reasonable
charges and reasonable disbursements of
the Purchasers' special counsel and special
Bermuda and Barbados counsel
referred to in Section 4.4 to the extent
reflected in a statement of such
counsel rendered to the Company at least
one Business Day prior to the Closing
Date.
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 each Series of
Notes.
Section 4.9. Changes
in Corporate Structure. None of the Obligors nor any
Subsidiary Guarantor shall have changed its
jurisdiction of organization or,
except as reflected in Schedule 4.9, been a
party to any merger or
consolidation, or 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.
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Section 4.10.
Subsidiary Guaranty. The Subsidiary Guaranty shall have been
duly authorized, executed and delivered by
each Subsidiary Guarantor, shall
constitute the legal, valid and binding
contract and agreement of each
Subsidiary Guarantor and such Purchaser
shall have received a true, correct and
complete copy thereof.
Section 4.11.
Proceedings and Documents. All corporate or other
organizational proceedings in connection
with the transactions contemplated by
this Agreement and all documents and
instruments incident to such transactions
shall be satisfactory to such Purchaser and
such Purchaser's special counsel,
and such Purchaser and such Purchaser's
special counsel shall have received all
such counterpart originals or certified or
other copies of such documents as
such Purchaser or such Purchaser's special
counsel may reasonably request.
Section 4.12. Evidence
of Consent to Receive Service of Process. Such
Purchaser shall have received evidence, in
form and substance satisfactory to
it, of the consent of CT Corporation System
in New York, New York to the
appointment and designation provided for by
Section 23.8 hereof and Section 27
of the Subsidiary Guaranty for the period
from the date of Closing through June
29, 2015 (and the prepayment in full of all
fees in respect thereof).
SECTION 5. REPRESENTATIONS AND WARRANTIES
OF THE OBLIGORS.
Each
Obligor represents and warrants to each Purchaser that:
Section 5.1.
Organization; Power and Authority. Each Obligor is a
corporation (or, in the case of the
Company, a partnership) duly organized,
validly existing and, for each Obligor that
is a corporation, good standing
under the laws of its jurisdiction of
organization, and is duly qualified as a
foreign 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 requisite power and
authority to own or hold under lease the
properties it purports to own or hold under
lease, to transact the business it
transacts and proposes to transact, to
execute and deliver this Agreement and
the Notes and to perform the provisions
hereof and thereof.
Section 5.2.
Authorization, Etc. This Agreement has been duly authorized by
all requisite action on the part of each
Obligor, and this Agreement constitutes
a legal, valid and binding obligation of
each Obligor enforceable against each
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 Notes have been duly
authorized by all necessary partnership
action on the part of the Company and,
upon execution and delivery thereof, each
Note will constitute, a legal, valid
and binding obligation of the Company
enforceable against the Company in
accordance with its terms, except as such
enforceability may be limited by (i)
applicable bankruptcy, insolvency,
reorganization, moratorium or other similar
laws affecting the enforcement of
creditors' rights generally and (ii) general
principles of equity (regardless of whether
such enforceability is considered in
a proceeding in equity or at law).
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<PAGE>
Section 5.3.
Disclosure. The Obligors, through their agent, Banc of America
Securities LLC, have delivered to each
Purchaser a copy of a Private Placement
Memorandum, dated May, 2004 (the
"Memorandum"), relating to the transactions
contemplated hereby. The financial
statements listed in Schedule 5.5, the
Memorandum, SEC Reports and the documents,
certificates or other writings
delivered to you by or on behalf of the
Obligors fairly describe, in all
material respects, the general nature of
the business and principal properties
of the Obligors and their Subsidiaries.
This Agreement, the Memorandum, SEC
Reports and the documents, certificates or
other writings delivered to you by or
on behalf of the Obligors in connection
with the transactions contemplated
hereby and the financial statements listed
in Schedule 5.5, taken as a whole, do
not contain any untrue statement of a
material fact or omit to state any
material fact necessary to make the
statements therein not misleading in light
of the circumstances under which they were
made. Since February 29, 2004, except
as described and disclosed in SEC Reports,
there has been no change in the
financial condition, operations, business
or properties of the Obligors or any
of their Restricted Subsidiaries 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 any Obligor that
could reasonably be expected to have
a Material Adverse Effect that has not been
set forth herein or in the
Memorandum or in the other documents,
certificates and other writings delivered
to each Purchaser by or on behalf of the
Obligors 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 of (i) the Parent Guarantor's
Restricted and Unrestricted
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 Parent
Guarantor and each other Subsidiary, and
all other Investments of the Parent
Guarantor and its Restricted Subsidiaries,
(ii) the Parent Guarantor's
Affiliates, other than Subsidiaries, and
(iii) the Parent Guarantor'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 Parent
Guarantor and its Subsidiaries have been
validly issued, are fully paid and
nonassessable and are owned by the Parent
Guarantor 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,
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
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<PAGE>
dividends out of profits or make any other
similar distributions of profits to
the Obligors or any of their Subsidiaries
that owns outstanding shares of
capital stock or similar equity interests
of such Subsidiary.
Section 5.5. Financial
Statements. The Obligors have delivered to each
Purchaser copies of the financial
statements of the Parent Guarantor and its
Subsidiaries listed on Schedule 5.5. All of
said financial statements (including
in each case the related schedules and
notes) fairly present in all material
respects the consolidated financial
position of the Parent Guarantor and its
Subsidiaries as of the respective dates
specified in such financial statements
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 each Obligor of
this Agreement and the issue and
sale of the Notes by the Company will not,
except where such has no Material
Adverse Effect, (a) contravene, result in
any breach of, or constitute a default
under, or result in the creation of any
Lien in respect of any property of any
Obligor 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 is bound or
by which any Obligor or any of their
respective properties may be bound or
affected, (b) conflict with or result in a
breach of any of the terms, conditions or
provisions of any order, judgment,
decree, or ruling of any court, arbitrator
or Governmental Authority applicable
to any Obligor, or (c) violate any
provision of any statute or other rule or
regulation of any Governmental Authority
applicable to any Obligor.
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 this Agreement or the
Notes by the Company.
Section 5.8.
Litigation; Observance of Statutes and Orders. (a) There are no
actions, suits or proceedings pending or,
to the knowledge of any Obligor,
threatened against or affecting any Obligor
or any Restricted Subsidiary or any
property of any Obligor or any Restricted
Subsidiary in any court or before any
arbitrator of any kind or before or by any
Governmental Authority that,
individually or in the aggregate, could
reasonably be expected to have a
Material Adverse Effect.
(b) None
of the Obligors nor any Restricted 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.
-8-
<PAGE>
Section 5.9. Taxes.
The Obligors and their 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 (a) the amount
of which is not individually or in the
aggregate Material or (b) the amount,
applicability or validity of which is
currently being contested in good faith by
appropriate proceedings and with respect to
which the Obligors or a Subsidiary,
as the case may be, has established
adequate reserves in accordance with GAAP.
None of the Obligors knows of any 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
Parent Guarantor and its Subsidiaries
in respect of federal, state or other taxes
for all fiscal periods are adequate.
The federal income tax liabilities of the
Parent Guarantor 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 February 28, 1999.
Section 5.10. Title to
Property; Leases. The Obligors and their Restricted
Subsidiaries have good and sufficient title
to their respective properties which
the Obligors and their Restricted
Subsidiaries own or purport to own 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
Obligors or any Restricted 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. Except as disclosed in Schedule 5.11:
(a) the Obligors and their Restricted 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
Material rights of others;
(b) to the best knowledge of the Obligors, no product of any
Obligor
or any of
its Restricted Subsidiaries infringes in any Material respect
any
license, permit, franchise, authorization, patent, copyright,
service
mark,
trademark, trade name or other right owned by any other Person;
and
(c) to the best knowledge of the Obligors, there is no Material
violation
by any Person of any right of any Obligor or any of its
Restricted
Subsidiaries with respect to any patent, copyright, service
mark,
trademark, trade name or other right owned or used by any Obligor
or
any of its
Restricted Subsidiaries.
Section 5.12.
Compliance with ERISA. (a) The Obligors 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.
None of the Obligors or any ERISA Affiliate
has incurred any
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<PAGE>
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 Obligors or any ERISA Affiliate, or
in the imposition of any Lien on any
of the rights, properties or assets of the
Obligors 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) 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 by
more than $1,000,000 in the aggregate
for all Plans. The term "benefit
liabilities" has the meaning specified in
section 4001 of ERISA and the terms
"current value" and "present value" have the
meaning specified in section 3 of
ERISA.
(c) The
Obligors and their ERISA Affiliates have not incurred any
withdrawal liabilities (and are not subject
to contingent withdrawal
liabilities) under section 4201 or 4204 of
ERISA in respect of Multiemployer
Plans that individually or in the aggregate
are Material.
(d) The
expected post-retirement benefit obligation (determined as of
the
last day of the Parent Guarantor'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 Parent Guarantor's 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 Section
4975(c)(1)(A)-(D) of the Code. The representation by
the Obligors in the first sentence of this
Section 5.12(e) is made in reliance
upon and subject to the accuracy of each
Purchaser's representation in Section
6.2 as to the sources of the funds to be
used to pay the purchase price of the
Notes to be purchased by such
Purchaser.
Section 5.13. Private
Offering by the Obligors. None of the Obligors or
anyone acting on the Obligors' behalf has
offered the Notes or any similar
securities for sale to, or solicited any
offer to buy any of the same from, or
otherwise approached or negotiated in
respect thereof with, any Person other
than the Purchasers and not more than 39
other Institutional Investors, each of
which has been offered the Notes in
connection with a private sale for
investment. None of the Obligors or anyone
acting on its behalf has taken, or
will take, any action that would subject
the issuance or sale of the Notes to
the registration requirements of Section 5
of the Securities Act.
Section 5.14. Use of
Proceeds; Margin Regulations. The Company will apply
the proceeds of the sale of the Notes to
finance, or refinance indebtedness
incurred in connection with, the
acquisition of Oxo International and for
general corporate purposes of the
Company.
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<PAGE>
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 Obligors in a
violation of Regulation X of said Board (12
CFR 224) or to involve any broker or
dealer in a violation of Regulation T of
said Board (12 CFR 220). Margin stock
does not constitute more than 5% of the
value of the consolidated assets of the
Parent Guarantor and its Subsidiaries and
the Parent Guarantor does not have any
present intention that margin stock will
constitute more than 5% of the value of
such assets. As used in this Section, the
terms "margin stock" and "purpose of
buying or carrying" shall have the meanings
assigned to them in said Regulation
U.
Section 5.15. Existing
Debt; Future Liens. (a) Except as described therein,
Schedule 5.15 sets forth a complete and
correct list of all outstanding Debt of
the Parent Guarantor and its Restricted
Subsidiaries as of May 31, 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 Parent
Guarantor or its Restricted Subsidiaries.
None of the Obligors or any Restricted
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 any Obligor or such
Restricted Subsidiary, and no event or
condition exists with respect to any Debt
of any Obligor or any Restricted
Subsidiary, that would permit (or that with
notice or the lapse of 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, none of the Obligors or any
Restricted 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 10.4.
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, or is in violation of any
federal statute or Presidential
Executive Order, including without
limitation Executive Order 13224 66 Fed. Reg.
49079 (September 25, 2001) (Blocking
Property and Prohibiting Transactions with
Persons who Commit, Threaten to Commit or
Support Terrorism), or The USA Patriot
Act.
Section 5.17. Status
under Certain Statutes. None of the Obligors or any
Restricted 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. None of the Obligors or any Restricted
Subsidiary has knowledge of any claim or
has received any notice of any claim,
and no proceeding has been instituted
raising any claim against any Obligor or
any of its Restricted Subsidiaries or any
of
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<PAGE>
their respective real properties now or
formerly owned, leased or operated by
any of them, or other assets, alleging
damage to the environment or any
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 each Purchaser in
writing:
(a) none of the Obligors or any Restricted Subsidiary has
knowledge
of any
facts which would give rise to any claim, public or private,
for
violation
of Environmental Laws or damage to the environment emanating
from,
occurring on or in any way related to real properties or to
other
assets now
or formerly owned, leased or operated by any of them or their
use,
except, in each case, such as could not reasonably be expected
to
result in
a Material Adverse Effect;
(b) none of the Obligors or any of its Restricted 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 each case in a manner contrary to any Environmental Laws and
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 Obligors or any of their Restricted 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. Notes
Rank Pari Passu. The respective obligations of the
Obligors under this Agreement and the Notes
rank pari passu in right of payment
with all other senior unsecured Debt
(actual or contingent) of the Obligors,
including, without limitation, all senior
unsecured Debt of the Obligors
described in Schedule 5.15 hereto.
SECTION 6. REPRESENTATIONS OF THE
PURCHASER.
Section 6.1. Purchase
for Investment. Each Purchaser represents that it is
purchasing the Notes for its own account or
for one or more separate accounts
maintained by it or for the account of one
or more pension or trust funds and
not with a view to the distribution thereof
(other than any Notes purchased by
Banc of America Securities LLC on the
Closing Date which are intended to be
resold to a "qualified institutional buyer"
pursuant to Rule 144A of the
Securities Act), provided that the
disposition of such Purchaser's or such
pension or trust funds' property shall at
all times be within such Purchaser's
or such pension or trust funds' control.
Each Purchaser understands that the
Notes have not been registered under the
Securities Act and may be resold only
if registered pursuant to the provisions of
the Securities Act or if an
exemption from registration is available,
except under circumstances where
neither such registration nor such an
exemption is required by law, and that the
Company is not required to register the
Notes.
Section 6.2.
Accredited Investor. Each Purchaser represents that it is an
"accredited investor" (as defined in Rule
501(a)(1), (2), (3) or (7) of
Regulation D under the Securities Act
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<PAGE>
acting for its own account (and not for the
account of others) or as a fiduciary
or agent for others (which others are also
"accredited investors").
Section 6.3. Source of
Funds. Each Purchaser represents that at least one of
the following statements is an accurate
representation as to each source of
funds (a "Source") to be used by it to pay
the purchase price of the Notes to be
purchased by it hereunder:
(a) the Source is an "insurance company general account" within
the
meaning of
Department of Labor Prohibited Transaction Exemption ("PTE")
95-60 (issued
July 12, 1995) and there is no employee benefit plan,
treating
as a single plan all plans maintained by the same employer or
employee
organization, with respect to which the amount of the general
account
reserves and liabilities for all contracts held by or on behalf
of
such plan,
exceeds 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 for such Purchaser
most
recently
filed with such Purchaser's state of domicile; or
(b) the Source is either (i) an insurance company pooled
separate
account,
within the meaning of PTE 90-1 (issued January 29, 1990), or
(ii)
a bank
collective investment fund, within the meaning of the PTE 91-38
(issued
July 12, 1991) and, except as such Purchaser prior to the
execution
and delivery of this Agreement has disclosed to the Company in
writing
pursuant to this paragraph (b), no employee benefit plan or
group
of plans
maintained by the same employer or employee organization
beneficially owns more than 10% of all assets allocated to such
pooled
separate
account or collective investment fund; or
(c) the Source constitutes assets of an "investment fund"
(within
the
meaning of Part V of the QPAM Exemption) managed by a
"qualified
professional asset manager" or "QPAM" (within the meaning of Part V
of the
QPAM
Exemption), no employee benefit plan's assets that are included
in
such
investment fund, when combined with the assets of all other
employee
benefit
plans established or maintained by the same employer or by an
affiliate
(within the meaning of Section V(c)(1) of the QPAM Exemption)
of
such
employer or by the same employee organization and managed by
such
QPAM,
exceed 20% of the total client assets managed by such QPAM, the
conditions
of Part I(c) and (g) of the QPAM Exemption are satisfied,
neither
the QPAM nor a person controlling or controlled by the QPAM
(applying
the definition of "control" in Section V(e) of the QPAM
Exemption)
owns a 5% or more interest in the Obligors 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
Obligors
in writing
pursuant to this paragraph (c) prior to the execution and
delivery
of this Agreement; 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 prior to the
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<PAGE>
execution
and delivery of this Agreement has been identified to the
Obligors
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; or
(g) the Source is an insurance company separate account
maintained
solely in
connection with the fixed contractual obligations of the
insurance
company under which the amounts payable, or credited, to any
employee
benefit plan (or its related trust) and to any participant or
beneficiary of such plan (including any annuitant) are not affected
in any
manner by
the investment performance of the separate account.
If any Purchaser or any subsequent
transferee of the Notes indicates that such
Purchaser or such transferee is relying on
any representation contained in
paragraph (b), (c) or (e) above, the
Obligors shall deliver on the date of
issuance of such Notes 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 Code), 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 6.3, 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 COMPANY.
Section 7.1. Financial
and Business Information. The Obligors shall deliver
to each holder of Notes that is an
Institutional Investor:
(a) Quarterly Statements -- within 60 days after the end of
each
quarterly
fiscal period in each fiscal year of the Parent Guarantor
(other
than the
last quarterly fiscal period of each such fiscal year),
duplicate
copies
of,
(i) a consolidated balance sheet of the Parent Guarantor and
its Subsidiaries as at the end of such quarter, and
(ii) consolidated statements of income, changes in
shareholders' equity and cash flows of the Parent Guarantor and
its
Subsidiaries, for such quarter and (in the case of the second
and
third quarters) for the portion of the fiscal year ending with
such
quarter,
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
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<PAGE>
Officer as
fairly presenting, in all material respects, the financial
position
of the companies being reported on and their results of
operations
and cash flows, subject to changes resulting from year-end
adjustments, provided that delivery within the time period
specified above
of copies
of the Parent Guarantor'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 105 days after the end of each
fiscal
year of the Parent Guarantor, duplicate copies of,
(i) a consolidated balance sheet of the Parent Guarantor and
its Subsidiaries, as at the end of such year, and
(ii) consolidated statements of income, changes in
shareholders' equity and cash flows of the Parent Guarantor and
its
Subsidiaries, for such year,
setting
forth in each case in comparative form the figures for the
previous
fiscal year, all in reasonable detail, prepared in accordance
with GAAP,
and accompanied by an opinion thereon of independent certified
public
accountants of recognized national standing, which opinion
shall
state that
such financial statements present fairly, in all material
respects,
the financial position of the companies being reported upon and
their
results of operations and cash flows and have been prepared in
conformity
with GAAP, and that the examination of such accountants in
connection
with such financial statements has been made in accordance with
generally
accepted auditing standards, and that such audit provides a
reasonable
basis for such opinion in the circumstances, provided that the
delivery
within the time period specified above of the Parent
Guarantor's
Annual
Report on Form 10-K for such fiscal year (together with the
Parent
Guarantor's annual report to shareholders, if any, prepared
pursuant to
Rule 14a-3 under the Exchange Act)
prepared in accordance with the
requirements therefor and filed with the Securities and
Exchange
Commission
shall be deemed to satisfy the requirements of this Section
7.1(b);
(c) SEC and Other Reports -- promptly upon their becoming
available,
one copy
of (i) each financial statement, report, notice or proxy
statement
sent by the Obligors 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
Obligors
or any Subsidiary with the Securities and Exchange Commission
and
of all
press releases and other statements made available generally by
the
Obligors
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 Business Days after a Responsible Officer becomes
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(g),
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a written
notice specifying the nature and period of existence thereof
and
what
action the Obligors are taking or propose to take with respect
thereto;
(e) ERISA Matters -- promptly, and in any event within five
Business
Days after
a Responsible Officer becomes aware of any of the following, a
written
notice setting forth the nature thereof and the action, if any,
that the
Obligors or an ERISA Affiliate propose to take with respect
thereto:
(i) with respect to any Plan, any reportable event, as defined
in Section 4043(c) of ERISA and the regulations thereunder, for
which notice thereof has not been waived pursuant to such
regulations as in effect on the date thereof; 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 any Obligor
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 any Obligor or any ERISA
Affiliate pursuant to Title I or IV of ERISA or the imposition of
a
penalty or excise tax under the provisions of the Code relating
to
employee benefit plans, or the imposition of any Lien on any of
the
rights, properties or assets of any Obligor or any ERISA
Affiliate
pursuant to Title I or IV of ERISA or such penalty or excise
tax
provisions, if such liability or Lien, taken together with any
other
such liabilities or Liens then existing, could reasonably be
expected to have a Material Adverse Effect;
(f) Notices from Governmental Authority -- promptly, and in any
event
within 30 days of receipt thereof, copies of any notice to any
Obligor 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; and
(g) Requested Information -- with reasonable promptness, such
other
data and
information relating to the business, operations, affairs,
financial
condition, assets or properties of any Obligor or any of its
Subsidiaries or relating to the ability of any Obligor to perform
its
obligations hereunder and under the Notes as from time to time may
be
reasonably
requested by any such holder of Notes.
Notwithstanding the foregoing, in the event that one or more
Unrestricted
Subsidiaries shall either (i) own more than
10% of the total consolidated assets
of the Parent Guarantor and its
Subsidiaries, or (ii) account for more than 10%
of the consolidated gross revenues of the
Parent Guarantor and its Subsidiaries,
determined in each case in accordance with
GAAP, then, within
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the respective periods provided in Section
7.1(a) and (b) above, the Obligors
shall deliver to each holder of Notes that
is an Institutional Investor,
unaudited financial statements of the
character and for the dates and periods as
in said Sections 7.1(a) and (b) covering
such group of Unrestricted Subsidiaries
(on a consolidated basis), together with a
consolidating statement reflecting
eliminations or adjustments required to
reconcile the financial statements of
such group of Unrestricted Subsidiaries to
the financial statements delivered
pursuant to Sections 7.1(a) and (b).
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 Obligors
were in
compliance
with the requirements of Section 10.1 through Section 10.6
hereof,
inclusive, during the quarterly or annual period covered by the
statements
then being furnished (including with respect to each such
Section,
where applicable, the calculations of the maximum or minimum
amount,
ratio or percentage, as the case may be, permissible under the
terms of
such Sections, and the calculation of the amount, ratio or
percentage
then in existence); and
(b) Event of Default -- a statement that such officer has
reviewed
the
relevant terms hereof and has made, or caused to be made, under his
or
her
supervision, a review of the transactions and conditions of the
Obligors
and their Subsidiaries from the beginning of the quarterly or
annual
period covered by the statements then being furnished to the
date
of the certificate and
that such review shall not have disclosed the
existence
during such period of any condition or event that constitutes a
Default or
an Event of Default or, if any such condition or event existed
or exists
(including, without limitation, any such event or condition
resulting
from the failure of any Obligor or any Subsidiary to comply
with
any
Environmental Law), specifying the nature and period of
existence
thereof
and what action the Obligors shall have taken or propose to
take
with
respect thereto.
Section
7.3. Inspection. The Obligors 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 any
Obligor,
to visit the principal executive offices of the Obligors, to
discuss
the affairs, finances and accounts of the Obligors and their
Subsidiaries with the Obligors' officers, and (with the consent of
the
Obligors,
which consent will not be unreasonably withheld) their
independent public accountants) and (with the consent of the
Obligors,
which
consent will not be unreasonably withheld) to visit the other
offices
and properties of the Obligors and each Restricted Subsidiary,
all
at such
reasonable times and as often as may be reasonably requested in
writing;
and
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<PAGE>
(b) Default -- if a Default or Event of Default then exists, at
the
expense of
the Obligors, to visit and inspect any of the offices or
properties
of the Obligors or any Restricted 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
Obligors
authorize
said accountants to discuss the affairs, finances and accounts
of the
Obligors and their Subsidiaries), all at such times and as often
as
may be
requested.
SECTION 8. PAYMENT OF THE NOTES.
Section
8.1. Required Payments. (a) There are no required prepayments
with
respect to the Series A Notes. The entire
unpaid principal amount of the Series
A Notes shall become due and payable on
June 29, 2009.
(b) There
are no required prepayments with respect to the Series B Notes.
The entire unpaid principal amount of the
Series B Notes shall become due and
payable on June 29, 2011.
(c) There
are no required prepayments with respect to the Series C Notes.
The entire unpaid principal amount of the
Series C Notes shall become due and
payable on June 29, 2014.
Section
8.2. Optional Prepayments. (a) The Company may, at its option,
upon notice as provided below, prepay all
or any part of the Series A Notes at
any time or from time to time in an amount
not less than $2,000,000 in the
aggregate principal amount of the Series A
Notes then outstanding in the case of
a partial prepayment (or such lesser amount
as shall be required to effect a
partial prepayment resulting from an offer
of prepayment pursuant to Section
10.5). The Company may, at its option, upon
notice as provided below, prepay all
of either or both of the Series B Notes or
Series C Notes at any time after the
first annual anniversary date of the
Closing or from time to time thereafter any
part of Series B Notes or Series C Notes,
in an amount not less than $2,000,000
in the aggregate principal amount of the
Notes of such Series then outstanding
in the case of a partial prepayment (or
such lesser amount as shall be required
to effect a partial prepayment resulting
from an offer of prepayment pursuant to
Section 10.5). Any prepayment of the Notes
of any Series pursuant to this
Section 8.2 shall be made at 100% of the
principal amount so prepaid, together
with interest accrued thereon to the date
of such prepayment, plus the
Prepayment Premium and LIBOR Breakage
Amount (unless the date specified for
prepayment is an Interest Payment Date)
determined for the prepayment date with
respect to such principal amount of each
Note then outstanding for the Series
being prepaid. The Company will give each
holder of Notes written notice of each
optional prepayment under this Section 8.2
not less than 20 days and not more
than 60 days prior to the date fixed for
such prepayment. Each such notice shall
specify such date, the Series of Notes to
be prepaid, the aggregate principal
amount of the Notes of such Series to be
prepaid on such date, the principal
amount of each Note held by such holder to
be prepaid (determined in accordance
with Section 8.3), and the interest to be
paid on the prepayment date with
respect to such principal amount being
prepaid, and shall be accompanied by a
certificate of a Senior Financial Officer
as to the Prepayment Premium and
estimated respective LIBOR Breakage Amount
due in connection with such
prepayment (calculated as if the date of
such notice were the date of the
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<PAGE>
prepayment), setting forth the details of
such computation. Two Business Days
prior to such prepayment, the Company shall
deliver to each holder of Notes to
be prepaid a certificate of a Senior
Financial Officer specifying the
calculation of each such LIBOR Breakage
Amount as of the specified prepayment
date.
(b) The
term "LIBOR Breakage Amount" shall mean any loss, cost or
expense
(other than lost profits) actually incurred
by any holder of a Note as a result
of any payment or prepayment of any Note on
a day other than a regularly
scheduled Interest Payment Date for such
Note or at the scheduled maturity
(whether voluntary, mandatory, automatic,
by reason of acceleration or
otherwise), and any loss or expense arising
from the liquidation or reemployment
of funds obtained by it or from fees
payable to terminate the deposits from
which such funds were obtained, provided
that any such loss, cost or expense
shall be limited to the time period from
the date of such prepayment through the
earlier of (i) the next interest payment
date, or (ii) the maturity date of the
Notes. Each holder shall determine the
LIBOR Breakage Amount with respect to the
principal amount of its Notes then being
paid or prepaid (or required to be paid
or prepaid) and shall provide written
notice to the Obligor that issued such
Note setting forth such determination in
reasonable detail not less than five
Business Days prior to the date of
prepayment in the case of any prepayment
pursuant to Section 8.2(a) and not less
than one Business Day prior to the date
of prepayment in the case of any payment
required by Section 12.1. Each such
determination shall be presumptively
correct absent manifest error.
Section
8.3. Allocation of Partial Prepayments. In the case of each
partial prepayment of the Notes pursuant to
the provisions of Section 8.2, the
principal amount of the Notes of the Series
to be prepaid shall be allocated
among all of the Notes of such Series at
the time outstanding in proportion, as
nearly as practicable, to the respective
unpaid principal amounts thereof. In
the case of each other partial prepayment
of the Notes, the principal amount of
the Notes to be prepaid shall be allocated
among all of the Notes at the time
outstanding in proportion, as nearly as
practicable, to the respective unpaid
principal amounts thereof.
Section
8.4. Maturity; Surrender, Etc. In the case of each prepayment
of
Notes pursuant to this Section 8, the
principal amount of each Note to be
prepaid shall mature and become due and
payable on the date fixed for such
prepayment, together with interest on such
principal amount accrued to such date
and the applicable Prepayment Premium, if
any and LIBOR Breakage Amount. 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 Prepayment Premium, if
any, and LIBOR Breakage Amount as
aforesaid, interest on such principal amount
shall cease to accrue. Any Note paid or
prepaid in full shall be surrendered to
the Company and cancelled and shall not be
reissued, and no Note shall be issued
in lieu of any prepaid principal amount of
any Note.
Section
8.5. Purchase of Notes. The Obligors will not and will not
permit
any Affiliate to purchase, redeem, prepay
or otherwise acquire, directly or
indirectly, any of the outstanding Notes
except (a) upon the payment or
prepayment of the Notes in accordance with
the terms of this Agreement and the
Notes or (b) pursuant to a written offer to
purchase any outstanding Notes made
by any Obligor or an Affiliate pro rata to
the holders of all Notes at the time
outstanding upon the same terms and
conditions. If the holders of more than 33%
of the principal amount of
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<PAGE>
the Notes then outstanding accept such
offer, the Obligors shall promptly notify
the remaining holders of such fact and the
expiration date for the acceptance by
holders of Notes of such offer shall be
extended by the number of days necessary
to give each such remaining holder at least
three (3) Business Days from its
receipt of such notice to accept such
offer. The Obligors will promptly cancel
all Notes acquired by them or any Affiliate
pursuant to any payment, prepayment
or purchase of Notes pursuant to any
provision of this Agreement and no Notes
may be issued in substitution or exchange
for any such Notes.
Section
8.6. Withholding Taxes. (a) Any and all payments required to be
made hereunder or under the Notes by any
Obligor shall be made in United States
Dollars, free and clear of and without
deduction for any and all present and
future taxes, levies, imposts, deductions,
charges or withholdings, and all
liabilities with respect thereto (excluding
(A) taxes imposed on, or measured by
reference to, the net income of, and
franchise taxes imposed on, the holder of
any Note by any of (i) the United States or
any political subdivision thereof,
(ii) the state jurisdiction under the laws
of which such holder is organized or
in which it is otherwise doing business or
(iii) any political subdivision
thereof and (B) taxes imposed by deduction
or withholding by the United States
if a holder does not comply with Section
8.6(f) hereof) (all such non-excluded
taxes, levies, imposts, deductions,
charges, withholdings and liabilities being
hereinafter referred to as "Taxes").
Subject to Section 8.6(d), if any Obligor
shall be required by law to deduct any
Taxes from or in respect of any sum
required to be paid hereunder or under the
Notes to or for the benefit of the
holder of any Note, (A) such sum shall be
increased as may be necessary so that
after making all required deductions
(including deductions applicable to
additional sums required to be paid under
this Section 8.6) the amount received
by such holder shall be equal to the sum
which have been so received had no such
deductions been made, (B) the Obligors
shall make such deductions and (C) the
Obligors shall pay the full amount of such
deductions to the relevant taxation
authority or other authority in accordance
with applicable law. Notwithstanding
anything to the contrary in this Section
8.6(a), if a holder of a Note shall not
be a U.S. Person, the Obligors shall only
be required to indemnify such holder
for the amount of Taxes it would pay if
such holder were a U.S. Person.
(b) In
addition, each Obligor agrees to pay any taxes which arise from
any
payment made hereunder or under any Note or
from the execution, delivery or
registration of, or otherwise with respect
to, this Agreement or any Note
(including, without limitation, any taxes
imposed on amounts payable under this
Section 8.6).
(c) Each
Obligor shall jointly and severally indemnify each holder of a
Note for the full amount of taxes
(including, without limitation, any taxes
imposed by any jurisdiction on amounts
payable under this Section 8.6) paid by
such holder and any liability (including
penalties, interest and expenses)
arising therefrom or required to be paid
with respect thereto. The holder of any
Note agrees to notify the Obligors promptly
of any payment of Taxes made by such
holder and, if practicable, any request,
demand or notice received in respect
thereof prior to such payment. Each holder
of a Note shall be entitled to
payment of this indemnification within 30
days from the date such holder makes
written demand therefor to the Obligors. A
certificate as to the amount of such
indemnification submitted to the Obligors
by such holder, setting forth the
calculation thereof, shall (absent manifest
error) be conclusive and binding for
all purposes.
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<PAGE>
(d) In the
event any Obligor desires to contest its liability for payment
of any Taxes which it otherwise would be
required to pay pursuant to Sections
8.6(a) or (b), an Obligor may elect not to
make such payment, provided (i) such
nonpayment is lawful and such Obligor has a
reasonable basis, as set forth in an
Officer's Certificate delivered to the
holder of the relevant Note, for such
nonpayment, (ii) such Obligor promptly
commences and continues to pursue
diligently a contest of such liability,
(iii) such Obligor keeps the holder of
the relevant Note fully informed about the
progress of such contest, (iv) such
nonpayment does not result in any danger of
sale, forfeiture or loss of, or the
creation of any Lien on, any asset of any
Obligor thereof, and (v) such
nonpayment does not continue past the
earliest date on which such Taxes are
determined by a court or administrative
body of competent jurisdiction to be due
and payable by an Obligor and such
determination is not stayed pending appeal.
(e) Within
30 days after the date of any payment of Taxes, the Obligors
shall furnish to the applicable holder or
holders of Notes the original or a
certified copy of a receipt evidencing
payment thereof.
(f) Each
holder shall, if required by law to avoid withholding taxes
imposed by the United States, provide to an
Obligor a U.S. Form W-8BEN, Form
W-8ECI, Form W-9 or any successor form
thereto as requested and provided by such
Obligor.
SECTION 9. AFFIRMATIVE COVENANTS.
Each
Obligor covenants that so long as any of the Notes are
outstanding:
Section
9.1. Compliance with Law. Each Obligor 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. Each Obligor will, and will cause each of its
Restricted 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 except for
any non-maintenance that would not
reasonably be expected to have a Material
Adverse Effect.
Section
9.3. Maintenance of Properties. Each Obligor will, and will
cause
each of its Restricted 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
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<PAGE>
tear), so that the business carried on in
connection therewith may be properly
conducted at all times, provided that this
Section shall not prevent any Obligor
or any Restricted Subsidiary from
discontinuing the operation and the
maintenance of any of its properties if
such discontinuance is desirable in the
conduct of its business and each Obligor
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. Each Obligor 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 any Obligor
or any Subsidiary not permitted by Section
10.4, provided that neither any
Obligor nor any Subsidiary need pay any
such tax or assessment or claims if (i)
the amount, applicability or validity
thereof is contested by any Obligor or
such Subsidiary on a timely basis in good
faith and in appropriate proceedings,
and such Obligor or Subsidiary has
established adequate reserves therefor in
accordance with GAAP on the books of such
Obligor or such Subsidiary or (ii) the
non-filing or nonpayment, as the case may
be, of all such taxes and assessments
in the aggregate could not reasonably be
expected to have a Material Adverse
Effect.
Section
9.5. Corporate Existence, Etc. Subject to Sections 10.5 and
10.6,
each Obligor will at all times preserve and
keep in full force and effect its
corporate or partnership existence, as the
case may be, and will at all times
preserve and keep in full force and effect
such corporate or partnership
existence, as the case may be, of each of
its Restricted Subsidiaries (unless
merged into an Obligor or a Restricted
Subsidiary) and all rights and franchises
of such Obligor and its Restricted
Subsidiaries unless, in the good faith
judgment of such Obligor, the termination
of or failure to preserve and keep in
full force and effect such corporate or
partnership existence, as the case may
be, right or franchise could not,
individually or in the aggregate be expected,
to have a Material Adverse Effect.
Section
9.6. Additional Subsidiary Guarantors. The Parent Guarantor
will
cause any Subsidiary which is required by
the terms of either Bank Credit
Agreement to become a party to, or
otherwise guarantee, Debt in respect of
either Bank Credit Agreement, to enter into
the Subsidiary Guaranty and deliver
to each of the holders of the Notes
(concurrently with the incurrence of any
such obligation pursuant to such Bank
Credit Agreement) the following items:
(a) a joinder agreement in respect of the Subsidiary Guaranty;
(b) a certificate signed by the President, a Vice President or
another
authorized Responsible Officer of the Parent Guarantor making
representations and warranties to the effect of those contained
in
Sections
5.4, 5.6 and 5.7 and in the Subsidiary Guaranty, with respect
to
such
Subsidiary and the Subsidiary Guaranty, as applicable; and
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<PAGE>
(c) an opinion of counsel (who may be in-house counsel for the
Parent
Guarantor) addressed to each of the holders of the Notes
satisfactory to the Required Holders, to the effect that the
Subsidiary
Guaranty
by such Person has been duly authorized, executed and delivered
and that
the Subsidiary Guaranty constitutes the legal, valid and
binding
contract
and agreement of such Person enforceable in accordance with its
terms,
except as an enforcement of such terms may be limited by
bankruptcy, insolvency, fraudulent conveyance and similar laws
affecting
the
enforcement of creditors' rights generally and by general
equitable
principles.
Section
9.7. Designation of Subsidiaries. The Parent Guarantor may from
time to time cause any Subsidiary (other
than an Obligor or a Subsidiary
Guarantor) to be designated as an
Unrestricted Subsidiary or any Unrestricted
Subsidiary to be designated a Restricted
Subsidiary; provided, however, that at
the time of such designation and
immediately after giving effect thereto, (a) no
Default or Event of Default would exist
under the terms of this Agreement, and
(b) the Obligors and their Restricted
Subsidiaries would be in compliance with
all of the covenants set forth in this
Section 9 and Section 10 if tested on the
date of such action and provided, further,
that once a Subsidiary has been
designated an Unrestricted Subsidiary, it
shall not thereafter be redesignated
as a Restricted Subsidiary on more than one
occasion. Within ten (10) days
following any designation described above,
the Obligors will deliver to you a
notice of such designation accompanied by a
certificate signed by a Senior
Financial Officer of the Obligors
certifying compliance with all requirements of
this Section 9.7 and setting forth all
information required in order to
establish such compliance.
Section
9.8. Notes to Rank Pari Passu. The Notes and all other
respective
obligations under this Agreement of the
Obligors are and at all times shall
remain direct and unsecured obligations of
the Obligors ranking pari passu as
against the assets of the Obligors 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 unsecured
Debt (actual or contingent) of the
Obligors which is not expressed to be
subordinate or junior in rank to any other
unsecured Debt of the Obligors.
SECTION 10. NEGATIVE COVENANTS.
Each
Obligor covenants that so long as any of the Notes are
outstanding:
Section
10.1. Consolidated Net Worth. The Obligors will not, at any
time,
permit Consolidated Net Worth to be less
than the sum of (a) $260,000,000, plus
(b) 25% of Consolidated Net Income (but
only if a positive number) for each
completed fiscal quarter, beginning with
the fiscal quarter ending after
February 29, 2004.
Section
10.2. Limitations on Total Capitalization; Consolidated Debt.
(a)
The Obligors will not, at any time, permit
the ratio of Consolidated Debt to
Consolidated Total Capitalization to exceed
the percentage set forth opposite
the respective period below:
-23-
<PAGE>
<TABLE>
<CAPTION>
PERIOD
PERCENTAGE
--------------------------------------------------------------
<S>
<C>
Closing Date through February 28, 2005:
60%
--------------------------------------------------------------
March 1, 2005 and thereafter:
55%
--------------------------------------------------------------
</TABLE>
(b) The
Obligors 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 Consolidated Debt
unless, on the date such Obligor or such
Restricted Subsidiary becomes liable
with respect to any such Consolidated Debt
and immediately after giving effect
thereto and the concurrent retirement of
any other Consolidated Debt,
(i) no Default or Event of Default exists, and
(ii) in the case of the incurrence of any Debt, other than
Permitted
Credit
Facility Debt, the ratio of Consolidated Debt to Consolidated
EBITDA
(calculated as at the end of each fiscal quarter for the four
consecutive fiscal quarters then most recently ended) shall not
exceed
4.00 to
1.00; and
(iii) in the case of the incurrence of any Permitted Credit
Facility
Debt, the
ratio of Consolidated Adjusted Debt to Consolidated EBITDA
(calculated as at the end of each fiscal quarter for the four
consecutive
fiscal
quarters then most recently ended) shall not exceed 4.00 to
1.00.
For the
purposes of this Section 10.2(b), 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
10.3. Priority Debt. The Obligors will not, at any time, permit
the aggregate amount of all Priority Debt
to exceed 20% of Consolidated Net
Worth, determined as of the end of the then
most recently ended fiscal quarter
of the Parent Guarantor.
Section
10.4. Limitation on Liens. The Obligors will not, and will not
permit any of their 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 any Obligor or any such
Restricted Subsidiary, 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:
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<PAGE>
(a) Liens for taxes, assessments or other governmental charges
that
are not
yet due and payable or the payment of which is not at the time
required
by Section 9.4;
(b) Liens incidental to the conduct of business or the ownership
of
properties
and assets (including landlords', carriers', warehousemen's,
mechanics', materialmen's and other similar Liens for sums not yet
due and
payable)
and Liens to secure the performance of bids, tenders, leases,
or
trade
contracts, or to secure statutory obligations (including
obligations
under
workers compensation, unemployment insurance and other social
security
legislation), surety or appeal bonds or other Liens incurred in
the
ordinary course of business and not in connection with the
borrowing
of
money;
(c) leases or subleases granted to others, easements,
rights-of-way,
restrictions and other similar charges or encumbrances, in each
case
incidental
to the ownership of property or assets or the ordinary conduct
of the
business of any Obligor or any of its Restricted Subsidiaries,
or
Liens
incidental to minor survey exceptions and the like, provided
that
such Liens
do not, in the aggregate, materially detract from the value of
such
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;
(e) Liens securing Debt of a Restricted Subsidiary (other than
the
Company or
Troy Barbados) to an Obligor or to a Restricted Subsidiary;
(f) Liens existing as of the date of Closing and reflected in
Schedule
10.4;
(g) Liens incurred after the date of Closing given to secure
the
payment of
the purchase price incurred in connection with the acquisition,
construction or improvement of property (other than accounts
receivable or
inventory)
useful and intended to be used in carrying on the business of
an Obligor
or a Restricted Subsidiary, including Liens existing on such
property
at the time of acquisition or construction thereof or Liens
incurred
within 365 days of such acquisition or completion of such
construction or improvement, provided that (i) the Lien shall
attach
solely to
the property acquired, purchased, constructed or improved; (ii)
at the
time of acquisition, construction or improvement of such
property,
the
aggregate amount remaining unpaid on all Debt secured by Liens on
such
property,
whether or not assumed by an Obligor or a Restricted
Subsidiary,
shall not
exceed the lesser of (y) the cost of such acquisition,
construction or improvement or (z) the Fair Market Value of such
property
(as
determined in good faith by one or more officers of an Obligor to
whom
authority
to enter into the transaction has been delegated by the board
of
directors
of such Obligor); and (iii) at the time of such incurrence and
after
giving effect thereto, no Default or Event of Default would
exist;
(h) any Lien existing on property of a Person immediately prior
to
its being
consolidated with or merged into an Obligor or a Restricted
Subsidiary
or its becoming a
-25-
<PAGE>
Restricted
Subsidiary, or any Lien existing on any property acquired by an
Obligor 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, (ii)
each such
Lien on any acquired property 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, and (iii) at the time of such incurrence and after
giving
effect thereto, no Default or Event of Default would exist;
(i) any extensions, renewals or replacements of any Lien
permitted
by the
preceding subparagraphs (f), (g) and (h) of this Section 10.4,
provided
that (i) no additional property shall be encumbered by such
Liens,
(ii) the unpaid principal amount of the Debt or other
obligations
secured
thereby shall not be increased on or after the date of any
extension,
renewal or replacement, and (iii) at such time and immediately
after
giving effect thereto, no Default or Event of Default shall
have
occurred
and be continuing; or
(j) Liens securing Priority Debt of any Obligor or any
Restricted
Subsidiary,
provided that the aggregate principal amount of any such
Priority
Debt shall be permitted by Section 10.3.
Section
10.5. Sales of Assets. The Obligors will not, and will not
permit
any Restricted Subsidiary to, sell, lease
or otherwise dispose of any
substantial part (as defined below) of the
assets of the Obligors and their
Restricted Subsidiaries (including without
limitation the sale or transfer of
assets in a sale and leaseback transaction
or a securitization transaction or a
sale of equity interest in any Subsidiary);
provided, however, that any Obligor
or any Restricted Subsidiary may sell,
lease or otherwise dispose of assets
constituting a substantial part of the
assets of the Obligors and its Restricted
Subsidiaries if such assets are sold in an
arms length transaction and, at such
time and after giving effect thereto, no
Default or Event of Default shall have
occurred and be continuing and an amount
equal to the net proceeds received from
such sale, lease or other disposition shall
be used within 365 days of such
sale, lease or disposition, in any
combination:
(1) to acquire productive assets used or useful in carrying on
the
business
of the Obligors and their Restricted Subsidiaries and having a
value at
least equal to the value of such assets sold, leased or
otherwise
disposed
of; or
(2) to prepay or retire Senior Debt of the Obligors and/or its
Restricted
Subsidiaries, provided that, to the extent any such proceeds
are used to prepay the outstanding
principal amount of the Notes, such
prepayment
shall be made in accordance with the terms of Section 8.2.
As used in
this Section 10.5, a sale, lease or other disposition of assets
shall be deemed to be a "substantial part"
of the assets of the Parent Guarantor
and its Restricted Subsidiaries if the
-26-
<PAGE>
book value of such assets, when added to
the book value of all other assets
sold, leased or otherwise disposed of by
the Parent Guarantor and its Restricted
Subsidiaries during the period of 12
consecutive months ending on the date of
such sale, lease or other disposition,
exceeds 15% of the book value of
Consolidated Total Assets, determined as of
the end of the fiscal year
immediately preceding such sale, lease or
other disposition; provided that there
shall be excluded from any determination of
a "substantial part" any (i) sale or
disposition of assets in the ordinary
course of business of the Obligors and
their Restricted Subsidiaries, (ii) any
transfer of assets from any Obligor to
any other Obligor or any Restricted
Subsidiary or from any Restricted Subsidiary
to any Obligor or a Restricted Subsidiary
and (iii) any sale or transfer of
property acquired by any Obligor or any
Restricted Subsidiary after the date of
this Agreement to any Person within 365
days following the acquisition or
construction of such property by any
Obligor or any Restricted Subsidiary if
such Obligor or such Restricted Subsidiary
shall concurrently with such sale or
transfer, lease such property, as
lessee.
Section
10.6. Merger and Consolidation. The Obligors will not, and will
not permit any of their Restricted
Subsidiaries to, consolidate with or merge
with any other Person or convey, transfer
or lease substantially all of their
assets in a single transaction or series of
transactions to any Person; provided
that:
(1) any Restricted Subsidiary of an Obligor may (x) consolidate
with
or merge
with, or convey, transfer or lease substantially all of its
assets in
a single transaction or series of transactions to, (i) an
Obligor or
a Restricted Subsidiary so long as in any merger or
consolidation involving an Obligor, the Obligor shall be the
surviving or
continuing
corporation or (ii) any other Person so long as the survivor is
the
Restricted Subsidiary, or (y) convey, transfer or lease all of
its
assets in
compliance with the provisions of Section 10.5;
(2) any Obligor may consolidate with or merge with, or convey,
transfer
or lease substantially all of its assets in a single
transaction
or series
of transactions to, any other Obligor so long as (i) in any
merger or
consolidation involving the Parent Guarantor, the Parent
Guarantor
shall be the surviving or continuing corporation, and (ii) in
any merger
or consolidation involving the Company, if the Company is not
the
surviving or continuing corporation, such surviving or
continuing
corporation
shall have executed and delivered to each holder of Notes its
assumption
of the due and punctual performance and observance of each
covenant
and condition of this Agreement of the Company and the Notes
(pursuant
to such agreements and instruments as shall be reasonably
satisfactory to the Required Holders), and such surviving or
continuing
corporation shall have caused to be delivered to each holder of
Notes (A)
an opinion
of nationally recognized independent counsel, to the effect
that all
agreements or instruments effecting such assumption are
enforceable in accordance with their terms and (B) an
acknowledgment from
each
Guarantor and Subsidiary Guarantor that its respective Guaranty
continues in
full force and effect; and
(3) the foregoing restriction does not apply to the consolidation
or
merger of
the Parent Guarantor with, or the conveyance, transfer or lease
of
substantially all of the
-27-
<PAGE>
assets of
the Parent Guarantor in a single transaction or series of
transactions to, any Person so long as:
(a) 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 Parent Guarantor as an entirety, as the case may be
(the "Successor Corporation"), shall be a solvent entity
organized and existing under the laws of the United States of
America, any State thereof or the District of Columbia;
(b) if the Parent Guarantor is not the Successor
Corporation, such Successor Corporation shall have executed
and delivered to each holder of Notes its assumption of the
due and punctual performance and observance of each covenant
and condition of this Agreement (pursuant to such agreements
and instruments as shall be reasonably satisfactory to the
Required Holders), and the Successor Corporation shall have
caused to be delivered to each holder of Notes (A) an opinion
of nationally recognized independent counsel, to the effect
that all agreements or instruments effecting such assumption
are enforceable in accordance with their terms and (B) an
acknowledgment from Troy Barbados and each Subsidiary
Guarantor that its respective Guaranty continues in full force
and effect; and
(c) immediately after giving effect to such transaction
no Default or Event of Default would exist and the Obligors
would be permitted to incur at least $1.00 of additional
Consolidated Debt pursuant to the provisions of Section 10.2.
Section
10.7. Nature of Business. The Obligors and their Restricted
Subsidiaries will not engage in any
business, if, as a result, when taken as a
whole, the general nature of the business
of the Obligors and their Restricted
Subsidiaries would be substantially changed
from the general nature of the
business conducted by the Obligors and
their Restricted Subsidiaries on the date
of this Agreement as described in the
Memorandum.
Section
10.8. Transactions with Affiliates. The Obligors will not and
will
not permit any Restricted Subsidiary to
enter into directly or indirectly any
Material transaction or Material group of
related transactions (including
without limitation the purchase, lease,
sale or exchange of properties of any
kind or the rendering of any service) with
any Affiliate (other than an Obligor
or another Restricted Subsidiary), except
in the ordinary course and upon fair
and reasonable terms that are not
materially less favorable to such Obligor or
such Restricted Subsidiary than would be
obtainable in a comparable arm's-length
transaction with a Person not an
Affiliate.
SECTION 11. EVENTS OF DEFAULT.
An "Event
of Default" shall exist if any of the following conditions or
events shall occur and be continuing:
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<PAGE>
(a) any Obligor defaults in the payment of any principal or
Prepayment
Premium, if any, or LIBOR Breakage 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) any Obligor defaults in the payment of any interest on any
Note
for more
than five Business Days after the same becomes due and payable;
or
(c) any Obligor
defaults in the performance of or compliance with
any term
contained in Section 10 or any Subsidiary Guarantor defaults in
the
performance of or compliance with any term of the Subsidiary
Guaranty
beyond any
period of grace or cure period provided with respect thereto;
or
(d) any Obligor defaults in the performance of or compliance
with
any term
contained herein (other than those referred to in paragraphs
(a),
(b) and
(c) of this Section 11) and such default is not remedied within
30
days after
the earlier of (i) a Responsible Officer obtaining actual
knowledge
of such default or (ii) any Obligor 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); or
(e) any Subsidiary Guaranty or the guarantee in Section 14
hereof
ceases to
be a legally valid, binding and enforceable obligation or
contract
of the guarantor thereunder (other than upon a release of any
Subsidiary
Guarantor from a Subsidiary Guaranty in accordance with the
terms of
Section 2.2(b) hereof), or any guarantor thereunder or any
Affiliate
by, through or on account of any such Person, challenges the
validity,
binding nature or enforceability of any such guaranty; or
(f) any representation or warranty made in writing by or on
behalf
of any
Obligor or any Subsidiary Guarantor or by any officer of any
Obligor or
any Subsidiary Guarantor in any writing furnished in connection
with the
transactions contemplated hereby or by any Subsidiary Guaranty
proves to
have been false or incorrect in any material respect on the
date
as of
which made; or
(g) (i) any Obligor or any Restricted Subsidiary is in default
(as
principal
or as guarantor or other surety) in the payment of any
principal
of or
prepayment premium or interest (in the payment amount of at
least
$100,000)
on any Debt other than the Notes that is outstanding in an
aggregate
principal amount of at least $10,000,000 beyond any period of
grace
provided with respect thereto, or (ii) any Obligor or any
Restricted
Subsidiary
is in default in the performance of or compliance with any term
of any
instrument, mortgage, indenture or other agreement relating to
any
Debt other
than the Notes in an aggregate principal amount of at least
$10,000,000 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 or
one or more Persons has the right to declare such Debt to be
due and
payable before its stated maturity or before its regularly
scheduled
dates of payment, or (iii) as a consequence of the occurrence
or
continuation of any event or
-29-
<PAGE>
condition
(other than the passage of time or the right of the holder of
Debt to
convert such Debt into equity interests), any Obligor or any
Restricted
Subsidiary has become obligated to purchase or repay Debt other
than the
Notes before its regular maturity or before its regularly
scheduled
dates of payment in an aggregate outstanding principal amount
of
at least
$10,000,000 or one or more Persons have the right to require
any
Obligor or
any Restricted Subsidiary to purchase or repay such Debt; or
(h) any Obligor, any Material Subsidiary or any Subsidiary
Guarantor
(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
(i) a court or governmental authority of competent jurisdiction
enters an
order appointing, without consent by any Obligor, any of its
Material
Subsidiaries or any Subsidiary Guarantor, a custodian,
receiver,
trustee or
other officer with similar powers with respect to it or with
respect to
any substantial part of its property, or constituting an order
for relief
or approving a petition for relief or reorganization or any
other
petition in bankruptcy or for liquidation or to take advantage
of
any
bankruptcy or insolvency law of any jurisdiction, or ordering
the
dissolution, winding-up or liquidation of any Obligor, any of its
Material
Subsidiaries or any Subsidiary Guarantor, or any such petition
shall be
filed
against any Obligor, any of its Material Subsidiaries or any
Subsidiary
Guarantor and such petition shall not be dismissed within 60
days;
or
(j) a final judgment or judgments at any one time outstanding
for
the
payment of money aggregating in excess of $10,000,000 are
rendered
against
one or more of any Obligor, its Restricted Subsidiaries or any
Subsidiary
Guarantor and which judgments are not, within 60 days after
entry
thereof, bonded, discharged or stayed pending appeal, or are
not
discharged
within 60 days after the expiration of such stay; or
(k) if (i) any Plan shall fail to satisfy the minimum funding
standards
of ERISA or the Code for any plan year or part thereof or a
waiver of
such standards or extension of any amortization period is
sought
or granted
under Section 412 of the Code, (ii) a notice of intent to
terminate
any Plan shall have been or is reasonably expected to be filed
with the
PBGC or the PBGC shall have instituted proceedings under
Section
4042 of
ERISA to terminate or appoint a trustee to administer any Plan
or
the PBGC
shall have notified any Obligor or any ERISA Affiliate that a
Plan may
become a subject of any such proceedings, (iii) the aggregate
"amount of
unfunded benefit liabilities" (within the meaning of Section
4001(a)(18) of ERISA) under all Plans, determined in accordance
with Title
IV of
ERISA, shall exceed $10,000,000, (iv) any Obligor or any ERISA
Affiliate
shall have incurred or is reasonably expected to incur any
liability
pursuant to
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<PAGE>
Title I or
IV of ERISA or the penalty or excise tax provisions of the Code
relating
to employee benefit plans, (v) any Obligor or any ERISA
Affiliate
withdraws from
any Multiemployer Plan, or (vi) any Obligor or any
Subsidiary
establishes or amends any employee welfare benefit plan that
provides
post-employment welfare benefits in a manner that could
increase
the
liability of any Obligor or any Subsidiary thereunder; and any
such
event or
events described in clauses (i) through (vi) above, either
individually or together with any other such event or events,
could
reasonably
be expected to have a Material Adverse Effect.
As used in Section 11(k), the terms
"employee benefit plan" and "employee
welfare benefit plan" shall have the
respective meanings assigned to such terms
in Section 3 of ERISA.
SECTION 12. REMEDIES ON DEFAULT, ETC.
Section
12.1. Acceleration. (a) If an Event of Default with respect to
any
Obligor described in paragraph (h) or (i)
of Section 11 (other than an Event of
Default described in clause (i) of
paragraph (h) or described in clause (vi) of
paragraph (h) by virtue of the fact that
such clause encompasses clause (i) of
paragraph (h)) has occurred, all the Notes
then outstanding shall automatically
become immediately due and payable.
(b) If any
other Event of Default has occurred and is continuing, any
holder or holders of more than 50% in
aggregate principal amount of the Notes at
the time outstanding may at any time at its
or their option, by notice or
notices to any Obligor, declare all the
Notes then outstanding to be immediately
due and payable.
(c) If any
Event of Default described in paragraph (a) or (b) of Section
11 has occurred and is continuing with
respect to any Note, any holder or
holders of Note at the time outstanding
affected by such Event of Default may at
any time, at its or their option, by notice
or notices to any Obligor, declare
all the Notes held by such holder or
holders to be immediately due and payable.
Upon any
Note's becoming due and payable under this Section 12.1,
whether
automatically or by declaration, such Note
will forthwith mature and the entire
unpaid principal amount of such Note, plus
(i) all accrued and unpaid interest
thereon and (ii) the Prepayment Premium and
LIBOR Breakage Amount, if any,
determined in respect of such principal
amount (to the full extent permitted by
applicable law), shall all be immediately
due and payable, in each and every
case without presentment, demand, protest
or further notice, all of which are
hereby waived. The Company acknowledges,
and the parties hereto agree, that each
holder of a Note has the right to maintain
its investment in the Notes free from
repayment by the Company (except as herein
specifically provided for) and that
the provision for payment of a Prepayment
Premium by the Company in the event
that the Notes are prepaid or are
accelerated as a result of an Event of
Default, is intended to provide
compensation for the deprivation of such right
under such circumstances.
Section
12.2. Other Remedies. If any Default or Event of Default has
occurred and is continuing, and
irrespective of whether any Notes have become or
have been declared
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<PAGE>
immediately due and payable under Section
12.1, the holder of any Note at the
time outstanding may proceed to protect and
enforce the rights of such holder by
an action at law, suit in equity or other
appropriate proceeding, whether for
the specific performance of any agreement
contained herein or in any Note, or
for an injunction against a violation of
any of the terms hereof or thereof, or
in aid of the exercise of any power granted
hereby or thereby or by law or
otherwise.
Section
12.3. Rescission. At any time after the Notes have been
declared
due and payable pursuant to clause (b) or
(c) of Section 12.1, the holders of
not less than 51% in aggregate principal
amount of the Notes then outstanding,
by written notice to the Company, may
rescind and annul any such declaration and
its consequences if (a) the Company has
paid all overdue interest on the Notes
and LIBOR Breakage Amount, if any, all
principal of and Prepayment Premium, if
any, on any Notes that are due and payable
and are unpaid other than by reason
of such declaration, and all interest on
such overdue principal and Prepayment
Premium and LIBOR Breakage Amount, if any,
and (to the extent permitted by
applicable law) any overdue interest in
respect of the Notes, at the Default
Rate, (b) all Events of Default and
Defaults, other than non-payment of amounts
that have become due solely by reason of
such declaration, have been cured or
have been waived pursuant to Section 18,
and (c) no judgment or decree has been
entered for the payment of any monies due
pursuant hereto or to any Notes. No
rescission and annulment under this Section
12.3 will extend to or affect any
subsequent Event of Default or Default or
impair any right consequent thereon.
Section
12.4. No Waivers or Election of Remedies, Expenses, Etc. No
course
of dealing and no delay on the part of any
holder of any Note in exercising any
right, power or remedy shall operate as a
waiver thereof or otherwise prejudice
such holder's rights, powers or remedies.
No right, power or remedy conferred by
this Agreement or by any Note upon any
holder thereof shall be exclusive of any
other right, power or remedy referred to
herein or therein or now or hereafter
available at law, in equity, by statute or
otherwise. Without limiting the
obligations of the Company under Section
16, the Company will pay to the holder
of each Note on demand such further amount
as shall be sufficient to cover all
costs and expenses of such holder incurred
in any enforcement or collection
under this Section 12, including, without
limitation, reasonable attorneys'
fees, expenses and disbursements.
SECTION 13. REGISTRATION; EXCHANGE;
SUBSTITUTION OF NOTES.
Section
13.1. Registration of Notes. The Company shall keep at its
principal executive office a register for
the registration and registration of
transfers of Notes. The name and address of
each holder of one or more Notes,
each transfer thereof and the name and
address of each transferee of one or more
Notes shall be registered in such register.
Prior to due presentment for
registration of transfer, the Person in
whose name any Note shall be registered
shall be deemed and treated as the owner
and holder thereof for all purposes
hereof, and the Company shall not be
affected by any notice or knowledge to the
contrary. The Company shall give to any
holder of a Note that is an
Institutional Investor promptly upon
request therefor, a complete and correct
copy of the names and addresses of all
registered holders of Notes.
Section
13.2. Transfer and Exchange of Notes. Upon surrender of any
Note
at the principal executive office of the
Company for registration of transfer or
exchange (and in the case
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of a surrender for registration of
transfer, duly endorsed or accompanied by a
written instrument of transfer duly
executed by the registered holder of such
Note or its attorney duly authorized in
writing and accompanied by the address
for notices of each transferee of such Note
or part thereof), the Company shall
execute and deliver not more than 5
Business Days following surrender of such
Note, at the Company' expense (except as
provided below), one or more new Notes
(as requested by the holder thereof) of the
same Series in exchange therefor, in
an aggregate principal amount equal to the
unpaid principal amount of the
surrendered Note. Each such new Note shall
be payable to such Person as such
holder may request and shall be
substantially in the form of the Note (and of
the same Series) originally issued
hereunder. Each such new Note shall be dated
and bear interest from the date to which
interest shall have been paid on the
surrendered Note or dated the date of the
surrendered Note if no interest shall
have been paid thereon. The Company may
require payment of a sum sufficient to
cover any stamp tax or governmental charge
imposed in respect of any such
transfer of Notes. Notes shall not be
transferred in denominations of less than
$100,000, provided that if necessary to
enable the registration of transfer by a
holder of its entire holding of Notes, one
Note may be in a denomination of less
than $100,000. Any transferee, by its
acceptance of a Note registered in its
name (or the name of its nominee), shall be
deemed to have made the
representation set forth in Section 6.2,
provided that such holder may (in
reliance upon information provided by the
Company, which shall not be
unreasonably withheld) make a
representation to the effect that the purchase by
such holder of any Note will not constitute
a non-exempt prohibited transaction
under Section 406(a) of ERISA.
The Notes
have not been registered under the Securities Act or under the
securities laws of any state and may not be
transferred or resold unless
registered under the Securities Act and all
applicable state securities laws or
unless an exemption from the requirement
for such registration is available.
Section
13.3. Replacement of Notes. Upon receipt by the Company of
evidence reasonably satisfactory to it
