ASSOCIATED MATERIALS,
LLC,
APOLLO INVESTMENT
CORPORATION,
THE NORTHWESTERN MUTUAL LIFE
INSURANCE COMPANY
Dated as of June 16,
2009,
15% Senior Subordinated Notes Due
2012 of Associated Materials, LLC.
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Page
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SECTION 1. DEFINITIONS AND ACCOUNTING
TERMS
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1
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1
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1.2 Computation of Time Periods
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9
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9
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SECTION 2. AUTHORIZATION AND ISSUANCE OF
NOTES
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9
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2.1 Authorization of Issue
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9
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2.2 Sale and Purchase of the Notes
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9
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9
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SECTION 3. CONDITIONS TO CLOSING
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10
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3.1 Conditions to the Obligations of the
Parties
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10
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3.2 Conditions to the Obligations of the
Purchasers
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10
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3.3 Conditions to the Obligations of the
Company
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12
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SECTION 4. REPRESENTATIONS AND WARRANTIES OF THE
COMPANY
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12
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12
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4.2 Due Authorization;
Non-Contravention
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13
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4.3 Governmental Approval; Regulation
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13
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13
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4.5 No Material Adverse Effect
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13
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13
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14
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14
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4.9 Ownership of Properties
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14
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14
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4.11 Pension and Welfare Plans
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14
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4.12 Environmental Warranties
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15
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4.13 Accuracy of Information
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17
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17
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17
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4.16 Private Offering; No Integration or General
Solicitation; Rule 144A Eligibility
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17
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4.17 Affiliate Transactions
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18
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18
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18
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SECTION 5. REPRESENTATIONS, WARRANTIES AND
AGREEMENTS OF THE PURCHASERS
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18
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5.1 Purchase for Investment
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18
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SECTION 6. COVENANT REGARDING
REFINANCING
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19
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6.1 Existing Note Refinancing
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19
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Page
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20
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20
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20
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21
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21
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7.5 Effects of Termination
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21
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SECTION 8. INDEMNIFICATION AND
CONTRIBUTION
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21
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21
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22
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8.2 Waiver of Punitive Damages
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22
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22
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8.4 Tax Treatment of Indemnification
Payments
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22
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22
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9.1 Disclosure of Transactions and Other
Material Information
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22
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23
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9.3 Benefit of Agreement; Assignments and
Participations
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23
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9.4 No Waiver; Remedies Cumulative
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24
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9.5 Amendments, Waivers and Consents
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24
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24
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24
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25
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9.9 Survival of Covenants and
Indemnities
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25
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9.10 Governing Law; Submission to Jurisdiction;
Venue
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25
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26
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26
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9.13 Survival of Representations and
Warranties
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26
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26
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26
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9.16 Intent to Limit Interest to
Maximum
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26
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27
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9.18 No Personal Obligations
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27
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27
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Schedule 2.2 —
Information Relating to Purchasers
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Schedule 4.2 —
Due Authorization; Non-Contravention
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Schedule 4.8
— Subsidiaries
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Schedule 4.12 —
Environmental Warranties
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Schedule 4.18 —
Brokerage Fees
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PURCHASE AGREEMENT, dated as of June 16,
2009, by and among Associated Materials, LLC., a Delaware limited
liability company (together with its successors and permitted
assigns, the “ Company ”), Apollo Investment
Corporation, a Maryland corporation (together with its successors
and permitted assigns, “ Apollo ”), The
Northwestern Mutual Life Insurance Company, a Wisconsin corporation
(together with its successors and permitted assigns, “
Northwestern Mutual ”) and Goldman, Sachs & Co., a
New York limited partnership (together with its successors and
permitted assigns, “ Goldman ”, and together
with Apollo and Northwestern Mutual, the “ Purchasers
”).
WHEREAS, the Company desires to issue to the
Purchasers, upon the terms and subject to the conditions set forth
in this Agreement and the Indenture, $20,000,000 in aggregate
original principal amount of the Company’s 15.00% Senior
Subordinated Notes Due 2012 (the “ Notes ”);
and
WHEREAS, the Purchasers desire to purchase the
Notes from the Company upon the terms and subject to the conditions
set forth in this Agreement and the Indenture.
NOW, THEREFORE, in consideration of the
foregoing and the mutual covenants and agreements herein contained,
and intending to be legally bound hereby, the parties agree as
follows:
DEFINITIONS AND ACCOUNTING
TERMS
1.1 Definitions . As used herein, the
following terms shall have the meanings specified herein unless the
context otherwise requires:
“ 8-K
Filing ” is defined in Section 9.1
.
“ ABL Facility ” means the
Loan and Security Agreement, dated as of October 3, 2008, by
and among the Company and Gentek Building Products, Inc., as U.S.
Borrowers, Gentek, as Canadian Borrower, Associated Materials
Holdings, LLC, Gentek Holdings, LLC and Alside, Inc., as
Guarantors, the lenders and issuing bank from time to time party
thereto, Wachovia Bank, National Association, as administrative and
collateral agent, Wachovia Capital Markets, LLC and CIT Capital
Securities, LLC, as joint lead arrangers and joint lead
bookrunners, and The CIT Group/Business Credit, Inc., as
syndication agent.
“ Accredited Investor ” means
any Person that is an “accredited investor” within the
meaning of Rule 501(a) under the Securities Act.
“
Affiliate ” is defined in the Indenture.
“ Agreement ” is defined in
Section 9.5 .
“ Amended ABL Facility ”
means the ABL Facility, as amended in connection with the Note
Refinancing.
“ AMH ” means AMH Holdings,
LLC, a Delaware limited liability company, and its
successors.
“ AMH
II ” means AMH Holdings II, Inc., a Delaware corporation,
and its successors.
“
Apollo ” is defined in the Preamble.
“ Applicable Law ” means as
to any Person, the articles or certificate of incorporation and
by-laws or other organizational or governing documents of such
Person, and all laws, statutes, treaties, rules, codes (including
building codes), ordinances, regulations, certificates, orders and
licenses of, and legally binding interpretations by, any
Governmental Authority and judgments, decrees, injunctions, writs,
permits, orders or like governmental action of any Governmental
Authority (including, without limitation, Environmental Laws)
applicable to such Person or any of its Subsidiaries or any of
their property, assets or operations.
“
Business Day ” means any day other than a Legal
Holiday.
“ Canadian Pension Plan ”
means (a) a “pension plan” or “plan”
which is subject to applicable pension benefits legislation in any
jurisdiction of Canada and is applicable to employees of the
Company or any of its Subsidiaries resident in Canada, or
(b) any pension benefit plan or similar arrangement applicable
to employees of the Company or any of its Subsidiaries resident in
Canada.
“ Canadian Welfare Plan ”
means any medical, health, hospitalization, insurance or other
employee benefit or welfare plan, agreement or arrangement
applicable to employees of the Company or any of its Subsidiaries
resident in Canada.
“ Capital Stock ” means
(a) in the case of a corporation, corporate stock, (b) in
the case of a partnership or limited liability company, partnership
or membership interests (whether general or limited) and
(c) in the case of an association or other business entity,
any and all shares, interests, participations, rights or other
equivalents (however designated) of corporate stock.
“ CERCLA ” means the
Comprehensive Environmental Response, Compensation and Liability
Act of 1980, as amended.
“ CERCLIS ” means the
Comprehensive Environmental Response Compensation Liability
Information System List.
“
Closing ” is defined in Section 2.3
.
“ Closing Date ” is defined
in Section 2.3 .
2
“ Code ” means the Internal
Revenue Code of 1986, as amended from time to time, and the rules
and regulations promulgated thereunder from time to
time.
“ Commission ” means the
Securities and Exchange Commission, as from time to time
constituted, created under the Exchange Act or, if at any time
after the execution of this Agreement such Commission is not
existing and performing the duties now assigned to it under the
Exchange Act, the body performing such duties at such
time.
“ Company Exchange Notes ”
means (a) notes or other Indebtedness and any other
consideration of the Company issued in exchange for the Existing
Company Notes, (b) the Existing Company Notes, after any
amendment to the terms and conditions thereof or of the Existing
Company Notes Indenture, and (c) in each case, if applicable,
other consideration in exchange for, or the net proceeds of which
are used to Refinance, all or a portion of the Existing Company
Notes.
“ Controlled Group ” means
all members of a controlled group of corporations and all members
of a controlled group of trades or businesses (whether or not
incorporated) under common control which, together with the
Company, are treated as a single employer under Section 414(b) or
414(c) of the Code or Section 4001 of ERISA.
“ Default ” means any event,
act or condition that is, or with the giving of notice, lapse of
time or both would constitute, an Event of Default.
“ Enforceability Exceptions ”
means, with respect to any specified obligation, (a) any
limitations on the enforceability of such obligation due to
bankruptcy, insolvency, reorganization, moratorium, and other
similar laws of general applicability relating to or affecting
creditors’ rights or general equity principles, and
(b) that rights to indemnification or contribution may be
limited by federal or state securities laws or applicable public
policy (other than with respect to usury).
“ Environmental Laws ” means
the common law and all applicable U.S. and Canadian federal, state,
provincial or local statutes, laws, ordinances, codes, rules,
regulations and guidelines having the force and effect of law
(including consent decrees and administrative orders) relating to
public health and safety, or pollution or protection of the
environment (including ambient air, surface water, groundwater,
soil, subsurface strata and natural resources such as flora and
fauna) including without limitation the Clean Air Act, as amended,
CERCLA, the Superfund Amendments and Reauthorization Act of 1986,
as amended, the Resource Conservation and Recovery Act, the Toxic
Substances Control Act of 1976, as amended, the Federal Water
Pollution Control Act Amendments of 1972, the Clean Water Act of
1977, as amended, the Hazardous Materials Transportation Act, as
amended, and any other law having a similar subject
matter.
“ Environmental Matter ”
means any matter relating to pollution, contamination, protection
of the environment, human health or safety, and health or safety of
employees, and any matter relating to emissions, discharges,
releases or threatened releases, of Hazardous Materials into the
air (indoor and outdoor), surface water, groundwater, soil, land
surface or subsurface, buildings, facilities, real or personal
property or fixtures or otherwise relating to the manufacture,
processing, distribution, use, treatment, storage, disposal,
transport or handling of Hazardous Materials.
3
“
Environmental Permits ” is defined in
Section 4.12(d) .
“ Equity Investors ” means
the holders of Capital Stock of AMH II, other than Harvest and
Investcorp.
“ ERISA ” means the Employee
Retirement Income Security Act of 1974, as amended from time to
time, and the regulations promulgated thereunder.
“
Event of Default ” is defined in the
Indenture.
“
Exchange Act ” means the Securities Exchange Act of
1934, as amended.
“ Existing AMH Indenture ”
means the indenture, dated as of March 4, 2004, between
Wilmington Trust Company, as trustee, and AMH, providing for the
issuance of the Existing AMH Notes, as such indenture may be
amended, supplemented or otherwise modified from time to
time.
“
Existing AMH Notes ” means the 11
1 / 4
% Senior Discount Notes due 2014 of
AMH.
“ Existing Company Notes ”
means the Company’s outstanding 9 3 / 4
% Senior Subordinated Notes due
2012.
“ Existing Company Notes Indenture
” means the indenture, dated as of April 23, 2002, by
and among the Company, the subsidiary guarantors party thereto, and
Wilmington Trust Company, as trustee, providing for the issuance of
the Existing Company Notes, as such indenture may be amended,
supplemented or otherwise modified from time to time.
“ Foreign Subsidiary ” means
any Subsidiary of the Company which is organized under the laws of
any jurisdiction outside of the United States of
America.
“ GAAP ” means generally
accepted accounting principles in the United States of America as
in effect from time to time, including those set forth in the
opinions and pronouncements of the Accounting Principles Board of
the American Institute of Certified Public Accountants and
statements and pronouncements of the Financial Accounting Standards
Board or in such other statements by such other entity as have been
approved by a significant segment of the accounting
profession.
“ Gentek ” means Gentek
Building Products Limited, a corporation organized and existing
under the laws of Ontario, Canada.
“
Goldman ” is defined in the Preamble.
“ Governmental Authority ”
means the government of the United States of America, any other
nation or any political subdivision thereof, whether state or
local, and any agency, authority, instrumentality, regulatory body,
court, central bank or other entity exercising executive,
legislative, judicial, taxing, regulatory or administrative powers
or functions of or pertaining to such governments.
4
“ Harvest ” means certain
affiliates of Harvest Partners, LLC that own Capital Stock of AMH
II.
“ Hazardous Materials ” means
(a) any “hazardous substance”, as defined by
CERCLA, (b) any “hazardous waste”, as defined by the
Resource Conservation and Recovery Act, as amended, (c) any solid
waste that is generated in the diagnosis, treatment (e.g.,
provision of medical services) or immunization of human beings or
animals, in research pertaining thereto, or in the production or
testing of biologicals, and (d) any pollutant or contaminant
or hazardous, dangerous or toxic chemical, material or substance
(including, without limitation, crude oil and any petroleum
product) subject to regulation, or which can give rise to
liability, under any Environmental Law.
“
Holder ” means a Person in whose name a Note is
registered on the Security Register.
“
Indebtedness ” is defined in the Indenture.
“
Indemnitees ” is defined in Section 8.2
.
“ Indenture ” means that
certain indenture, in the form attached as Exhibit A
hereto, by and among the Company, the subsidiary guarantors party
thereto, and Deutsche Bank Trust Company Americas, as trustee,
providing for the issuance of the Notes.
“ Institutional Investor ”
means (a) any original purchaser of a Note and any transferee
that is an Affiliate of any original purchaser, (b) any Holder
of a Note holding more than 25% of the aggregate principal amount
of the Notes then outstanding, or (c) any bank, trust company,
savings and loan association or other financial institution, any
pension plan, any investment company or investment fund, any
insurance company, any broker or dealer, or any other similar
financial institution or entity, regardless of legal form organized
under the laws of the United States, any state thereof, or the
District of Columbia, with capital and surplus in excess of
$50,000,000.
“ Investcorp ” means certain
funds affiliated with Investcorp S.A. which own Capital Stock of
AMH II.
“ Legal Holiday ” means a
Saturday, a Sunday or a day on which banking institutions in New
York, Minnesota or at a place of payment are authorized by law,
regulation or executive order to remain closed.
“
Lien ” is defined in the Indenture.
“ Material Adverse Effect ”
means a material adverse effect on the condition (financial or
otherwise), business, operations, assets, liabilities (contingent
or otherwise), properties or prospects of the Company and its
Subsidiaries, taken as a whole.
5
“
Northwestern Mutual ” is defined in the
Preamble.
“
Notes ” is defined in the Recitals.
“ Note Refinancing ” means
any amendment (or other modification) in any manner of any of the
material terms of, or any Refinancing of, all or any part of the
Obligations under the Existing Company Notes or the Existing AMH
Notes, or both, including (a) any amendment of the Existing
Company Notes or the Existing Company Notes Indenture or the
issuance of notes or other Indebtedness of the Company and, if
applicable, other consideration in exchange for, or the net
proceeds of which are used to Refinance, all or any part of the
Existing Company Notes, whether or not the principal amount of any
such notes or other Indebtedness being issued is less or greater
than the principal amount of the Existing Company Notes, whether
such notes or other Indebtedness is secured or unsecured, senior or
subordinated, and irrespective of the terms of any indenture or
other debt agreement or agreements evidencing such notes or other
Indebtedness, but in each case subject to the limitations set forth
in this Agreement and the Indenture, (b) the issuance of notes
or other Indebtedness of the Company and, if applicable, other
consideration in exchange for, or the net proceeds of which are
used to Refinance, all or any part of the Existing AMH Notes,
whether or not the principal amount of such notes or other
Indebtedness is less or greater than the principal amount of the
Existing AMH Notes, whether such notes or other Indebtedness is
secured or unsecured, senior or subordinated, and irrespective of
the terms of any indenture or other debt agreement or agreements
evidencing such notes or other Indebtedness, but in each case
subject to the limitations set forth in this Agreement and the
Indenture, (c) any amendment of the ABL Facility, including,
among other things, to permit the other transactions taking place
as part of the transactions referred to in clause (a), (b) or
(d) hereof, or (d) the issuance of the Replacement Notes,
including in each case the payment of accrued interest and fees and
expenses in connection therewith.
“ Obligations ” means all
obligations for principal, premium, interest, penalties, fees,
indemnification, reimbursements and damages under the documentation
governing any Indebtedness.
“ Permitted Liens ” means (a)
“Permitted Liens” as such term is defined in the ABL
Facility and (b) Liens that are permitted under the terms of
the Indenture and the Existing Company Notes Indenture.
“ Person ” means any
individual, corporation, partnership, limited liability company,
joint venture, association, joint-stock company, trust,
unincorporated organization, government or any agency or political
subdivision thereof or any other entity.
“
principal ” is defined in the Indenture.
“
Purchase Price ” is defined in Section 2.2
.
“
Purchasers ” is defined in the Preamble.
“ Refinance ” means, in
respect of any Indebtedness, to refinance, extend, renew, refund,
repay, prepay, redeem, defease or retire, or to issue other
Indebtedness in exchange or replacement for, such
Indebtedness.
6
“
Regulation FD ” is defined in
Section 9.17 .
“ Regulation S ” means
Regulation S under the Securities Act (or any successor
provision), as it may be amended from time to time.
“ Regulation T ” means
Regulation T of the Board of Governors of the Federal Reserve
System as from time to time in effect and any successor regulation
to all or a portion thereof.
“ Regulation U ” means
Regulation U of the Board of Governors of the Federal Reserve
System as from time to time in effect and any successor regulation
to all or a portion thereof.
“ Regulation X ” means
Regulation X of the Board of Governors of the Federal Reserve
System as from time to time in effect and any successor regulation
to all or a portion thereof.
“
Release ” means a “release”, as such term
is defined in CERCLA.
“
Replacement Notes ” is defined in
Section 6.1(a) .
“
Replacement Notes Indenture ” means the indenture
governing the Replacement Notes.
“ Responsible Officer ” means
the chief executive officer, the president or the chief accounting
officer of the Company or any other officer having substantially
the same authority and responsibility; or, with respect to
compliance with financial covenants or delivery of financial
information, the chief financial officer or the treasurer of the
Company or any other officer having substantially the same
authority and responsibility.
“
Restricted Subsidiaries ” is defined in the
Indenture.
“ Rule 144 ” means
Rule 144 under the Securities Act (or any successor
provision), as it may be amended from time to time.
“ Rule 144A ” means
Rule 144A under the Securities Act (or any successor
provision), as it may be amended from time to time.
“
Securities Act ” means the Securities Act of 1933, as
amended from time to time.
“
Security Register ” is defined in the
Indenture.
“
Senior Indebtedness ” is defined in the Existing
Company Notes Indenture.
7
“ Solvent ” means, with
respect to any Person and its Subsidiaries on a particular date,
that on such date (a) the fair value of the property of such
Person and its Subsidiaries on a consolidated basis is greater than
the total amount of liabilities, including contingent liabilities,
of such Person and its Subsidiaries on a consolidated basis,
(b) the present fair salable value of the assets of such
Person and its Subsidiaries on a consolidated basis is not less
than the amount that will be required to pay the probable liability
of such Person and its Subsidiaries on a consolidated basis on its
debts as they become absolute and matured, (c) such Person
does not intend to, and does not believe that it or its
Subsidiaries will, incur debts or liabilities beyond the ability of
such Person and its Subsidiaries to pay such debts and liabilities
as the same mature, and (d) such Person and its Subsidiaries
on a consolidated basis is not engaged in business or a
transaction, and such Person and its Subsidiaries on a consolidated
basis is not about to engage in business or a transaction, for
which the property of such Person and its Subsidiaries on a
consolidated basis would constitute an unreasonably small capital.
The amount of contingent liabilities at any time shall be computed
as the amount that, in light of all the facts and circumstances
existing at such time, can reasonably be expected to become an
actual or matured liability.
“ Subsidiary ” means, with
respect to any Person, (a) any corporation, association or
other business entity of which more than 50% of the total voting
power of shares of Capital Stock entitled (without regard to the
occurrence of any contingency) to vote in the election of
directors, managers or trustees thereof is at the time owned or
controlled, directly or indirectly, by such Person or one or more
of the other Subsidiaries of that Person (or a combination thereof)
and (b) any partnership (i) the sole general partner or
the managing general partner of which is such Person or a
Subsidiary of such Person or (ii) the only general partners of
which are such Person or one or more Subsidiaries of such Person
(or any combination thereof). Unless the context otherwise
specifically requires, the term “Subsidiary” shall be a
reference to a Subsidiary of the Company.
“ Taxes ” means any and all
income, stamp or other taxes, duties, levies, imposts, charges,
fees, deductions or withholdings, now or hereafter imposed, levied,
collected, withheld or assessed by any Governmental Authority, and
all interest and penalties with respect thereto.
“ Transaction Documents ”
means, collectively, this Agreement, the Indenture, the Notes and
all certificates, instruments and other documents made or delivered
in connection herewith and therewith.
“ Transactions ” means the
issuance of the Notes and all other transactions provided for in,
or contemplated by, the Transaction Documents.
“
United States ” shall have the meaning assigned to
such term in Regulation S.
“ U.S. Multiemployer Plan ”
means a “multiemployer plan” as defined in Section
4001(a)(3) of ERISA.
“ U.S. Pension Plan ” means a
“pension plan”, as such term is defined in
Section 3(2) of ERISA, which is subject to Title IV of ERISA
(other than a U.S. Multiemployer Plan), and to which the Company or
any corporation, trade or business that is, along with the Company,
a member of a Controlled Group, has liability (actual or
contingent), including any liability by reason of having been a
substantial employer within the meaning of Section 4063 of
ERISA at any time during the preceding five years, or by reason of
being deemed to be a contributing sponsor under Section 4069
of ERISA.
8
“ U.S. Welfare Plan ” means a
“welfare plan”, as such term is defined in Section 3(l)
of ERISA.
1.2 Computation of Time Periods . For
purposes of computation of periods of time hereunder, the word
“from” means “from and including” and the
words “to” and “until” each mean “to
but excluding.”
1.3 Terms Generally . Unless the context
requires otherwise (a) any definition of or reference to any
agreement, instrument or other document herein shall be construed
as referring to such agreement, instrument or other document as
from time to time amended, supplemented or otherwise modified
(subject to any restrictions on such amendments, supplements or
modifications set forth herein), (b) any reference herein to
any Person shall be construed to include such Person’s
successors and assigns, and (c) the word
“including” shall mean “including without
limitation.”
AUTHORIZATION AND ISSUANCE OF
NOTES
2.1 Authorization of Issue . On or prior
to the execution and delivery of this Agreement, the Company will
authorize the issue and sale of the Notes. The Notes shall be in
the form specified in the Indenture.
2.2 Sale and Purchase of the Notes .
Subject to the terms and conditions of this Agreement, the Company
will issue and sell to the Purchasers, and the Purchasers will
purchase from the Company, at the Closing provided for in
Section 2.3 , the Notes, for an aggregate cash purchase
price (the “ Purchase Price ”) equal to 100% of
the aggregate principal amount of the Notes being so purchased.
Each Purchaser shall, in exchange for the payment by such Purchaser
of the portion of the Purchase Price set forth opposite such
Purchaser’s name on Schedule 2.2 , receive the
aggregate principal amount of Notes set forth opposite such
Purchaser’s name on Schedule 2.2 . The
obligations hereunder of the Purchasers to purchase and pay for
Notes are several and not joint, and no Purchaser shall have any
liability to any Person for the performance or non-performance by
any other Purchaser.
2.3 Closing . The sale and purchase of
the Notes shall occur at the offices of Gibson, Dunn & Crutcher
LLP, 200 Park Avenue, 48th Floor, New York, New York 10166-1093 at
10:00 a.m. local time, at a closing (the “
Closing ”) on the Business Day following the
satisfaction or, to the extent permitted by law, waiver of all
conditions to the obligations of the parties set forth in
Section 3 (other than such conditions as may, by their
terms, only be satisfied at the Closing or on the Closing Date), or
at such other place or time or on such other date thereafter as may
be agreed upon by the Company and the Purchasers (in either case,
the date and time of the Closing is referred to herein as the
“ Closing Date ”). At the Closing, the Company
will deliver to each Purchaser the Notes to be purchased by such
Purchaser on the Closing Date, in such denominations (which will be
a multiple of $1,000 principal amount) as such Purchaser may
request, dated the Closing Date and registered in such
Purchaser’s name, against payment by such Purchaser to the
Company of immediately available funds in the amount of the
applicable portion of the Purchase Price (as provided in
Section 2.2 ) by wire transfer of immediately available
funds to such bank account or accounts as the Company may request
in writing at least one Business Day prior to the Closing
Date.
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3.1 Conditions to the Obligations of the
Parties . The obligation of the Parties to consummate the
transactions contemplated by this Agreement is subject to the
fulfillment (or waiver) on or before the Closing Date of the
following:
(a) Each Purchaser’s purchase of the
Notes shall (i) be permitted by the laws and regulations of
each jurisdiction to which it is subject, and (ii) not violate
any Applicable Laws (including, without limitation,
Regulation U, Regulation T or
Regulation X).
3.2 Conditions to the Obligations of the
Purchasers . The obligation of the Purchasers to consummate the
transactions contemplated by this Agreement is subject to the
fulfillment (or waiver) on or before the Closing Date of the
following:
(a) Each of the representations and
warranties of the Company in this Agreement and in each of the
other Transaction Documents that are modified by materiality or
Material Adverse Effect qualifiers shall be true and correct when
made and on and as of the Closing Date as if made on and as of the
Closing Date (unless stated to relate to a specific earlier date,
in which case such representations and warranties shall be true and
correct as of such earlier date), and each of the representations
and warranties of the Company in this Agreement and in each of the
other Transaction Documents that are not so qualified as to
materiality or Material Adverse Effect shall be true and correct in
all material respects when made and on and as of the Closing Date
as if made on and as of the Closing Date (unless stated to relate
to a specific earlier date, in which case such representations and
warranties shall be true and correct as of such earlier
date).
(b) The Company and its Subsidiaries, to
the extent parties hereto or thereto, shall each have performed and
complied in all material respects with all agreements and covenants
contained in this Agreement and each of the other Transaction
Documents required to be performed or complied with by it prior to
or at the Closing (or such compliance shall have been waived on
terms and conditions reasonably satisfactory to each Purchaser)
and, after giving effect to the issue and sale of the Notes and the
other Transactions (and the application of the proceeds thereof as
contemplated by this Agreement and the other Transaction
Documents), no Default or Event of Default shall have occurred and
be continuing, and no default or event of default shall have
occurred and be continuing under any of the other Transaction
Documents.
(c) The Company shall have delivered to
each Purchaser an Officer’s Certificate, dated as of the
Closing Date, in the form previously agreed to by the parties,
certifying as to the Company’s organizational documents and
resolutions attached thereto, the incumbency and signatures of
certain officers of the Company and other corporate proceedings of
the Company relating to the authorization, execution and delivery
of the Notes, this Agreement and the other Transaction Documents to
which the Company is a party and that the conditions specified in
Section 3.2 (other than Section 3.2(d) )
have been fulfilled, except as to matters which require the
approval or satisfaction of each Purchaser.
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(d) Gibson, Dunn & Crutcher LLP, New
York counsel for the Company, shall have furnished to each
Purchaser its written opinion, dated the Closing Date, in the form
previously agreed to by the parties.
(e) On the Closing Date the Company shall
have delivered to the Purchasers the entire $20,000,000 original
principal amount of Notes.
(f) Except as disclosed in the reports,
notices, prospectuses, registration statements and other filings
which the Company has filed with the Commission prior to the date
of this Agreement, no event or events shall have occurred since
December 31, 2008, which, individually or in the aggregate,
has had or would reasonably be expected to have a material adverse
effect on the assets, liabilities, results of operations, financial
condition or business of the Company and its Subsidiaries, taken as
a whole; provided that none of the following shall, in any
case, be deemed to constitute a material adverse effect, nor shall
any of the following be considered in determining whether a
material adverse effect has occurred: (i) changes (x) in
economic, financial market, regulatory or political conditions
generally or (y) generally affecting the building
products/siding and windows industry or principal markets in which
the Company or any of its Subsidiaries conducts business that, in
the case of clause (y), do not adversely affect the Company and its
Subsidiaries, taken as a whole, disproportionately to other
companies in the building products/siding and windows industry,
(ii) changes in laws, rules, regulations, or orders of any
Governmental Authority or interpretations thereof by any
Governmental Authority or changes in accounting requirements or
principles, (iii) the announcement or pendency of the
Transactions, or (iv) any natural disaster or any act of
terrorism, sabotage, military action or war (whether or not
declared) or any escalation or worsening thereof; in each case,
which do not adversely affect the Company and its Subsidiaries,
taken as a whole, disproportionately to other Persons affected
thereby.
(g) All corporate, limited liability
company and other proceedings in connection with the Transactions,
and all documents and instruments incident thereto and the terms
thereof, shall be reasonably satisfactory to each Purchaser and the
Purchasers’ special counsel, and each Purchaser and the
Purchasers’ special counsel shall have received all such
certified or other copies of such documents as it or they may
reasonably request.
(h) The issuance of the Notes by the
Company shall not violate any provision of the Existing Company
Notes Indenture or the Existing AMH Indenture and no default or
event of default shall occur thereunder as a result
thereof.
(i) Each Purchaser shall have received true
and correct copies of all Transaction Documents and such documents
(i) shall have been duly executed and delivered by the parties
thereto, (ii) shall be in form and substance reasonably
satisfactory to each Purchaser and the Purchasers’ special
counsel and (iii) shall be valid and binding obligations of
the parties thereto, enforceable against each of them in accordance
with its respective terms, subject to the Enforceability
Exceptions.
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(j) The Purchasers shall have received from
the Company or a Subsidiary of the Company a payment in cash equal,
in the aggregate, to $1,500,000 by wire transfer of immediately
available funds according to the wire transfer instructions set
forth on Schedule 2.2 (which payment shall be
apportioned pro rata between the Purchasers according to the
principal amount of the Notes purchased by each Purchaser as set
forth on Schedule 2.2 ).
3.3 Conditions to the Obligations of the
Company . The obligation of the Company to consummate the
transactions contemplated by this Agreement is subject to the
fulfillment (or waiver) on or before the Closing Date of the
following:
(a) Each of the representations and
warranties of each of the Purchasers in this Agreement and in each
of the other Transaction Documents that are modified by materiality
or material adverse effect qualifiers shall be true and correct
when made and on and as of the Closing Date as if made on and as of
the Closing Date (unless stated to relate to a specific earlier
date, in which case such representations and warranties shall be
true and correct as of such earlier date), and each of the
representations and warranties of each of the Purchasers in this
Agreement and in each of the other Transaction Documents that are
not so qualified as to materiality or material adverse effect shall
be true and correct in all material respects when made and on and
as of the Closing Date as if made on and as of the Closing Date
(unless stated to relate to a specific earlier date, in which case
such representations and warranties shall be true and correct as of
such earlier date).
(b) Each of the Purchasers, to the extent
parties hereto or thereto, shall each have performed and complied
in all material respects with all agreements and covenants
contained in this Agreement and each of the other Transaction
Documents required to be performed or complied with by it prior to
or at the Closing (or such compliance shall have been waived on
terms and conditions reasonably satisfactory to the
Company).
(c) On or prior to the Closing Date,
(i) AMH II shall have received additional equity capital from
its shareholders and/or (ii) the availability to make
“Restricted Payments” pursuant to Section 4.04 of
the Existing AMH Indenture shall have been increased, in an
aggregate amount of at least $8 million.
REPRESENTATIONS AND WARRANTIES OF
THE COMPANY
In order to induce the Purchasers to enter into
this Agreement and the Indenture and to purchase the Notes, the
Company makes the following representations and warranties as of
the date hereof and as of the Closing Date (except as specifically
provided herein, both before and after giving pro forma
effect to the consummation on the Closing Date of the transactions
contemplated by this Agreement and the other Transaction Documents,
and the issuance of the Notes to be issued on the Closing Date and
the application of the proceeds thereof) that:
4.1 Organization . Each of the Company
and its Subsidiaries (a) is validly organized and existing and
in good standing under the laws of the state or jurisdiction of its
incorporation or organization, (b) is duly qualified to do
business and is in good standing as a foreign entity in each
jurisdiction where the nature of its business requires such
qualification and where the failure to be so qualified would
reasonably be expected to have a Material Adverse Effect and (c)
has full corporate, partnership or limited liability company power
and authority, as the case may be, to own and hold under lease its
property and to conduct its business substantially as currently
conducted by it.
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4.2 Due Authorization; Non-Contravention
. Each of the Company’s and its Subsidiaries’
participation in the consummation of all aspects of the
Transactions, and the execution, delivery and performance by the
Company and its Subsidiaries of the Transaction Documents are in
each case within each such Person’s corporate, partnership or
limited liability company powers, as the case may be, have been
duly authorized by all necessary corporate, partnership or limited
liability company action, as the case may be, and, except as
disclosed on Schedule 4.2 , do not (a) contravene any
(i) articles or certificate of incorporation and by-laws or
other organizational or governing documents of the Company or any
of its Subsidiaries, (ii) material contractual restriction
binding on or affecting the Company or any of its Subsidiaries,
(iii) court decree or order binding on or affecting the
Company or any of its Subsidiaries or (iv) material law or
governmental regulation binding on or affecting the Company or any
of its Subsidiaries, or (b) result in, or require the creation or
imposition of, any Lien on any of the Company or any of its
Subsidiaries’ properties (except for Permitted
Liens).
4.3 Governmental Approval; Regulation .
Except for any filing required to be made under applicable
securities law (including the Securities Act and the Exchange Act),
no material authorization or approval or other action by, and no
material notice to or filing with, any Governmental Authority or
other Person is required for (a) the due execution, delivery
or performance by the Company and its Subsidiaries of any
Transaction Document to which it is a party or (b) the conduct
of the business of AMH and its Subsidiaries as currently conducted.
Neither the Company, nor any of its Subsidiaries is an
“investment company” within the meaning of the
Investment Company Act of 1940, as amended, or a “holding
company”, or a “subsidiary company” of a
“holding company”, or an “affiliate” of a
“holding company” or of a “subsidiary
company” of a “holding company”, within the
meaning of the Public Utility Holding Company Act of 1935, as
amended.
4.4 Validity . Each Transaction Document
constitutes, or, upon the due execution and delivery thereof, will
constitute, a legal, valid and binding obligation of the Company
and its Subsidiaries, to the extent a party thereto, enforceable
against them in accordance with its terms (subject to the
Enforceability Exceptions).
4.5 No Material Adverse Effect . Except
as disclosed in the reports, notices, prospectuses, registration
statements and other filings which the Company has filed with the
Commission prior to the date of this Agreement, there has been no
event, occurrence, omission or change which has resulted in a
Material Adverse Effect since December 31, 2008.
4.6 Litigation . There is no pending or,
to the knowledge of the Company, threatened litigation, action,
investigation or proceeding (a) affecting the Company or any
of its Subsidiaries or any of their respective properties,
businesses, assets or revenues, which would reasonably be expected
to have a Material Adverse Effect or (b) which purports to
affect the legality, validity or enforceability of any Transaction
Document.
13
4.7 Labor Matters . There is no labor
strike, work stoppage, lockout or other work action or other labor
controversy, and no such dispute or controversy is actually pending
or, to the Company’s knowledge, threatened against or
affecting the Company or of any of its Subsidiaries that has had or
would reasonably be expected to have a Material Adverse
Effect.
4.8 Subsidiaries . The Company has no
Subsidiaries, except those Subsidiaries which are identified on
Schedule 4.8 , none of which are Foreign Subsidiaries
other than Gentek. Schedule 4.8 , as of the Closing
Date, lists the percentage of shares of the Capital Stock of each
Subsidiary owned by the Company or another Subsidiary.
4.9 Ownership of Properties . The Company
and each of its Subsidiaries maintains (a) in the case of material
owned real property, good and marketable fee title to, (b) in
the case of material owned personal property, good and valid title
to, or (c) in the case of material leased real or personal
property, valid and enforceable leasehold interests (as the case
may be) in, all of such properties and assets, real and personal,
tangible and intangible, of any nature whatsoever, free and clear
in each case of all Liens, except for Permitted Liens.
4.10 Taxes . The Company and each of its
Subsidiaries has timely filed all material Tax returns and reports
required by law to have been filed by it, has timely withheld all
material Taxes that were required to be withheld in respect of
compensation or other amounts paid to any employee or independent
contractor (or, in the case of independent contractors, the Company
or the relevant Subsidiary has the right to indemnification with
respect thereto) and has timely paid all material Taxes and
governmental charges thereby shown or required to be due and owing,
except any such Taxes or charges which are being diligently
contested in good faith by appropriate proceedings and for which
adequate reserves in accordance with GAAP shall have been set aside
on its books.
4.11 Pension
and Welfare Plans .
(a) During the twelve-consecutive-month
period prior to the date of the execution and delivery of this
Agreement (i) no steps have been taken to terminate any U.S.
Pension Plan, (ii) no contribution failure has occurred with
respect to any U.S. Pension Plan sufficient to give rise to a Lien
under Section 302(f) of ERISA and (iii) no steps have been
taken to effect a partial or complete withdrawal from any U.S.
Multiemployer Plan, in each case which could (individually or in
the aggregate) reasonably be expected to result in liabilities of
the Company or any of its Subsidiaries in excess of $5,000,000 or a
Material Adverse Effect. No condition exists or event or
transaction has occurred with respect to any U.S. Pension Plan
which could reasonably be expected to result in the incurrence by
the Company or any member of the Controlled Group of any material
liability, fine or penalty, that could (individually or in the
aggregate) reasonably be expected to result in liabilities in
excess of $5,000,000 or a Material Adverse Effect. Neither the
Company nor any member of the Controlled Group has any contingent
liability with respect to any post-retirement benefit under a U.S.
Welfare Plan, other than liability for continuation coverage
described in Part 6 of Subtitle B of Title I of ERISA, which
could reasonably be expected to result in a Material Adverse
Effect.
14
(b) During the twelve-consecutive-month
period before the date of the execution and delivery of this
Agreement, (i) no steps have been taken to terminate any
Canadian Pension Plan and (ii) no contribution failure has
occurred with respect to any Canadian Pension Plan, in each case
that, individually or in the aggregate, could reasonably be
expected to result in a Material Adverse Effect. No condition
exists and no event or transaction has occurred with respect to any
Canadian Pension Plan which could reasonably be expected to result
in the incurrence by the Company or any of its Subsidiaries of any
liability, fine or penalty that could (individually or in the
aggregate) reasonably be expected to result in liabilities in
excess of $5,000,000 or a Material Adverse Effect. Neither the
Company nor any of its Subsidiaries has any liability, including
without limitation a contingent liability, with respect to any
benefit under a Canadian Pension Plan or Canadian Welfare Plan
which, in each case could reasonably be expected to result in a
Material Adverse Effect.
(c) (i) Each Canadian Pension Plan is
in compliance in all material respects with all applicable pension
benefits and tax laws; (ii) all contributions (including
employee contributions made by authorized payroll deductions or
other withholdings) required to be made to the appropriate funding
agency in accordance with all Applicable Laws and the terms of each
Canadian Pension Plan have been made in accordance with all
Applicable Laws and the terms of each Canadian Pension Plan;
(iii) all liabilities under each Canadian Pension Plan are
being funded, on a going concern and solvency basis, in accordance
with the terms of the respective Canadian Pension Plan, the
requirements of applicable pension benefits laws and of applicable
regulatory authorities and the most recent actuarial report filed
with respect to such Canadian Pension Plan; and (iv) no event
has occurred and no conditions exist with respect to any Canadian
Pension Plan that has resulted or could reasonably be expected to
result in any Canadian Pension Plan having its registration revoked
or refused for the purposes of any applicable pension benefits or
tax laws or being placed under the administration of any relevant
pension benefits regulatory authority or being required to pay any
Taxes or penalties under any applicable pension benefits or tax
laws, except for any exceptions to clauses (i) through
(iv) above that, individually or in the aggregate, could not
reasonably be expected to result in a Material Adverse
Effect.
4.12
Environmental Warranties . Except as disclosed in
Schedule 4.12 :
(a) all facilities and property (including
underlying groundwater) owned or leased by the Company or any of
its Subsidiaries and their operations are in compliance with all
Environmental Laws, except for any such noncompliance that could
not (individually or in the aggregate) reasonably be expected to
have a Material Adverse Effect;
(b) there are no pending or, to the
knowledge of the Company, any threatened (i) claims,
complaints, notices, requests for information, proceedings, or
investigation against or involving the Company or any of its
Subsidiaries with respect to any alleged violation of any
Environmental Law, or (ii) complaints, notices or inquiries to
the Company or any of its Subsidiaries regarding actual or
potential liability under any Environmental Law, that, with respect
to clauses (i) and (ii) of this paragraph, could
(individually or in the aggregate) reasonably be expected to have a
Material Adverse Effect;
(c) there have been no Releases of
Hazardous Materials at, on or under or from any property or
facility now owned, leased or operated by the Company or any of its
Subsidiaries, or to the knowledge of the Company, previously owned,
leased or operated by the Company or any of its Subsidiaries, that
could (individually or in the aggregate) reasonably be expected to
have a Material Adverse Effect;
15
(d) The Company and its Subsidiaries have
been issued all permits, certificates, approvals, licenses and
other authorizations pursuant to Environmental Laws necessary for
the operation of their business (“ Environmental
Permits ”) and are in compliance with all Environmental
Permits (except to the extent the failure to have or be in
compliance with any such Environmental Permit could not
(individually or in the aggregate) reasonably be expected to have a
Material Adverse Effect);
(e) no property or facility, now or
previously, leased or operated by the Company or its Subsidiaries
is listed, or proposed for listing, on the National Priorities List
pursuant to CERCLA, on the CERCLIS or on any similar state list of
sites with respect to any clean up responsibility or similar
liability of the Company or a Subsidiary which would be reasonably
likely to result in a Material Adverse Effect;
(f) there are no underground storage tanks
or related piping, active or abandoned, including petroleum storage
tanks, on or under any property now owned or leased by the Company
or any of its Subsidiaries or, to the knowledge of the Company, at
any property previously owned or leased by the Company or any of
its Subsidiaries, that could (individually or in the aggregate)
reasonably be expected to have a Material Adverse
Effect;
(g) neither the Company nor any of its
Subsidiaries has transported or arranged for the transportation of
any Hazardous Material to any location which is listed or proposed
for listing on the National Priorities List pursuant to CERCLA, on
the CERCLIS or on any similar state list or which, to the
Company’s knowledge, is the subject of federal, state or
local enforcement actions or other investigations which may lead to
material claims against the Company or such Subsidiary for any
investigatory or remedial work, damage to natural resources or
personal injury or property damage, including claims under CERCLA,
which could (individually or in the aggregate) reasonably be
expected to have a Material Adverse Effect;
(h) there are no polychlorinated biphenyls
or friable asbestos present at any property now or previously owned
or leased by the Company or any of its Subsidiaries that could
(individually or in the aggregate) reasonably be expected to have a
Material Adverse Effect;
(i) neither the Company nor any of its
Subsidiaries has manufactured or sold any product containing
asbestos, the result of which could (individually or in the
aggregate) reasonably be expected to result in a Material Adverse
Effect; and
(j) no conditions exist at, on or under any
property now or previously owned or leased by the Company or any of
its Subsidiaries, or to the knowledge of the Company, at any
property previously owned or leased by the Company or any of its
Subsidiaries, that could, with the passage of time, or the giving
of notice or both, reasonably be expected (individually or in the
aggregate) to have a Material Adverse Effect under any
Environmental Law.
16
4.13 Accuracy of Information . None of
the reports, notices, prospectuses, registration statements and
other filings which the Company has filed with the Commission
contains any untrue statements of material fact, or omits to state
any material facts necessary in either case to make such
information taken as a whole not materially misleading in light of
the circumstances under which such information was provided.
Notwithstanding the foregoing, all “forward-looking
statements” and projections contained in any filings that the
Company has made with the Commission have been prepared in good
faith based upon assumptions believed by Responsible Officers of
the Company to be reasonable at the time such assumptions were made
(it being recognized by each Purchaser, however, that
forward-looking statements and projections as to future events are
not to be viewed as facts and that the actual results during the
period or periods covered by the forward-looking statements or
projections will probably differ from the forward-looking or
projected results and such differences may be material).
4.14 Regulations U and X . Neither the
Company nor any of its Subsidiaries is engaged in the business of
extending credit for the purpose of purchasing or carrying margin
stock, and no proceeds of the issuance and sale of the Notes will
be used to purchase or carry margin stock or otherwise for a
purpose which violates, or would be inconsistent with
Regulation U or Regulation X. Terms for which meanings
are provided in Regulation U or Regulation X or any
regulations substituted therefor, as from time to time in effect,
are used in this section with such meanings.
4.15 Solvency . As of the Closing Date,
the Company and its Subsidiaries (taken together) are, and after
giving effect to the Transactions, will be Solvent.
4.16 Private
Offering; No Integration or General Solicitation; Rule 144A
Eligibility .
(a) Assuming the accuracy of the
representations and warranties of each Purchaser set forth in
Section 5 , it is not necessary in connection with the
offer, issue, sale and delivery of the Notes to the Purchasers in
the manner contemplated by this Agreement and the other Transaction
Documents to register the Notes under the Securities
Act.
(b) Neither the Company nor any of its
Subsidiaries has, directly or indirectly, offered, issued, sold or
solicited any offer to buy nor will any of them, directly or
indirectly, offer, issue, sell or solicit any offer to buy, any
security of a type or in a manner which would be integrated with
the sale of the Notes and require the Notes to be registered under
the Securities Act. None of the Company, any of its Subsidiaries,
their Affiliates or any person acting on any of their behalf (other
than the Purchasers and their assignees, as to whom neither the
Company nor any of its Subsidiaries makes any representation or
warranty except as provided in this Section 4 ) has engaged
or will engage in any form of general solicitation or general
advertising (within the meaning of Rule 502(c) under the Securities
Act) in connection with the offering of the Notes.
(c) The Notes are eligible for resale
pursuant to Rule 144A and the Notes will not, at the Closing
Date, be of the same class as securities listed on a national
securities exchange registered under Section 6 of the Exchange
Act or quoted on a U.S. automated interdealer quotation
system.
17
4.17 Affiliate Transactions . As of the
Closing Date, all transactions with Affiliates of the Company and
any of its Subsidiaries which are required to have been disclosed
pursuant to the rules and regulations of the Commission have been
disclosed in the public filings of the Company. Neither the Company
nor any of its Subsidiaries has entered into a material transaction
with an Affiliate since the date of the last such filing of the
Company.
4.18 Brokerage Fees . Except as set forth
on Schedule 4.18 , neither the Company nor any of its
Subsidiaries has paid, or is obligated to pay, to any Person any
brokerage or finder’s fees in connection with the
transactions contemplated hereby or by any other Transaction
Documents.
4.19 Fees . All fees payable in
connection with the consummation of the Transactions to the Equity
Investors, Harvest, or Investcorp or any of their respective
Affiliates, in each case by AMH II or any of its Subsidiaries, have
been disclosed to each Purchaser on or prior to the date
hereof.
REPRESENTATIONS, WARRANTIES AND
AGREEMENTS OF THE PURCHASERS
Each Purchaser, severally but not jointly,
represents and warrants to the Company as of the date hereof and as
of the Closing Date as follows:
5.1 Purchase
for Investment .
(a) Such Purchaser is acquiring Notes for
its own account, for investment and not with a view to any
distribution thereof within the meaning of the Securities
Act.
(b) Such Purchaser understands that the
Notes have not been registered under the Securities Act and the
Notes are being issued by the Company in a transaction exempt from
the registration requirements of the Securities Act and the Notes
may not be offered or sold except pursuant to effective
registration statements under the Securities Act or pursuant to
applicable exemptions from registration under the Securities Act
and in compliance with applicable State laws.
(c) Such Purchaser further understands that
the exemption from registration afforded by Rule 144 (the
provisions of which are known to the Purchaser) promulgated under
the Securities Act depends on the satisfaction of various
conditions, and that, if applicable, Rule 144 may afford the
basis for sales only in limited amounts.
(d) Such Purchaser did not employ any
broker or finder in connection with the transactions contemplated
in this Agreement and no fees or commissions are payable to the
Purchaser except as otherwise provided for in this
Agreement.
(e) Such Purchaser is an Accredited
Investor. Such Purchaser is financially able to hold the Notes for
long term investment and to suffer a complete loss of its
investment in the Notes. Such Purchaser has had the opportunity to
ask questions of the Company and its officers and employees and to
receive to its satisfaction such information about the business and
financial condition of the Company as it considers necessary or
appropriate for deciding whether to purchase the Notes, and the
Purchaser is fully capable of understanding and evaluating the
risks associated with the ownership of the Notes.
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(f) Such Purchaser has or will on the
Closing Date have funds sufficient to purchase the Notes to be
purchased by it hereunder. The source of funds to be used by such
Purchaser to pay the purchase price of the Notes purchased by such
Purchaser hereunder does not include assets of any employee benefit
plan (other than a plan exempt from the coverage of ERISA) or plan
or any other entity the assets of which consist of “plan
assets” of employee benefit plans or plans as defined in
Department of Labor regulation Section 2510.3-101. As used in
this Section 5.1(f) , the term “employee benefit
plan” shall have the meaning assigned to such term in
Section 3 of ERISA, and the term “plan” shall have
the meaning assigned thereto in Section 4975(e)(1) of the
Code.
(g) Such Purchaser is a corporation duly
organized and validly existing under the laws of the state of its
incorporation and has the power and authority to deliver and
perform the transactions contemplated by this Agreement.
COVENANT REGARDING
REFINANCING
6.1 Existing
Note Refinancing .
(a) In the event of the consummation of a
Note Refinancing by the Company or AMH, the Company shall promptly
notify the Holders of such Note Refinancing and the Holders of a
majority of the outstanding principal amount of the Notes may
elect, at any time from the date of such consummation through and
including 30 days thereafter, in writing to have the Company
exchange all of the Notes owned by the Holders for an equal
principal amount of notes (such notes issued in exchange for the
Notes, the “ Replacement Notes ”). Within 30
days of such election by the Holders, all Holders (including
Persons that become Holders following the date hereof) and the
Company shall exchange the Notes for the Replacement Notes, which
Replacement Notes and the related Replacement Notes Indenture shall
have terms and conditions identical to the Notes being exchanged
and the Indenture (including, for the avoidance of doubt,
Section 4.03(e) thereof) (with references in the Replacement
Notes Indenture to the “Securities” being to the
Replacement Notes), except :
(i) if the Company Exchange Notes are not
subordinated in right of payment and/or constitute Senior
Indebtedness (rather than being subordinated in right of payment as
in the case of the Existing Company Notes), (i) such
Replacement Notes will not be subordinated in right of payment and,
if applicable, will be Senior Indebtedness, and (ii) in lieu
of Section 4.03(d) of the Indenture as applies to the Notes,
the Replacement Notes Indenture will include the equivalent of
Section 4.03(d) of the Existing AMH Indenture;
(ii) if any of the Company Exchange Notes
are secured by a Lien on any assets of the Company or its
Restricted Subsidiaries, such Replacement Notes will be secured by
a Lien on the same collateral which Lien shall rank equal with the
Lien securing the Company Exchange Notes pursuant to an
intercreditor agreement (with all decisions with respect to such
intercreditor agreement to be made by holders of a majority in
principal amount of the holders of the Company Exchange Notes and
Replacement Notes, voting together as one class) or senior to the
Lien securing the Company Exchange Notes;
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(iii) at the election of the Holders of a
majority of the outstanding principal amount of the Notes, the
covenants and events of default (and related definitions) included
in the Replacement Notes Indenture will be those included in the
indenture or other debt instrument governing the Company Exchange
Notes, rather than those included in the Indenture;
(iv) If the yield to maturity, calculated
on a per annum basis according to standard market practices based
on a 360 day convention and quarterly interest payments
(including increased or decreased principal amount (or accreted
value, in the case of a security issued with original issue
discount) and upfront fees) on the Company Exchange Notes is
greater than 17%, then the per annum interest rate on the
Replacement Notes shall be increased such that the yield to
maturity on the Replacement Notes equals the yield to maturity on
the Company Exchange Notes. For the purpose of such interest rate
increase, any interest beyond 18% per annum can be payable at the
Company’s option in additional Replacement Notes;
and
(v) If the Company Exchange Notes are not
callable by the Company for a specified period of time after their
issuance, the Replacement Notes will not be callable by the Company
for the same period of time. If the holders of the Company Exchange
Notes receive warrants to purchase Capital Stock of the Company,
the holders of the Replacement Notes shall be entitled to a
proportionate share of such warrants.
(b) The Note Refinancing may not occur
unless the Amended ABL Facility, if any, is comprised entirely of a
revolving credit facility and does not contain any term debt
component.
7.1 By Mutual Consent . This Agreement
may be terminated at any time prior to the Closing Date by the
mutual written consent of the Company and the
Purchasers.
7.2 By Purchasers . This Agreement may be
terminated by the Purchasers, if the Company breaches or fails to
perform in any respect any of its representations, warranties or
covenants contained in this Agreement and such breach or failure to
perform (a) would give rise to the failure of a condition set
forth in Section 3.2 , (b) cannot be cured prior
to the Cutoff Date or has not been cured within 15 days
following delivery of written notice of such breach or failure to
perform and (c) has not been waived by the
Purchasers.
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7.3 By the Company . This Agreement may
be terminated by the Company, if the Purchasers breach or fail to
perform in any respect any of their representations, warranties or
covenants contained in this Agreement and such breach or failure to
perform (a) would give rise to the failure of a condition set
forth in Section 3.3 , (b) cannot be cured prior
to the Cutoff Date or has not been cured within 15 days
following delivery of written notice of such breach or failure to
perform and (c) has not been waived by the Company.
7.4 Failure to Close . If the Closing
does not occur by June 30, 2009 (the “ Cutoff
Date ”), then either the Purchasers or the Company may
terminate this Agreement by delivery of written notice of
termination to the other parties hereto; provided ,
however , any party that is in material breach of this
Agreement shall not have the right to terminate this Agreement
pursuant to this Section 7.4 .
7.5 Effect of Termination . If this
Agreement is terminated as provided in this Section 7 ,
then this Agreement will forthwith become null and void and there
will be no liability on the part of any party hereto to any other
party hereto or any other person or entity in respect thereof,
except in connection with Section 8 hereof,
provided that no such termination will relieve any party
from liability for breach of its obligations under this Agreement,
and in such event the other parties shall have all rights and
remedies available at law or equity, including the right of
specific performance against such party.
INDEMNIFICATION AND
CONTRIBUTION
8.1 Expenses . On the Closing Date, the
Company will pay all reasonable out-of-pocket costs and expenses
(including reasonable and documented attorneys’ fees and
disbursements; provided , that in connection with the
consummation of the Transactions, the Company will pay fees and
disbursements of only one counsel to the Purchasers) incurred by
each Purchaser (a) in connection with the Transactions and
(b) in connection with any amendments, waivers or consents
under or in respect of this Agreement or the other Transaction
Documents (whether or not such amendment, waiver or consent becomes
effective), including, without limitation, the following:
(i) the reasonable and documented out-of-pocket costs and
expenses incurred in enforcing, defending or declaring (or
determining whether or how to enforce, defend or declare) any
rights or remedies under this Agreement or the other Transaction
Documents or in responding to any subpoena or other legal process
or informal investigative demand issued in connection with this
Agreement or the other Transaction Documents, or by reason of being
a Holder of any Note; and (ii) the reasonable and documented
out-of-pocket costs and expenses, including reasonable and
documented consultants’ and advisors’ fees, incurred in
connection with the insolvency or bankruptcy of the Company or any
Subsidiary of the Company or in connection with any work-out or
restructuring of the transactions contemplated hereby, or by the
Transaction Documents; provided , however , that for
the purposes of clause (b) above, reasonable out-of-pocket
costs and expenses shall not include, and the Company shall not be
required to pay, the reasonable and documented attorneys’
fees and disbursements of counsel to the Purchasers, unless such
amendment, waiver or consent results from the circumstances
described in clause (i) or clause (ii) above. The Company
will pay, and will save each Purchaser and each other Holder of a
Note harmless from, all claims in respect of any fees, costs or
expenses if any, of brokers and finders engaged by the Company or
any of its Subsidiaries in relation to the Transactions. For the
avoidance of doubt, the Company shall not be required to pay any
out-of-pocket costs and expenses of the Purchasers in connection
with the issuance of the Replacement Notes by the Company to the
Purchasers in connection with Section 6.1(a) .
21
8.2 Indemnification . The Company shall,
and shall cause each of its Subsidiaries to indemnify and hold
harmless each Purchaser and each of their Affiliates, partners,
stockholders, members, directors, agents, employees and controlling
persons (collectively, the “ Indemnitees ”) from
and against any and all actual losses, claims, damages or
liabilities to any such Indemnitee in connection with or as a
result of (a) the execution or delivery of any Transaction
Document or any other agreement or instrument contemplated thereby
or the performance by the parties to the Transaction Documents of
their respective obligations hereunder or the consummation of the
Transactions or any other transactions contemplated hereby,
(b) the issuance of the Notes or the use of the proceeds
therefrom, (c) any liability with respect to Environmental
Matters or (d) any actual or prospective claim, litigation,
investigation or proceeding relating to any of the foregoing,
whether based on contract, tort or any other theory and regardless
of whether any Indemnitee is a party thereto; provided that
such indemnity shall not, as to any Indemnitee, be available to the
extent that such losses, claims, damages or liabilities
(i) are determined by a court of competent jurisdiction by
final and nonappealable judgment to have resulted from the bad
faith, gross negligence or willful misconduct of such Indemnitee or
breach of its obligations under this Agreement or (ii) result
from a change in the market value of the Notes.
8.3 Waiver of Punitive Damages . To the
extent permitted by Applicable Law, none of the Company or any of
its Subsidiaries shall assert, and each hereby waives, any claim
against any Indemnitee, on any theory of liability, for special,
indirect, consequential or punitive damages (as opposed to direct
or actual damages) arising out of, in connection with, or as a
result of, this Agreement or any agreement or instrument
contemplated hereby, the Transactions, any Transaction Document,
the Notes or the use of the proceeds thereof.
8.4 Survival . The obligations of the
Company and its Subsidiaries under this Section 8 will
survive the payment or transfer of any Note, the enforcement,
amendment or waiver of any provision of this Agreement and the
termination of this Agreement.
8.5 Tax Treatment of Indemnification
Payments . Any indemnification payment pursuant to this
Agreement shall, to the extent permitted by applicable law, be
treated for federal, state, local and foreign Tax purposes as an
adjustment to the Purchase Price.
9.1 Disclosure of Transactions and Other
Material Information . On the fourth Business Day after the
date hereof, the Company shall issue a press release and file a
Current Report on Form 8-K describing the terms of the transactions
contemplated by the Transaction Documents in the form required by
the Exchange Act and attaching the Transaction Documents (including
all attachments, the “ 8-K Filing ”). Without
the prior written consent of any applicable Purchaser, neither the
Company nor any of its Subsidiaries or Affiliates shall disclose
the name of such Purchaser in any filing (other than in the exhibit
index of and the exhibits to the 8-K Filing), announcement, release
or otherwise, except as otherwise required by any law, rule or
regulation applicable to the Company after consultation with such
Purchaser.
22
9.2 Notices . Except as otherwise
expressly provided herein, all notices and other communications
shall have been duly given and shall be effective (a) when
delivered, (b) when transmitted via telecopy (or other
facsimile device) to the number set out below if the sender on the
same day sends a confirming copy of such notice by a recognized
overnight delivery service (charges prepaid), (c) the day
following the day (except if not a Business Day then the next
Business Day) on which the same has been delivered prepaid to a
reputable national overnight air courier service for overnight
delivery or (d) the third Business Day following the day on
which the same is sent by certified or registered mail, postage
prepaid, in each case to the respective parties at the addresses
set forth below, or at such other address as such party may specify
by written notice to the other party hereto:
(a) if to a Purchaser or its nominee, to
such Purchaser or its nominee at the address specified for such
communications in Schedule 2.2 , with a copy to Fried,
Frank, Harris, Shriver & Jacobson LLP, One New York Plaza, New
York, New York 10004, or by facsimile at (212) 859-4000, in each
case addressed to the attention of Emil Buchman, Esq., or at such
other address as such Purchaser or its nominee shall have specified
to the Company in writing;
(b) if to the Company, to it at
(i) 3773 State Road, Cuyahoga Falls, Ohio 44223, or by
facsimile at (330) 922-2296, in each case addressed to the
attention of Thomas N. Chieffe and (ii) c/o Investcorp
International Inc., 280 Park Avenue, New York, New York 10017, or
by facsimile at (212) 329-6741, in each case addressed to the
attention of James Christopoulos, with a copy to Gibson, Dunn &
Crutcher LLP, 200 Park Avenue, 49 th Floor, New York, New York 10166-0193, or by
facsimile at (212) 351-4035, in each case addressed to Joerg
E. Esdorn, or at such other address as the Company shall have
specified to the Purchasers in writing.
9.3 Benefit of Agreement; Assignments and
Participations . This Agreement may not be assigned without the
express written consent of the Company and the Holders holding a
majority in principal amount of all outstanding Notes (which
consent may be granted or withheld in the sole discretion of the
Company or such Holders); provided , that a Purchaser may,
without such consent, assign its rights and obligations under this
Agreement to its affiliates in connection with a transfer of Notes
in accordance with the Indenture to such affiliate so long as such
affiliate agrees in writing to be bound by this Agreement as if it
were a Holder hereunder. Nothing set forth herein shall be
construed as or deemed to limit the right of the Purchasers to
transfer the Notes in accordance with the terms of the Indenture.
Notwithstanding the foregoing, the Purchasers may not transfer the
Notes unless the transferee agrees to be bound by the provisions of
Section 6.1(a) . In furtherance of the foregoing, in
the event that a Holder consents to the exchange of such
Holder’s Notes for Replacement Notes pursuant to Section
6.1(a) and, after such consent but prior to such exchange, such
Holder transfers its Notes such Holder’s election to exchange
its Notes for Replacement Notes shall be binding upon any such
transferee of such Notes.
23
9.4 No Waiver; Remedies Cumulative . No
failure or delay on the part of any party hereto in exercising any
right, power or privilege hereunder or under the Notes and no
course of dealing between the Company and any other party shall
operate as a waiver thereof; nor shall any single or partial
exercise of any right, power or privilege hereunder or under the
Notes preclude any other or further exercise thereof or the
exercise of any other right, power or privilege hereunder or
thereunder. The rights and remedies provided herein and in the
Notes are cumulative and not exclusive of any rights or remedies
that the parties would otherwise have. No notice to or demand on
the Company in any case shall entitle the Company to any other or
further notice or demand in similar or other circumstances or
constitute a waiver of the rights of the other parties hereto or
the Holders to any other or further action in any circumstances
without notice or demand.
9.5 Amendments, Waivers and Consents .
This Agreement may be amended, and the observance of any term
hereof may be waived (either retroactively or prospectively) with
(and only with) the written consent of the Company and the Holders
holding a majority in principal amount of all outstanding Notes. No
amendment or waiver of this Agreement will extend to or affect any
obligation, covenant or agreement, not expressly amended or waived
or thereby impair any right consequent thereon. As used herein, the
term this “ Agreement ” and references thereto
shall mean this Agreement as it may from time to time be amended,
supplemented or modified.
9.6 Counterparts . This Agreement may be
executed in any number of counterparts, each of which when so
executed and delivered shall be an original, but all of which shall
constitute one and the same instrument. It shall not be necessary
in making proof of this Agreement to produce or account for more
than one such counterpart. Each counterpart may consist of a number
of copies hereof, each signed by less than all, but together signed
by all, of the parties hereto. For the purposes of the Closing,
signatures transmitted via telecopy (or other facsimile device)
will be accepted as original signatures if the sender on the same
day sends a manually executed signature page by a recognized
overnight delivery service (charges prepaid).
9.7 Reproduction . This Agreement, the
other Transaction Documents and all documents relating hereto and
thereto, including, without limitation, (a) consents, waivers
and modifications that may hereafter be executed,
(b) documents received by the parties at the Closing (except
the Notes themselves), and (c) financial statements,
certificates and other information previously or hereafter
furnished in connection herewith, may be reproduced by any
photographic, photostatic, microfilm, microcard, miniature
photographic or other similar process and any original document so
reproduced may be destroyed. The parties agree and stipulate that,
to the extent permitted by Applicable Law, any such reproduction
shall be admissible in evidence as the original itself in any
judicial or administrative proceeding (whether or not the original
is in existence and whether or not such reproduction was made in
the regular course of business) and any enlargement, facsimile or
further reproduction of such reproduction shall likewise be
admissible in evidence. This Section 9.7 shall not
prohibit any party hereto from contesting any such reproduction to
the same extent that it could contest the original or from
introducing evidence to demonstrate the inaccuracy of any such
reproduction.
24
9.8 Headings . The headings of the
sections and subsections hereof are provided for convenience only
and shall not in any way affect the meaning or construction of any
provision of this Agreement.
9.9 Survival of Covenants and Indemnities
. All covenants and indemnities set forth herein shall survive the
execution and delivery of this Agreement, the issuance of the
Notes, and, except as otherwise expressly provided herein with
respect to covenants, the payment of principal of the Notes and any
other obligations hereunder.
9.10 Governing Law; Submission to
Jurisdiction; Venue .
(a) THIS AGREEMENT AND THE NOTES SHALL
BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH, AND THE RIGHTS OF THE
PARTIES SHALL BE GOVERNED BY, THE LAW OF THE STATE OF NEW YORK,
EXCLUDING CHOICE-OF-LAW PRINCIPLES OF THE LAW OF SUCH STATE THAT
WOULD REQUIRE THE APPLICATION OF THE LAWS OF A JURISDICTION OTHER
THAN SUCH STATE.
(b) If any action, proceeding or litigation
shall be brought by any Purchaser in order to enforce any right or
remedy under this Agreement or any of the Notes, the Company hereby
consents and will submit to the jurisdiction of any state or
federal court of competent jurisdiction sitting within the area
comprising the Southern District of New York on the date of this
Agreement. The Company hereby irrevocably waives any objection,
including, but not limited to, any objection to the laying of venue
or based on the grounds of forum non conveniens , which they
may now or hereafter have to the bringing of any such action,
proceeding or litigation in such jurisdiction. The Company further
agrees that it shall not bring any action, proceeding or litigation
arising out of this Agreement or the Notes in any state or federal
court other than any state or federal court of competent
jurisdiction sitting within the area comprising the Southern
District of New York on the date of this Agreement.
(c) The Company irrevocably consents to the
service of process of any of the aforementioned courts in any such
action, proceeding or litigation by the mailing of copies thereof
by registered or certified mail, postage prepaid, to the Company at
its address set forth in Section 9.2 , such service to
become effective thirty (30) days after such
mailing.
(d) Nothing herein shall affect the right
of each Purchaser to serve process in any other manner permitted by
law or to commence legal proceedings or otherwise proceed against
the Company in any other jurisdiction. If service of process is
made on a designated agent it should be made by either
(i) personal delivery or (ii) mailing a copy of summons
and complaint to the agent via registered or certified mail, return
receipt requested.
(e) THE COMPANY AND THE PURCHASERS
WAIVE ANY AND ALL RIGHTS IT MAY HAVE TO A TRIAL BY JURY IN RESPECT
OF ANY ACTION, PROCEEDING OR LITIGATION DIRECTLY OR INDIRECTLY
ARISING OUT OF, UNDER OR IN CONNECTION WITH, THIS AGREEMENT OR ANY
OF THE NOTES.
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9.11 Severability . If any provision of
this Agreement is determined to be illegal, invalid or
unenforceable, such provision shall be fully severable to the
extent of such illegality, invalidity or unenforceability and the
remaining provisions shall remain in full force and effect and
shall be construed without giving effect to the illegal, invalid or
unenforceable provisions.
9.12 Entirety . This Agreement together
with the other Transaction Documents represents the entire
agreement of the parties hereto and thereto, and supersedes all
prior agreements and understandings, oral or written, if any,
relating to the Transaction Documents or the transactions
contemplated herein or therein.
9.13 Survival of Representations and
Warranties . All representations and warranties made by the
Company herein shall survive the execution and delivery of this
Agreement, the issuance and transfer of all or any portion of the
Notes, and the payment of principal of the Notes, and any other
obligations hereunder, regardless of any investigation made at any
time by or on behalf of any Purchaser or any other Holder that is
an affiliate of any Purchaser.
9.14 Construction . Each covenant
contained herein shall be construed (absent express provision to
the contrary) as being independent of each other covenant contained
herein, so that compliance with any one covenant shall not (absent
such an express contrary provision) be deemed to excuse compliance
with any other covenant. Where any provision herein refers to
action to be taken by any Person, or which such Person is
prohibited from taking, such provision shall be applicable whether
such action is taken directly or indirectly by such Person, whether
or not expressly specified in such provision.
9.15 Incorporation . All Schedules
attached hereto are incorporated as part of this Agreement as if
fully set forth herein.
9.16 Intent to Limit Interest to Maximum
. In no event shall the interest rate payable on the Notes under
the Indenture, plus any other amounts paid by the Company to the
Purchasers in connection therewith, exceed the highest rate
permissible under law that a court of competent jurisdiction shall,
in the final determination, deem applicable. The Company and the
Purchasers, in executing and delivering this Agreement, intend
legally to agree upon the rate or rates of interest and the manner
of payment stated within the Indenture; provided ,
however , that, anything contained herein to the contrary
notwithstanding, if said rate or rates of interest or manner of
payment exceed the maximum allowable under Applicable Law, then,
ipso facto as of the date of this Agreement, the Company shall be
liable only for the payment of such maximum as allowed by law, and
payment received from the Company in excess of such legal maximum,
whenever received, shall be applied to reduce the principal balance
of any Notes then outstanding to the extent of such excess, or, if
such excess exceeds the then outstanding principal balance, such
excess shall be first set-off against any other amounts then due
and owing by the Company and then refunded to the
Company.
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9.17 Confidentiality . The parties hereto
agree to exercise their best efforts to keep any non-public
information delivered pursuant to this Agreement or the Indenture
confidential from Persons other than those employed by or engaged
by each party; provided that such engaged party agrees to
keep such non-public information confidential. This subsection
shall not apply to disclosures required to be made by the parties
to any regulatory or governmental agency or pursuant to legal
process. Notwithstanding the foregoing, (a) the parties hereto
may disclose to any and all persons the tax treatment and tax
structure of the transactions contemplated hereby and (b) at
any time that the Company is subject to Regulation FD of the
Commission (“ Regulation FD ”), the Company
will not be required to deliver any material non-public information
to any Purchaser unless and until such Purchaser has executed a
confidentiality agreement reasonably acceptable to the Company if
the Company is advised by counsel that the delivery of such
information to a Purchaser would require the public disclosure of
such information pursuant to Regulation FD.
9.18 No Personal Obligations .
Notwithstanding anything to the contrary contained herein or in any
Transaction Document, it is expressly understood and each Purchaser
expressly agrees that nothing contained herein or in any other
Transaction Document or in any other document contemplated hereby
or thereby (whether from a covenant, representation, warranty or
other provision herein or therein) shall create, or be construed as
creating, any personal liability of any stockholder, director,
officer, employee, agent, partner or Affiliate of the Company and
its Subsidiaries (excluding any such Person which is the Company or
any Subsidiary of the Company) in such Person’s capacity as
such or otherwise.
9.19 Home Office Payment . So long as a
Purchaser or its nominee shall be the Holder of any Note, and
notwithstanding anything contained in this Agreement, the Indenture
or such Note to the contrary, the Company will pay all sums
becoming due on such Note for principal, premium, if any, and
interest by such method and at the address specified for such
purpose in Schedule 2.2 or at such other address as such
Purchaser shall have from time to time specified to the Company in
writing for such purpose, without the presentation or surrender of
such Note or the making of any notation thereon, except that upon
written request of the Company made concurrently with or reasonably
promptly after payment or prepayment in full of any Note, such
Purchaser shall surrender such Note for cancellation reasonably
promptly after any such request, to the Company at its principal
executive office. Prior to any sale or other disposition of any
Note held by a Purchaser or its nominee, such Purchaser will, at
its election, either endorse thereon the amount of principal paid
thereon and the last date to which interest has been paid thereon
or surrender such Note to the Company in exchange for a new Note or
Notes pursuant to Section 2.06 of the Indenture. The Company
will afford the benefits of this Section 9.19 to any
Institutional Investor that is the direct or indirect transferee of
any Note purchased by a Purchaser under this Agreement and that has
made the same agreement relating to such Note as such Purchaser
made in this Section 9.19 . The term
“Purchaser” as used in this section shall include only
the Purchasers party hereto and any such Institutional Investor
that has made such agreement.
[S ignature pages follow
]
27
IN WITNESS WHEREOF, each of the parties hereto
has caused this Agreement to be duly executed and delivered as of
the date first written above.
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ASSOCIATED
MATERIALS, LLC
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By:
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/s/ Cynthia
Sobe
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Name:
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Cynthis
Sobe
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Title:
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Vice President,
Chief Financial Officer, Treasurer and Secretary
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PURCHASE
AGREEMENT SIGNATURE PAGE
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APOLLO
INVESTMENT CORPORATION
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By:
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Apollo
Investment Management, L.P., as Advisor
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By:
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ACC Management,
LLC, as its General Partner
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By:
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/s/ Rajay
Bagaria
Name: Rajay
Bagaria
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Title:
Partner
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THE
NORTHWESTERN MUTUAL LIFE INSURANCE COMPANY
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By:
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/s/ Richard A.
Strait
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Name: Richard
A. Strait
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Title: Its
Authorized Representative
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GOLDMAN, SACHS
& CO.
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By:
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/s/ Albert
Dombrowski
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Name: Albert
Dombrowski
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Title:
Authorized Signatory
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PURCHASE
AGREEMENT SIGNATURE PAGE
ASSOCIATED MATERIALS, LLC
THE SUBSIDIARY GUARANTORS
Dated as of June
[ ], 2009
DEUTSCHE BANK TRUST COMPANY
AMERICAS
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Page
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ARTICLE 1 Definitions and Incorporation by
Reference
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7
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SECTION 1.01. Definitions
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7
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SECTION 1.02. Other Definitions
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34
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SECTION 1.03. TIA Provisions
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35
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SECTION 1.04. Rules of Construction
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35
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35
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SECTION 2.01. Form and Dating
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35
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SECTION 2.02. Execution and
Authentication
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35
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SECTION 2.03. Registrar and Paying
Agent
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36
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SECTION 2.04. Paying Agent to Hold Money in
Trust
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36
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SECTION 2.05. Securityholder Lists
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37
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SECTION 2.06. Transfer and Exchange
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37
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SECTION 2.07. Replacement Securities
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37
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SECTION 2.08. Outstanding Securities
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38
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SECTION 2.09. Temporary Securities
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38
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SECTION 2.10. Cancellation
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38
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SECTION 2.11. Defaulted Interest
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39
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SECTION 2.12. CUSIP Numbers
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39
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39
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SECTION 3.01. Notices to Trustee
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39
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SECTION 3.02. Selection of Securities To Be
Redeemed
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39
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SECTION 3.03. Notice of Redemption
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40
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SECTION 3.04. Effect of Notice of
Redemption
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40
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SECTION 3.05. Deposit of Redemption
Price
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40
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SECTION 3.06. Securities Redeemed in
Part
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41
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41
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SECTION 4.01. Payment of Securities
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41
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SECTION 4.02. SEC Reports
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41
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SECTION 4.03. Limitations on
Indebtedness
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42
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SECTION 4.04. Limitation on Restricted
Payments
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42
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SECTION 4.05. Limitation on Restrictions on
Distributions from Restricted Subsidiaries
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49
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SECTION 4.06. Limitation on Sales of Assets and
Subsidiary Stock
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50
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SECTION 4.07. Limitation on Affiliate
Transactions
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53
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SECTION 4.08. Limitation on the Sale or Issuance
of Capital Stock of Restricted Subsidiaries
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54
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SECTION 4.09. Change of Control
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55
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SECTION 4.10. Future Guarantors
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56
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SECTION 4.11. Compliance Certificate
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56
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SECTION 4.12. Further Instruments and
Acts
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56
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SECTION 4.13. Dividend Blocker
Carveout
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56
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i
Table of Contents
(Continued)
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Page
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ARTICLE 5 Successor Company
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57
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SECTION 5.01. When Company May Merge or Transfer
Assets
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57
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ARTICLE 6 Defaults and Remedies
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58
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SECTION 6.01. Events of Default
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58
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SECTION 6.02. Acceleration
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60
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SECTION 6.03. Other Remedies
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61
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SECTION 6.04. Waiver of Past Defaults
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61
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SECTION 6.05. Control by Majority
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61
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SECTION 6.06. Limitation on Suits
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62
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SECTION 6.07. Rights of Holders To Receive
Payment
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62
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SECTION 6.08. Collection Suit by
Trustee
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62
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SECTION 6.09. Trustee May File Proofs of
Claim
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62
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62
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SECTION 6.11. Undertaking for Costs
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63
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SECTION 6.12. Waiver of Stay or Extension
Laws
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63
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64
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SECTION 7.01. Duties of Trustee
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64
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SECTION 7.02. Rights of Trustee
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65
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SECTION 7.03. Individual Rights of
Trustee
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66
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SECTION 7.04. Trustee’s
Disclaimer
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66
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SECTION 7.05. Notice of Defaults
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66
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SECTION 7.06. Reports by Trustee to
Holders
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66
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SECTION 7.07. Compensation and
Indemnity
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67
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SECTION 7.08. Replacement of Trustee
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67
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SECTION 7.09. Successor Trustee by
Merger
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68
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SECTION 7.10. Eligibility;
Disqualification
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69
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SECTION 7.11. Preferential Collection of Claims
Against Company
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69
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ARTICLE 8 Discharge of Indenture;
Defeasance
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69
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SECTION 8.01. Discharge of Liability on
Securities; Defeasance
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69
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SECTION 8.02. Conditions to
Defeasance
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70
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SECTION 8.03. Application of Trust
Money
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71
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SECTION 8.04. Repayment to Company
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71
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SECTION 8.05. Indemnity for Government
Obligations
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71
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SECTION 8.06. Reinstatement
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71
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72
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SECTION 9.01. Without Consent of
Holders
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72
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SECTION 9.02. With Consent of Holders
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73
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SECTION 9.03. Compliance with Trust Indenture
Act
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74
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SECTION 9.04. Revocation and Effect of Consents
and Waivers
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74
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SECTION 9.05. Notation on or Exchange of
Securities
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74
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ii
Table of Contents
(Continued)
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Page
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SECTION 9.06. Trustee To Sign
Amendments
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74
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SECTION 9.07. Payment for Consent
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74
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75
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SECTION 10.01. Agreement To
Subordinate
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75
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SECTION 10.02. Liquidation, Dissolution,
Bankruptcy
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75
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SECTION 10.03. Default on Senior Indebtedness of
the Company
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|
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76
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SECTION 10.04. Acceleration of Payment of
Securities
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77
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SECTION 10.05. When Distribution Must Be Paid
Over
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77
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SECTION 10.06. Subrogation
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77
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SECTION 10.07. Relative Rights
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77
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SECTION 10.08. Subordination May Not Be Impaired
by Company
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77
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SECTION 10.09. Rights of Trustee and Paying
Agent
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78
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SECTION 10.10. Distribution or Notice to
Representative
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78
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SECTION 10.11. Article 10 Not To Prevent
Events of Default or Limit Right to Accelerate
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78
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SECTION 10.12. Trust Moneys Not
Subordinated
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78
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SECTION 10.13. Trustee Entitled to
Rely
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78
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SECTION 10.14. Trustee To Effectuate
Subordination
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79
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SECTION 10.15. Trustee Not Fiduciary for Holders
of Senior Indebtedness of the Company
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79
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SECTION 10.16. Reliance by Holders of Senior
Indebtedness of the Company on Subordination Provisions
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79
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ARTICLE 11 Subsidiary Guaranties
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79
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SECTION 11.01. Guaranties
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79
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SECTION 11.02. Limitation on
Liability
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81
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SECTION 11.03. Successors and Assigns
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81
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82
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SECTION 11.05. Modification
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82
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SECTION 11.06. Release of Subsidiary
Guarantor
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82
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|
|
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ARTICLE 12 Subordination of Subsidiary
Guaranties
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82
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SECTION 12.01. Agreement To
Subordinate
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82
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SECTION 12.02. Liquidation, Dissolution,
Bankruptcy
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83
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SECTION 12.03. Default on Senior Indebtedness of
Subsidiary Guarantor
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83
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SECTION 12.04. Demand for Payment
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|
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84
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SECTION 12.05. When Distribution Must Be Paid
Over
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|
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84
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SECTION 12.06. Subrogation
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|
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84
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SECTION 12.07. Relative Rights
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|
|
85
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SECTION 12.08. Subordination May Not Be Impaired
by Company
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85
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SECTION 12.09. Rights of Trustee and Paying
Agent
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|
|
85
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SECTION 12.10. Distribution or Notice to
Representative
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|
|
86
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SECTION 12.11. Article 12 Not To Prevent
Events of Default or Limit Right To Demand Payment
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|
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86
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SECTION 12.12. Trustee Entitled To
Rely
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|
|
86
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SECTION 12.13. Trustee To Effectuate
Subordination
|
|
|
86
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|
SECTION 12.14. Trustee Not Fiduciary for Holders
of Senior Indebtedness of Subsidiary Guarantor
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|
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86
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SECTION 12.15. Reliance by Holders of Senior
Indebtedness of Subsidiary Guarantors on Subordination
Provisions
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87
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iii
Table of Contents
(Continued)
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Page
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|
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|
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87
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SECTION 13.01. Trust Indenture Act
Controls
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87
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87
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|
SECTION 13.03. Communication by Holders with
Other Holders
|
|
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88
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SECTION 13.04. Certificate and Opinion as to
Conditions Precedent
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|
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88
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SECTION 13.05. Statements Required in
Certificate or Opinion
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|
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88
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SECTION 13.06. When Securities
Disregarded
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|
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89
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SECTION 13.07. Rules by Trustee
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|
|
89
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|
SECTION 13.08. Legal Holidays
|
|
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89
|
|
SECTION 13.09. GOVERNING LAW; WAIVER OF JURY
TRIAL
|
|
|
89
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|
SECTION 13.10. No Recourse Against
Others
|
|
|
89
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|
SECTION 13.11. Successors
|
|
|
90
|
|
SECTION 13.12. Multiple Originals
|
|
|
90
|
|
SECTION 13.13. Table of Contents;
Headings
|
|
|
90
|
|
SECTION 13.14. No Adverse Interpretations of
Other Agreements
|
|
|
90
|
|
SECTION 13.15. Force Majeure
|
|
|
90
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|
SECTION 13.16. U.S.A. Patriot Act
|
|
|
90
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iv
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|
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TIA
|
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Indenture
|
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Section
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|
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Section
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(a)
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|
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7.10
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|
(a)(3)
|
|
|
N.A.
|
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|
|
(a)(4)
|
|
|
N.A.
|
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(b)
|
|
|
7.03, 7.08, 7.10
|
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(b)(1)
|
|
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7.10
|
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(c)
|
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N.A.
|
|
|
|
|
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7.03
|
|
|
|
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(a)
|
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7.11
|
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(b)
|
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|
7.11
|
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(c)
|
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N.A.
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(a)
|
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2.05
|
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(b)
|
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13.03
|
|
|
|
|
(c)
|
|
|
13.03
|
|
|
|
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(a)
|
|
|
7.06
|
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|
(b)(1)
|
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N.A.
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(b)
|
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7.06
|
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(c)
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N.A.
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(d)
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N.A.
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(a)
|
|
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4.02
|
|
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|
|
(a)(4)
|
|
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4.11
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(b)
|
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N.A.
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(c)(1)
|
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N.A.
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(c)(2)
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N.A.
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|
(c)(3)
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N.A.
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(d)
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N.A.
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(e)
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N.A.
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(f)
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N.A.
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(a)
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7.01
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(b)
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N.A.
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(c)
|
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N.A.
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(d)
|
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N.A.
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|
|
(e)
|
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N.A.
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|
|
(a)(last
sentence)
|
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N.A.
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|
|
(a)(1)(A)
|
|
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N.A.
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|
|
(a)(1)(B)
|
|
|
N.A.
|
|
|
|
|
(a)(2)
|
|
|
N.A.
|
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|
|
(b)
N
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|
|
.A.
|
|
|
|
|
(a)(1)
|
|
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N.A.
|
|
|
|
|
(a)(2)
|
|
|
N.A.
|
|
|
|
|
(b)
N
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|
|
.A.
|
|
|
|
|
(a)
N
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|
|
.A.
|
|
5
Rule 144A/Regulation S
Appendix
Exhibit 1
— Form of Security
Exhibit 2
— Affiliate Subordination Agreement
6
INDENTURE dated as of June [
], 2009, among ASSOCIATED MATERIALS,
LLC, a Delaware limited liability company (the
“Company”), the Subsidiary Guarantors and DEUTSCHE BANK
TRUST COMPANY AMERICAS, a New York banking corporation, as trustee
(the “Trustee”).
Each party agrees as follows for the benefit of
the other parties and for the equal and ratable benefit of the
Holders of the Company’s Securities.
Definitions and Incorporation by
Reference
SECTION 1.01.
Definitions.
“Additional Assets”
means:
(1) any property, plant, equipment or other
assets used or usable in a Related Business;
(2) the Capital Stock of a Person that
becomes a Restricted Subsidiary as a result of the acquisition of
such Capital Stock by the Company or another Restricted Subsidiary;
or
(3) Capital Stock constituting a minority
interest in any Person that at such time is a Restricted
Subsidiary;
provided,
however, that any such Restricted Subsidiary described in clause
(2) or (3) above is primarily engaged in a Related
Business.
“Affiliate” of any specified Person
means any other Person, directly or indirectly, controlling or
controlled by or under direct or indirect common control with such
specified Person. For the purposes of this definition,
“control” when used with respect to any Person means
the power to direct the management and policies of such Person,
directly or indirectly, whether through the ownership of voting
securities, by contract or otherwise; and the terms
“controlling” and “controlled” have
meanings correlative to the foregoing. For purposes of
Sections 4.04 and 4.07 only, “Affiliate” shall
also mean any beneficial owner of Capital Stock representing 10% or
more of the total voting power of the Voting Stock (on a fully
diluted basis) of the Company or of rights or warrants to purchase
such Capital Stock (whether or not currently exercisable) and any
Person who would be an Affiliate of any such beneficial owner
pursuant to the first sentence hereof.
“Affiliate Subordinated
Indebtedness” means Subordinated Obligations of the Company
or any Restricted Subsidiary issued to and held by a Person that is
an Affiliate of the Company immediately prior to its incurrence
that (a) has a stated maturity and provides for no payment of
the principal of or cash interest or premium, if any, thereof,
prior to six months after the Stated Maturity of the Securities and
(b) is contractually subordinated and junior in right of
payment to the prior payment in full in cash of all Obligations of
the Company under the Securities and this Indenture pursuant to a
subordination agreement substantially in the form of Exhibit 2
or otherwise as acceptable to the holders of a majority in
principal amount of the Securities.
7
“AMH” means AMH Holdings, LLC, a
Delaware limited liability company, and its successors.
“AMH Exchange Notes” means notes or
other Indebtedness of the Company issued in exchange for the
Existing AMH Notes, and in each case, if applicable, other
consideration in exchange for, or the net proceeds of which are
used to Refinance, all or a portion of the Existing AMH
Notes.
“AMH Restricted Subsidiary” means a
“Restricted Subsidiary” of AMH as that term is used in
the Existing AMH Indenture.
“AMH
II” means AMH Holdings II, Inc. a Delaware corporation, and
its successors.
“AMI Exchange Notes” means
(a) notes or other Indebtedness and any other consideration of
the Company issued in exchange for the Existing AMI Notes;
(b) the Existing AMI Notes, after any amendment to the terms
and conditions thereof or of the Existing AMI Indenture, and
(c) in each case, if applicable, other consideration in
exchange for, or the net proceeds of which are used to Refinance,
all or a portion of the Existing AMI Notes.
“Asset Disposition” means any sale,
lease (other than operating leases entered into in the ordinary
course of business), transfer or other disposition (or series of
related sales, leases, transfers or dispositions) by the Company or
any Restricted Subsidiary, including any disposition by means of a
merger, consolidation or similar transaction (each referred to for
the purposes of this definition as a “disposition”),
of
(1) any shares of Capital Stock of a
Restricted Subsidiary (other than directors’ qualifying
shares or shares required by applicable law to be held by a Person
other than the Company or a Restricted Subsidiary);
(2) all or substantially all the assets of
any division or line of business of the Company or any Restricted
Subsidiary; or
(3) any other assets of the Company or any
Restricted Subsidiary outside of the ordinary course of business of
the Company or such Restricted Subsidiary,
other than, in
the case of clauses (1), (2) and (3) above,
(A) a disposition or transfer by a
Restricted Subsidiary to the Company or by the Company or a
Restricted Subsidiary to a Restricted Subsidiary;
(B) for purposes of Section 4.06 only,
(x) a disposition that constitutes a Restricted Payment
permitted by Section 4.04 or a Permitted Investment or
(y) a disposition of all or substantially all the assets of
the Company in accordance with Section 5.01;
8
(C) sales or other dispositions of
obsolete, uneconomical, negligible, damaged, worn-out or surplus
assets in the ordinary course of business (including but not
limited to equipment, inventory and intellectual
property);
(D) a disposition of assets with a fair
market value of less than or equal to $1.0 million, not to exceed
$5.0 million in the aggregate in any 12 month
period;
(E) sale or discount of accounts receivable
in connection with the compromise or collection thereof;
(F) sale or exchange of equipment in
connection with the purchase or other acquisition of equipment;
and
(G) sales or grants of licenses to use
intellectual property;
provided,
however, that a disposition of all or substantially all the assets
of the Company and its Restricted Subsidiaries taken as a whole
will be governed by the provisions of this Indenture described
under Section 4.09 and/or the provisions described under
Section 5.01 and not by the provisions described under
Section 4.06.
“Attributable Debt” in respect of a
Sale/Leaseback Transaction means, as at the time of determination,
the present value (discounted at the interest rate borne by the
Securities, compounded annually) of the total obligations of the
lessee for rental payments during the remaining term of the lease
included in such Sale/Leaseback Transaction (including any period
for which such lease has been extended); provided, however, that if
such Sale/Leaseback Transaction results in a Capital Lease
Obligation, the amount of Indebtedness represented thereby will be
determined in accordance with the definition of “Capital
Lease Obligation.”
“Average Life” means, as of the date
of determination, with respect to any Indebtedness, the quotient
obtained by dividing
(1) the sum of the products of the numbers
of years from the date of determination to the dates of each
successive scheduled principal payment of or redemption or similar
payment with respect to such Indebtedness multiplied by the amount
of such payment by
(2) the sum of all such
payments.
“Bank Facilities” means the bank
facilities under the Credit Agreement as in effect on April 23,
2002.
“Bank
Indebtedness” means all Obligations pursuant to the Credit
Agreement.
“Board of Directors” with respect to
a Person means the Board of Directors of such Person or any
committee thereof duly authorized to act on behalf of such
Board.
9
“Business
Day” means each day which is not a Legal Holiday.
“Capital Lease Obligation” means an
obligation that is required to be classified and accounted for as a
capital lease for financial reporting purposes in accordance with
GAAP, and the amount of Indebtedness represented by such obligation
shall be the capitalized amount of such obligation determined in
accordance with GAAP; and the Stated Maturity thereof shall be the
date of the last payment of rent or any other amount due under such
lease prior to the first date upon which such lease may be
terminated by the lessee without payment of a penalty.
“Capital Stock” of any Person means
any and all shares, interests, rights to purchase, warrants,
options, participations or other equivalents of or interests in
(however designated) equity of such Person, including any Preferred
Stock, but excluding any debt securities convertible into such
equity.
“Change
of Control” means the occurrence of any of the following
events:
(1) any “person” (as such term
is used in Sections 13(d) and 14(d) of the Exchange Act), other
than (directly or indirectly) one or more Permitted Holders, is or
becomes the beneficial owner (as defined in Rules 13d-3 and
13d-5 under the Exchange Act, except that such person shall be
deemed to have “beneficial ownership” of all shares
that any such person has the right to acquire, whether such right
is exercisable immediately or only after the passage of time, and
except that in the case of a “group” pursuant to
Rule 13d-5(b)(1) of the Exchange Act which group includes one
or more Permitted Holders (or one or more Permitted Holders are
deemed to share beneficial ownership with one or more other Persons
of any shares of Voting Stock), (i) such “group”
shall be deemed not to have beneficial ownership of any shares held
by a Permitted Holder forming a part of such group and
(ii) any Person (other than a Permitted Holder) that is a
member of such group (or sharing such beneficial ownership) shall
be deemed not to have beneficial ownership of any shares held by a
Permitted Holder that is a part of such group (or in which such
person shares beneficial ownership)), directly or indirectly, of
more than 35% of the total voting power of the Voting Stock of the
Company; provided, however, that the Permitted Holders beneficially
own (as defined in Rules 13d-3 and 13d-5 under the Exchange
Act), directly or indirectly, in the aggregate a lesser percentage
of the total voting power of the Voting Stock of the Company than
such other person and do not have the right or ability by voting
power, contract or otherwise to elect or designate for election a
majority of the Board of Directors of the Company (for the purposes
of this clause (1), (a) such other person shall be deemed to
beneficially own any Voting Stock of a specified Person held by a
parent entity if (and any such parent entity shall be deemed to
beneficially own such Voting Stock only if) such other person is
the beneficial owner (as defined in this provision), directly or
indirectly, of more than 35% of the voting power of the Voting
Stock of such parent entity and the Permitted Holders beneficially
own (as defined in this provision), directly or indirectly, in the
aggregate a lesser percentage of the voting power of the Voting
Stock of such parent entity and do not have the right or ability by
voting power, contract or otherwise to elect or designate for
election a majority of the Board of Directors of such parent
entity);
10
(2) individuals who upon the Issue Date
constituted the Board of Directors of the Company or Parent
(together with any new directors whose election by such Board of
Directors of the Company of the Parent Board or whose nomination
for election by the shareholders of the Company or the Parent, as
the case may be, was approved by a vote of a majority of the
directors of the Company or the Parent, as the case may be, then
still in office who were either directors on the Issue Date or
whose election or nomination for election was previously so
approved) cease for any reason to constitute a majority of the
Board of Directors of the Company or the Parent then in
office;
(3) the adoption of a plan relating to the
liquidation or dissolution of the Company;
(4) the merger or consolidation of the
Company with or into another Person or the merger of another Person
with or into the Company, or the sale of all or substantially all
the assets of the Company to another Person (other than a Person
that is controlled by the Permitted Holders), and, in the case of
any such merger or consolidation, the securities of the Company
that are outstanding immediately prior to such transaction and
which represent 100% of the aggregate voting power of the Voting
Stock of the Company are changed into or exchanged for cash,
securities or property, unless pursuant to such transaction such
securities are changed into or exchanged for, in addition to any
other consideration, securities of the surviving corporation that
represent immediately after such transaction, at least a majority
of the aggregate voting power of the Voting Stock of the surviving
corporation; or
(5) while any Existing AMI Notes remain
outstanding, a “Change of Control” as defined under the
Existing AMI Indenture has occurred that requires the Company to
purchase Existing AMI Notes pursuant to Section 4.09 of the
Existing AMI Indenture and such requirement has not been
waived.
“Code” means the Internal Revenue
Code of 1986, as amended.
“Company” means the party named as
such in this Indenture until a successor replaces it and,
thereafter, means the successor.
“Company Order” means a written
order from the Company to the Trustee requesting the Trustee to
authenticate the Securities.
“Consolidated Coverage Ratio” as of
any date of determination means the ratio of (x) the aggregate
amount of EBITDA for the period of the most recent four consecutive
fiscal quarters for which internal financial statements are
available on or prior to the date of such determination to
(y) Consolidated Interest Expense for such four fiscal
quarters; provided, however, that:
(1) if the Company or any Restricted
Subsidiary has Incurred any Indebtedness since the beginning of
such period that remains outstanding or if the transaction giving
rise to the need to calculate the Consolidated Coverage Ratio is an
Incurrence of Indebtedness, or both, EBITDA and Consolidated
Interest Expense for such period shall be calculated after giving
effect on a pro forma basis to such Indebtedness as if such
Indebtedness had been Incurred on the first day of such period
(and, if such Indebtedness is revolving Indebtedness, the amount of
Indebtedness deemed to be outstanding for such period shall be the
average outstanding amount of such Indebtedness during such
period);
11
(2) if the Company or any Restricted
Subsidiary has repaid, repurchased, defeased or otherwise
discharged any Indebtedness since the beginning of such period or
if any Indebtedness is to be repaid, repurchased, defeased or
otherwise discharged (in each case other than Indebtedness Incurred
under any revolving credit facility unless such Indebtedness has
been permanently repaid and has not been replaced) on the date of
the transaction giving rise to the need to calculate the
Consolidated Coverage Ratio, EBITDA and Consolidated Interest
Expense for such period shall be calculated on a pro forma basis as
if such discharge had occurred on the first day of such period and
as if the Company or such Restricted Subsidiary had not earned the
interest income actually earned during such period in respect of
cash or Temporary Cash Investments used to repay, repurchase,
defease or otherwise discharge such Indebtedness;
(3) if since the beginning of such period
the Company or any Restricted Subsidiary shall have made any Asset
Disposition, EBITDA for such period shall be reduced by an amount
equal to EBITDA (if positive) attributable to the assets which are
the subject of such Asset Disposition for such period, or increased
by an amount equal to EBITDA (if negative), attributable thereto
for such period and Consolidated Interest Expense for such period
shall be reduced by an amount equal to the Consolidated Interest
Expense attributable to any Indebtedness of the Company or any
Restricted Subsidiary repaid, repurchased, defeased or otherwise
discharged with respect to the Company and its continuing
Restricted Subsidiaries in connection with such Asset Disposition
for such period (or, if the Capital Stock of any Restricted
Subsidiary is sold, the Consolidated Interest Expense for such
period attributable to the Indebtedness of such Restricted
Subsidiary to the extent the Company and its continuing Restricted
Subsidiaries are no longer liable for such Indebtedness after such
sale);
(4) if since the beginning of such period
the Company or any Restricted Subsidiary (by merger or otherwise)
shall have made an Investment in any Restricted Subsidiary (or any
person which becomes a Restricted Subsidiary) or an acquisition of
assets, including any acquisition of assets occurring in connection
with a transaction requiring a calculation to be made hereunder,
which constitutes all or substantially all of an operating unit of
a business, EBITDA and Consolidated Interest Expense for such
period shall be calculated after giving pro forma effect thereto
(including the Incurrence of any Indebtedness) as if such
Investment or acquisition occurred on the first day of such period;
and
(5) if since the beginning of such period
any Person (that subsequently became a Restricted Subsidiary or was
merged with or into the Company or any Restricted Subsidiary since
the beginning of such period) shall have made any Asset
Disposition, any Investment or acquisition of assets that would
have required an adjustment pursuant to clause (3) or (4)
above if made by the Company or a Restricted Subsidiary during such
period, EBITDA and Consolidated Interest Expense for such period
shall be calculated after giving pro forma effect thereto as if
such Asset Disposition, Investment or acquisition occurred on the
first day of such period.
12
For purposes of
this definition, whenever pro forma effect is to be given to an
acquisition of assets (including Capital Stock), the amount of
income or earnings relating thereto and the amount of Consolidated
Interest Expense associated with any Indebtedness Incurred in
connection therewith, the pro forma calculations shall be
determined in accordance with Regulation S-X under the
Exchange Act or as otherwise acceptable to the SEC. If any
Indebtedness bears a floating rate of interest and is being given
pro forma effect, the interest on such Indebtedness shall be
calculated as if the rate in effect on the date of determination
had been the applicable rate for the entire period (taking into
account any Interest Rate Agreement applicable to such Indebtedness
if such Interest Rate Agreement has a remaining term in excess of
12 months).
“Consolidated Interest Expense”
means, for any period, the total interest expense of the Company
and its consolidated Restricted Subsidiaries, plus, to the extent
not included in such total interest expense, and to the extent
Incurred by the Company or its Restricted Subsidiaries, without
duplication,
(1) interest expense attributable to
Capital Lease Obligations and the interest expense attributable to
leases constituting part of a Sale/Leaseback
Transaction;
(2) amortization of debt discount and debt
issuance cost (to the extent not excluded under clause (a) of
the proviso below);
(3) capitalized interest;
(4) non-cash interest expense;
(5) commissions, discounts and other fees
and charges owed with respect to letters of credit and
bankers’ acceptance financing;
(6) net payments or receipts pursuant to
Hedging Obligations;
(7) dividends declared and paid in cash or
Disqualified Stock in respect of (A) all Preferred Stock of
Restricted Subsidiaries and (B) all Disqualified Stock of the
Company, in each case held by Persons other than the Company or a
Wholly Owned Subsidiary and, in each case, excluding dividends
payable in Qualified Stock;
(8) interest incurred in connection with
Investments in discontinued operations;
(9) interest accruing on any Indebtedness
of any other Person (other than a Subsidiary) to the extent such
Indebtedness is Guaranteed by (or secured by the assets of) the
Company or any Restricted Subsidiary and such Indebtedness is
accelerated or any payment is actually made in respect of such
Guarantee; and
13
(10) the cash contributions to any employee
stock ownership plan or similar trust to the extent such
contributions are used by such plan or trust to pay interest or
fees to any Person (other than the Company or a Restricted
Subsidiary thereof) in connection with Indebtedness Incurred by
such plan or trust,
and less, to
the extent included in such interest expense, (a) the
amortization during such period of debt issuance costs; provided,
however, that the aggregate amount of amortization relating to any
such debt issuance costs deducted in calculating Consolidated
Interest Expense shall not exceed 5.0% of the aggregate amount of
the financing giving rise to such debt issuance costs and
(b) the write-off of debt issuance costs and debt discount
paid in connection with any early extinguishment of Indebtedness
during such period.
“Consolidated Net Income” means, for
any period, the sum of (1) net income of the Company and its
Subsidiaries and (2) to the extent deducted in calculating net
income of the Company and its Subsidiaries, any non-recurring fees,
expenses or charges related to the Transactions or any Note
Refinancing ; provided, however, that there shall not be included
in such Consolidated Net Income:
(1) any net income of any Person (other
than the Company) if such Person is not a Restricted Subsidiary,
except that:
(A) subject to the exclusion contained in
clause (3) below, the Company’s equity in the net income
of any such Person for such period shall be included in such
Consolidated Net Income up to the aggregate amount of cash actually
distributed by such Person during such period to the Company or a
Restricted Subsidiary as a dividend or other distribution (subject,
in the case of a dividend or other distribution paid to a
Restricted Subsidiary, to the limitations contained in clause
(2) below); and
(B) the Company’s equity in a net
loss of any such Person for such period shall be included in
determining such Consolidated Net Income;
(2) any net income of any Restricted
Subsidiary if such Restricted Subsidiary is subject to
restrictions, directly or indirectly, on the payment of dividends
or the making of distributions by such Restricted Subsidiary,
directly or indirectly, to the Company, except that:
(A) subject to the exclusion contained in
clause (3) below, the Company’s equity in the net income
of any such Restricted Subsidiary for such period shall be included
in such Consolidated Net Income up to the aggregate amount of cash
that could have been distributed by such Restricted Subsidiary
during such period to the Company or another Restricted Subsidiary
as a dividend or other distribution (subject, in the case of a
dividend or other distribution paid to another Restricted
Subsidiary, to the limitation contained in this clause);
and
(B) the Company’s equity in a net
loss of any such Restricted Subsidiary for such period shall be
included in determining such Consolidated Net Income;
14
(3) any gain or loss (and the related tax
effects) realized upon the sale or other disposition of any assets
of the Company, its consolidated Restricted Subsidiaries or any
other Person (including pursuant to any sale-and-leaseback
arrangement) which is not sold or otherwise disposed of in the
ordinary course of business and any gain or loss realized upon the
sale or other disposition of any Capital Stock of any
Person;
(4) extraordinary, non-cash or
non-recurring gains, losses or charges, including (i) those
related to impairment of goodwill and other intangible assets,
(ii) the write-off of capitalized financing costs and related
premiums paid in connection with any early extinguishment of
Indebtedness and the related tax effects, and (iii) any gains,
losses or charges relating to any Note Refinancing;
(5) the cumulative effect of a change in
accounting principles; and
(6) any net income or loss attributable to
discontinued operations.
Notwithstanding
the foregoing, for the purposes of Section 4.04 only, there
shall be excluded from Consolidated Net Income any repurchases,
repayments or redemptions of Investments, proceeds realized on the
sale of Investments or return of capital to the Company or a
Restricted Subsidiary to the extent such repurchases, repayments,
redemptions, proceeds or returns increase the amount of Restricted
Payments permitted under Section 4.04(a)(3)(D).
“Credit Agreement” means the Credit
Agreement dated as of April 19, 2002, by and among the
Company, the lenders referred to therein, UBS AG, Stamford Branch,
as Administrative Agent, Credit Suisse First Boston, as Syndication
Agent, and CIBC World Markets Corp., as Documentation Agent,
together with the related documents thereto (including any
guarantees and security documents, whether in effect on
April 23, 2002 or entered into thereafter), as amended,
extended, renewed, restated, supplemented or otherwise modified.
For the avoidance of doubt, within the meaning of “Credit
Agreement” shall be the Loan and Security Agreement, dated as
of October 3, 2008, by and among the Company and Gentek
Building Products, Inc., as U.S. Borrowers, Gentek Building
Products Limited, as Canadian Borrower, Associated Materials
Holdings, Gentek Holdings, LLC and Alside, Inc., as guarantors, the
lenders and issuing bank from time to time party thereto, Wachovia
Bank, National Association, as administrative and collateral agent,
Wachovia Capital Markets, LLC and CIT Capital Securities, LLC, as
joint lead arrangers and joint lead bookrunners, and The CIT
Group/Business Credit, Inc., as syndication agent, as amended,
extended, renewed, restated, supplemented or otherwise
modified.
“Credit Facilities” means, with
respect to the Company and its Restricted Subsidiaries, one or more
debt facilities (including under the Credit Agreement) or
commercial paper facilities with banks, insurance companies or
other institutional lenders providing for revolving credit loans,
term loans, notes, factoring or other receivables financing
(including through the sale of receivables to such lenders or to
special purpose entities formed to borrow from or issue securities
to such lenders against such receivables) or letters of credit or
other credit facilities, in each case, as amended, modified,
supplemented, increased or restated from time to time, or refunded,
refinanced, restructured, replaced, renewed, repaid or extended
from time to time (whether with the original agents and lenders or
other agents or lenders or otherwise, and whether provided under
the original credit agreement or other credit agreements or
otherwise).
15
“Currency Agreement” means in
respect of a Person any foreign exchange contract, currency swap
agreement or other similar agreement designed to protect such
Person against fluctuations in currency values.
“Default” means any event which is,
or after notice or passage of time or both would be, an Event of
Default.
“Designated Senior Indebtedness”,
with respect to a Person, means
(1) the Bank Indebtedness; and
(2) any other Senior Indebtedness of such
Person which, at the date of determination, has an aggregate
principal amount outstanding of, or under which, at the date of
determination, the holders thereof are committed to lend up to, at
least $25.0 million and is specifically designated by such
Person in the instrument evidencing or governing such Senior
Indebtedness as “Designated Senior Indebtedness” for
purposes of this Indenture.
“Disqualified Stock” means, with
respect to any Person, that portion of any Capital Stock which by
its terms (or by the terms of any security into which it is
convertible or for which it is exchangeable at the option of the
holder) or upon the happening of any event:
(1) matures (excluding any maturity as a
result of an optional redemption by the issuer thereof) or is
mandatorily redeemable (other than redeemable only for Capital
Stock of such Person which is not itself Disqualified Stock)
pursuant to a sinking fund obligation or otherwise;
(2) is convertible or exchangeable at the
option of the holder for Indebtedness or Disqualified Stock;
or
(3) is mandatorily redeemable or must be
purchased upon the occurrence of certain events or otherwise, in
whole or in part;
in each case on
or prior to the date that is 91 days after the Stated Maturity
of the Securities; provided, however, that if such Capital Stock is
issued to any employee or to any plan for the benefit of employees
of the Company or its Subsidiaries or by any such plan to such
employees, such Capital Stock shall not constitute Disqualified
Stock solely because it may be required to be repurchased by the
Company in order to satisfy obligations as a result of such
employee’s death or disability; and provided, further,
however, that any Capital Stock that would not constitute
Disqualified Stock but for provisions thereof giving holders
thereof the right to require such Person to purchase or redeem such
Capital Stock upon the occurrence of an “asset sale” or
“change of control” occurring prior to the date that is
91 days after the Stated Maturity of the Securities shall not
constitute Disqualified Stock if the “asset sale” or
“change of control” provisions applicable to such
Capital Stock are not more favorable to the holders of such Capital
Stock than the terms applicable to the Securities in
Section 4.06 and 4.09 of this Indenture.
16
The amount of any Disqualified Stock that does
not have a fixed redemption, repayment or repurchase price shall be
calculated in accordance with the terms of such Disqualified Stock
as if such Disqualified Stock were redeemed, repaid or repurchased
on any date on which the amount of such Disqualified Stock is to be
determined pursuant to this Indenture; provided, however, that if
such Disqualified Stock could not be required to be redeemed,
repaid or repurchased at the time of such determination, the
redemption, repayment or repurchase price shall be the book value
of such Disqualified Stock as reflected in the most recent
financial statements of such Person.
“EBITDA” for any period means the
sum of Consolidated Net Income, plus the following to the extent
deducted in calculating such Consolidated Net Income:
(1) all income tax expense of the Company
and its consolidated Restricted Subsidiaries;
(2) Consolidated Interest
Expense;
(3) depreciation and amortization expense
of the Company and its consolidated Restricted Subsidiaries
(excluding amortization expense attributable to a prepaid operating
activity item that was paid in cash in a prior period);
and
(4) all other non-cash charges of the
Company and its consolidated Restricted Subsidiaries (excluding any
such non-cash charge to the extent that it represents an accrual of
or reserve for cash expenditures in any future period);
in each case
for such period determined in accordance with GAAP. Notwithstanding
the foregoing, the provision for taxes based on the income or
profits of, and the depreciation and amortization and non-cash
charges of, a Restricted Subsidiary shall be added to Consolidated
Net Income to compute EBITDA only to the extent (and in the same
proportion, including by reason of minority interest) that the net
income of such Restricted Subsidiary was included in calculating
Consolidated Net Income and only if a corresponding amount would be
permitted at the date of determination to be dividended to the
Company by such Restricted Subsidiary without prior approval (that
has not been obtained), pursuant to the terms of its charter and
all agreements, instruments, judgments, decrees, orders, statutes,
rules and governmental regulations applicable to such Restricted
Subsidiary or its stockholders. In addition, to the extent reducing
EBITDA for any period, all costs and charges directly relating to
the Transactions and the Note Refinancing shall be
excluded.
“Equity Financing” means the
financing by Parent of at least $172.0 million of equity
capital to provide a portion of the funds for the Equity Tender
Offer and the Merger.
“Equity Offering” means a primary
offering of common stock or common equity of Parent or the
Company.
“Equity Tender Offer” means the cash
tender offer for 100% of the shares of common stock of the Company
at a price of $50.00 per share.
“Exchange Act” means the U.S.
Securities Exchange Act of 1934, as amended.
17
“Existing
AMH II Notes” means AMH II’s 13.625% Senior Notes Due
2014.
“Existing AMH Indenture” means the
Indenture dated as of March 4, 2004, between AMH and
Wilmington Trust Company, as trustee.
“Existing
AMH Notes” means AMH’s 11 1/4% Senior Discount Notes
Due 2014.
“Existing
AMI Notes” means the Company’s 9
3 / 4
% Senior Subordinated Notes Due
2012.
“Existing AMI Indenture” means the
Indenture dated as of April 23, 2002, among the Company and
Wilmington Trust Company, as trustee, as amended.
“GAAP” means generally accepted
accounting principles in the United States of America as in effect
as of April 23, 2002, including those set forth in
(1) the opinions and pronouncements of the
Accounting Principles Board of the American Institute of Certified
Public Accountants;
(2) statements and pronouncements of the
Financial Accounting Standards Board;
(3) such other statements by such other
entity as approved by a significant segment of the accounting
profession; and
(4) the rules and regulations of the SEC
governing the inclusion of financial statements (including pro
forma financial statements) in periodic reports required to be
filed pursuant to Section 13 of the Exchange Act, including
opinions and pronouncements in staff accounting bulletins and
similar written statements from the accounting staff of the
SEC.
All ratios and
computations based on GAAP contained in this Indenture shall be
computed in conformity with GAAP.
“Guarantee” means any obligation,
contingent or otherwise, of any Person directly or indirectly
guaranteeing any Indebtedness of any Person and any obligation,
direct or indirect, contingent or otherwise, of such
Person
(1) to purchase or pay (or advance or
supply funds for the purchase or payment of) such Indebtedness of
such Person (whether arising by virtue of partnership arrangements,
or by agreements to keep-well, to purchase assets, goods,
securities or services, to take-or-pay or to maintain financial
statement conditions or otherwise); or
(2) entered into for the purpose of
assuring in any other manner the obligee of such Indebtedness of
the payment thereof or to protect such obligee against loss in
respect thereof (in whole or in part);
18
provided,
however, that the term “Guarantee” shall not include
endorsements for collection or deposit in the ordinary course of
business. The term “Guarantee” used as a verb has a
corresponding meaning.
“Guaranty” means each Subsidiary
Guaranty, as applicable.
“Guaranty Agreement” means a
supplemental indenture, in a form satisfactory to the Trustee,
pursuant to which a Subsidiary Guarantor guarantees the
Company’s obligations with respect to the Securities on the
terms provided for in this Indenture.
“Harvest Management Services
Agreement” means the management agreement, dated as of
April 19, 2002 between Harvest Partners, Inc. and the Company
entered into in connection with the Transaction.
“Hedging Obligations” of any Person
means the obligations of such Person pursuant to any Interest Rate
Agreement or Currency Agreement or similar Agreement.
“Holder” or
“Securityholder” means the Person in whose name a
Security is registered on the Registrar’s books.
“Holding Companies” means Parent,
AMH and AMH II or any other direct or indirect parent of the
Company.
“Incur” means issue, assume,
Guarantee, incur or otherwise become liable for; provided, however,
that any Indebtedness or Capital Stock of a Person existing at the
time such Person becomes a Restricted Subsidiary (whether by
merger, consolidation, acquisition or otherwise) shall be deemed to
be Incurred by such Person at the time it becomes a Restricted
Subsidiary. The term “Incurrence” when used as a noun
shall have a correlative meaning.
“Indebtedness” means, with respect
to any Person on any date of determination (without
duplication):
(1) the principal in respect of
(A) indebtedness of such Person for borrowed money and
(B) indebtedness evidenced by notes, debentures, bonds or
other similar instruments for the payment of which such Person is
responsible or liable, including, in each case, any premium on such
indebtedness to the extent such premium has become due and
payable;
(2) all Capital Lease Obligations of such
Person and all Attributable Debt in respect of Sale/Leaseback
Transactions entered into by such Person;
(3) all obligations of such Person issued
or assumed as the deferred purchase price of property, all
conditional sale obligations of such Person and all obligations of
such Person under any title retention agreement (but excluding
trade accounts payable arising in the ordinary course of
business);
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(4) all obligations of such Person for the
reimbursement of any obligor on any letter of credit,
bankers’ acceptance or similar credit transaction (other than
obligations with respect to letters of credit securing obligations
(other than obligations described in clauses (1) through
(3) above) entered into in the ordinary course of business of
such Person to the extent such letters of credit are not drawn upon
or, if and to the extent drawn upon, such drawing is reimbursed no
later than the tenth Business Day following payment on the letter
of credit);
(5) the amount of all obligations of such
Person with respect to the redemption, repayment or other
repurchase of any Disqualified Stock of such Person or, with
respect to any Preferred Stock of any Subsidiary of such Person,
the principal amount of such Preferred Stock to be determined in
accordance with this Indenture (but excluding, in each case, any
accrued dividends);
(6) all obligations of the type referred to
in clauses (1) through (5) of other Persons and all
dividends of other Persons for the payment of which, in either
case, such Person is responsible or liable, directly or indirectly,
as obligor, guarantor or otherwise, including by means of any
Guarantee;
(7) all obligations of the type referred to
in clauses (1) through (6) of other Persons secured by
any Lien on any property or asset of such Person (whether or not
such obligation is assumed by such Person), the amount of such
obligation being deemed to be the lesser of the value of such
property or assets and the amount of the obligation so secured;
and
(8) to the extent not otherwise included in
this definition, Hedging Obligations of such Person.
The amount of Indebtedness of any Person at any
date shall be the outstanding balance at such date of all
unconditional obligations as described above and the maximum
liability, upon the occurrence of the contingency giving rise to
the obligation, of any contingent obligations at such date;
provided, however, that in the case of Indebtedness sold at a
discount, the amount of such Indebtedness at any time will be the
accreted value thereof at such time.
“Indenture” means this Indenture as
amended or supplemented from time to time.
“Independent Qualified Party” means
an investment banking firm, accounting firm or appraisal firm of
national standing; provided, however, that such firm is not an
Affiliate of the Company.
“Interest Rate Agreement” means the
obligations of any Person pursuant to any arrangement with any
other Person, whereby, directly or indirectly, such Person is
entitled to receive from time to time periodic payments calculated
by applying either a floating or a fixed rate of interest on a
stated notional amount in exchange for periodic payments made by
such other Person calculated by applying a fixed or a floating rate
of interest on the same notional amount and shall include interest
rate swaps, caps, floors, collars and similar agreements to protect
such Person against fluctuations in interest rates.
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“Investcorp Management Services
Agreements” means (i) the Agreement for Management
Advisory, Strategic Planning and Consulting Services, dated as of
December 22, 2004, between Investcorp International Inc. and
the Company, (ii) the Financing Advisory Services Agreement,
dated as of December 22, 2004, between Investcorp
International Inc. and the Company, and (iii) M&A Advisory
Services Agreement, dated as of December 5, 2004, between
Investcorp International Inc. and the Company |