EXHIBIT 10.12
EXECUTION COPY
OrCal Geothermal Inc.
$165,000,000
6.21% Senior Secured Notes due December 2020
Note Purchase Agreement
December 2, 2005
Lehman Brothers Inc.
745 Seventh Avenue
New York, New York 10019
Ladies and Gentlemen:
OrCal Geothermal Inc., a Delaware corporation (the "Company"),
proposes to
issue and sell to Lehman Brothers Inc. (the "Purchaser"),
$165,000,000 in
aggregate principal amount of 6.21% Senior Secured Notes due
December 2020 (the
"Notes") on the terms and in the manner set forth herein. The Notes
will
initially be unconditionally guaranteed when issued on a senior
secured basis
(the "Guarantees") by OrHeber 1 Inc., a Delaware corporation
("OrHeber 1"),
OrHeber 2 Inc., a Delaware corporation ("OrHeber 2"), Second
Imperial Geothermal
Company, a California limited partnership ("SIGC"), Heber Field
Company, a
California general partnership ("HFC") and Heber Geothermal
Company, a
California general partnership ("HGC" and collectively with OrHeber
1, OrHeber
2, SIGC and HFC, each a "Guarantor" and collectively, the
"Guarantors"). The
Notes and the Guarantees are referred to collectively herein as the
"Securities."
The Notes will initially be sold by the Company to the Purchaser
without
being registered under the Securities Act of 1933, as amended (the
"Securities
Act"), in reliance on certain exemptions from registration.
The Securities are to be issued pursuant to an indenture among the
Company,
the Guarantors and Union Bank of California, N.A., as trustee (the
"Trustee") to
be dated as of December 8, 2005 (as amended, modified, supplemented
and in
effect from time to time, the "Indenture").
The Purchaser is entitled to resell, subject to the conditions set
forth
herein, all of the Securities to subsequent investors at any time
after the date
of this Note Purchase Agreement (this "Agreement"). The Securities
are to be
offered and sold through the Purchaser to such subsequent investors
without
being registered under the Securities Act in reliance upon certain
exemptions
from registration. As used herein, (a) "Preliminary Offering
Memorandum" means
the preliminary offering memorandum dated November 28, 2005,
including the
annexes thereto and the documents incorporated by reference
therein, relating to
both the Securities to be resold outside the United States pursuant
to
Regulation S ("Regulation S") under the Securities Act and the
Securities to be
resold in the United States pursuant to Rule 144A ("Rule 144A")
under the
Securities Act, (b) the "Offering Memorandum" means the offering
memorandum
dated December 2, 2005, including the annexes thereto and the
documents
incorporated by reference therein, relating to the foregoing, and
(c) the
Preliminary Offering Memorandum and the Offering Memorandum, as
either may be
amended or supplemented prior to the Time of Delivery (as defined
in Section
5(a) hereof), are referred to herein collectively as the "Offering
Materials."
Capitalized terms used but not defined herein shall have the
meanings
assigned thereto in the Indenture.
1. Preliminary Offering Memorandum and Offering Memorandum.
The Securities will be offered and sold (or in the case of the
Guarantees,
issued) to the Purchaser without registration under the Securities
Act, in
reliance on an exemption pursuant to Section 4(2) under the U.S.
Securities Act
of 1933, as amended (the "Securities Act"). The Company has
prepared the
Offering Materials, setting forth information regarding the
Company, the
Guarantors and the Securities. The Company hereby confirms that it
has
authorized the use of the Offering Materials in connection with the
offering and
resale of the Securities by the Purchaser.
It is understood and acknowledged that upon original issuance
thereof, and
until such time as the same is no longer required under the
applicable
requirements of the Securities Act, the Notes (and all securities
issued in
exchange therefor or in substitution thereof) will bear the
following legend
(along with such other legends as required by the Indenture):
"THE NOTES EVIDENCED HEREBY HAVE NOT BEEN REGISTERED UNDER THE
UNITED
STATES SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT")
AND MAY
NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED EXCEPT (A)
(1) TO A
PERSON WHOM THE SELLER REASONABLY BELIEVES IS A QUALIFIED
INSTITUTIONAL
BUYER WITHIN THE MEANING OF RULE 144A UNDER THE SECURITIES ACT
PURCHASING
FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL
BUYER
IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A, (2) IN AN
OFFSHORE
TRANSACTION COMPLYING WITH RULE 903 OR RULE 904 OF REGULATION S
UNDER THE
SECURITIES ACT, (3) PURSUANT TO AN EXEMPTION FROM REGISTRATION
UNDER THE
SECURITIES ACT PROVIDED BY RULE 144 THEREUNDER (IF
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AVAILABLE), (4) TO AN INSTITUTIONAL "ACCREDITED INVESTOR" WITHIN
THE
MEANING OF RULE 501(A)(1), (2), (3) OR (7) UNDER THE SECURITIES
ACT, IN A
TRANSACTION EXEMPT FROM THE REGISTRATION REQUIREMENTS OF THE
SECURITIES
ACT, (5) IN ACCORDANCE WITH ANOTHER EXEMPTION FROM THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT (BASED UPON AN OPINION OF
COUNSEL IF THE
COMPANY SO REQUESTS) OR (6) PURSUANT TO AN EFFECTIVE REGISTRATION
STATEMENT
UNDER THE SECURITIES ACT AND (B) IN ACCORDANCE WITH ALL APPLICABLE
BLUE SKY
LAWS OF THE STATES OF THE UNITED STATES."
You have advised the Company that you will make offers of and sell
the
Securities (the "Exempt Resales") purchased by you hereunder on the
terms set
forth in the Offering Memorandum, solely to (i) Persons whom you
reasonably
believe to be "qualified institutional buyers" as defined in Rule
144A under the
Securities Act ("QIBs") and (ii) outside the United States to
certain Persons in
offshore transactions in reliance on Regulation S under the
Securities Act.
Those Persons specified in clauses (i) and (ii) are referred to
herein as the
"Eligible Purchasers". You will offer the Securities to Eligible
Purchasers
initially at a price equal to 100% of the principal amount thereof.
Such price
may be changed at any time without notice.
2. Representations, Warranties and Agreements.
As of the date hereof, the Company and each of the Guarantors,
jointly and
severally, represent and warrant to the Purchaser, as follows:
(a) Accurate Disclosure. The Offering Materials, including any
amendments or supplements thereto issued by the Company, and the
information
required to be delivered to holders and prospective purchasers of
the Securities
on or prior to the Time of Delivery pursuant to the Indenture and
in accordance
with Rule 144A(d)(4) under the Securities Act do not and will not,
as of their
respective dates, contain an untrue statement of a material fact or
omit to
state a material fact necessary in order to make the statements
therein, in
light of the circumstances under which they were made, not
misleading; provided,
however, that this representation and warranty shall not apply to
(i) any
statements or omissions made in reliance upon and in conformity
with information
furnished in writing to the Company by the Purchaser expressly for
use therein
(as set forth in Section 9(a) hereof), (ii) the report prepared by
the
Independent Engineer (as defined below) and included as Annex A to
the Offering
Materials (the "Independent Engineer's Report") or excerpts
therefrom (except as
set forth in the next sentence), (iii) the report prepared by the
Geothermal
Consultant (as defined below) and included as Annex B to the
Offering Materials
(the "Geothermal Consultant's Report") or excerpts therefrom
(except as set
forth in the next sentence), (iv) the report prepared by the
Independent Energy
Market Consultant (as defined below) and included as Annex C to the
Offering
Materials (the "Independent Energy Market Consultant's Report") or
excerpts
therefrom (except as set forth in the next sentence), or (v) the
projections
referenced in 2(y) below. The factual information provided by the
Company to
Stone & Webster Management Consultants, Inc. (the
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"Independent Engineer") for inclusion in the Independent Engineer's
Report, to
GeothermEx, Inc. (the "Geothermal Consultant") for inclusion in the
Geothermal
Consultant's Report and to DAI Management Consultants, Inc. (the
"Independent
Energy Market Consultant") for inclusion in the Independent Energy
Market
Consultant's Report does not, as of the date hereof, and will not,
as of the
Time of Delivery, contain an untrue statement of a material fact or
omit to
state a material fact necessary in order to make the statements in
the factual
information so provided, in the light of the circumstances under
which they were
made, not misleading.
(b) Use of Offering Materials. The Offering Materials have been
prepared by the Company for use by the Purchaser in connection with
the Exempt
Resales. No order or decree prohibiting the use of the Offering
Materials, or
any order or decree asserting that the transactions contemplated by
this
Agreement are subject to the registration requirements of the
Securities Act,
has been issued and no proceeding for that purpose has commenced or
is pending
or, to the knowledge of the Company, the Guarantors or any Person
acting on
their behalf, is contemplated.
(c) Compliance with GAAP. The audited consolidated financial
statements (including the related notes and supporting schedules,
if any) of the
Company and its Subsidiaries (as defined below) contained in the
Offering
Materials have been prepared in conformity with GAAP and fairly
present the
financial condition, results of operations and cash flows of the
Company and its
Subsidiaries as of and for the dates set forth therein.
(d) Interim Financial Statements. The unaudited consolidated
interim
financial statements of the Company and its Subsidiaries contained
in the
Offering Materials were prepared in conformity with GAAP on a basis
consistent
with the Company's most recent audited financial statements so
included and
fairly present the financial condition, results of operations and
cash flows of
the Company and its Subsidiaries as of and for the dates set forth
therein.
(e) Marketable Title; Absence of Liens. Except as disclosed in the
Offering Materials, the Company and each of its Subsidiaries has
good and
marketable title to all real properties and all other properties
and assets
respectively owned by it (collectively, the "Assets"), in each case
free from
all Liens other than Permitted Liens. Except as disclosed in the
Offering
Materials, the Company and each of its Subsidiaries holds any
leased real or
personal property (including without limitation, geothermal
resources) under
valid and enforceable leases and has rights of access and use under
valid and
enforceable easements, in the case of each lease and easement with
no material
exceptions. The lessors under all of the leases set forth on Annex
A hereto have
consented to and ratified the terms of the Unit Agreement, among
HFC and each
lessor listed as a party therein, dated on or about June 16, 1978,
as amended.
The Material Project Documents (as defined below) are valid and
binding
agreements enforceable by the Company or its Subsidiaries, as
applicable, in
accordance with their terms except as such enforceability (i) may
be limited by
applicable bankruptcy, insolvency, reorganization, fraudulent
conveyance,
moratorium or other similar laws affecting the enforcement of
creditors' rights
and remedies generally and (ii) is subject to general principles of
equity
(regardless of whether enforceability is considered in a proceeding
in equity or
at law).
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(f) Operation of Projects. (i) The material mechanical, electrical
and
other operating systems on and in the Projects are in all material
respects in
good working order (ordinary wear and tear excepted) and repair and
are adequate
in all material respects for the operation of the Projects by the
Company and
its Subsidiaries as described in the Offering Materials;
(ii) Other than as described in the Offering Materials or as set
forth on Annex C hereto, the use of the Projects as described in
the Offering
Memorandum does not in any material respect depend on any variance,
special
exception or other local or municipal Governmental Approval that
has not been
obtained by or for the benefit of the Company or its Subsidiaries,
as
applicable, and all material building, construction, ownership,
operation and
maintenance, environmental, water and use related Governmental
Approvals
necessary for such use, except those set forth on Annex C hereto,
have been
issued and are in full force and effect; and
(iii) Except as set forth in the Offering Materials, all of the
power purchase agreements, plant connection agreements,
transmission services
agreements, fluid and water supply agreements, operation and
maintenance
agreements and other similar agreements necessary for the operation
and
maintenance of the Projects by the Company and its Subsidiaries as
described in
the Offering Materials (the "Material Project Documents") are
listed on Annex B
hereto.
(g) Due Organization, etc. (i) The Company has been duly organized,
is
validly existing and in good standing as a corporation under the
laws of the
State of Delaware;
(ii) The entities listed on Schedule B hereto will be all of the
direct and indirect subsidiaries of the Company (each, a
"Subsidiary" and
collectively, the "Subsidiaries") at the Time of Delivery. Each
Subsidiary has
been duly organized, is validly existing and is in good standing as
a
corporation, limited partnership, or general partnership, as the
case may be,
under the laws of the States indicated on Schedule B hereto;
(iii) The Company and each of the Subsidiaries has all requisite
power and authority to own, lease and/or operate and maintain its
properties and
conduct its business as described in the Offering Materials and to
execute,
deliver and perform its obligations under, or as contemplated by,
the
Transaction Documents; and
(iv) The Company and each of the Subsidiaries is in good standing
as a foreign corporation in each jurisdiction in which its
ownership or lease of
property or the conduct of its business requires such
qualification; except, in
each case, where the failure to be so qualified or in good standing
would not,
individually or in the aggregate, have a Material Adverse Effect.
(h) ERISA. (i) The Company and each of the Subsidiaries are in
compliance in all material respects with the applicable provisions
of ERISA and
the Code and the regulations and published interpretations
thereunder or any
similar non-United States laws to the extent that they relate to
any Plan.
Neither the Company nor any of its Subsidiaries maintains or
contributes to or
has maintained or contributed to or has any liability with respect
to a Plan
subject to Title
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IV of ERISA or Section 412 of the Code or Section 302 of ERISA or
any similar
non-United States laws (including without limitation any liability
with respect
to any Plan subject to Title IV of ERISA or Section 412 of the Code
or Section
302 of ERISA maintained or contributed to by an ERISA Affiliate)
with respect to
which any liability, including, without limitation, any contingent,
potential or
secondary liability, continues to exist; and
(ii) 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) of the
Code that is
not otherwise exempt. The representation by the Company set forth
in the
immediately preceding sentence is made in reliance upon and subject
to the
accuracy of the representation of each purchaser of the Notes set
forth in the
Offering Memorandum in paragraph (7) under the caption "Notice to
Investors".
(iii) As used in this paragraph (h):
(A) "Code" means the Internal Revenue Code of 1986, as
amended;
(B) "ERISA" means the Employee Retirement Income Security
Act of 1974, as amended;
(C) "ERISA Affiliate" means any trade or business (whether
or not incorporated) that is member of a group of which the Company
or
any Subsidiary, as the case may be, is a member and which is
treated
as a single employer under Section 414 of the Code; and
(D) "Plan" means any "employee benefit plan" within the
meaning of Section 3(3) of ERISA (1) which is maintained in whole
or
in part for current or former employees (or any beneficiary
thereof)
of the Company or any Subsidiary, as the case may be or (2) with
respect to which the Company, any Subsidiary, as the case may be,
could have a direct or indirect, actual or contingent liability;
included (without limitation) in this category shall be any
multiemployer plan (as defined in Section 4001(a)(3) of ERISA) to
which the Company, any Subsidiary or any ERISA Affiliate, as the
case
may be, is making or has an obligation to make contributions, or
has
at the Time of Delivery (as defined in Section 5(a) hereof) any
outstanding actual or contingent liability.
(i) Business Activities. Except as described in the Offering
Materials, neither the Company, nor any of the Subsidiaries, have
any direct or
indirect equity ownership interest in any corporation, partnership,
joint
venture or other entity other than the Subsidiaries. The Company
and the
Subsidiaries have not engaged in any business or activity other
than as
disclosed in the Offering Materials.
(j) Capitalization. The capitalization of the Company and the
Subsidiaries, after giving effect to the offering of the Notes and
the
application of the proceeds therefrom, will be as set forth in the
Offering
Memorandum; the issued and outstanding shares of Capital Stock
6
of the Company and the Subsidiaries, as the case may be, have been
duly and
validly authorized and issued, are fully paid and nonassessable and
are free
from all Liens; and there are no outstanding rights, warrants or
options to
acquire, or instruments convertible into or exchangeable for, any
equity
interest in the Company or the Subsidiaries. All of the issued and
outstanding
Capital Stock of the Company is owned, free from all liens and
encumbrances, by
Ormat Nevada Inc.
(k) Authorization and Enforceability of Transaction Documents. (i)
All
action on the part of the Company and the Guarantors that is
required for the
authorization, execution, delivery and performance of this
Agreement has been
and, at or prior to the Time of Delivery, all action on the part of
the Company,
the Guarantors and Ormat Nevada Inc. that is required for the
authorization,
execution, delivery and performance of any other Transaction
Document (except
for Project Documents relating to the Heber 1 Project and the Heber
2 Project
that were executed and delivered by a Person other than any of the
Guarantors
prior to the Time of Delivery) and the Letter of Representations to
The
Depository Trust Company ("DTC") relating to the eligibility of the
Securities
for inclusion in the DTC book-entry system (the "Letter of
Representations"), in
each case, has been or will be duly and effectively taken, and, at
or prior to
the Time of Delivery, the execution, delivery and performance of
each
Transaction Document (except for Project Documents relating to the
Heber 1
Project and the Heber 2 Project that were executed and delivered by
a Person
other than any of the Guarantors prior to the Time of Delivery) and
the Letter
of Representations will not require the approval or consent of any
holder or
trustee of any debt or other obligations or securities of the
Company, any
Guarantor or Ormat Nevada Inc. which will not have been obtained at
or prior to
the Time of Delivery.
(ii) This Agreement has been and, at or prior to the Time of
Delivery, any other Transaction Document (except for Project
Documents relating
to the Heber 1 Project and the Heber 2 Project that were executed
and delivered
by a Person other than any of the Guarantors prior to the Time of
Delivery) to
which the Company or any Guarantor is a party and the Letter of
Representations
has been or will be, duly executed and delivered by the Company and
the
Guarantors. Each Transaction Document to which the Company, any
Subsidiary or
Ormat Nevada Inc. is a party, other than this Agreement and the
Securities, will
constitute, at the Time of Delivery, a legal, valid and binding
obligation of
the Company, each Subsidiary and Ormat Nevada Inc. enforceable
against the
Company, each Subsidiary and Ormat Nevada Inc. in accordance with
the terms
hereof or thereof, except as such enforceability (i) may be limited
by
applicable bankruptcy, insolvency, reorganization, fraudulent
conveyance,
moratorium or other similar laws affecting the enforcement of
creditors' rights
and remedies generally and (ii) is subject to general principles of
equity
(regardless of whether enforceability is considered in a proceeding
in equity or
at law).
(l) Authorization and Enforceability of Securities. The Securities
have been duly authorized and, when issued and authenticated in
accordance with
the terms of the Indenture and delivered against payment therefor
in accordance
with the terms of this Agreement and the Indenture, will have been
duly
executed, authenticated, issued and delivered and will constitute
valid and
legally binding obligations of the Company and the Guarantors
enforceable
against the Company and the Guarantors in accordance with the terms
thereof,
except as such enforceability (i) may be limited by applicable
bankruptcy,
insolvency, reorganization,
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fraudulent conveyance, moratorium or other similar
laws affecting the enforcement of creditors' rights and remedies
generally and
(ii) is subject to general principles of equity (regardless of
whether
enforceability is considered in a proceeding in equity or at law).
The
Securities, the Indenture and each of the other Financing Documents
will conform
in all material respects to the description thereof in the Offering
Materials,
and the Securities will be entitled to the benefits provided by the
Indenture
and each of the other Financing Documents.
(m) Ranking. When the Securities are issued and authenticated in
accordance with the terms of the Indenture and delivered against
payment
therefor in accordance with the terms of this Agreement and the
Indenture, each
of the Securities will (i) rank pari passu without any preference
among
themselves and (ii) constitute Senior Secured Obligations as
defined in the
Offering Materials.
(n) Property Rights. The leases, easements, licenses, rights of way
and other rights possessed by the Company and the Subsidiaries
listed on Annex A
hereto (the "Material Real Property Interests") provide the Company
and the
Subsidiaries, as the case may be, with all rights and property
interests
required to enable the Company and the Subsidiaries to obtain, in
all material
respects, all services, materials (including without limitation
geothermal
resources) or rights (including without limitation access rights
and rights to
extract and develop geothermal resources) required for the
operation and
maintenance of the Projects, as contemplated by the Offering
Memorandum
including, without limitation, as contemplated in the pro forma
projections for
the Project (the "Pro Forma Projections").
(o) Title Policy. The Policy of Title Insurance to be provided
pursuant to Section 8(j) herein covers all of the Material Real
Property
Interests.
(p) Defaults under Material Project Documents. (i) Neither the
Company
nor any Subsidiary nor, to the knowledge of the Company and the
Guarantors, any
other party to a Material Project Document, is in default (and no
event has
occurred which with lapse of time or notice or action by a third
party could
result in a default) in any material respect in the performance of
or compliance
with any Material Project Document, (ii) except as described in the
Offering
Materials, each Material Project Document is in full force and
effect and (iii)
to the knowledge of the Company, no Force Majeure event has
occurred and is
continuing under any Material Project Document. Except as described
in the
Offering Materials, each of the other Project Documents described
in the
Offering Materials is in full force and effect.
(q) Non-contravention. Neither the execution or delivery of this
Agreement, any other Financing Document, the Letter of
Representations or any of
the transactions contemplated hereby or thereby nor the performance
of or
compliance with the terms and conditions hereof or thereof (i)
contravenes in
any material respect any Applicable Law, (ii) constitutes a default
under or
results in the violation of the provisions of the organizational
documents of
the Company or any Subsidiary, (iii) results in the creation or
imposition of
any Liens (other than Permitted Liens) on any assets or properties
of the
Company or any of the Subsidiaries, or (iv) constitutes a default
under or
results in the violation of any other material agreement, contract
or instrument
to which the Company or any of the Subsidiaries is a party or by
which they or
any of their properties or assets are bound.
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(r) Governmental Approvals. (i) Other than as described in the
Offering Materials or as set forth on Annex C hereto, the Company,
each of the
Subsidiaries and the Projects is in compliance in all material
respects with all
Governmental Approvals applicable to the Company, the Subsidiaries,
and the
Projects, as the case may be.
(ii) All Governmental Approvals which are required to be obtained
in connection with (i) the ownership, construction, operation and
maintenance of
the Projects as described in the Offering Materials and (ii) the
issuance and
sale of the Securities and the execution, delivery and performance
by the
Company and the Subsidiaries of the Transaction Documents have been
or will be
at the Time of Delivery duly obtained, were or will be at the Time
of Delivery
validly issued and are or will be at the Time of Delivery in full
force and
effect, final, not subject to appeal (and all applicable statutory
appeal
periods have or will have at the Time of Delivery expired, except
for
Governmental Approvals which do not have statutory limits on appeal
periods),
held in the name of the Company or such Subsidiary, as the case may
be, or other
appropriate party and free from conditions which the Company or
such Subsidiary,
as the case may be, does not reasonably expect either it or such
other
appropriate party, as applicable, will be able to satisfy, except
(A) as set
forth on Annex C hereto or in the Offering Memorandum, (B) those
which are not
required to be obtained as of the date hereof or as of the Time of
Delivery (and
which the Company expects will be obtained in the ordinary course)
or (C) such
as may be required under state securities or blue sky laws of the
various states
in the United States. There are no proceedings pending, with
respect to the
Company or the Subsidiaries that may result in a rescission,
termination,
modification, or suspension of any Governmental Approval of the
Company or any
Subsidiary. The Company and the Subsidiaries have no reason to
believe that any
Governmental Approvals not required to have been obtained on the
date hereof or
as of the Time of Delivery (or amendments, renewals or reissuance
of any
Governmental Approvals required after the date hereof) will not be
obtained by
the Company or the relevant Subsidiary, as the case may be, on or
before the
date such Governmental Approval, amendment, renewal or reissuance
is required.
(s) Legal and other Proceedings. Other than as set forth in the
Offering Materials, there is no material legal or governmental
action, suit,
proceeding or investigation pending before any Governmental
Authority to which
the Company or any Subsidiary is a party or to which any property
of the Company
or any Subsidiary is subject or affecting the Company, any
Subsidiary, or their
respective properties.
(t) Taxes. The Company and the Subsidiaries have filed all material
federal, state, local and foreign tax returns that are required to
be filed and
have paid all material taxes required to be paid and any related
assessments,
fines or penalties, except for any such tax, assessment, fine or
penalty that is
being contested in good faith and by appropriate proceedings and
for which
appropriate reserves have been allocated to the extent required and
in
accordance with GAAP.
(u) Insurance. The Company and the Subsidiaries have in full force
and
effect, insurance with reputable insurers covering the Projects and
their other
assets, properties, operations, personnel and businesses against
such losses,
damage, risks and hazards as are
9
consistent with customary industry practice to protect the Company,
the
Subsidiaries and their respective businesses.
(v) Compliance with Laws; Environmental Laws. Other than as
described
in the Offering Memorandum or as set forth on Annex C hereto, (i)
each of the
Company and the Subsidiaries are in compliance in all material
respects with all
Applicable Laws, (ii) the Company, the Subsidiaries (and their
affiliates acting
on their behalf) and the Projects are in compliance in all material
respects
with all applicable Environmental Laws, (iii) there are no pending
or, to the
Company's knowledge, threatened administrative, regulatory or
judicial actions,
suits, demands, demand letters, claims, Liens, notices of
non-compliance or
violation, investigations or proceedings relating to any
Environmental Law
against the Company, the Subsidiaries or the Projects, and (iv)
there are no
conditions, events or circumstances that may reasonably be expected
to form the
basis of an order for clean-up or remedial action or any action,
investigation,
claim, suit, or proceeding by a private party or government body or
agency,
against or affecting the Company, the Subsidiaries or the Projects
relating to
Hazardous Substances or Environmental Laws. For purposes of this
subsection (v),
"Environmental Law" means any national, regional or local law,
statute,
ordinance, rule, regulation, code, principle of common law,
license, permit,
authorization, approval, consent, order, judgment, decree,
injunction,
requirement or agreement with any Governmental Authority relating
to the
environment (including, without limitation, air, water vapor,
surface water,
groundwater, drinking water supply, surface land, subsurface land,
plant and
animal life or any other natural resource) or to human health or
safety,
including, without limitation, statutes, regulations, and rules of
common law
regulating or imposing liability or standards of conduct with
respect to (A)
emissions, discharges, releases or threatened releases of
pollutants,
contaminants, chemicals or industrial, toxic or Hazardous
Substances or wastes
into the environment, or (B) the exposure to, or use, storage,
recycling,
treatment, generation, manufacturing, transportation, processing,
handling,
labeling, production, release or disposal of any Hazardous
Substances, in each
case as amended and as now in effect; and "Hazardous Substance"
means any
substance presently or hereafter listed, defined, designated or
classified as
hazardous, toxic, radioactive or dangerous, or otherwise regulated
under any
Environmental Law, including asbestos containing materials,
petroleum and
petroleum containing products.
(w) Intellectual Property. To the Company's and the Guarantors'
knowledge, the Company and the Subsidiaries own, possess or can
acquire on
reasonable terms, adequate trademarks, trade names and other rights
to
inventions, know-how, patents, copyrights, confidential information
and other
intellectual property (collectively, "intellectual property
rights") necessary
to operate the Projects as contemplated by the Offering Materials,
and have not
received any notice of infringement of or conflict with asserted
rights of
others with respect to any intellectual property rights.
(x) Investment Company Act. The Company and the Subsidiaries are
not
and, after giving effect to the offering and sale of the
Securities, neither the
Company nor any Subsidiary will be, an "investment company," or an
entity
"controlled" by an investment company, as such terms are defined in
the
Investment Company Act of 1940, as amended (the "Investment Company
Act").
10
(y) Projections. The financial projections and other projected
financial and operating data relating to the Company, the
Subsidiaries and the
Projects contained in the Offering Materials (including, without
limitation, in
the Independent Engineer's Report, the Geothermal Consultant's
Report and the
Independent Energy Market Consultant's Report) (i) are, in the
judgment of the
Company and the Guarantors as to the matters covered thereby,
reasonable as of
their date, and (ii) are based on assumptions that the Company and
the
Guarantors consider reasonable as to all factual and legal matters
material to
the estimates therein and (iii) are in all material respects
consistent with the
provisions of the Transaction Documents. To the knowledge of the
Company and the
Guarantors, none of the information forming the basis of such
projections and
assumptions has changed since they were originally prepared so as
to materially
affect such projections and assumptions.
(z) Rule 144A/Regulation S. (i) The Securities are eligible for
resale
pursuant to Rule 144A and when the Securities are issued and
delivered pursuant
to the Indenture and this Agreement, the Securities will not be of
the same
class (within the meaning of Rule 144A) as securities which are
listed on a
national securities exchange registered under Section 6 of the
Securities
Exchange Act of 1934, as amended (the "Exchange Act") or quoted in
a U.S.
automated inter-dealer quotation system.
(ii) Except for the offer and sale of the Securities as
contemplated under this Agreement, none of the Company or any of
its Affiliates,
nor any Person acting on its or their behalf (x) has, within the
six-month
period prior to the date hereof, offered or sold in the United
States or to any
U.S. person (as such terms are defined in Regulation S under the
Securities Act)
the Securities or any security of the same class or series as the
Securities or
(y) has offered or will offer or sell the Securities or any such
other
securities (A) in the United States by means of any form of general
solicitation
or general advertising within the meaning of Rule 502(c) under the
Securities
Act or (B) with respect to any such securities sold in reliance on
Rule 903 of
Regulation S, by means of any directed selling efforts within the
meaning of
Rule 902(c) of Regulation S. The Company, its Affiliates and any
Person acting
on its or their behalf have complied and will comply with the
offering
restrictions requirement of Regulation S. Neither the Company nor
any of its
Affiliates have entered and neither the Company nor any of its
Affiliates will
enter into any contractual arrangement with respect to the
distribution of the
Securities except for this Agreement.
(iii) The proceeds to the Company from the offering of the
Securities will not be used to purchase or carry any security in
any manner
which would violate Regulations T, U or X of the Federal Reserve
Board.
(aa) Securities Act Registration. Subject to compliance by the
Purchaser with the representations, warranties and agreements set
forth in
Section 4 hereof, it is not necessary in connection with the offer,
sale and
delivery of the Securities to the Purchaser (and in connection with
the original
resale of the Securities by the Purchaser) in the manner
contemplated by this
Agreement and the Offering Materials to register the Securities
under the
Securities Act or to qualify the Indenture under the Trust
Indenture Act of
1939.
(bb) Brokerage Commissions. Except as disclosed in the Offering
Materials, there are no contracts, agreements or understandings
between the
Company or any Affiliate of
11
the Company and any other Person that would give rise to a valid
claim against
the Company or the Purchaser for a brokerage commission, finder's
fee or other
like payment in connection with the issuance, sale or delivery of
the
Securities.
(cc) Bank Accounts. At the Time of Delivery, the Company and the
Subsidiaries will not have any bank accounts, except as expressly
contemplated
in the Offering Materials, the Indenture and the Depositary
Agreement.
(dd) Abandonment. The Company and the Subsidiaries have not
abandoned
(and do not intend to abandon) any of the Projects or any Plant.
(ee) Project Documents. All of the Project Documents previously
provided to the Purchaser are true, complete and correct copies in
all material
respects.
(ff) Solvency. After giving effect to the issuance of the
Securities
by the Company and the Guarantors, the use of proceeds therefrom
and the
performance by the Company and the Guarantors of their respective
obligations
pursuant to the Transaction Documents, the sum of the Assets, at a
fair
valuation, of each of the Company and the Subsidiaries will exceed
their
respective debts and the Company and the Guarantors will not have
incurred (as a
result of the issuance of the Securities and the assumption of
their obligations
pursuant to the Transaction Documents) and do not intend to incur,
and do not
believe that they will incur, debts beyond their ability to pay
such debts as
such debts mature.
(gg) Labor Matters. Neither the Company nor any Subsidiary has any
employees. To the Company's knowledge, no labor dispute exists with
the
employees of Ormat Nevada Inc. that provide services to the
Projects that would
result in a Material Adverse Effect.
(hh) Collateral. The Company and the Guarantors have delivered or,
at
the Time of Delivery, will deliver to the Collateral Agent all
Collateral which,
pursuant to Applicable Law, must be delivered to the Collateral
Agent in order
to perfect the security interest therein as a first priority Lien
(including,
without limitation, any letters of credit, bonds or notes for which
the Company
or a Guarantor is the beneficiary).
(ii) Security Documents. The Security Documents create valid first
priority liens on and/or security interests in all of the
Collateral in favor of
the Secured Parties, subject only to Permitted Liens of the type
described in
clauses (b), (c), (d), (e), (f), (g) and (j) of the definition
thereof.
(jj) Absence of Defaults. No condition exists which would
constitute a
Default or an Event of Default under the Indenture or a default or
event of
default (however defined) pursuant to any of the other Financing
Documents.
(kk) Registration Statements. There are no contracts, agreements or
understandings between the Company or any Subsidiary, on the one
hand, and any
Person, on the other hand, granting such Person the right to
require the Company
or any Subsidiary, as the case may be, to file a registration
statement under
the Securities Act with respect to any securities of the Company or
any
Subsidiary owned or to be owned by such Person or to require the
Company
12
or any Guarantor to include such securities in any securities being
registered
pursuant to a registration statement filed by the Company or any
Subsidiary
under the Securities Act.
(ll) Material Adverse Effect. Neither the Company nor any
Subsidiary
has sustained, since the date of the latest audited financial
statements
included in the Offering Memorandum, any loss or interference with
its business
from fire, explosion, flood or other calamity, whether or not
covered by
insurance, or from any labor dispute or court or governmental
action, order or
decree, otherwise than as set forth or contemplated in the Offering
Memorandum
or that would not result in a Material Adverse Effect; and, since
such date
other than in connection with the Offering and the application of
the proceeds
therefrom, there has not been any material adverse change, or any
development
involving a prospective material adverse change, in or affecting
the condition,
financial or otherwise, stockholder's equity, results of operations
or business
of the Company and the Subsidiaries, taken as a whole, otherwise
than as set
forth or contemplated in the Offering Memorandum.
(mm) Independent Public Accounts. PricewaterhouseCoopers LLP who
have
certified certain financial statements of the Company and the
Subsidiaries whose
reports appear in the Offering Materials and who have delivered the
Initial
Letter referred to in Section 8(d) hereof concurrently with the
execution and
delivery of this Agreement, are independent certified public
accountants with
respect to the Company under Rule 101 of the Code of Professional
Conduct of the
American Institute of Certified Public Accountants, and its rulings
and
interpretations, and were independent certified public accountants
with respect
to the Company under Rule 101 of the Code of Professional Conduct
of the
American Institute of Certified Public Accountants, and its rulings
and
interpretations during the periods covered by the financial
statements on which
they reported that are contained in the Offering Materials.
(nn) Liabilities. Since the date as of which information is given
in
the Preliminary Offering Memorandum through the date hereof, and
except as may
otherwise be disclosed in the Offering Memorandum, neither the
Company nor any
Subsidiary has (i) issued or granted any securities, (ii) incurred
any liability
or obligation, direct or contingent, other than liabilities and
obligations
which were incurred in the ordinary course of business, (iii)
entered into any
transaction not in the ordinary course of business or (iv) declared
or paid any
dividend on its capital stock.
(oo) Books and Records. Each of the Company and the Subsidiaries
(i)
makes and keeps accurate books and records and (ii) maintains
internal
accounting controls which provide reasonable assurance that (A)
transactions are
executed in accordance with management's authorization, (B)
transactions are
recorded as necessary to permit preparation of its financial
statements and to
maintain accountability for its assets, (C) access to its assets is
permitted
only in accordance with management's authorization and (D) the
reported
accountability for its assets is compared with existing assets at
reasonable
intervals.
(pp) FERC. Each of the Projects is a Qualifying Facility that is
eligible for the regulatory exemptions from the Federal Power Act,
as amended,
certain state laws and regulations and the Public Utility Holding
Company Act of
1935, as amended, as set forth in 18 C.F.R. Sections 292.601 and
292.602.
13
(qq) Subordinated Credit Agreement. The Subordinated Credit
Agreement
between Ormat Nevada Inc. and the Company has been duly authorized
and executed
by the Company and Ormat Nevada Inc. and constitutes Subordinated
Debt for
purposes of the Indenture.
(rr) Deeds of Trust. Each of the Company and any Guarantor that
possesses any property, leases, easements, licenses, rights of way
or other
property interests will have, as of the Time of Delivery, executed
and delivered
a Deed of Trust covering all such property, leases, easements,
licenses, rights
of way or other property interests of the Company or such
Guarantor.
3. Agreements to Sell and Purchase.
On the basis of the representations, warranties and agreements of
the
Purchaser set forth herein and subject to the terms and conditions
set forth
herein, the Company agrees to issue and to sell to the Purchaser,
and the
Purchaser agrees to purchase, $165,000,000 aggregate principal
amount of Notes,
at the prices set forth on such Schedule A.
4. Representations, Warranties and Agreements of the Purchaser.
The Purchaser acknowledges that the Securities have not been
registered under the Securities Act and represents, warrants and
agrees that it
will offer the Securities for sale only upon the terms and
conditions set forth
in this Agreement and the Offering Memorandum and in all cases
pursuant to
transactions exempt from registration under the Securities Act. The
Purchaser
further represents and warrants to, and agrees with, the Company
and the
Guarantors that:
(a) It (i) is a "qualified institutional buyer" within the meaning
of
Rule 144A ("QIB") with such knowledge and experience in financial
and business
matters as are necessary in order to evaluate the merits and risks
of an
investment in the Securities; and (ii) is purchasing the Securities
pursuant to
a private sale exempt from registration under the Securities Act.
(b) It will offer and sell the Securities only to (i) Persons whom
it
reasonably believes are QIBs within the meaning of Rule 144A or, if
any such
Person is buying for one or more institutional accounts for which
such Person is
acting as fiduciary or agent, only when such Person has represented
to the
Purchaser that each such account is a QIB to whom such notice has
been given
that such sale or delivery is being made in reliance on Rule 144A,
in each case
in transactions meeting the requirements of Rule 144A; or (ii)
Persons whom it
reasonably believes, at the time any buy order for Securities was
or is
originated, were or are outside the United States and were or are
not U.S.
persons (and were or are not purchasing for the account or benefit
of a U.S.
person) within the meaning of Regulation S ("U.S. Persons").
Notwithstanding the
foregoing, following the sale of the Securities by the Purchaser to
subsequent
purchasers in accordance with the provisions of this Agreement and
the Offering
Memorandum, the Purchaser shall not be liable or responsible to the
Company or
the Guarantors for any losses, damages or liabilities suffered or
incurred by
the Company or the Guarantors, including any losses, damages, or
liabilities
under the Securities Act, arising from or relating to any resale or
transfer of
any Securities by any subsequent purchaser.
14
(c) No action has been or will be taken by the Purchaser in any
jurisdiction that would permit or constitute a public offering of
the Securities
in any such jurisdiction; and the Purchaser has not offered or sold
and it will
not offer or sell the Securities by any form of general
solicitation or general
advertising, including but not limited to the methods described in
Rule 502(c)
under Regulation D under the Securities Act or in any manner
involving a public
offering within the meaning of Section 4(2) of the Securities Act;
provided that
it is understood and agreed that the Purchaser is permitted to
place, at its
cost and expense, a tombstone advertisement with respect to the
resale of the
Securities in accordance with the rules of the SEC following the
later of the
Time of Delivery or the consummation of the resale of all of the
Securities
purchased hereunder.
(d) The Purchaser represents that, with respect to any offer or
sale
made by the Purchaser in reliance on Regulation S, neither the
Purchaser nor any
of its Affiliates nor any employees or representatives acting on
its behalf has
engaged or will engage in any directed selling efforts with respect
to the
Securities, and that any advertisement undertaken by the Purchaser
will comply
with Rule 902(c)(3) of Regulation S. The Purchaser agrees that, at
or prior to
confirmation of any sale of Securities made in reliance on
Regulation S, the
Purchaser will send to each distributor, dealer or Person receiving
a selling
concession, fee or other remuneration that purchases the Securities
from it a
confirmation or notice to substantially the following effect:
"The Securities covered hereby have not been registered under the
U.S.
Securities Act of 1933 (the "Securities Act") and may not be
offered
or sold within the United States or to, or for the account or
benefit
of U.S. Persons (i) as part of their distribution at any time or
(ii)
otherwise until 40 days after the date of the commencement of the
offering and the closing date, except in either case in accordance
with Regulation S (or Rule 144A if available) under the Securities
Act. Terms used above have the meanings given to them by Regulation
S."
Terms used in this subsection (d) which are defined in Regulation S
have the
meanings given to them therein.
(e) The Purchaser, and each of its Affiliates, have only
communicated
or caused to be communicated and will only communicate or cause to
be
communicated any invitation or inducement to engage in investment
activity
(within the meaning of Section 21 of the Financial Services and
Markets Act 2000
(the "FSMA")) received by it in connection with the issue or sale
of any
Securities in circumstances in which Section 21(1) of the FSMA does
not apply to
it.
(f) The Purchaser, and each of its Affiliates, have complied with
and
will comply with all applicable provisions of the FSMA with respect
to anything
done by it in relation to the Securities in, from, or otherwise
involving the
United Kingdom.
(g) The Purchaser, and each of its Affiliates, will not offer or
sell
directly or indirectly the Securities, and it will not distribute,
publish or
make available the Offering
15
Materials in or from any jurisdiction except in compliance with any
applicable
rules and regulations of any such jurisdiction.
(h) In relation to each member state of the European Economic Area
which has implemented the Prospectus Directive, each, a Relevant
Member State,
that with effect from and including the date on which the
Prospectus Directive
is implemented in that Relevant Member State, or the relevant
implementation
date, the Purchaser has not made and will not make an offer of the
Securities to
the public in that Relevant Member State prior to the publication
of a
prospectus in relation to the Securities which has been approved by
the
competent authority in that Relevant Member State or, where
appropriate,
approved in another Relevant Member State and notified to the
competent
authority in that Relevant Member State, all in accordance with the
Prospectus
Directive, except that the Purchaser may, with effect from and
including the
relevant implementation date, make an offer of the Securities to
the public in
that Relevant Member State at any time:
(i)
to legal entities which are authorized or regulated to
operate in the financial markets or, if not so authorized or
regulated, whose
corporate purpose is solely to invest in securities;
(ii) to any legal entity which has two or more of (A) an average
of at least 250 employees during the last financial year; (B) a
total balance
sheet of more than (euro)43,000,000 and (C) an annual net turnover
of more than
(euro)50,000,000, as shown in its last annual or consolidated
account; or
(ii) in any other circumstances which do not require the
publication by the Company of a prospectus pursuant to Article 3 of
the
Prospectus Directive.
For the purposes of this Section 4(h), the expression an "offer of
the
Securities to the public" in relation to the Securities in any
Relevant Member
State means the communication in any form and by any means of
sufficient
information on the terms of the offer and the Securities to be
offered so as to
enable an investor to decide to purchase or subscribe to the
Securities, as the
same may be varied in that member state by any measure implementing
the
Prospectus Directive in that member state and the expression
"Prospectus
Directive" means Directive 2003/71/EC and includes any relevant
implementing
measure in each Relevant Member State.
The Purchaser understands that the Company and the Guarantors and,
for
purposes of the opinions to be delivered to the Purchaser pursuant
to Sections
8(a) hereof, counsel to the Company and counsel to the Purchaser,
will rely upon
the accuracy and truth of the foregoing representations, warranties
and
agreements and the Purchaser hereby consents to such reliance.
5.
Delivery and Payment.
(a) Notes will be issued in registered form in denominations of
$1,000
and integral multiples of $1,000 in excess thereof. The Notes sold
in reliance
on Rule 144A or Regulation S will initially be represented, in each
case, by one
or more global notes in registered
16
form without coupons attached (collectively, the "Global Note(s)").
Each Global
Note relating to the Notes offered and sold pursuant to Regulation
S will be
authenticated by the Trustee and deposited with the Trustee, as
custodian for
DTC (the "Global Depositary") for the respective accounts of
Euroclear Bank,
S.A./N.V., as operator of the Euroclear System ("Euroclear"), and
Clearstream,
Luxembourg Banking Societe Anonyme ("Clearstream"), at the Time of
Delivery.
Each Global Note relating to the Notes offered and sold pursuant to
Rule 144A
will be authenticated by the Trustee and deposited with the
Trustee, as
custodian for DTC (the "U.S. Custodian") at the Time of Delivery.
The Global
Notes and interests therein will be held in book-entry form and
will not be
exchangeable for certificated Notes except under certain limited
circumstances
described in the Offering Memorandum. In such cases, certificated
Notes will be
available in registered form only without interest coupons.
Euroclear,
Clearstream or DTC, as the case may be, will credit the account of
each
subscriber or participant with the principal amount of Notes being
subscribed
for by such subscriber or by or through such participant. The
Global Depositary
and the U.S. Custodian are collectively referred to herein as the
"Depositaries". Notes purchased hereunder shall be delivered by or
on behalf of
the Company to the Purchaser through the facilities of the
Depositaries in form
for the account of the Purchaser, against payment by or on behalf
of the
Purchaser of the purchase price therefor by wire transfer of United
States
dollars in immediately available funds to the Trustee under the
Indenture. The
Company will cause the certificates representing the Notes to be
made available
for inspection by the Purchaser at least twenty-four hours' prior
to the Time of
Delivery at the Closing Location (defined below). The time and date
of such
delivery and payment shall be 10:00 a.m., New York time, on
December 8, 2005, or
such other time and date not later than five business days after
such date as
the Purchaser and the Company may agree upon in writing. Such time
and date are
herein called the "Time of Delivery."
(b) The documents to be delivered at the Time of Delivery by or on
behalf of the parties hereto pursuant to Section 8 hereof,
including any
additional documents requested by the Purchaser pursuant to Section
8(s) hereof,
will be delivered at such time and date at the offices of White
& Case LLP, New
York, New York (the "Closing Location"), and the Notes will be
delivered to the
offices of the U.S. Custodian, all at the Time of Delivery. A
meeting will be
held at the Closing Location at 10:00 a.m., on the New York
Business Day next
preceding the Time of Delivery, at which meeting the final drafts
of the
documents to be delivered pursuant to the preceding sentence will
be available
for review by the parties hereto. For the purposes of this Section
5, "New York
Business Day" shall mean each Monday, Tuesday, Wednesday, Thursday
and Friday
which is not a day on which banking institutions in New York are
generally
authorized or obligated by law or executive order to close.
(c) Beneficial interests in each Global Note will be shown on, and
transfers thereof will be effected only through, the book entry
records
maintained by DTC and its direct and indirect participants.
6.
Additional Agreements of the Company and the Guarantors.
The Company and the Guarantors agree with the Purchaser:
17
(a) Not to amend or supplement the Offering Materials at any time
unless the Purchaser shall previously have been advised thereof and
shall not
reasonably have objected thereto after being furnished a copy
thereof.
(b) Promptly from time to time to take such action as the Purchaser
may reasonably request to qualify the Securities for offering and
sale under the
securities laws of such jurisdictions as the Purchaser may
reasonably request
and to maintain such qualification in effect in such jurisdictions
for as long
as may be necessary to complete the Exempt Resales, provided that
in connection
therewith the Company and the Guarantors shall not be required to
qualify as a
foreign corporation or to file a general consent to service of
process in any
jurisdiction in which they are not otherwise so subject.
(c) To furnish the Purchaser with as many copies of the Offering
Materials and each amendment or supplement thereto as the Purchaser
may from
time to time reasonably request.
(d) If at any time prior to completion of the Exempt Resales (i)
any
event shall have occurred as a result of which, in the reasonable
opinion of
counsel to the Company or to the Purchaser, the Offering Memorandum
as then
existing, amended or supplemented would include an untrue statement
of a
material fact or omit to state any material fact necessary in order
to make the
statements therein, in the light of the circumstances under which
they were made
when such Offering Memorandum is delivered, not misleading, or (ii)
for any
other reason, in the reasonable opinion of the Purchaser it shall
be necessary
during such same period to amend or supplement the Offering
Memorandum, then to
notify the Purchaser promptly, and upon the Purchaser's request to
prepare and
furnish as many copies as the Purchaser may reasonably request of
an amended
Offering Memorandum or a supplement to the Offering Memorandum
which will
correct such statement or omission or effect such necessary
amendments or
supplements and in form and substance satisfactory in the
reasonable opinion of
counsel for the Purchaser. Neither the Purchaser's consent to, nor
the
Purchaser's delivery of, any such amendment or supplement prior to
the Time of
Delivery shall constitute a waiver of any of the conditions set
forth in Section
8 hereof.
(e) Not to offer, sell, contract to sell, grant any option to
purchase
or otherwise dispose of, at any time prior to the Time of Delivery,
or for a
period of 180 days thereafter, any securities of the Company or the
Guarantors
that are substantially similar to the Securities, or any securities
of the
Company or the Guarantors convertible into or exchangeable for
securities issued
or guaranteed by the Company or any of the Guarantors substantially
similar to
the Securities, except with the prior consent of the Purchaser.
(f) To furnish, or cause to be furnished to the Purchaser (i) until
the Exempt Resales have been completed (as notified to the Company
by the
Purchaser), (i) prompt notice of any event or other change known to
the Company
or the Guarantors that, in each case, would result in the Offering
Memorandum or
any amendments or supplements thereto containing an untrue
statement of a
material fact or omitting to state any material fact necessary to
make the
statements contained therein, in the light of circumstances under
which they
were made, not misleading and (ii) such other information
concerning the
business and condition (financial or
18
otherwise) of the Company or the Guarantors as the Purchaser may
from time to
time reasonably request in writing.
(g) To furnish at its expense, upon request, to holders and
beneficial
owners of the Securities, prospective purchasers of the Securities
and to
securities analysts, information satisfying the requirements of
subsection
(d)(4) of Rule 144A under the Securities Act, unless at such time
the Company
and the Guarantors are subject to and in compliance with Section 13
or 15(d) of
the Exchange Act.
(h) For a period of three years from the Time of Delivery, to
furnish
to the Purchaser, as soon as reasonably available, copies of all
audited
financial statements, quarterly financial information and such
other documents,
reports and information as shall be furnished by the Company and
the Guarantors
to the Trustee, the holders of the Securities or, after any initial
public
offering of any of their equity securities, the Company's and the
Guarantors'
shareholders or members, as the case may be, or such other
information as the
Purchaser may reasonably request in writing.
(i) During the period of two years after the Time of Delivery not
to,
and not to permit any of its affiliates (as defined in Rule 144
under the
Securities Act) to, resell the Securities which have been
reacquired by any of
them, as beneficial owner or otherwise, and which constitute
"restricted
securities" under Rule 144 under the Securities Act otherwise than
outside the
United States in accordance with Regulation S.
(j) Not to offer or sell any security that will be integrated with
and
negatively affect the status of the offer and sale of the
Securities in the
United States as contemplated by this Agreement as transactions
exempt from the
registration provisions of the Securities Act.
(k) To use the net proceeds received by it from the sale of the
Securities pursuant to this Agreement in the manner specified in
the Offering
Memorandum under the caption "Use of Proceeds".
(l) During the period of two years after the Time of Delivery, not
be
or become an open-end investment company, unit investment trust or
face-amount
certificate company that is or is required to be registered under
Section 8 of
the Investment Company Act.
(m) In connection with the offering, until the Purchaser shall have
notified the Company of the completion of the resale of the
Securities, not to,
and not to permit any of its affiliates (as defined in Rule 144
under the
Securities Act) to, either alone or with one or more other Persons,
bid for or
purchase for any account in which it or any of its affiliates has a
beneficial
interest, any Securities or attempt to induce any Person to
purchase any
Securities; and none of the Company, the Guarantors or any of their
affiliates
will make bids or purchases for the purpose of creating actual, or
apparent,
active trading in, or of raising the price of, the Securities. The
Purchaser
shall notify the Company promptly after the consummation of the
resale of the
Securities.
(n) Except as stated in this Agreement and in the Offering
Materials,
neither the Company, any of the Guarantors nor any of their
respective
Affiliates has taken, nor will any
19
of them take, directly or indirectly, any action designed to or
that might
reasonably be expected to cause or result in stabilization or
manipulation of
the price of any Security of the Company or any of the Guarantors
to facilitate
the sale or resale of the Securities. Except as permitted by the
Act, neither
the Company nor any of the Guarantors will distribute any offering
material in
connection with the Exempt Resales.
(o) In connection with the offering of the Securities, until the
Purchaser shall have notified the Company of the completion of the
resale of the
Securities, not to, and to use its commercially reasona
