Exhibit 10.5
TEMPUR WORLD, LLC
BERNALILLO COUNTY,
NEW MEXICO
and
TEMPUR PRODUCTION USA,
INC.
BOND PURCHASE AGREEMENT
Dated: October 26,
2005
Bernalillo County, New
Mexico
Taxable Industrial Revenue Bonds
(Tempur Production USA, Inc. Project)
Fixed Rate Unsecured Industrial Revenue Bonds
Series 2005B
BOND PURCHASE AGREEMENT
TEMPUR WORLD, LLC (together with its
successors, assigns and transferees, the “Purchaser”),
BERNALILLO COUNTY, NEW MEXICO (the “Issuer”) and
TEMPUR PRODUCTION USA, INC. (the “Company”)
agree:
Section 1. Recitals .
The Issuer and The Bank of New York Trust Company, N.A., as Trustee
(the “Trustee”), have entered into a Trust Indenture
dated as of September 1, 2005 (the “Indenture”).
Pursuant to the Indenture, the Issuer will issue its Taxable
Industrial Revenue Bonds (Tempur Production USA, Inc. Project)
Fixed Rate Unsecured Industrial Revenue Bonds Series 2005B in the
maximum principal amount of $25,000,000 (the “Bonds”).
Proceeds of the Bonds will be used to finance the acquisition,
construction and equipping of an approximately 750,000 square foot
mattress and pillow manufacturing plant in the County of
Bernalillo, City of Albuquerque, New Mexico (the
“Project”).
Section 2. Purchase and
Delivery . On the basis of the representations and covenants
contained in this Bond Purchase Agreement (this
“Agreement”) and subject to the terms and conditions
contained in this Agreement, the Purchaser agrees to purchase the
Bonds from the Issuer and the Issuer agrees to sell the Bonds to
the Purchaser. As consideration for the sale of the Bonds, the
Purchaser agrees to make advances on the Bonds at the times and
under the conditions specified in Section 2.10 of the
Indenture. The Issuer will deliver the initial Bonds to the
Purchaser, at or prior to 10:00 a.m., Eastern Time, on October
27, 2005, or at such other time not later than five business days
thereafter as the Issuer, the Trustee and the Purchaser may agree
(the “Closing Date”).
Section 3. Issuer
Representations . The Issuer represents that, as of the date of
this Agreement:
(a) Each of the representations of
the Issuer in the Lease Agreement dated as of September 1,
2005 (the “Lease” and, together with the Indenture and
this Bond Purchase Agreement, the “Bond Documents”) and
the Indenture is true and correct as if made on and as of the date
of this Agreement.
(b) Pursuant to an ordinance duly
adopted by the County Commission of the Issuer on August 23,
2005 (the “Bond Ordinance”), the Issuer duly authorized
and approved (i) the execution and delivery by the Issuer of
the Bond Documents and the performance by the Issuer of its
obligations under the Bond Documents, and (ii) the issuance,
execution and delivery of the Bonds. The Bond Ordinance has not
been amended, modified or repealed.
(c) The Issuer is duly authorized
under the Constitution and laws of the State to issue the Bonds and
to execute, deliver and perform its obligations under the Bond
Documents and the Bonds, to pledge the security described in the
Indenture and pledged thereby in the manner and to the extent
therein set forth; based on the opinion of Bond Counsel, all
actions required of the Issuer for the issuance of the Bonds and
the execution and delivery of, and the performance of its
obligations under, the Bond Documents and the Bonds have been duly
and effectively taken; the Bond Documents have been duly executed,
issued and delivered by the Issuer and, assuming the due
authorization and execution thereof by the other parties thereto,
are valid, binding and enforceable agreements of the Issuer, except
as the enforceability thereof may be limited by bankruptcy,
insolvency or similar laws affecting the enforcement of
creditors’ rights generally and general principles of equity,
and, based on the opinion of Bond Counsel, the Bonds have been duly
authorized, executed, issued and delivered and constitute, and in
the hands of the Purchaser will constitute, valid and binding
limited obligations of the Issuer, enforceable in accordance with
their terms, except as the enforceability thereof may be limited by
bankruptcy, insolvency or similar laws affecting the enforcement of
creditors’ rights generally and general principles of
equity.
(d) There is no action, suit,
proceeding, inquiry or investigation at law or in equity or before
or by any court, public board or body or other governmental
authority pending, with respect to which the Issuer has received
service of process, or, to the knowledge of the Issuer, threatened
against or affecting it wherein an unfavorable decision, ruling or
finding could adversely affect the transactions contemplated by
this Agreement, or which in any way raises any question concerning
the validity of the Bonds or the Bond Documents, nor to the best
knowledge and belief of the Issuer is there any basis
therefor.
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(e) The execution, delivery and
performance by the Issuer of the Bond Documents and the Bonds do
not and will not violate any order, injunction, ruling or decree by
which the Issuer is bound, and do not and will not constitute a
breach of or a default under any agreement, indenture, mortgage,
lease, note or other obligation, instrument or arrangement to which
the Issuer is a party or by which the Issuer or any of its property
is bound, or contravene or constitute a violation of any law, rule
or regulation to which the Issuer or any of its property is
subject, and no approval or other action by, or filing or
registration with, any governmental authority or agency is required
in connection therewith which has not been previously obtained or
accomplished (except that the Issuer makes no representation as to
compliance with state securities or “Blue Sky” laws or
the securities laws of the United States and as to any permits,
governmental permissions, including environmental clearances,
rights and licenses as may be necessary for the construction and
operation of the Project, as to which no representation or warranty
or covenant is made).
(f) The statements contained in any
certificate provided under this Agreement and signed and delivered
to the Purchaser by any authorized official of the Issuer will be
deemed a representation and warranty by the Issuer to the
Purchaser.
Section 4. Company
Representations . The Company represents that, as of the date
of this Agreement:
(a) The Company is a for-profit
corporation duly incorporated and validly existing and in good
standing under the laws of the State of Virginia and has or will
obtain at the necessary time, all necessary licenses and permits to
lease and operate the Project and other property financed with the
proceeds of the Bonds. The Company has not received any notice of
an alleged violation and is not in violation of any zoning, land
use, environmental or other similar law or regulation applicable to
the property subject to the Lease. The Company has full right,
power and authority to approve the Bond Documents and to perform
the other acts and things as provided for in this Agreement. The
Company has full right, power and authority to approve, enter into,
deliver and/or perform its obligations under the Bond
Documents.
(b) The approval by the Company of
the Bond Documents and the execution, delivery and performance of
its obligations under the Bond Documents, compliance by the Company
with the provisions hereof and of any and all of the foregoing
documents, the application by the Company of the proceeds of the
sale of the Bonds for the purposes described in the Indenture, and
the consummation of the transactions contemplated herein do not and
will not conflict with or result in the breach of any of the terms,
conditions or provisions of, or constitute a default under, the
Articles of Incorporation, as amended, or the By-Laws, as amended,
of the Company or any material agreement, indenture, mortgage,
lease or instrument to which the Company is a party or by which the
Company or any of its property is or may be bound or any existing
law or court or administrative regulation, decree or order which is
applicable to the Company or any of its property, and do not and
will not result in the creation or imposition of any lien of any
nature upon any of the property of the Company, except for
Permitted Liens (as defined in the Lease).
(c) No “Default,”
“Event of Default” or event which, with notice or lapse
of time or both, would constitute a “Default” or an
“Event of Default” under the Bond Documents has
occurred and is continuing.
(d) The Company has duly authorized
all necessary action to be taken by it for (i) the issuance
and delivery of the Bonds by the Issuer upon the terms and
conditions and for the uses set forth or described herein and in
the Indenture; (ii) the approval of the Bonds and the
Indenture; and (iii) the execution, delivery or receipt of and
the performance as applicable, of its obligations under the Bond
Documents and any and all such other agreements and documents as
may be required to be executed, delivered or received by the
Company in order to carry out, effectuate and consummate the
transactions contemplated herein and therein.
(e) The Company will not take or
omit to take any action which will in any way cause or result in
the proceeds of the sale of the Bonds being applied in a manner
other than as provided in the Indenture and the Lease.
(f) To the knowledge of the Company,
there is no action, suit, proceeding, inquiry or investigation at
law or in equity before or by any public board or body pending or,
to the knowledge of the Company, threatened against or affecting
the Company or its property wherein an unfavorable decision, ruling
or
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finding would have a material
adverse effect on (i) the transactions contemplated in this
Agreement or (ii) the validity or enforceability in accordance
with their respective terms of the Bond Documents.
(g) On or before the date of the
sale of the Bonds, the Company will approve or execute and deliver,
as applicable, the Bond Documents. This Agreement is, and when
executed and delivered, as applicable, the Bond Documents will be
the legal, valid and binding obligations of the Company enforceable
against the Company in accordance with their respective terms,
except as enforcement may be limited by bankruptcy, insolvency,
reorganization, moratorium or other similar laws affecting
creditors’ rights generally and general principles of
equity.
(h) To the knowledge of the Company,
all approvals, consents, authorizations, certifications, and other
orders of any government authority, board, agency or commission
having jurisdiction, and all filings with such entities, failure to
obtain or make which would materially adversely affect the
performance by the Company of its obligations hereunder or under
the Bond Documents, have been duly obtained. All permits and
approvals required to date for the construction and operation of
the Project have been obtained or will be obtained in due
course.
(i
