Exhibit 1.1
Global Cash Access, L.L.C.,
Global Cash Access Finance
Corporation
and
The Guarantors named herein
$235,000,000
8 3/4% Senior Subordinated Notes due
2012
Purchase Agreement
dated March 4, 2004
Banc of America Securities LLC
Purchase Agreement
March 4, 2004
BANC OF AMERICA SECURITIES LLC
9 West 57 th Street
New York, New York 10019
Ladies and Gentlemen:
Global Cash Access, L.L.C., a
Delaware limited liability company (the “Company”), and
Global Cash Access Finance Corporation, a Delaware corporation, as
co-obligor (“Finance Corp.”) propose to issue and sell
to Banc of America Securities LLC (the “Initial
Purchaser”) $235,000,000 aggregate principal amount of the
Company’s 8 3/4% Senior Subordinated Notes due 2012 (the
“Notes”). Banc of America Securities LLC has agreed to
act as the sole Initial Purchaser in connection with the offering
and sale of the Notes.
The Notes will be issued pursuant to
an indenture, to be dated as of March 10, 2004 (the
“Indenture”), among the Company, Finance Corp., the
Guarantors (as defined below) and The Bank of New York, as trustee
(the “Trustee”). Notes issued in book-entry form will
be issued in the name of Cede & Co., as nominee of The
Depository Trust Company (“DTC” or the
“Depositary”), pursuant to a DTC letter of
representations, to be dated as of the Closing Date (as defined in
Section 2) (the “DTC Agreement”), among the Company,
Finance Corp. and the Depositary.
The payment of principal of, premium
and Liquidated Damages (as defined in the Indenture), if any, and
interest on the Notes and the Exchange Notes (as defined below)
will be fully and unconditionally guaranteed on a senior
subordinated unsecured basis, jointly and severally by (i) all of
the existing wholly owned domestic subsidiaries of the Company and
(ii) any wholly owned subsidiary of the Company formed or acquired
after the Closing Date or any other subsidiary that executes an
additional guarantee in accordance with the terms of the Indenture,
and their respective successors and assigns (collectively, the
“Guarantors”), pursuant to their guarantees (the
“Guarantees”). The Notes and the Guarantees attached
thereto are herein collectively referred to as the
“Securities”; and the Exchange Notes and the Guarantees
attached thereto are herein collectively referred to as the
“Exchange Securities.”
The Company, M&C International,
a Nevada corporation, FDFS Holdings LLC, a Delaware limited
liability company, First Data Corporation, a Delaware corporation,
Karim Maskatiya, Robert Cucinotta and GCA Holdings, L.L.C.
(“GCA Holdings”) entered into a Restructuring Agreement
dated December 10, 2003, as amended January 20, 2004 and February
20, 2004 (the “Restructuring Agreement”) in order to
recapitalize and restructure the Company’s membership. The
term “Recapitalization” as used herein refers to the
transactions described in and contemplated by the Restructuring
Agreement together with all of the transactions described in the
Preliminary Offering Memorandum under the caption
“Recapitalization.” In connection with the
Recapitalization, a subsidiary of Bank of America Corporation is
expected to acquire a 4.99% membership interest in GCA Holdings
(the “BofA Equity Purchase”).
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At or prior to the Closing Date, the
Company will enter into a senior secured credit facility,
consisting of up to $280.0 million in senior secured credit
facilities, comprised of (i) a term loan facility of up to $260.0
million and (ii) a revolving credit facility of up to $20.0
million, with a syndicate of lenders led by Bank of America, N.A.,
substantially as described in the Offering Memorandum (the
“Credit Facility”). It is a condition to the closing of
the Credit Facility that the Company shall have received at least
$235 million in gross cash proceeds from the issuance and sale of
the Securities. The Company will use the net proceeds from the
issuance and sale of the Securities, along with borrowings under
the Credit Facility, to consummate the Recapitalization. The
Restructuring Agreement, the Credit Facility and the agreements in
connection with the redemption of certain interests in GCA Holdings
held by M&C International and the BofA Equity Purchase and all
other documents or instruments executed in connection with or
pursuant to the Recapitalization or any of the foregoing are
collectively referred to as the “Recapitalization
Documents.” The issuance and sale of the Securities (as
defined below), the Recapitalization, the BofA Equity Purchase, the
redemption of certain interests in GCA Holdings held by M&C
International and the Credit Facility and all related transactions
are hereinafter referred to as the “Recapitalization
Transactions.”
The Company, Finance Corp., and the
Guarantors understand that the Initial Purchaser proposes to make
an offering of the Securities on the terms and in the manner set
forth herein and in the Offering Memorandum (as defined below) and
agree that the Initial Purchaser may resell, subject to the
conditions set forth herein, all or a portion of the Securities to
purchasers (the “Subsequent Purchasers”) at any time
after the date of this Agreement. The Securities are to be offered
and sold to or through the Initial Purchaser without being
registered with the Securities and Exchange Commission (the
“Commission”) under the Securities Act of 1933 (as
amended, the “Securities Act,” which term, as used
herein, includes the rules and regulations of the Commission
promulgated thereunder), in reliance upon exemptions therefrom. The
terms of the Securities and the Indenture will require that
investors who acquire Securities expressly agree that Securities
may only be resold or otherwise transferred, after the date hereof,
if such Securities are registered for sale under the Securities Act
or if an exemption from the registration requirements of the
Securities Act is available (including the exemptions afforded by
Rule 144A (“Rule 144A”) or Regulation S
(“Regulation S”) thereunder).
The Company, Finance Corp. and the
Guarantors have prepared and delivered to the Initial Purchaser
copies of a Preliminary Offering Memorandum, dated February 21,
2004 (the “Preliminary Offering Memorandum”), and have
prepared and will deliver to the Initial Purchaser, copies of the
Offering Memorandum, dated March 4, 2004, describing the terms of
the Securities, each for use by such Initial Purchaser in
connection with its solicitation of offers to purchase the
Securities. As used herein, the “Offering Memorandum”
shall mean, with respect to any date or time referred to in this
Agreement, the Company’s Offering Memorandum, dated March 4,
2004, including amendments or supplements thereto and any exhibits
thereto, in the most recent form that has been prepared and
delivered by the Company, Finance Corp. and the Guarantors to the
Initial Purchaser in connection with their solicitation of offers
to purchase Securities.
The Company, Finance Corp., GCA
Holdings and the Guarantors hereby confirm their respective
agreements with the Initial Purchaser as follows:
SECTION 1. Representations and Warranties. Each
of the Company, Finance Corp., GCA Holdings and the Guarantors,
jointly and severally, hereby represents, warrants and covenants to
the Initial Purchaser as follows:
(a) No Registration Required.
Subject to compliance by the Initial Purchaser with the
representations and warranties set forth in Section 2 hereof and
with the procedures set forth in Section 7 hereof, it is not
necessary in connection with the issuance and sale of the
Securities to the Initial Purchaser and the offer, sale and
delivery of the Securities to each Subsequent Purchaser in the
manner contemplated by this Agreement and the Offering Memorandum
to register the Securities under the Securities Act or, until such
time as the Exchange Securities are issued pursuant to an effective
registration statement, to qualify the Indenture under the Trust
Indenture Act of 1939 (the “Trust Indenture Act,” which
term, as used herein, includes the rules and regulations of the
Commission promulgated thereunder).
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(b) No Integration of Offerings or
General Solicitation. None of the Company, Finance Corp., GCA
Holdings or any of their respective subsidiaries or Affiliates (as
such term is defined in Rule 501 under the Securities Act (each, an
“Affiliate”)) have, directly or indirectly, solicited
any offer to buy or offered to sell, and will not, directly or
indirectly, solicit any offer to buy or offer to sell, in the
United States or to any United States citizen or resident, any
security which is or would be integrated with the sale of the
Securities in a manner that would require the Securities to be
registered under the Securities Act. None of the Company, Finance
Corp., GCA Holdings, the Guarantors, any of their subsidiaries or
Affiliates, or any person acting on its or any of their behalf
(other than the Initial Purchaser, as to whom the Company, Finance
Corp., GCA Holdings and the Guarantors make no representation or
warranty) has engaged or will engage, in connection with the
offering of the Securities, in any form of general solicitation or
general advertising within the meaning of Rule 502 under the
Securities Act. With respect to those Securities sold in reliance
upon Regulation S, (i) none of the Company, Finance Corp., GCA
Holdings, the Guarantors, any of their subsidiaries or Affiliates,
or any person acting on its or any of their behalf (other than the
Initial Purchaser, as to whom the Company, Finance Corp., GCA
Holdings and the Guarantors make no representation or warranty) has
engaged or will engage in any directed selling efforts within the
meaning of Regulation S and (ii) each of the Company, Finance
Corp., GCA Holdings, the Guarantors, any of their subsidiaries or
Affiliates or any person acting on its or their behalf (other than
the Initial Purchaser, as to whom the Company, Finance Corp., GCA
Holdings and the Guarantors make no representation or warranty) has
complied and will comply with the offering restrictions set forth
in Regulation S.
(c) Eligibility for Resale Under
Rule 144A. The Securities are eligible for resale pursuant to Rule
144A and will not be, at the Closing Date, of the same class as
securities listed on a national securities exchange registered
under Section 6 of the Exchange Act or quoted in a U.S. automated
interdealer quotation system.
(d) The Offering Memorandum and the
Preliminary Offering Memorandum. Each of the Offering Memorandum
and Preliminary Offering Memorandum does not, and at the Closing
Date the Offering Memorandum will not, include 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 that
this representation, warranty and agreement shall not apply to
statements in or omissions from the Offering Memorandum made in
reliance upon and in conformity with information furnished to the
Company, Finance Corp., GCA Holdings or any Guarantor in writing by
the Initial Purchaser expressly for use in the Offering Memorandum.
Each of the Preliminary Offering Memorandum and the Offering
Memorandum, as of its respective date, contains all the
information
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specified in, and meeting the
requirements of, Rule 144A. Neither the Company, Finance Corp., GCA
Holdings nor any of the Guarantors have distributed, and the
Company, Finance Corp., GCA Holdings and the Guarantors will not
distribute, prior to the later of the Closing Date and the
completion of the Initial Purchaser’s distribution of the
Securities, any offering material in connection with the offering
and sale of the Securities other than a Preliminary Offering
Memorandum or the Offering Memorandum.
(e) The Purchase Agreement. This
Agreement has been duly authorized, executed and delivered by, and
is a valid and binding agreement of, the Company, Finance Corp. and
each of the Guarantors (and, as of the Closing Date, GCA Holdings),
enforceable in accordance with its terms, except as rights to
indemnification hereunder may be limited by applicable law and
except as the enforcement hereof may be limited by bankruptcy,
insolvency, reorganization, moratorium or other similar laws
relating to or affecting the rights and remedies of creditors or by
general equitable principles (whether considered in a proceeding at
law or in equity).
(f) The Registration Rights
Agreement and DTC Agreement. The Registration Rights Agreement, to
be dated as of March 10, 2004 (the “Registration Rights
Agreement”), among the Company, Finance Corp., the Guarantors
and the Initial Purchaser has been duly authorized by the Company,
Finance Corp. and each of the Guarantors and, at the Closing Date,
will be duly executed and delivered by, and will be a valid and
binding agreement of, the Company, Finance Corp. and each of the
Guarantors, enforceable in accordance with its terms, except as the
enforcement thereof may be limited by bankruptcy, insolvency,
fraudulent conveyance, reorganization, moratorium or other similar
laws relating to or affecting the rights and remedies of creditors
or by general equitable principles (whether considered in a
proceeding at law or in equity) and except as rights to
indemnification under the Registration Rights Agreement may be
limited by applicable law. At the Closing Date, the DTC Agreement
will be duly authorized, executed and delivered by, and will be a
valid and binding agreement of, the Company and Finance Corp.,
enforceable in accordance with its terms, except as the enforcement
thereof may be limited by bankruptcy, insolvency, fraudulent
conveyance, reorganization, moratorium or other similar laws
relating to or affecting the rights and remedies of creditors or by
general equitable principles (whether considered in a proceeding at
law or in equity).
(g) Authorization of the Securities
and the Exchange Securities. (i) The Notes to be purchased by the
Initial Purchaser from the Company and Finance Corp. are in the
form contemplated by the Indenture, have been duly authorized for
issuance and sale pursuant to this Agreement and the Indenture and,
at the Closing Date, will have been duly executed by the Company
and Finance Corp. and, when authenticated in the manner provided
for in the Indenture and delivered against payment of the purchase
price therefor, will constitute valid and binding agreements of the
Company and Finance Corp. enforceable in accordance with their
terms, except as the enforcement thereof may be limited by
bankruptcy, insolvency, fraudulent conveyance, reorganization,
moratorium or other similar laws relating to or affecting the
rights and remedies of creditors or by general equitable principles
(whether considered in a proceeding at law or in equity) and will
be entitled to the benefits of the Indenture. (ii) The series of
debt securities of the Company with terms substantially identical
to the Notes (the “Exchange Notes”) to be offered in
exchange for the Notes (the “Exchange Offer”) have been
duly and validly authorized for issuance by the Company and Finance
Corp. and, when issued and authenticated in accordance with the
terms of the Indenture, the Registration
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Rights Agreement and the Exchange
Offer, will constitute valid and binding obligations of the Company
and Finance Corp., enforceable against the Company and Finance
Corp. in accordance with their terms, except as the enforcement
thereof may be limited by bankruptcy, insolvency, fraudulent
conveyance, reorganization, moratorium, or other similar laws
relating to or affecting enforcement of the rights and remedies of
creditors or by general equitable principles (whether considered in
a proceeding at law or in equity) and will be entitled to the
benefits of the Indenture. (iii) The Guarantees of the Notes and
the Exchange Notes are in the respective forms contemplated by the
Indenture, have been duly authorized for issuance and sale pursuant
to this Agreement and the Indenture and, at the Closing Date, will
have been duly executed by each of the Guarantors and, when the
Notes have been authenticated in the manner provided for in the
Indenture and delivered against payment of the purchase price
therefor, will constitute valid and binding agreements of the
Guarantors, enforceable in accordance with their terms, except as
the enforcement thereof may be limited by bankruptcy, insolvency,
fraudulent conveyance, reorganization, moratorium or other similar
laws relating to or affecting the rights and remedies of creditors
or by general equitable principles (whether considered in a
proceeding at law or in equity) and will be entitled to the
benefits of the Indenture.
(h) Authorization of the Indenture.
The Indenture has been duly authorized by the Company, Finance
Corp. and each of the Guarantors and, at the Closing Date, will
have been duly executed and delivered by the Company, Finance Corp.
and each of the Guarantors and will constitute a valid and binding
agreement of the Company, Finance Corp. and each of the Guarantors,
enforceable against the Company, Finance Corp. and each of the
Guarantors in accordance with its terms, except as the enforcement
thereof may be limited by bankruptcy, insolvency, fraudulent
conveyance, reorganization, moratorium or other similar laws
relating to or affecting the rights and remedies of creditors or by
general equitable principles (whether considered in a proceeding at
law or in equity).
(i) Authorization of the
Recapitalization Transactions. Each of the Company, Finance Corp.,
GCA Holdings and their respective Subsidiaries have all necessary
corporate power and authority to enter into, to perform the
obligations to be performed by them under, and to consummate the
transactions contemplated by the Recapitalization Transactions and
the Recapitalization Documents to which it is a party. The
Recapitalization Documents have been duly authorized, executed and
delivered by the Company, Finance Corp., GCA Holdings and their
respective subsidiaries (to the extent they are party thereto) and
constitute the legal, valid and binding obligations of the Company,
Finance Corp., GCA Holdings and their respective subsidiaries (to
the extent they are party thereto), enforceable against the parties
thereto in accordance with their terms. All actions and proceedings
required by law to be taken by the Company and their respective
Subsidiaries prior to the Closing Date in connection with the
Recapitalization Transactions have been or prior to the Closing
Date will have been duly and validly taken. All actions and
proceedings required by law to be taken by the Company and its
Subsidiaries prior to the consummation of the Recapitalization
Transactions will have been duly and validly taken. In addition,
none of the Recapitalization Transactions requires the filing of a
registration statement, Schedule TO or other document with the
Commission (except as required by the Registration Rights
Agreement).
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(j) Description of the Securities,
the Indenture, the Registration Rights Agreement and the Credit
Facility. The Notes, the Guarantees of the Notes, the Indenture,
the Registration Rights Agreement and the Credit Facility conform,
or will conform, in all material respects to the respective
statements relating thereto contained in the Offering Memorandum.
Each of the Recapitalization Documents conforms or upon
consummation of the Recapitalization will conform in all material
respects to the respective statements relating thereto contained in
the Offering Memorandum and all provisions in any of the
Recapitalization Documents material to the holders of the Notes
have been described in the Offering Memorandum. The Exchange Notes
and the Guarantees of the Exchange Notes will conform in all
material respects to the respective statements relating thereto
contained in the Offering Memorandum and the registration statement
relating to the Exchange Securities at the time such registration
statement becomes effective.
(k) No Material Adverse Change.
Except as otherwise disclosed in the Offering Memorandum,
subsequent to the respective dates as of which information is given
in the Offering Memorandum, (i) there has been no material adverse
change, or any development that could reasonably be expected to
result in a material adverse change, in the condition, financial or
otherwise, or in the earnings, business, operations or prospects,
whether or not arising from transactions in the ordinary course of
business, of the Company, Finance Corp., GCA Holdings and their
subsidiaries, considered as one entity (any such change or
development is called a “Material Adverse Change”);
(ii) the Company, Finance Corp., GCA Holdings and their
subsidiaries, considered as one entity, have neither incurred any
material liability or obligation, indirect, direct or contingent,
not in the ordinary course of business nor entered into any
material transaction or agreement not in the ordinary course of
business; and (iii) there has been no dividend or distribution of
any kind declared, paid or made by the Company, GCA Holdings or,
except for dividends paid to the Company or other subsidiaries, any
of their subsidiaries on any class of capital stock or repurchase
or redemption by the Company, GCA Holdings or any of its
subsidiaries of any class of capital stock.
(l) Independent Accountants.
Deloitte & Touche LLP, who have expressed their opinion with
respect to the financial statements (which term as used in this
Agreement includes the related notes thereto) included in the
Offering Memorandum, are independent public or certified public
accountants within the meaning of Regulation S-X under the
Securities Act and the Securities and Exchange Act of 1934 (as
amended, the “Exchange Act,” which term, as used
herein, includes the rules and regulations of the Commission
promulgated thereunder).
(m) Preparation of the Financial
Statements. The financial statements, together with the related
schedules and notes, included in the Offering Memorandum present
fairly the consolidated financial position of the Company and its
subsidiaries as of and at the dates indicated and the results of
their operations and cash flows for the periods specified. Such
financial statements have been prepared in conformity with
generally accepted accounting principles applied on a consistent
basis throughout the periods involved, except as may be expressly
stated in the related notes thereto or otherwise described in the
Offering Memorandum. The financial statements included in the
Offering Memorandum comply as to form with the requirements
applicable to registration statements on Form S-1 under the
Securities Act. The historical financial data set forth in the
Offering Memorandum under the captions “Summary Consolidated
Financial Data” and “Selected Consolidated Financial
Data” fairly present the
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information set forth therein on a
basis consistent with that of the audited financial statements
contained in the Offering Memorandum. The Offering Memorandum
contains all historical and pro forma financial statements that
would be required if the Offering Memorandum was a registration
statement on Form S-1. The pro forma financial statements included
in the Offering Memorandum present fairly in all material respects
the information shown therein, have been prepared in accordance
with the Commission’s rule and guidelines with respect to pro
forma financial statements and have been properly compiled on the
basis described therein, and, in the Company’s opinion, the
assumptions used in the preparation thereof are reasonable and the
adjustments used therein are appropriate to give effect to the
transactions and circumstances referred to therein. The
Company’s anticipated cost savings identified in the Offering
Memorandum have been calculated using data derived from the
Company’s accounting systems based on reasonable good faith
assumptions.
(n) Good Standing of the Company.
The Company has been duly organized and is validly existing as a
limited liability company in good standing under the laws of the
State of Delaware and has corporate power or such other similar
power and authority to own, lease and operate its properties and to
conduct its business as described in the Offering Memorandum and to
enter into and perform its obligations under each of this
Agreement, the Registration Rights Agreement, the DTC Agreement,
the Securities, the Exchange Securities, the Indenture, each of the
Recapitalization Documents and the Credit Facility; and the Company
is duly qualified as a foreign limited liability company to
transact business and is in good standing in each other
jurisdiction in which such qualification is required, whether by
reason of the ownership or leasing of property or the conduct of
business, except for such jurisdictions where the failure to so
qualify or to be in good standing would not result in a Material
Adverse Change.
(o) Good Standing of Finance Corp.
Finance Corp. has been duly organized and is validly existing as a
corporation in good standing under the laws of the State of
Delaware and has corporate power or such other similar power and
authority to own, lease and operate its properties and to conduct
its business as described in the Offering Memorandum and to enter
into and perform its obligations under each of this Agreement, the
Registration Rights Agreement, the DTC Agreement, the Securities,
the Exchange Securities, the Indenture, the Credit Facility and the
Recapitalization Documents to which it is a party; and Finance
Corp. is duly qualified as a foreign corporation to transact
business and is in good standing in each other jurisdiction in
which such qualification is required, whether by reason of the
ownership or leasing of property or the conduct of business, except
for such jurisdictions where the failure to so qualify or to be in
good standing would not result in a Material Adverse
Change.
(p) Good Standing of Subsidiaries.
Each company that is, or will be at the Closing Date, a subsidiary
of the Company is listed on Exhibit A (each a
“Subsidiary” and, collectively, the
“Subsidiaries”). Each Subsidiary has been duly
organized and is validly existing as a corporation or a limited
liability company in good standing under the laws of the
jurisdiction of its incorporation or formation, has corporate power
or such other similar power and authority to own, lease and operate
its properties and to conduct its business as described in the
Offering Memorandum and to enter into and perform its obligations
under this Agreement, the Registration Rights Agreement, the
Indenture, the Securities, the Exchange Securities, the Credit
Facility and each of the Recapitalization Documents (to the extent
it is a party thereto) and to enter into and consummate all the
transactions in connection therewith as contemplated in the
Offering Memorandum.
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Each Subsidiary is duly qualified as
a foreign corporation or limited liability company to transact
business and is in good standing in each jurisdiction in which such
qualification is required, whether by reason of the ownership or
leasing of property or the conduct of business, except where the
failure so to qualify or to be in good standing would not result in
a Material Adverse Effect. Each of the direct and indirect
subsidiaries of the Company is a Guarantor other than CashCall
Systems, Inc. and QuikPlay, LLC. (and Finance Corp., which is a
Co-Obligor).
(q) Good Standing of GCA Holdings.
GCA Holdings has been duly organized and is validly existing as a
limited liability company in good standing under the laws of the
jurisdiction of its formation and as of the Closing Date will have
corporate power or such other similar power and authority to own,
lease and operate its properties and to conduct its business as
described in the Offering Memorandum and to enter into and perform
its obligations under this Agreement, the Credit Facility and each
of the Recapitalization Documents (to the extent it is a party
thereto) and to enter into and consummate all the transactions in
connection therewith as contemplated in the Offering Memorandum.
GCA Holdings is duly qualified as a foreign corporation or limited
liability company to transact business and is in good standing in
each jurisdiction in which such qualification is required, whether
by reason of the ownership or leasing of property or the conduct of
business, except where the failure so to qualify or to be in good
standing would not result in a Material Adverse Effect.
(r) Capitalization and Other
Membership Interest Matters. At December 31, 2003, on a
consolidated basis, after giving pro forma effect to the issuance
and sale of the Securities pursuant hereto, the application of the
net proceeds therefrom and the closing of the Credit Facility, the
Company would have an authorized and outstanding capitalization as
set forth in the Offering Memorandum under the caption
“Capitalization.” All of the outstanding membership
interests in the Company and GCA Holdings and all of the
outstanding shares of capital stock of Finance Corp. have been and
will at the Closing Date be duly authorized and validly issued, are
fully paid and nonassessable and have been issued in compliance
with federal and state securities laws. None of the outstanding
membership interests of the Company or capital stock of Finance
Corp. were issued in violation of any preemptive rights, rights of
first refusal or other similar rights to subscribe for or purchase
securities of the Company or Finance Corp., as the case may be. As
of the Closing Date, none of the outstanding membership interests
of the GCA Holdings will have been issued in violation of any
preemptive rights, rights of first refusal or other similar rights
to subscribe for or purchase securities of the GCA Holdings. There
are no authorized or outstanding options, warrants, preemptive
rights, rights of first refusal or other rights to purchase, or
equity or debt securities convertible into or exchangeable or
exercisable for, any membership interests in the Company, GCA
Holdings or any of its Subsidiaries or capital stock of Finance
Corp. other than those accurately described in the Offering
Memorandum. All of the issued and outstanding capital stock or
membership interests of each Subsidiary have been duly authorized
and validly issued, are fully paid and nonassessable and are owned
by the Company, directly or through subsidiaries, free and clear of
any security interest, mortgage, pledge, lien, encumbrance or claim
except that International Game Technologies owns a 40% interest in
QuikPlay, LLC and other than as contemplated in connection with the
Credit Facility. The Company does not own or control, directly or
indirectly, any corporation, association or other entity other than
the Subsidiaries listed in Exhibit A hereto. As of the Closing
Date, GCA Holdings will own 100% of the membership interests of the
Company, free and clear of any security interest,
mortgage,
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pledge, lien, encumbrance or claim,
other than as contemplated in connection with the Credit
Facility.
(s) Non-Contravention of Existing
Instruments; No Further Authorizations or Approvals Required.
Neither the Company, Finance Corp., GCA Holdings nor any of their
subsidiaries is in violation of its charter or by-laws or limited
liability company agreement, as the case may be, is in default (or,
with the giving of notice or lapse of time, would be in default)
(“Default”) under any indenture, mortgage, loan or
credit agreement, note, contract, franchise, lease, license or
other instrument to which the Company, Finance Corp., GCA Holdings
or any of their subsidiaries is a party or by which it or any of
them may be bound or to which any of the property or assets of the
Company, GCA Holdings or any of their subsidiaries is subject
(each, an “Existing Instrument”), except for such
Defaults as would not, individually or in the aggregate, result in
a Material Adverse Change. The execution, delivery and performance
of this Agreement, the Registration Rights Agreement, the
Indenture, the Credit Facility and the Recapitalization Documents
by the Company, Finance Corp., GCA Holdings and each Subsidiary (to
the extent it is a party thereto), the Company’s execution,
delivery and performance of the DTC Agreement, the issuance and
delivery of the Securities or the Exchange Securities, and
consummation of the Recapitalization Transactions and the other
transactions contemplated hereby and thereby and by the Offering
Memorandum (i) will not result in any violation of the provisions
of the charter, by-laws, or limited liability company agreement, as
the case may be, or other similar constitutive document of the
Company, Finance Corp., GCA Holdings or any of their respective
subsidiaries, (ii) will not conflict with or constitute a breach
of, or Default or a Debt Repayment Triggering Event (as defined
below) under, or result in the creation or imposition of any lien,
charge or encumbrance upon any property or assets of the Company,
Finance Corp., GCA Holdings or any of their subsidiaries pursuant
to, or require the consent of any other party to, any Existing
Instrument, except for such conflicts, breaches, Defaults, liens,
charges or encumbrances as would not, individually or in the
aggregate, result in a Material Adverse Change, and (iii) will not
result in any violation of any law, administrative regulation or
administrative or court order, judgment or decree applicable to the
Company, Finance Corp., GCA Holdings or any Subsidiary (including
without limitation, any gaming law of any jurisdiction or
jurisdiction to which the Company, Finance Corp., any of their
subsidiaries or any of the Guarantors is, or may at any time, be
subject). No consent, approval, authorization or other order of, or
registration or filing with, any court or other governmental or
regulatory authority or agency, is required for the
Company’s, Finance Corp.’s, GCA Holdings’ or any
Guarantor’s execution, delivery and performance of this
Agreement, the Registration Rights Agreement, the DTC Agreement,
the Indenture, the Credit Facility and the Recapitalization
Documents, or the issuance and delivery of the Securities or the
Exchange Securities, or consummation of the transactions
contemplated hereby and thereby and by the Offering Memorandum,
except such as have been obtained or made by the Company, Finance
Corp. or the Guarantors and are in full force and effect under the
Securities Act, applicable state securities or blue sky laws and
except such as may be required by federal and state securities laws
with respect to the Company’s, Finance Corp.’s and the
Guarantors’ obligations under the Registration Rights
Agreement. As used herein, a “Debt Repayment Triggering
Event” means any event or condition that gives, or with the
giving of notice or lapse of time would give, the holder of any
note, debenture or other evidence of indebtedness (or any person
acting on such holder’s behalf) the right to require the
repurchase, redemption or repayment of all
9
or a portion of such indebtedness by
the Company, Finance Corp., GCA Holdings or any of their
subsidiaries.
(t) No Other Approvals or Licenses
Required. No consent, approval, permit, license, qualification,
finding of suitability, registration or filing with any
governmental or regulatory authority or agency, including, without
limitation, any gaming regulatory authority or agency, is required
on a mandatory basis by the Initial Purchaser to consummate the
sale of the Securities or is required on a mandatory basis to be
obtained by any Subsequent Purchaser except as described in the
Offering Memorandum.
(u) No Material Actions or
Proceedings. Except as otherwise disclosed in the Offering
Memorandum, there are no legal or governmental actions, suits,
investigations or proceedings pending or, to the best of the
Company’s, Finance Corp.’s, GCA Holdings’ or any
of their subsidiaries’ knowledge, threatened against or
affecting the Company, Finance Corp., GCA Holdings or any of their
subsidiaries, or the officers, directors, employees or agents (as
defined in 42 C.F.R. Part 420 Subpart C and 42 C.F.R. Section
1001.1001(a)(2)) of the Company, Finance Corp., GCA Holdings or any
of their subsidiaries, which has as the subject thereof any
property owned or leased by the Company, Finance Corp., GCA
Holdings or any of their subsidiaries, where in any such case there
is a reasonable possibility that such action, suit or proceeding
might be determined adversely to the Company, Finance Corp., GCA
Holdings or such subsidiary and any such action, suit,
investigation or proceeding, if so determined adversely, would
reasonably be expected to result in a Material Adverse Change or
adversely affect the consummation of the transactions contemplated
by this Agreement. Except as otherwise disclosed in the Offering
Memorandum, no material labor dispute with the employees of the
Company or any of its Subsidiaries, or with the employees of any
principal supplier of the Company, exists or, to the best of
Company’s knowledge, is threatened or imminent.
(v) Intellectual Property Rights.
The Company, Finance Corp., GCA Holdings and their subsidiaries
own, possess or license sufficient trademarks, trade names, trade
secrets, know-how, including customer lists, plans, processes,
supplier lists, business plans, business methods, prototypes,
patent rights, inventions, discoveries, internet domain names,
copyrights, software, licenses, approvals, trade secrets and other
similar rights (collectively, “Intellectual Property
Rights”) reasonably necessary to conduct their businesses in
all material respects as now conducted; and, except as otherwise
set forth in the Offering Memorandum, neither the Company, Finance
Corp., GCA Holdings nor their subsidiaries expect an expiration or
loss of such Intellectual Property Rights, except as would not
reasonably be expected to result in a Material Adverse Change.
Neither the Company, Finance Corp., GCA Holdings nor any of their
subsidiaries knows of any, or has received any notice of,
infringement or conflict with asserted Intellectual Property Rights
of others, which infringement or conflict, if the subject of an
unfavorable decision, ruling or filing, would result in a Material
Adverse Change. Neither the Company, Finance Corp., GCA Holdings
nor any of their subsidiaries has any knowledge that a third party
is infringing upon any Intellectual Property Right reasonably
necessary to conduct their businesses as now conducted. Neither the
Company, Finance Corp., GCA Holdings nor any of their subsidiaries
is in default or has received notice of breach under the terms of
any license or similar agreement related to any Intellectual
Property Rights, and the Company, Finance Corp., GCA Holdings and
their subsidiaries have taken all action reasonably necessary to
maintain and preserve in full force and effect each item
of
10
Intellectual Property Rights,
necessary to conduct their businesses as now conducted or
contemplated to be conducted except as would not result in a
Material Adverse Change.
(w) All Necessary Permits, etc. The
Company, Finance Corp., GCA Holdings and each of their subsidiaries
possess such valid and current certificates, authorizations,
qualifications, licenses, permits, consents or approvals issued by
the appropriate municipal, state, federal or foreign regulatory
agencies or bodies necessary to conduct their respective businesses
in all material respects, and except as otherwise set forth in the
Offering Memorandum neither the Company, Finance Corp., GCA
Holdings nor any of their subsidiaries has received any notice of
proceedings relating to the revocation or modification of, or
non-compliance with, any such certificate, authorization or permit
which, singly or in the aggregate, if the subject of an unfavorable
decision, ruling or finding, could result in a Material Adverse
Change.
(x) Title to Properties. The
Company, Finance Corp., GCA Holdings and each of their subsidiaries
has good and marketable title to all the properties and assets
reflected as owned in the financial statements referred to in
Section 1(m) above (or elsewhere in the Offering Memorandum), in
each case free and clear of any security interests, mortgages,
liens, encumbrances, equities, claims and other defects, except
such as do not materially and adversely affect the value of such
property and do not materially interfere with the use made or
proposed to be made of such property by the Company, Finance Corp.,
GCA Holdings or such subsidiary or except as permitted under the
Credit Facility. The real property, improvements, equipment and
personal property held under lease by the Company, Finance Corp.,
GCA Holdings or any subsidiary are held under valid and enforceable
leases, with such exceptions as are not material and do not
materially interfere with the use made or proposed to be made of
such real property, improvements, equipment or personal property by
the Company, Finance Corp., GCA Holdings or such
subsidiary.
(y) Tax Law Compliance . The
Company, Finance Corp., GCA Holdings and their subsidiaries have
filed all necessary federal, state and foreign income and franchise
tax returns and have paid all taxes required to be paid by any of
them and, if due and payable, any related or similar assessment,
fine or penalty levied against any of them. The Company, Finance
Corp., GCA Holdings and each Guarantor have made adequate charges,
accruals and reserves in the applicable financial statements
referred to in Section 1(m) above in respect of all federal, state
and foreign income and franchise taxes for all periods as to which
the tax liability of the Company, Finance Corp., GCA Holdings or
any of their subsidiaries has not been finally
determined.
(z) Company Not an “Investment
Company.” The Company, Finance Corp., GCA Holdings and each
of their subsidiaries have been advised of the rules and
requirements under the Investment Company Act of 1940, as amended
(the “Investment Company Act”). Each of the Company,
Finance Corp., GCA Holdings and each of their subsidiaries is not,
and after receipt of payment for the Securities will not be, an
“investment company” within the meaning of the
Investment Company Act and will conduct its business in a manner so
that it will not become subject to the Investment Company
Act.
(aa) Insurance. Each of the Company,
Finance Corp., GCA Holdings and their subsidiaries are insured by
recognized, financially sound institutions with policies in such
amounts and with such deductibles and policy limits and covering
such risks as are
11
generally deemed adequate,
appropriate and customary for their businesses including, but not
limited to, policies covering professional liability and
malpractice, real and personal property owned or leased by the
Company and its subsidiaries against theft, damage, destruction,
acts of terrorism and vandalism and earthquakes. The Company,
Finance Corp. and GCA Holdings believe they have adequate,
sufficient and appropriate coverage under their policies to cover
all of their known litigation and the Company believes that its
litigation reserve is appropriate under generally accepted
accounting principles. Neither the Company, Finance Corp. nor GCA
Holdings has reason to believe that it or any subsidiary will not
be able (i) to renew its existing insurance coverage as and when
such policies expire or (ii) to obtain adequate and comparable
coverage from similar institutions as may be necessary or
appropriate to conduct its business as now conducted and at a cost
that would not result in a Material Adverse Change. Neither the
Company, Finance Corp., GCA Holdings nor any subsidiary has been
denied any insurance coverage that it has sought or for which it
has applied and there are no claims by the Company, Finance Corp.,
GCA Holdings or any of their subsidiaries under any current
insurance policy as to which any insurance company or institution
is denying, or will deny, liability or coverage or defending under
a reservation of rights clause.
(bb) No Price Stabilization or
Manipulation. None of the Company, Finance Corp., GCA Holdings, the
Guarantors or any of their respective Affiliates has taken or will
take, directly or indirectly, any action designed to or that might
be reasonably expected to cause or result in stabilization or
manipulation of the price of any security of the Company to
facilitate the sale or resale of the Securities.
(cc) Solvency. The Company, Finance
Corp., GCA Holdings and each of the Guarantors is, and immediately
after the Closing Date will be, Solvent. As used herein, the term
“Solvent” means, with respect to the Company, Finance
Corp., GCA Holdings or any Guarantor on a particular date, that on
such date (i) the fair market value of the assets of the Company,
Finance Corp., GCA Holdings or such Guarantor, as the case may be,
is greater than the total amount of liabilities (including
contingent liabilities) of the Company, Finance Corp., GCA Holdings
or such Guarantor, as the case may be, (ii) the present fair
salable value of the assets of the Company, Finance Corp., GCA
Holdings or such Guarantor, as the case may be, is greater than the
amount that will be required to pay the probable liabilities of the
Company, Finance Corp., GCA Holdings or such Guarantor, as the case
may be, on its debts as they become absolute and matured, (iii) the
Company, Finance Corp., GCA Holdings or such Guarantor, as the case
may be, is able to realize upon its assets and pay its debts and
other liabilities, including contingent obligations, as they
mature, (iv) the Company, Finance Corp., GCA Holdings or such
Guarantor, as the case may be, does not intend to, and does not
believe that it will, incur debts or liabilities beyond such
entity’s ability to realize upon its assets and pay its debts
and other liabilities, including contingent obligations, as they
mature in their ordinary course, and (v) the Company, Finance
Corp., GCA Holdings or such Guarantor, as the case may be, does not
have unreasonably small capital.
(dd) No Unlawful Contributions or
Other Payments. Neither the Company, Finance Corp., GCA Holdings
nor any of their subsidiaries nor, to the best of the
Company’s, Finance Corp.’s, GCA Holdings’ and the
Guarantors’ knowledge, any employee or agent of the Company,
Finance Corp., GCA Holdings or any subsidiary, has made any
contribution or other payment to any official of, or candidate for,
any federal, state or foreign office in violation of any law or of
the character necessary to be disclosed in the Offering Memorandum
in order to make the statements therein not misleading.
12
(ee) Company’s Accounting
System. The Company, on a consolidated basis, and each of the
Company’s Subsidiaries, maintain a system of accounting
controls sufficient to provide reasonable assurances that (i)
transactions are executed in accordance with management’s
general or specific authorization; (ii) transactions are recorded
as necessary to permit preparation of financial statements in
conformity with generally accepted accounting principles and to
maintain accountability for assets; (iii) access to assets is
permitted only in accordance with management’s general or
specific authorization; (iv) the recorded accountability for assets
is compared with existing assets at reasonable intervals and
appropriate action is taken with respect to any differences; (v)
material information relating to the Company and its consolidated
Subsidiaries is promptly made known to the officers responsible for
establishing and maintaining the system of internal control over
financial reporting; and (vi) any significant deficiencies or
material weaknesses in the design or operation of internal control
over financial reporting that are reasonably likely to adversely
affect the Company’s ability to record, process, summarize
and report financial information, and any fraud whether or not
material that involves management or other employees who have a
significant role in the Company’s internal control over
financial reporting, are adequately and promptly disclosed to the
Company’s independent auditors and the Company’s
Management Committee.
(ff) Related Party Transactions. No
relationship, direct or indirect, exists between or among any of
the Company or any affiliate of the Company, on the one hand, and
any director, officer, member, stockholder, customer or supplier of
the Company or any affiliate of the Company, on the other hand,
which is required by the Securities Act, the Exchange Act or the
rules and regulations promulgated thereunder to be described in the
Offering Memorandum which is not so described and described as
required. There are no outstanding loans, advances (except normal
advances for business expenses in the ordinary course of business)
or guarantees of indebtedness by the Company or any affiliate of
the Company to or for the benefit of any of the officers or
directors of the Company or any affiliate of the Company or any of
their respective family members, except as disclosed in the
Offering Memorandum.
(gg) Compliance with Environmental
Laws. Except as would not, individually or in the aggregate, result
in a Material Adverse Change, (i) the Company, Finance Corp., GCA
Holdings and each of their subsidiaries have all permits,
authorizations and approvals required under any Environmental Laws
(as defined below) and are in compliance with their requirements,
(ii) neither the Company, Finance Corp., GCA Holdings nor any of
their subsidiaries is in violation of any federal, state, local or
foreign law or regulation relating to pollution or protection of
human health or the environment (including, without limitation,
ambient air, surface water, groundwater, land surface or subsurface
strata) or wildlife, including, without limitation, laws and
regulations relating to emissions, discharges, releases or
threatened releases of chemicals, pollutants, contaminants, wastes,
toxic substances, hazardous substances, petroleum and petroleum
products (collectively, “Materials of Environmental
Concern”), or otherwise relating to the manufacture,
processing, distribution, use, treatment, storage, disposal,
transport or handling of Materials of Environmental Concern
(collectively, “Environmental Laws”), which violation
includes, but is not limited to, noncompliance with any permits or
other governmental authorizations required for the operation of the
businesses of the Company, Finance Corp., GCA Holdings or their
subsidiaries under applicable Environmental Laws, or noncompliance
with the terms and conditions thereof, nor has the Company, Finance
Corp., GCA Holdings or any of their subsidiaries
13
received any written communication,
whether from a governmental authority, citizens group, employee or
otherwise, that alleges that the Company, Finance Corp., GCA
Holdings or any of their subsidiaries is in violation of any
Environmental Law; (iii) there is no claim, action or cause of
action filed with a court or governmental authority, no
investigation with respect to which the Company, Finance Corp., GCA
Holdings or any of their subsidiaries has received written notice
and no written notice by any person or entity alleging potential
liability for investigatory costs, clean-up costs, governmental
responses costs, natural resources damages, property damages,
personal injuries, attorneys’ fees or penalties arising out
of, based on or resulting from the presence, or release into the
environment, of any Material of Environmental Concern at any
location owned, leased or operated by the Company, Finance Corp.,
GCA Holdings or any of their subsidiaries, now or in the past
(collectively, “Environmental Claims”), pending or, to
the best of the Company’s, Finance Corp.’s, GCA
Holdings’ or any Guarantors’ knowledge, threatened
against the Company, Finance Corp., GCA Holdings or any of their
subsidiaries or any person or entity whose liability for any
Environmental Claim the Company, Finance Corp., GCA Holdings or any
of their subsidiaries has retained or assumed either contractually
or by operation of law; and (iv) to the best of the
Company’s, Finance Corp.’s, GCA Holdings’ and the
Guarantors’ knowledge, there are no past or present actions,
activities, circumstances, conditions, events or incidents,
including, without limitation, the release, emission, discharge,
presence or disposal of any Material of Environmental Concern, that
reasonably could result in a violation of any Environmental Law or
form the basis of a potential Environmental Claim against the
Company, Finance Corp., GCA Holdings or any of their subsidiaries
or against any person or entity whose liability for any
Environmental Claim the Company, Finance Corp., GCA Holdings or any
of their subsidiaries has retained or assumed either contractually
or by operation of law.
(hh) ERISA Compliance . The
Company, Finance Corp., GCA Holdings and their subsidiaries and any
“employee benefit plan” (as defined under the Employee
Retirement Income Security Act of 1974, as amended, and the
regulations and published interpretations thereunder (collectively,
“ERISA”)) established or maintained by the Company,
Finance Corp., GCA Holdings, their subsidiaries or their
“ERISA Affiliates” (as defined below) are in compliance
in all material respects with ERISA. “ERISA Affiliate”
means, with respect to the Company, Finance Corp., GCA Holdings or
a subsidiary, any member of any group of organizations described in
Section 414(b), (c), (m) or (o) of the Internal Revenue Code of
1986, as amended, and the regulations and published interpretations
thereunder (the “Code”) of which the Company, Finance
Corp. or such subsidiary is a member. No “reportable
event” (as defined under ERISA) has occurred or is reasonably
expected to occur with respect to any “employee benefit
plan” established or maintained by the Company, Finance
Corp., GCA Holdings, their subsidiaries or any of their ERISA
Affiliates. No “employee benefit plan” established or
maintained by the Company, Finance Corp., GCA Holdings, their
subsidiaries or any of their ERISA Affiliates, if such
“employee benefit plan” were terminated, would have any
“amount of unfunded benefit liabilities” (as defined
under ERISA). Neither the Company, Finance Corp., GCA Holdings,
their subsidiaries nor any of their ERISA Affiliates has incurred
or reasonably expects to incur any liability under Title IV of
ERISA with respect to termination of, or withdrawal from, any
“employee benefit plan” or (ii) Section 412, 4971, 4975
or 4980B of the Code. Each “employee benefit plan”
established or maintained by the Company, Finance Corp., GCA
Holdings, their subsidiaries or any of their ERISA Affiliates that
is intended to be qualified under
14
Section 401 of the Code is so
qualified, and nothing has occurred, whether by action or failure
to act that would cause the loss of such qualification.
(ii) No Default in Senior
Indebtedness. No event of default exists under any contract,
indenture, mortgage, loan agreement, note, lease or other agreement
or instrument constituting Senior Indebtedness (as defined in the
Indenture).
(jj) Credit Facility . The
Credit Facility has been duly and validly authorized by the
Company, GCA Holdings and the guarantors thereto and, when duly
executed and delivered by the Company, GCA Holdings and the
guarantors thereto, will be the valid and legally binding
obligation of the Company, GCA Holdings and the guarantors thereto,
enforceable in accordance with its terms, except as the enforcement
thereof may be limited by bankruptcy, insolvency, reorganization,
moratorium or other similar laws relating to or affecting the
rights and remedies of creditors or by general equitable
principles.
(kk) Compliance with Regulation S.
The Company, Finance Corp., GCA Holdings, the Guarantors and their
respective subsidiaries and Affiliates and all persons acting on
their behalf (other than the Initial Purchaser, as to whom the
Company and the Guarantors make no representation) have complied
with and will comply with the offering restrictions requirements of
Regulation S in connection with the offering of the Securities
outside the United States and, in connection therewith, the
Offering Memorandum will contain the disclosure required by Rule
902. The Securities sold in reliance on Regulation S will be
represented upon issuance by a temporary global security that may
not be exchanged for definitive securities until the expiration of
the 40-day restricted period referred to in Rule 903 of the
Securities Act and only upon certification of beneficial ownership
of such Securities by non-U.S. persons or U.S. persons who
purchased such Securities in transactions that were exempt from the
registration requirements of the Securities Act.
(ll) Taxes; Fees. There are no stamp
or other issuance or transfer taxes or duties or other similar fees
or charges required to be paid by the Company in connection with
the execution and delivery of this Agreement or the issuance or
sale by the Company, Finance Corp., GCA Holdings and the Guarantors
of the Securities.
(mm) No Labor Disputes . As
of the date hereof, (i) there is no unfair labor practice complaint
pending against the Company, Finance Corp., GCA Holdings or any of
their subsidiaries or, to the best knowledge of the Company, GCA
Holdings and Finance Corp., threatened against any of them, before
the National Labor Relations Board or any state or local labor
relations board, and no significant grievance or significant
arbitration proceeding arising out of or under any collective
bargaining agreement is so pending against the Company, Finance
Corp., GCA Holdings or any of their subsidiaries or, to the best
knowledge of the Company, Finance Corp. and GCA Holdings,
threatened against any of them, (ii) there is no material strike,
labor dispute, slowdown or stoppage pending against the Company,
Finance Corp., GCA Holdings or any of their subsidiaries or, to the
knowledge of the Company, Finance Corp. and GCA Holdings,
threatened against the Company, Finance Corp. or GCA Holdings and
(iii) the Company, Finance Corp. and GCA Holdings are not aware of
any existing, threatened or imminent labor disturbance by the
employees of any of its principal customers, suppliers,
manufacturers or contractors, in each case that is likely to result
in a Material Adverse Change.
15
(nn) Flow-through Entity. Each of
the Company, GCA Holdings, CCI Acquisition, LLC, Central Credit,
LLC and QuikPlay, LLC is a Flow-Through Entity as defined in the
Indenture (including for California and San Francisco income tax
purposes).
Any certificate signed by an officer
of the Company, Finance Corp., GCA Holdings or any Guarantor and
delivered to the Initial Purchaser or to counsel for the Initial
Purchaser shall be deemed to be a representation and warranty by
the Company, Finance Corp., GCA Holdings or such Guarantor to the
Initial Purchaser as to the matters set forth therein.
SECTION 2. Purchase, Sale and Delivery of the
Securities.
(a) The Securities . The
Company, Finance Corp. and each of the Guarantors agrees to issue
and sell to the Initial Purchaser all of the Securities upon the
terms herein set forth. On the basis of the representations,
warranties and agreements of the Company, Finance Corp. and the
Guarantors herein contained, and upon the terms but subject to the
conditions herein set forth, the Initial Purchaser agrees to
purchase from the Company, Finance Corp. and the Guarantors
$235,000,000 aggregate principal amount of Securities, at a
purchase price of 97 3/4% of the principal amount thereof payable
on the Closing Date.
(b) The Closing Date. Delivery of
certificates for the Securities in definitive form to be purchased
by the Initial Purchaser and payment therefor shall be made at the
offices of Fried, Frank, Harris, Shriver & Jacobson LLP, One
New York Plaza, New York, New York 10004 (or such other place as
may be agreed to by the Company and Banc of America Securities LLC)
at 9:00 a.m. New York City time, on March 9, 2004 or such other
time and date as Banc of America Securities LLC shall designate by
notice to the Company and Finance Corp. after consultation with the
Company (the time and date of such closing are called the
“Closing Date”). The Company and Finance Corp. hereby
acknowledge that circumstances under which the Initial Purchaser
may provide notice to postpone the Closing Date as originally
scheduled include, but are in no way limited to, any determination
by the Company, Finance Corp. or the Initial Purchaser to
recirculate to investors copies of an amended or supplemented
Offering Memorandum or a delay as contemplated by the provisions of
Section 3(b).
(c) Delivery of the Securities. The
Company and Finance Corp. shall deliver, or cause to be delivered,
to Banc of America Securities LLC certificates for the Notes and
the Guarantees at the Closing Date against the irrevocable release
of a wire transfer of immediately available funds for the amount of
the purchase price therefor. The certificates for the Notes shall
be in such denominations and registered in the name of Cede &
Co., as nominee of the Depository, pursuant to the DTC Agreement,
and shall be made available for inspection on the business day
preceding the Closing Date at a location in New York City, as Banc
of America Securities LLC may designate. Time shall be of the
essence, and delivery at the time and place specified in this
Agreement is a further condition to the obligations of the Initial
Purchaser.
(d) Delivery of Offering Memorandum
to the Initial Purchaser. Not later than 12:00 p.m. New York City
time on the second business day following the date of this
Agreement, the Company and Finance Corp. shall deliver or cause to
be delivered copies
16
of the Offering Memorandum in such
quantities and at such places as the Initial Purchaser shall
reasonably request.
(e) Initial Purchaser as Qualified
Institutional Buyer. The Initial Purchaser represents and warrants
to, and agrees with, the Company and Finance Corp. that it is a
“qualified institutional buyer” within the meaning of
Rule 144A (a “Qualified Institutional Buyer”) and an
“accredited investor” within the meaning of Rule 501
under the Securities Act (an “Accredited
Investor”).
SECTION 3. Additional Covenants. Each of the
Company, Finance Corp., GCA Holdings and the Guarantors, jointly
and severally, further covenants and agrees with the Initial
Purchaser, as follows:
(a) Initial Purchaser’s Review
of Proposed Amendments and Supplements. Prior to amending or
supplementing the Offering Memorandum (including any amendment or
supplement through incorporation by reference of any report filed
under the Exchange Act), the Company, Finance Corp. and the
Guarantors shall furnish to the Initial Purchaser for review a copy
of each such proposed amendment or supplement, and the Company,
Finance Corp. and the Guarantors shall not use any such proposed
amendment or supplement to which the Initial Purchaser reasonably
objects.
(b) Additional Information,
Amendments and Supplements to the Offering Memorandum and Other
Securities Act Matters. The Company, Finance Corp. and the
Guarantors will immediately notify the Initial Purchaser, and
confirm such notice in writing, of (x) any filing made by the
Company, Finance Corp., GCA Holdings or any Guarantor with any
securities exchange or any other regulatory body in the United
States or any other jurisdiction or (y) any press release issued by
the Company, Finance Corp., GCA Holdings or any Guarantor. If,
prior to the completion of the placement of the Securities by the
Initial Purchaser with the Subsequent Purchasers, any event shall
occur or condition exist as a result of which it is necessary to
amend or supplement the Offering Memorandum in order to make the
statements therein, in light of the circumstances existing at the
time the Offering Memorandum is delivered to a purchaser not
misleading, or if in the opinion of the Initial Purchaser or
counsel for the Initial Purchaser it is otherwise necessary to
amend or supplement the Offering Memorandum to comply with law, the
Company, Finance Corp. and the Guarantors agree to promptly prepare
(subject to Section 3 hereof) and furnish at their own expense to
the Initial Purchaser, amendments or supplements to the Offering
Memorandum so that the statements in the Offering Memorandum as so
amended or supplemented will not, in light of the circumstances in
which the Offering Memorandum is delivered to a purchaser, be
misleading or so that the Offering Memorandum, as amended or
supplemented, will comply with law.
Following the consummation of the
Exchange Offer or the effectiveness of an applicable shelf
registration statement, and for so long as the Securities are
outstanding, if, in the reasonable judgment of the Initial
Purchaser, the Initial Purchaser or any of its affiliates (as such
term is defined in the Rules and Regulations under the Securities
Act) are required to deliver a prospectus in connection with sales
of, or market-making activities with respect to such securities,
the Company, Finance Corp. and the Guarantors agree to periodically
amend the applicable registration statement so that the information
contained therein complies with the requirements of Section 10 of
the Securities Act, to
17
amend the applicable registration
statement or supplement the related prospectus or the documents
incorporated therein when necessary to reflect any material changes
in the information provided therein so that the registration
statement and the prospectus will not contain any untrue statement
of a material fact or omit to state any material fact necessary in
order to make the statements therein, in light of the circumstances
existing as of the date the prospectus is so delivered, not
misleading and to provide the Initial Purchaser with copies of each
amendment or supplement filed and such other documents as the
Initial Purchaser may reasonably request.
The Company, Finance Corp. and the
Guarantors hereby expressly acknowledge that the indemnification
and contribution provisions of Sections 8 and 9 hereof are
specifically applicable and relate to each offering memorandum,
registration statement, prospectus, amendment or supplement
referred to in this Section 3.
(c) Copies of the Offering
Memorandum. The Company, Finance Corp. and the Guarantors agree to
furnish the Initial Purchaser, without charge, as many copies of
the Offering Memorandum and any amendments and supplements thereto
as they shall have reasonably requested.
(d) Blue Sky Compliance. The
Company, Finance Corp. and the Guarantors shall cooperate with the
Initial Purchaser and counsel for the Initial Purchaser to qualify
or register the Securities for sale under (or obtain exemptions
from the application of) the Blue Sky or state securities laws of
those jurisdictions designated by the Initial Purchaser, shall
comply with such laws and shall continue such qualifications,
registrations and exemptions in effect so long as required for the
distribution of the Securities. The Company, Finance Corp. and each
of the Guarantors shall not be required to qualify as a foreign
corporation or to take any action that would subject it to
gener
