Exhibit 10.1
EXECUTION COPY
THE GREENBRIER COMPANIES, INC.,
AUTOSTACK COMPANY LLC,
GREENBRIER-CONCARRIL, LLC,
GREENBRIER LEASING COMPANY LLC,
GREENBRIER LEASING LIMITED PARTNER, LLC,
GREENBRIER MANAGEMENT SERVICES, LLC,
GREENBRIER LEASING, L.P.,
GREENBRIER RAILCAR LLC,
XXXXXXXXX LLC,
GUNDERSON MARINE LLC,
XXXXXXXXX RAIL SERVICES LLC AND
GUNDERSON SPECIALTY PRODUCTS, LLC
$85,000,000
2.375% Convertible Senior Notes due 2026
PURCHASE AGREEMENT
dated May 17, 2006
BEAR, XXXXXXX & CO. INC.
BANC OF AMERICA SECURITIES LLC
PURCHASE AGREEMENT
May 17, 2006
BEAR, XXXXXXX & CO. INC.
BANC OF AMERICA SECURITIES LLC
c/o Bear, Xxxxxxx & Co. Inc.
000 Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
The Greenbrier Companies, Inc., an Oregon corporation (the "Company"),
and the Guarantors (as defined below) hereby confirm their agreement with you
(the "Initial Purchasers"), as set forth below.
1. The Transactions. Subject to the terms and conditions herein
contained, the Company proposes to issue and sell to the Initial Purchasers
$85,000,000 aggregate principal amount of its 2.375% Convertible Senior Notes
due 2026 (the "Firm Notes"). In addition, the Company has granted to the Initial
Purchasers an option to purchase up to an additional $15,000,000 aggregate
principal amount of its 2.375% Convertible Senior Notes due 2026 (the "Optional
Notes" and, together with the Firm Notes and the Guarantees (as defined below)
endorsed thereon, the "Notes"). The Notes shall be convertible into shares (the
"Conversion Shares") of common stock, without par value, of the Company (the
"Common Stock"), subject to and in accordance with the terms of the Notes. The
Notes will (i) have the terms and provisions which are described in the Offering
Memorandum (as defined below) under the heading "Description of Notes" and
contained in the Indenture (as hereinafter defined) and (ii) be issued pursuant
to the provisions of the Indenture (the "Indenture"), to be dated as of May 22,
2006, among the Company, the Guarantors (as defined below) and U.S. Bank
National Association, a national banking association organized under the laws of
the United States, as trustee (the "Trustee"). The Notes and the Conversion
Shares are hereinafter referred to collectively as the "Securities."
The sale of the Notes to the Initial Purchasers (the "Offering") will
be made without registration of the Securities under the Securities Act of 1933,
as amended (together with the rules and regulations of the Securities and
Exchange Commission (the "Commission") promulgated thereunder, the "Securities
Act"), in reliance upon the exemption therefrom provided by Section 4(2) of the
Securities Act.
In connection with the sale of the Notes, the Company has prepared a
preliminary offering memorandum dated May 15, 2006 (the "Preliminary Offering
Memorandum") and an offering memorandum dated the date hereof (the "Offering
Memorandum"), each setting forth information regarding the Company, the
Securities and the terms of the Offering and the transactions contemplated by
the Offering Documents (as defined below). For purposes of this Agreement, "Time
of Sale Memorandum" means the Preliminary Offering Memorandum together with the
information set forth on Exhibit E to this Agreement. The Time of Sale
Memorandum and the Offering Memorandum will incorporate by reference the
Company's (i) Annual Report on Form 10-K for the year ended August 31, 2005,
(ii) Quarterly Reports on Form 10-Q for the quarters ended November 30, 2005 and
February 28, 2006, and (iii) Current Reports on Form 8-K filed with the
Commission on November 10, 2005, November 16, 2005, December 1, 2005, January
12, 2006, January 26, 2006, March 2, 2006, March 2, 2006, April 13, 2006, May
12, 2006 and May 15, 2006 (other than information in the documents that is
deemed not to be filed with the Commission) (all such documents listed in
clauses (i) through (iii) referred to herein as the "Incorporated Documents").
Any references herein to the Time of Sale Memorandum or the Offering Memorandum
shall be deemed to include, in each case, all amendments and supplements thereto
and the Incorporated Documents and any amendments thereto as of the date of such
Time of Sale Memorandum or Offering Memorandum, as the case may be. The Company
hereby confirms that the Preliminary Offering Memorandum and the Offering
Memorandum may be used in connection with the offering and resale of the Notes
by the Initial Purchasers.
The Company understands that the Initial Purchasers propose to make an
offering of the Notes only on the terms and in the manner set forth in the
Offering Memorandum and Sections 3, 4 and 10 hereof as soon as the Initial
Purchasers deem advisable after this Agreement has been executed and delivered,
to persons in the United States whom the Initial Purchasers reasonably believe
to be qualified institutional buyers ("QIBs") as defined in Rule 144A under the
Securities Act, as such rule may be amended from time to time ("Rule 144A"), in
transactions under Rule 144A.
The Initial Purchasers and their direct and indirect transferees of
the Notes will be entitled to the benefits of the Registration Rights Agreement
to be dated as of May 22, 2006 among the parties hereto (the "Registration
Rights Agreement") pursuant to which the Company and the Guarantors will agree,
among other things, to use their reasonable best efforts to (i) file a
registration statement (the "Registration Statement") on the appropriate form
with the Commission registering the resale of the Securities under the
Securities Act and (ii) cause any such Registration Statement to be declared
effective.
The payment of principal of, premium and Additional Interest (as
defined in the Registration Rights Agreement), if any, and interest on the Notes
will be fully and unconditionally guaranteed on a senior unsecured basis,
jointly and severally, by (i) Autostack Company LLC, an Oregon limited liability
company, Greenbrier-Concarril, LLC, a Delaware limited liability company,
Greenbrier Leasing Company LLC, an Oregon limited liability company, Greenbrier
Leasing Limited Partner, LLC, a Delaware limited liability company, Greenbrier
Management Services, LLC, a Delaware limited liability company, Greenbrier
Leasing, L.P., a Delaware limited partnership, Greenbrier Railcar LLC, an Oregon
limited liability company, Xxxxxxxxx LLC, an Oregon limited liability company,
Gunderson Marine LLC, an Oregon limited liability company, Xxxxxxxxx Rail
Services, LLC, a Oregon limited liability company and Gunderson Specialty
Products, LLC, a Delaware limited liability company, and (ii) any Domestic
Subsidiary that is not an Immaterial Subsidiary (as each such term is defined in
the
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Indenture) of the Company formed or acquired after the Closing Date (as
hereinafter defined) that executes an additional guarantee in accordance with
the terms of the Indenture, and their respective successors and assigns
(collectively, the "Guarantors"), pursuant to their guarantees (the
"Guarantees").
This Agreement, the Securities, the Registration Rights Agreement and
the Indenture are herein referred to as the "Offering Documents."
2. Representations and Warranties of the Company and Guarantors. Each
of the Company and the Guarantors, jointly and severally, hereby represents, and
warrants to and agrees with the Initial Purchasers that:
(a) The Time of Sale Memorandum does not, and the Offering
Memorandum, as of its date, as of the Closing Date and as of the Additional
Closing Date, if any (each as defined in Section 3 hereof), does not and
will not, and any supplement or amendment to them will not, contain any
untrue statement of a material fact or omit to state a material fact
necessary in order to make the statements therein, in light of the
circumstances under which they were made, not misleading, except that the
representations and warranties contained in this paragraph shall not apply
to statements in or omissions from the Time of Sale Memorandum or the
Offering Memorandum made in reliance upon and in conformity with
information (as set forth in Section 16) furnished to the Company in
writing by the Initial Purchasers expressly for use in the Time of Sale
Memorandum or the Offering Memorandum or any amendment or supplement
thereto. The Time of Sale Memorandum and the Offering Memorandum with
respect to the Notes have been or will be prepared by the Company for use
by the Initial Purchasers in connection with the Offering. No stop order
preventing the use of the Time of Sale Memorandum or the Offering
Memorandum or any amendment or supplement thereto, or any order asserting
that any of the transactions contemplated by this Agreement are subject to
the registration requirements of the Securities Act, has been issued and no
proceeding for that purpose has commenced or is pending or, to the
knowledge of the Company, is contemplated. Each of the Preliminary Offering
Memorandum, the Offering Memorandum and any amendment or supplement thereto
complied or will comply in all material respects with Rule 144A(d)(4) under
the Securities Act.
(b) Subsequent to the date as of which information is given in
the Time of Sale Memorandum, except as disclosed in the Time of Sale
Memorandum, the Company has not declared, paid or made any dividends (other
than the dividend declared and paid by the Company during its second
quarter) or other distributions of any kind on or in respect of its capital
stock and there has been no material adverse change or effect or any
development involving a prospective material adverse change or effect,
whether or not arising from transactions in the ordinary course of
business, in or affecting (i) the business, condition (financial or
otherwise), results of operations, stockholders' equity, properties or
prospects of the Company and each subsidiary of the Company (the
"Subsidiaries"), taken as a whole, (ii) the long-term debt or capital stock
of the
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Company or any of its Subsidiaries or (iii) the ability of the Company to
consummate the Offering or any other transaction contemplated by the
Offering Documents (a "Material Adverse Effect"). Since the date of the
latest balance sheet included or incorporated by reference in the Time of
Sale Memorandum, neither the Company nor any Subsidiary has incurred or
undertaken any liability or obligation, whether direct or indirect,
liquidated or contingent, matured or unmatured, or entered into any
transaction, including any acquisition or disposition of any business or
asset, which is material to the Company and the Subsidiaries individually
or taken as a whole, except for liabilities, obligations and transactions
which are reflected in the Time of Sale Memorandum or the acquisition,
disposition or leasing of railcars in the ordinary course of business and
excluding changes to information contained in the Time of Sale Memorandum
that is effected by the final price of the Notes or any increase in the
aggregate principal amount of the Notes.
(c) The authorized, issued and outstanding capital stock of the
Company is as set forth in the Time of Sale Memorandum or the Offering
Memorandum under the caption "Description of Capital Stock." All of the
issued and outstanding shares of capital stock of the Company are fully
paid and non-assessable and have been duly authorized and validly issued,
in compliance with all applicable state, federal and foreign securities
laws and not in violation of or subject to any preemptive or similar right
that does or will entitle any person, upon the issuance or sale of any
security, to acquire from the Company or any Subsidiary any capital stock
or other security of the Company or any Subsidiary or any security
convertible into, or exercisable or exchangeable for, capital stock or any
other such security (any "Relevant Security"), except for such rights as
may have been fully satisfied or waived prior to the date of the Time of
Sale Memorandum.
(d) The Company has authorized the issuance of and reserved, and
covenants to continue to reserve, free of any preemptive or similar rights,
a sufficient number of authorized but unissued shares of Common Stock, to
satisfy the conversion rights of the Notes and issue the Conversion Shares.
The Conversion Shares have been duly authorized for issuance upon
conversion of the Notes, are sufficient in number to meet the current
conversion requirements and, upon conversion of the Notes in accordance
with their terms and the Indenture, will be issued free of statutory and
contractual preemptive rights, and the Conversion Shares, when so issued,
will be validly issued and fully paid and non-assessable, will be issued in
compliance with all applicable state, federal and foreign securities laws,
will not be issued in violation of or subject to any preemptive or similar
right that does or will entitle any person to acquire any Relevant Security
from the Company or any Subsidiary upon issuance or sale of the Notes or
the Conversion Shares, and will not be subject to any restriction upon the
voting or transfer thereof pursuant to applicable law or the Company's
articles of incorporation, bylaws or governing documents or any agreement
to which the Company or any of the Subsidiaries is a party or by which any
of them may be bound.
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(e) The Common Stock (including the Conversion Shares) conforms
to the descriptions thereof contained in the Offering Memorandum (or, if
the Offering Memorandum is not in existence, the most recent Preliminary
Offering Memorandum). Except as disclosed in the Time of Sale Memorandum,
neither the Company nor any Subsidiary has outstanding warrants, options to
purchase, or any preemptive rights or other rights to subscribe for or to
purchase, or any contracts or commitments to issue or sell, any Relevant
Security. All corporate action required to be taken by the Company for the
issuance and delivery of the Conversion Shares has been duly and validly
taken. Except as disclosed in the Time of Sale Memorandum, there are no
outstanding subscriptions, rights, warrants, options, calls, convertible
securities, commitments of sale or rights related to or entitling any
person to purchase or otherwise to acquire any shares of, or any security
convertible into or exchangeable or exercisable for, the capital stock of,
or other ownership interest in, the Company or the Subsidiaries.
(f) The Subsidiaries listed in Exhibit A are the only
subsidiaries (within the meaning of Rule 405 under the Securities Act) or
joint ventures of the Company, except for entities that when taken together
would not constitute a "significant subsidiary" within the meaning of Rule
102 of Regulation S-X. Except for the Subsidiaries and as otherwise
disclosed in the Time of Sale Memorandum, the Company holds no ownership or
other interest, nominal or beneficial, direct or indirect, in any
corporation, partnership, joint venture or other business entity. All of
the issued shares of capital stock of or other ownership interests in each
Subsidiary have been duly authorized and validly issued and are fully paid
and non-assessable. All of the issued shares of capital stock or other
ownership interests in each Subsidiary or in the case of the entities
listed on Exhibit B, such shares or ownership interest representing the
percentage of the voting control of the Subsidiary set forth next to the
name of the Subsidiary on Exhibit B, are owned directly or indirectly by
the Company free and clear of any lien, charge, mortgage, pledge, security
interest, claim, equity, trust or other encumbrance, preferential
arrangement, defect or restriction of any kind whatsoever (any "Lien").
(g) Each of the Company and the Subsidiaries has been duly
organized or formed and validly exists as a corporation, partnership or
limited liability company in good standing under the laws of its
jurisdiction of organization or formation. Each of the Company and the
Subsidiaries is duly qualified to do business and is in good standing as a
foreign corporation, partnership or limited liability company in each
jurisdiction in which the character or location of its properties (owned,
leased or licensed) or the nature or conduct of its business makes such
qualification necessary, except for those failures to be so qualified or in
good standing which (individually and in the aggregate) could not
reasonably be expected to have a Material Adverse Effect. Each of the
Company and the Subsidiaries has all requisite corporate (or other entity)
power and authority, and, except as could not reasonably be expected to
have a Material Adverse Effect, all necessary consents, approvals,
authorizations, orders,
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registrations, qualifications, licenses, filings and permits of, with and
from all judicial, regulatory and other legal or governmental agencies and
bodies and all third parties, foreign and domestic (collectively, the
"Consents"), to own, lease and operate its properties and conduct its
business as it is now being conducted and as described in the Time of Sale
Memorandum, and each such Consent is valid and in full force and effect,
and neither the Company nor any Subsidiary has received notice of any
investigation or proceedings which has resulted in or, if decided adversely
to the Company or any Subsidiary, could reasonably be expected to result
in, the revocation of, or imposition of a materially burdensome restriction
on, any such Consent. Each of the Company and the Subsidiaries is in
compliance with all applicable laws, rules, regulations, ordinances,
directives, judgments, decrees and orders, foreign and domestic, except
where failure to be in compliance could not reasonably be expected to have
a Material Adverse Effect. No Consent contains a materially burdensome
restriction not adequately disclosed in the Time of Sale Memorandum.
(h) The Company has the requisite corporate power and authority
to execute, deliver and perform its obligations under the Notes. The Notes
have been duly authorized by the Company for issuance and, when executed by
the Company and authenticated by the Trustee in accordance with the
provisions of the Indenture and when delivered to and paid for by the
Initial Purchasers in accordance with the terms hereof, will have been duly
executed, issued and delivered and will constitute valid and legally
binding obligations of the Company, entitled to the benefits of the
Indenture and enforceable against the Company in accordance with their
terms except that the enforcement thereof may be limited by (i) bankruptcy,
insolvency, reorganization, moratorium or other similar laws now or
hereafter in effect relating to or affecting creditors' rights generally
and (ii) general principles of equity (regardless of whether such
enforcement is considered in a proceeding at law or in equity) ((i) and
(ii) collectively, the "Enforceability Exceptions"). At the Closing Date,
the Notes will be in the form contemplated by the Indenture.
(i) Each Guarantor has the requisite limited liability company or
limited partnership (as applicable) power and authority to execute, deliver
and perform its obligations under the Guarantees. The Guarantees have been
duly authorized by each of the Guarantors and, when the Notes have been
executed, authenticated and issued in accordance with the terms of the
Indenture and delivered to and paid for by the Initial Purchasers in
accordance with the terms hereof, the Guarantees will constitute valid and
legally binding obligations of each of the Guarantors, entitled to the
benefits of the Indenture and enforceable against each of the Guarantors in
accordance with their terms except that the enforcement thereof may be
limited by the Enforceability Exceptions.
(j) The Company and the Guarantors have the requisite corporate,
limited liability company or limited partnership (as applicable) power and
authority to execute, deliver and perform their obligations under the
Indenture. The Indenture has been duly authorized by the Company and the
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Guarantors and, on the Closing Date, will comply, in all material respects,
with the requirements of the Trust Indenture Act of 1939, as amended (the
"TIA," which term as used herein includes the rules and regulations of the
Commission promulgated thereunder), and the rules and regulations of the
Commission applicable to an indenture which is qualified thereunder, and,
when executed and delivered by the Company and the Guarantors (assuming the
due authorization, execution and delivery by the Trustee), will constitute
a valid and legally binding agreement of the Company and the Guarantors,
enforceable against the Company and the Guarantors in accordance with its
terms except that the enforcement thereof may be limited by the
Enforceability Exceptions.
(k) The Company and the Guarantors have the requisite corporate,
limited liability company or limited partnership (as applicable) power and
authority to execute, deliver and perform their obligations under the
Registration Rights Agreement. The Registration Rights Agreement has been
duly authorized by the Company and the Guarantors and, when duly executed
and delivered by the Company and the Guarantors (assuming the due
authorization, execution and delivery by the Initial Purchasers), will
constitute a valid and legally binding agreement of the Company and the
Guarantors, enforceable against the Company and the Guarantors in
accordance with its terms except that the enforcement thereof may be
limited by the Enforceability Exceptions and except that rights to
indemnity and contribution may be limited by applicable law or public
policy.
(l) The Company and the Guarantors have the requisite corporate,
limited liability company or limited partnership (as applicable) right,
power and authority to execute, deliver and perform their obligations under
this Agreement. This Agreement has been duly authorized, executed and
delivered by the Company and the Guarantors and (assuming the due
authorization, execution and delivery by the Initial Purchasers)
constitutes the legal, valid and binding obligation of the Company and the
Guarantors, enforceable against the Company and the Guarantors in
accordance with its terms, except that the enforcement thereof may be
limited by the Enforceability Exceptions.
(m) The execution, delivery, and performance of this Agreement
and the consummation of the transactions contemplated by the Offering
Documents do not and will not (i) conflict with, require a Consent under
(except for any Consent previously obtained or to be obtained prior to the
Closing Date) or result in a breach of any of the terms and provisions of,
or constitute a default (or an event which with notice or lapse of time, or
both, would constitute a default) under, or result in the creation or
imposition of any Lien upon any property or assets of the Company or any
Subsidiary pursuant to, any indenture, mortgage, deed of trust, loan
agreement or other agreement, instrument, franchise, license or permit to
which the Company or any Subsidiary is a party or by which the Company or
any Subsidiary or their respective properties, operations or assets may be
bound, (ii) violate or conflict with any provision of the certificate or
articles of incorporation, by-laws, certificate of formation, limited
liability
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company agreement or other organizational documents of the Company or any
Subsidiary or (iii) violate or conflict with any law, rule, regulation,
ordinance, directive, judgment, decree or order of any judicial, regulatory
or other legal or governmental agency or body, domestic or foreign, except
in the case of clauses (i) and (iii) above as could not reasonably be
expected to have a Material Adverse Effect.
(n) No Consent of, with or from any judicial, regulatory or other
legal or governmental agency or body or any third party, foreign or
domestic, is required for the execution, delivery and performance of this
Agreement or the consummation of the Offering and the other transactions
contemplated by the Offering Documents, including the issuance, sale and
delivery of the Notes (and the issuance of the Conversion Shares upon
conversion of the Notes) except (i) such Consents as may be required under
applicable state securities or blue sky laws, (ii) as regards the
effectiveness of the Registration Statement as contemplated by the
Registration Rights Agreement, and (iii) as regards the amendment of the
Company's credit facility, which consent shall be obtained prior to the
Closing Date.
(o) Except as disclosed in the Time of Sale Memorandum, there is
no judicial, regulatory, arbitral or other legal or governmental proceeding
or other litigation or arbitration, domestic or foreign, pending to which
the Company or any Subsidiary is a party or of which any property,
operations or assets of the Company or any Subsidiary is the subject which,
individually or in the aggregate, if determined adversely to the Company or
any Subsidiary, could reasonably be expected to have a Material Adverse
Effect; to the best of the Company's knowledge, no such proceeding,
litigation or arbitration is threatened or contemplated; and the defense of
all such proceedings, litigation and arbitration against or involving the
Company or any Subsidiary could not reasonably be expected to have a
Material Adverse Effect.
(p) The financial statements and any pro forma data, including
the notes thereto, and the supporting schedules included or incorporated by
reference in the Time of Sale Memorandum present fairly the financial
position as of the dates indicated and the cash flows and results of
operations for the periods specified of the Company and its consolidated
subsidiaries and the other entities for which financial statements are
included or incorporated by reference in the Time of Sale Memorandum;
except as otherwise stated in the Time of Sale Memorandum, said financial
statements have been prepared in conformity with United States generally
accepted accounting principles ("GAAP") applied on a consistent basis
throughout the periods involved; and the supporting schedules included in
the Time of Sale Memorandum present fairly the information required to be
stated therein. No other financial statements or supporting schedules which
would be required by the Securities Act, the Securities Exchange Act of
1934, as amended (together with the rules and regulations of the Commission
promulgated thereunder, the "Exchange Act") or the rules and regulations of
the Commission (the "Rules and Regulations") to be included in the Offering
Memorandum (or, if
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the Offering Memorandum is not in existence, the Time of Sale Memorandum)
if the Offering Memorandum (or, if the Offering Memorandum is not in
existence, the Time of Sale Memorandum) were a prospectus included in a
registration statement on Form S-1 filed pursuant to the Securities Act,
have not been so included. The other financial and statistical information
included or incorporated by reference in the Time of Sale Memorandum
presents fairly the information included therein and, except for non-GAAP
financial measures (as such term is defined in Item 10(e) of Regulation S-K
of the Rules and Regulations), non-financial operating data (which are
addressed below in this Section 2(p)) and market and industry data (which
are addressed below in Section 2(r)), have been prepared on a basis
consistent with that of the financial statements that are included or
incorporated by reference in the Time of Sale Memorandum and the books and
records of the respective entities presented therein and, to the extent
such information is a range, projection or estimate, is based on the good
faith belief and estimates of the management of the Company. The financial
information included in the Incorporated Documents has been derived from
the Company's consolidated financial statements included in the
Incorporated Documents or from the Company's accounting books and records
generally. The non-GAAP financial measures and non-financial operating data
(which terms do not include market or industry data) included or
incorporated by reference in the Time of Sale Memorandum have been derived
from, and are consistent with, the books and records of the Company and the
Subsidiaries.
(q) The Time of Sale Memorandum contains, if any, all pro forma
and as adjusted financial information and statements which are required to
be included or incorporated by reference in accordance with Regulation S-X
in the Offering Memorandum (or, if the Offering Memorandum is not in
existence, the Time of Sale Memorandum) if the Offering Memorandum (or, if
the Offering Memorandum is not in existence, the Time of Sale Memorandum)
were a prospectus included in a registration statement on Form S-1 filed
pursuant to the Securities Act. The pro forma and as adjusted financial
information and statements, if any, have been properly compiled and
prepared in accordance with the applicable requirements of the Securities
Act and the Exchange Act and includes all adjustments necessary to present
fairly in accordance with GAAP the pro forma and as adjusted financial
position of the respective entity or entities presented therein at the
respective dates indicated and their cash flows and the results of
operations for the respective periods specified.
(r) The statistical, industry-related and market-related data
included in the Time of Sale Memorandum (i) are based on or derived from
sources which the Company reasonably and in good faith believes are
reliable and accurate, and such data agree with the sources from which they
are derived, or (ii) with respect to the items set forth in Exhibit C
hereto, represent the Company's reasonable estimates determined in good
faith.
(s) Deloitte & Touche LLP, which has examined certain of such
financial statements as set forth in its reports included in the Time of
Sale
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Memorandum, is an independent public accounting firm as required by the
Securities Act and the Exchange Act.
(t) The Company is subject to the reporting requirements of
Section 13 or 15(d) of the Exchange Act and files reports with the
Commission on XXXXX. The Common Stock is registered pursuant to Section
12(b) of the Exchange Act and its outstanding shares of Common Stock are
listed on the New York Stock Exchange (the "NYSE"), and the Company has
taken no action designed to, or likely to have the effect of, terminating
the registration of its common stock under the Exchange Act or de-listing
its Common Stock from the NYSE, nor has the Company received any
notification that the Commission or the NYSE is contemplating terminating
such registration or listing.
(u) Except for the Current Reports on Form 8-K filed with the
Commission on December 1, 2005 and May 12, 2006, the Company has filed in a
timely manner each document or report required to be filed by it pursuant
to the Exchange Act during the 12 calendar months and any portion of a
month immediately preceding the date of this Agreement, including, without
limitation, the Incorporated Documents; each such document or report
(including any financial statements) and any amendment thereto at the time
it was filed conformed in all material respects to the requirements of the
Exchange Act; and none of such documents or reports contained (or, when
read together with the other information in the Time of Sale Memorandum, do
contain) an untrue statement of any material fact or omitted (or, when read
together with the other information in the Time of Sale Memorandum, do
omit) to state any material fact required to be stated therein or necessary
to make the statements therein, in light of the circumstances under which
they were made, not misleading, and at all times up to and including the
Closing Date (and if any Optional Notes are purchased, the Additional
Closing Date), will not contain an untrue statement of a material fact or
omit to state a material fact required to be stated therein or necessary in
order to make the statements therein, in the light of the circumstances
under which they were made, not misleading.
(v) The Company and the Subsidiaries maintain a system of
internal accounting and other controls sufficient to provide reasonable
assurances that (i) transactions are executed in accordance with
management's general or specific authorizations, (ii) transactions are
recorded as necessary to permit preparation of financial statements in
conformity with GAAP and to maintain accountability for assets, (iii)
access to assets is permitted only in accordance with management's general
or specific authorization and (iv) the recorded accounting for assets is
compared with existing assets at reasonable intervals and appropriate
action is taken with respect to any differences.
(w) Neither the Company nor any of its affiliates (within the
meaning of Rule 144 under the Securities Act) has taken, directly or
indirectly, any action which constitutes or is designed to cause or result
in, or which could reasonably be expected to constitute, cause or result
in, the stabilization or
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manipulation of the price of any security to facilitate the sale or resale
of the Notes.
(x) None of the Company or any of the Subsidiaries or any of
their respective affiliates (as defined in Rule 501(b) of Regulation D
under the Securities Act) directly, or through any agent (except that the
Company, the Subsidiaries, and their respective affiliates make no
representation or warranty as to the Initial Purchasers), (i) sold, offered
for sale, solicited offers to buy or otherwise negotiated in respect of any
"security" (as defined in the Securities Act) which is or could be
integrated with the sale of the Securities in a manner that would require
the registration under the Securities Act of the Securities or (ii) engaged
in any form of general solicitation or general advertising (as those terms
are used in Regulation D under the Securities Act) in connection with the
offering of the Securities. Assuming the accuracy of the Initial
Purchasers' representations and warranties set forth in Section 10 hereof,
the offer and sale of the Notes to the Initial Purchasers in the manner
contemplated by this Agreement and the Time of Sale Memorandum does not
require registration of the Notes under the Securities Act and the
Indenture does not require qualification under the TIA at the time of the
offer and sale of the Notes.
(y) Except as disclosed in the Time of Sale Memorandum, no holder
of any Relevant Security has any rights to require registration of any
Relevant Security as part or on account of, or otherwise in connection with
the Offering and any of the other transactions contemplated by the Offering
Documents, and any such rights so disclosed have either been fully complied
with by the Company or effectively waived by the holders thereof, and any
such waivers remain in full force and effect.
(z) There exists as of the date hereof (after giving effect to
the transactions contemplated by each of the Offering Documents) no event
or condition that would constitute a default or an event of default (in
each case as defined in each of the Offering Documents) under any of the
Offering Documents that would result in a Material Adverse Effect or
materially adversely affect the ability of the Company to consummate the
Offering and the other transactions contemplated by the Offering Documents.
(aa) Each of the Company and the Subsidiaries is not now and,
after sale of the Notes as contemplated hereunder and application of the
net proceeds of such sale as described in the Time of Sale Memorandum under
the caption "Use of Proceeds," will not be an "investment company" or be
controlled by an "investment company" within the meaning of the Investment
Company Act of 1940, as amended.
(bb) There are no contracts or other documents (including,
without limitation, any voting agreement), that would be required by the
Securities Act, the Exchange Act or the Rules and Regulations to be
described in the Offering Memorandum (or, if the Offering Memorandum is not
in existence,
12
the Time of Sale Memorandum) if the Offering Memorandum (or, if the
Offering Memorandum is not in existence, the Time of Sale Memorandum) were
a prospectus included in a registration statement on Form S-1 filed under
the Securities Act, which have not been so described. Except as described
in the Time of Sale Memorandum, none of the Company or any of the
Subsidiaries is in default under any of the contracts described in the Time
of Sale Memorandum, has received a notice or claim of any such default or
has knowledge of any breach of such contracts by the other party or parties
thereto, except such defaults or breaches as would not, individually or in
the aggregate, have a Material Adverse Effect.
(cc) No relationship, direct or indirect, exists between or among
any of the Company or any affiliate of the Company, on the one hand, and
any director, officer, stockholder, customer or supplier of the Company or
any affiliate of the Company, on the other hand, which would be required by
the Securities Act, the Exchange Act or the Rules and Regulations to be
described in the Offering Memorandum (or, if the Offering Memorandum is not
in existence, the Time of Sale Memorandum) if the Offering Memorandum (or,
if the Offering Memorandum is not in existence, the Time of Sale
Memorandum) were a prospectus included in a registration statement on Form
S-1 filed under the Securities Act, which have not been so described. There
are no outstanding loans, advances (except normal advances for business
expenses in the ordinary course of business) or guarantees of indebtedness
by the Company to or for the benefit of any of the officers or directors of
the Company or any of their respective family members, except as disclosed
in the Time of Sale Memorandum. The Company has not, in violation of the
Xxxxxxxx-Xxxxx Act, directly or indirectly, including through a Subsidiary,
extended or maintained credit, arranged for the extension of credit, or
renewed an extension of credit, in the form of a personal loan to or for
any director or executive officer of the Company.
(dd) Except as disclosed in the Time of Sale Memorandum, there
are no contracts, agreements or understandings between the Company and any
person that would give rise to a valid claim against the Company or any
Initial Purchaser for a brokerage commission, finder's fee or other like
payment in connection with the transactions contemplated by the Offering
Documents.
(ee) The Company and each Subsidiary owns or leases all such
properties as are necessary to the conduct of its business as presently
operated and as proposed to be operated as described in the Time of Sale
Memorandum. The Company and the Subsidiaries have good and marketable title
in fee simple to all real property and good and marketable title to all
personal property owned by them, in each case free and clear of all Liens
except such as are described in the Time of Sale Memorandum or such as do
not (individually or in the aggregate) materially affect the value of such
property or interfere with the use made or proposed to be made of such
property by the Company and the Subsidiaries; and any real property and
buildings held under lease or sublease by the Company and the Subsidiaries
are held by them under valid, subsisting and enforceable leases
13
with such exceptions as are not material to, and do not interfere with, the
use made and proposed to be made of such property and buildings by the
Company and the Subsidiaries. Neither the Company nor any Subsidiary has
received any notice of any claim adverse to its ownership of any real or
personal property or of any claim against the continued possession of any
real property, whether owned or held under lease or sublease by the Company
or any Subsidiary.
(ff) Each of the Company and the Subsidiaries (i) owns or
possesses adequate right to use all patents, patent applications,
trademarks, service marks, trade names, trademark registrations, service
mark registrations, copyrights, licenses, formulae, customer lists, and
know-how and other intellectual property (including trade secrets and other
unpatented and/or unpatentable proprietary or confidential information,
systems or procedures) (collectively, the "Intellectual Property")
necessary for or used in the conduct of their respective businesses as
being conducted and as described in the Time of Sale Memorandum and (ii)
except as would, if determined adversely to the Company or the
Subsidiaries, not have individually or in the aggregate, a Material Adverse
Effect, has no reason to believe that the conduct of their respective
businesses does or will infringe, misappropriate, violate or conflict with,
and have not received any notice of any claim of infringement,
misappropriation, violation or conflict with, any such right of others. To
the best of the Company's knowledge, all material technical information
developed by and belonging to the Company or any Subsidiary which has not
been patented has been kept confidential. Except as described in the Time
of Sale Memorandum, neither the Company nor any Subsidiary has granted or
assigned to any other person or entity any right to manufacture, have
manufactured, assemble or sell the current products and services of the
Company and the Subsidiaries or those products and services described in
the Time of Sale Memorandum. Except as would, if determined adversely to
the Company or the Subsidiaries, not have individually or in the aggregate,
a Material Adverse Effect, (x) the Company is not aware of any infringement
by third parties of any Intellectual Property of the Company or any
Subsidiary; (y) there is no pending or, to the Company's knowledge,
threatened action, suit, proceeding or claim by others challenging the
Company's or any Subsidiary's ownership of or rights in or to any such
Intellectual Property, and the Company is unaware of any facts which would
form a reasonable basis for any such claim; and (z) there is no pending or,
to the Company's knowledge, threatened action, suit, proceeding or claim by
others that the Company or any Subsidiary infringes, misappropriates or
otherwise violates any patent, trademark, copyright, trade secret or other
proprietary rights of others, and the Company is unaware of any fact that
would form a reasonable basis for any such claim. Neither the Company nor
any Subsidiary thereof is in breach of any license or other agreement that
relates to any Intellectual Property owned or used by the Company or any
Subsidiary and, to the Company's best knowledge, no other party to any such
agreement is in breach thereof.
(gg) The Company and the Subsidiaries maintain insurance in such
amounts and covering such risks as the Company reasonably considers
14
adequate for the conduct of its business and the value of its properties
and as is customary for companies engaged in similar businesses in similar
industries, all of which insurance is in full force and effect, except
where the failure to maintain such insurance could not reasonably be
expected to have a Material Adverse Effect. There are no material claims by
the Company or any Subsidiary under any such policy or instrument as to
which any insurance company is denying liability or defending under a
reservation of rights clause, except the insurer has issued a reservation
of rights letter in the litigation pending in Tarrant County, Texas that is
described under Item 3, "Legal Proceedings" in the Company's Annual Report
on Form 10-K for the year ended August 31, 2005, and Part II, Item 1,
"Legal Proceedings" in the Company's Quarterly Report on Form 10-Q for the
quarter ended February 28, 2006 incorporated by reference in the Time of
Sale Memorandum. The Company reasonably believes that it will be able to
renew its existing insurance as and when such coverage expires or will be
able to obtain replacement insurance adequate for the conduct of the
business and the value of its properties at a cost that would not have a
Material Adverse Effect.
(hh) The Company has in effect insurance covering the Company,
its directors and officers for liabilities or losses arising in connection
with this Offering, including, without limitation, liabilities or losses
arising under the Securities Act, the Exchange Act, the Rules and
Regulations and applicable foreign securities laws.
(ii) Each of the Company and the Subsidiaries has accurately
prepared and timely filed (including through permitted extensions) all
federal, state, foreign and other tax returns that are required to be filed
by it, except where the failure to file would not have a Material Adverse
Effect, and has paid or made provision for the payment of all taxes,
assessments, governmental or other similar charges, including without
limitation, all sales and use taxes and all taxes which the Company or any
Subsidiary is obligated to withhold from amounts owing to employees,
creditors and third parties, with respect to the periods covered by such
tax returns (whether or not such amounts are shown as due on any tax
return), except to the extent that any of such taxes, assessments or
charges are being contested in good faith. No deficiency assessment with
respect to a proposed adjustment of the Company's or any Subsidiary's
federal, state, local or foreign taxes is pending or, to the best of the
Company's knowledge, threatened. The accruals and reserves on the books and
records of the Company and the Subsidiaries in respect of tax liabilities
for any taxable period not finally determined are adequate to meet any
assessments and related liabilities for any such period and, since August
31, 2005, the Company and the Subsidiaries have not incurred any liability
for taxes other than in the ordinary course of its business. There is no
tax Lien, whether imposed by any federal, state, foreign or other taxing
authority, outstanding against the assets, properties or business of the
Company or any Subsidiary.
(jj) No labor disturbance by the employees of the Company or any
Subsidiary exists or, to the best of the Company's knowledge, is imminent
15
and the Company is not aware of any existing or imminent labor disturbances
by the subcontracted labor at the Company's facility in Xxxxxxx, Mexico or
the employees of any of its or any Subsidiary's principal suppliers,
manufacturers, customers or contractors, which, in either case
(individually or in the aggregate), could reasonably be expected to have a
Material Adverse Effect.
(kk) No nonexempt "prohibited transaction" (as defined in either
Section 406 of the Employee Retirement Income Security Act of 1974, as
amended, including the regulations and published interpretations thereunder
("ERISA") or Section 4975 of the Internal Revenue Code of 1986, as amended
from time to time (the "Code")) has occurred with respect to any employee
benefit plan for which the Company or any Subsidiary would have any
liability; each employee benefit plan for which the Company or any
Subsidiary would have any liability is in compliance in all material
respects with applicable law, including (without limitation) ERISA and the
Code; neither the Company nor any Subsidiary has nor has it maintained any
employee benefit plans as such term is defined in Section 3(3) of ERISA
that are subject to Title IV of ERISA; and each plan for which the Company
would have any liability that is intended to be qualified under Section
401(a) of the Code has received a favorable determination letter from the
IRS as to its qualification is so qualified and nothing has occurred,
whether by action or by failure to act, which would reasonably be expected
to cause the loss of such qualification.
(ll) The execution, delivery, and performance of this Agreement
and the consummation of the transactions contemplated by the Offering
Documents do not and will not involve any prohibited transaction within the
meaning of Section 406 of ERISA or Section 4975 of the Internal Revenue
Code of 1986.
(mm) Except as disclosed in the Time of Sale Memorandum with
respect to the Portland Harbor Superfund Site and the ongoing soil and
groundwater remediation at the Xxxxxxxxx, Portland facility, and except as
could not reasonably be expected to have a Material Adverse Effect:
(i) Neither the Company nor any Subsidiary has unlawfully
released any hazardous substance in a manner likely to give rise to
any liability under any applicable law, rule, regulation, order,
judgment, decree or permit relating to pollution or protection of
human health and safety and environment ("Environmental Law").
(ii) Neither the Company nor any Subsidiary has agreed
contractually to indemnify any past or current owner or operator of
any property currently owned or operated by the Company or any
Subsidiary, for liability related to such prior ownership or operation
of such property, under any Environmental Law, including any
obligation for cleanup or remedial action.
16
(iii) There is no pending or, to the best of the Company's
knowledge, threatened administrative, regulatory or judicial action,
claim or notice of noncompliance or violation, investigation or
proceedings relating to any Environmental Law against the Company or
any Subsidiary.
(nn) Neither the Company, any Subsidiary nor, to the Company's
knowledge, any of its employees or agents has at any time during the last
five years (i) made any unlawful contribution to any candidate for foreign
office, or failed to disclose fully any contribution in violation of law or
(ii) made any payment to any federal or state governmental officer or
official, or other person charged with similar public or quasi-public
duties, other than payments required or permitted by the laws of the United
States of any jurisdiction thereof.
(oo) Neither the Company nor any Subsidiary (i) is in violation
of its certificate or articles of incorporation, by-laws, certificate of
formation, limited liability company agreement, partnership agreement or
other organizational documents, (ii) is in default under, and no event has
occurred which, with notice or lapse of time, or both, would constitute a
default under or result in the creation or imposition of any Lien upon any
property or assets of the Company or any of the Subsidiaries pursuant to,
any indenture, mortgage, deed of trust, loan agreement or other agreement
or instrument to which it is a party or by which it is bound or to which
any of its property or assets is subject or (iii) is in violation in any
respect of any law, rule, regulation, ordinance, directive, judgment,
decree or order of any judicial, regulatory or other legal or governmental
agency or body, foreign or domestic, except (in the case clauses (ii) and
(iii) above) violations or defaults that could not (individually or in the
aggregate) reasonably be expected to have a Material Adverse Effect and
except (in the case of clause (ii) alone) for any Lien disclosed in the
Time of Sale Memorandum.
(pp) The Company is in compliance with applicable provisions of
the Xxxxxxxx-Xxxxx Act.
(qq) The Company has implemented the "disclosure controls and
procedures" (as defined in Rules 13a-15(e) and 15d-15(e) of the Exchange
Act) required in order for the Chief Executive Officer and Chief Financial
Officer of the Company to engage in the review and evaluation process
mandated by the Exchange Act. The Company's "disclosure controls and
procedures" are reasonably designed to ensure that all information (both
financial and non-financial) required to be disclosed by the Company in the
reports that it files or submits under the Exchange Act is recorded,
processed, summarized and reported within the time periods specified in the
Rules and Regulations, and that all such information is accumulated and
communicated to the Company's management as appropriate to allow timely
decisions regarding required disclosure and to make the certifications of
the Chief Executive Officer and Chief Financial Officer of the Company
required under the Exchange Act with respect to such reports.
17
(rr) Since the date of the filing of the Company's Annual Report
on Form 10-K for the year ended August 31, 2005, the Company's auditors and
the audit committee of the board of directors of the Company (or persons
fulfilling the equivalent function) have not been advised of (i) any
significant deficiencies in the design or operation of internal controls
which adversely affect the Company's ability to record, process, summarize
and report financial data nor any material weaknesses in internal controls;
or (ii) any fraud, whether or not material, that involves management or
other employees who have a significant role in the Company's internal
controls.
(ss) Since the date of the filing of the Company's Annual Report
on Form 10-K for the year ended August 31, 2005, there have been no
material changes in internal controls or in other factors that could
materially affect internal controls, including any corrective actions with
regard to material deficiencies.
(tt) The section entitled "Management's Discussion and Analysis
of Financial Condition and Results of Operation - Critical Accounting
Policies" incorporated by reference in the Offering Memorandum (or, if the
Offering Memorandum is not in existence, the Time of Sale Memorandum)
accurately and fully describes in accordance with applicable Rules and
Regulations (i) accounting policies which the Company believes are the most
important in the portrayal of the financial condition and results of
operations of the Company and its consolidated subsidiaries and which
require management's most difficult, subjective or complex judgments
("critical accounting policies"), (ii) judgments and uncertainties
affecting the application of critical accounting policies and (iii) the
likelihood that materially different amounts would be reported under
different conditions or using different assumptions.
(uu) The Company's board of directors, senior management and
audit committee have reviewed and agreed with the selection, application
and disclosure of critical accounting policies and have consulted with
their legal advisers and independent accountants with regard to such
disclosure.
(vv) The section entitled "Management's Discussion and Analysis
of Financial Condition and Results of Operations - Liquidity and Capital
Resources" incorporated by reference in the Time of Sale Memorandum
accurately and fully describes in accordance with applicable Rules and
Regulations (i) all material trends, demands, commitments, events,
uncertainties and risks, and the potential effects thereof, that the
Company believes would materially affect liquidity and are reasonably
likely to occur and (ii) all off-balance sheet arrangements that have or
are reasonably likely to have a current or future effect on the financial
condition, changes in financial condition, revenues or expenses, results of
operations, liquidity, capital expenditures or capital resources of the
Company and the Subsidiaries taken as a whole.
18
(ww) Except as disclosed in the Time of Sale Memorandum, there
are no outstanding guarantees or other contingent obligations (other than
under product warranties given in the ordinary course of business) of the
Company or any Subsidiary that could reasonably be expected to have a
Material Adverse Effect.
(xx) The Company and its Subsidiaries have all material
certifications required by the Association of American Railroads ("AAR") as
a railcar builder, repair and refurbishment facility and component
manufacturer, and products sold and leased by the Company and its
Subsidiaries in North America meet applicable AAR, Transport Canada and
Federal Railroad Administration standards.
(yy) No event or circumstance has occurred or arisen that could
reasonably be expected to give rise to a requirement that the Company make
additional disclosure on Form 8-K and has not been so disclosed.
(zz) Subject to compliance by the Initial Purchasers with
Sections 3 and 10 hereof, it is not necessary in connection with the offer,
sale and delivery of the Notes to the Initial Purchasers in the manner
contemplated by this Agreement and the Offering Memorandum to register the
Notes under the Securities Act.
(aaa) No securities of the Company or any of the Subsidiaries are
(i) of the same class (within the meaning of Rule 144A under the Securities
Act) as the Notes and (ii) listed on a national securities exchange
registered under Section 6 of the Exchange Act or quoted in a U.S.
automated interdealer quotation system.
(bbb) The Company has not distributed and, prior to the later of
(i) the Closing Date (and, if any Optional Notes are purchased, the
Additional Closing Date) and (ii) completion of the distribution of the
Notes, will not distribute any offering material in connection with the
offering and sale of the Notes other than the Time of Sale Memorandum and
the Offering Memorandum.
(ccc) The certificates for the shares of Common Stock (including
the Conversion Shares) conform to the requirements of the NYSE and the
Oregon Business Corporation Act.
(ddd) Each of the Company and the Guarantors is, and immediately
after the Closing Date will be, Solvent. As used herein, the term "Solvent"
means, with respect to any person on a particular date, that on such date
(i) the fair market value of the assets of such person is greater than the
total amount of liabilities (including contingent liabilities) of such
person, (ii) the present fair salable value of the assets of such person is
greater than the amount that will be required to pay the probable
liabilities of such person on its debts as they become absolute and
matured, (iii) such person is able to realize upon its
19
assets and pay its debts and other liabilities, including contingent
obligations, as they mature and (iv) such person does not have unreasonably
small capital.
(eee) The Company and the Guarantors acknowledge and agree that
(i) the terms of this Agreement and the Offering (including the price of
the Notes) were negotiated at arm's length between sophisticated parties
represented by counsel; (ii) no fiduciary, advisory or agency relationship
between the Company and the Guarantors, on one hand, and the Initial
Purchasers, on the other, has been created as a result of any of the
transactions contemplated by this Agreement or the process leading to such
transactions, irrespective of whether any Initial Purchaser has advised or
is advising any such party on other matters, (iii) the Initial Purchasers'
obligations to the Company and the Guarantors in respect of the Offering
are set forth in this Agreement in their entirety; and (iv) they have
obtained such legal, tax, and accounting advice as they deem appropriate
with respect to this Agreement and the transactions contemplated hereby and
any other activities undertaken in connection therewith, and they are not
relying on the Initial Purchasers with respect to any such matters.
(fff) None of the Company or the Subsidiaries has taken or will
take any action that would cause this Agreement or the issuance or sale of
the Securities to violate Regulation T, U or X of the Board of Governors of
the Federal Reserve System, in each case as in effect, or as the same may
hereafter be in effect, on the Closing Date (and, if any Optional Notes are
purchased, as of the Additional Closing Date).
(ggg) The Securities, the Indenture and the Registration Rights
Agreement conform in all material respects to the descriptions thereof in
the Time of Sale Memorandum and the Offering Memorandum.
(hhh) Any certificate signed by an officer of the Company or any
Guarantor and delivered to the Initial Purchasers or to counsel for the
Initial Purchasers shall be deemed to be a representation and warranty by
the Company or such Guarantor to the Initial Purchasers as to the matters
set forth therein.
3. Purchase, Sale and Delivery of the Notes.
(a) On the basis of the representations, warranties, agreements
and covenants herein contained and subject to the terms and conditions
herein set forth, each of the Company and the Guarantors agrees to issue
and sell to the Initial Purchasers, and the Initial Purchasers, severally
and not jointly, agree to purchase from the Company and the Guarantors, at
100% of their principal amount, the respective aggregate principal amounts
of the Firm Notes set forth on Schedule 1 hereto.
(b) In addition, on the basis of the representations, warranties
and agreements herein contained, but subject to the terms and conditions
herein set forth, the Company hereby grants an option to the Initial
Purchasers, to
20
purchase up to $15,000,000 in aggregate principal amount of Optional Notes
from the Company at the same price as the purchase price to be paid by the
Initial Purchasers for the Firm Notes, plus accrued interest, if any, from
the Closing Date to the Additional Closing Date (as hereinafter defined).
The option granted hereunder may be exercised at any time, on or before the
13th day following the date of the Offering Memorandum upon notice by the
Initial Purchasers to the Company, which notice may be given from time to
time on one or more occasions. Such notice shall set forth (i) the amount
(which shall be an integral multiple of $1,000 in aggregate principal
amount at issuance) of Optional Notes as to which the Initial Purchasers
are exercising the option and (ii) the time, date and place at which such
Optional Notes will be delivered (which time and date may be simultaneous
with, but not earlier than, the Closing Date and in such case, the term
"Closing Date" shall refer to the time and date of delivery of the Firm
Notes and the Optional Notes). Such time and date of delivery, if
subsequent to the Closing Date, is called the "Additional Closing Date."
The Additional Closing Date must be not later than eight full business days
after the date the Initial Purchasers exercise the option, with the actual
date determined by the Initial Purchasers. The Initial Purchasers may
cancel the option at any time prior to its expiration by giving written
notice of such cancellation to the Company.
(c) One or more certificates in definitive form for the Firm
Notes that the Initial Purchasers have agreed to purchase hereunder, and in
such denomination or denominations and registered in such name or names as
the Initial Purchasers request upon notice to the Company at least 48 hours
prior to the Closing Date, shall be delivered by or on behalf of the
Company, against payment by or on behalf of the Initial Purchasers of the
purchase price therefor by wire transfer of immediately available funds to
the account of the Company previously designated by it in writing. Such
delivery of and payment for the Firm Notes shall be made at the offices of
Xxxxxx, Xxxx & Xxxxxxxx LLP, 000 Xxxxx Xxxxx Xxxxxx, Xxx Xxxxxxx,
Xxxxxxxxxx 00000 (or at such other place as the Initial Purchasers and the
Company may agree upon), at 9:00 a.m., New York time, on May 22, 2006, or
at such date as the Initial Purchasers and the Company may agree upon, such
time and date of delivery against payment being herein referred to as the
"Closing Date." The Company will make such certificate or certificates for
the Notes available for inspection by the Initial Purchasers at a location
in New York, New York as the Initial Purchasers may designate at least 24
hours prior to the Closing Date.
(d) Delivery to the Initial Purchasers of and payment for the
Optional Notes shall be made on the Additional Closing Date in the same
manner and in the same office and at the same time of days as payment for
the Firm Notes.
4. Offering by the Initial Purchasers. The Initial Purchasers propose
to make an offering of the Notes at the price and upon the terms set forth in
the Offering Memorandum as soon as practicable after this Agreement is entered
into and as in the judgment of the Initial Purchasers is advisable.
21
5. Certain Covenants. For purposes of this Section 5, "Closing Date"
shall refer to the Closing Date for the Firm Notes and any Additional Closing
Date for the Optional Notes. Each of the Company and the Guarantors covenants
and agrees with the Initial Purchasers that:
(a) The Company will not amend or supplement the Time of Sale
Memorandum or the Offering Memorandum or any amendment or supplement
thereto of which the Initial Purchasers shall not previously have been
advised and furnished a copy for a reasonable period of time prior to the
proposed amendment or supplement and as to which the Initial Purchasers
shall not have given their consent (which consent shall not be unreasonably
withheld). The Company will promptly, upon the reasonable request of the
Initial Purchasers or counsel to the Initial Purchasers, make any
amendments or supplements to the Time of Sale Memorandum or the Offering
Memorandum that may be reasonably necessary or advisable in connection with
the resale of the Notes by the Initial Purchasers.
(b) Each of the Company and the Guarantors will cooperate with
the Initial Purchasers and counsel for the Initial Purchasers to qualify
(or to obtain exemptions from qualifying) all or any part of the Notes for
offering and sale under the securities or "Blue Sky" laws of such
jurisdictions as the Initial Purchasers may designate and will continue
such qualifications in effect for as long as may be necessary to complete
the distribution of the Notes by the Initial Purchasers; provided, however,
that in connection therewith none of the Company or any of the Guarantors
shall not be required to qualify as a foreign corporation or to execute a
general consent to service of process in any jurisdiction or to take any
other action that would subject it to general service of process or to
taxation in respect of doing business in any jurisdiction in which it is
not otherwise subject. The Company will advise the Initial Purchasers
promptly upon receipt by the Company of any notice of the suspension of the
qualification of (or any such exemption relating to) the Notes for
offering, sale or trading in any jurisdiction or any initiation or threat
of any proceeding for any such purpose, and in the event of the issuance of
any order suspending such qualification or exemption, each of the Company
and the Guarantors shall use their reasonable best efforts to obtain the
withdrawal thereof at the earliest possible moment.
(c) If, at any time prior to the completion of the resale by the
Initial Purchasers of the Notes, any event shall occur as a result of which
it is necessary, in the reasonable judgment of the Company and the Initial
Purchasers, to amend or supplement the Time of Sale Memorandum or the
Offering Memorandum in order to make such Time of Sale Memorandum or
Offering Memorandum not misleading in the light of the circumstances
existing at the time it is delivered to a purchaser, or if for any other
reason it shall be necessary to amend or supplement the Time of Sale
Memorandum or the Offering Memorandum in order to comply with applicable
laws, rules or regulations, the Company shall (subject to Section 5(a))
forthwith amend or supplement such Time of Sale Memorandum or Offering
Memorandum at its own expense so that,
22
as so amended or supplemented, such Time of Sale Memorandum or Offering
Memorandum will not include an untrue statement of a material fact or omit
to state a material fact necessary in order to make the statements therein,
in light of the circumstances existing at the time it is delivered to a
purchaser, not misleading and will comply with all applicable laws, rules
or regulations.
(d) The Company will, without charge, provide to the Initial
Purchasers and to counsel to the Initial Purchasers as many copies of each
of the Preliminary Offering Memorandum and Offering Memorandum or any
amendment or supplement thereto as the Initial Purchasers or their counsel
may reasonably request.
(e) During the period of five years from the Closing Date, the
Company will furnish to the Initial Purchasers (i) as soon as available, a
copy of each report and other communication (financial or otherwise) of the
Company mailed to the Trustee or the holders of the Notes, stockholders or
any national securities exchange on which any class of securities of the
Company may be listed other than materials filed with the Commission and
(ii) from time to time such other information concerning the Company and
the Subsidiaries as the Initial Purchasers may reasonably request, provided
that such other information shall be subject to such confidentiality and
use restrictions as the Company may reasonably impose.
(f) The Company will apply the net proceeds from the sale of the
Notes materially as set forth under "Use of Proceeds" in the Offering
Memorandum.
(g) None of the Company or any of its respective affiliates will
sell, offer for sale or solicit offers to buy or otherwise negotiate in
respect of any "security" (as defined in the Securities Act) which could be
integrated with the sale of the Notes in a manner which would require the
registration under the Securities Act of the Notes.
(h) For so long as the Notes constitute "restricted" securities
within the meaning of Rule 144(a)(3) under the Securities Act, the Company
will not, and will not permit any of the Subsidiaries to, solicit any offer
to buy or offer to sell the Notes by means of any form of general
solicitation or general advertising (as those terms are used in Regulation
D under the Securities Act) or in any manner involving a public offering
within the meaning of Section 4(2) of the Securities Act.
(i) If the Time of Sale Memorandum is being used to solicit
offers to buy the Notes at a time when the Offering Memorandum is not yet
available to prospective purchasers and any event shall occur or condition
exist as a result of which it is necessary to amend or supplement the Time
of Sale Memorandum in order to make the statements therein, in the light of
the circumstances, not misleading, or if, in the opinion of counsel for the
Initial
23
Purchasers, it is necessary to amend or supplement the Time of Sale
Memorandum to comply with applicable law, forthwith to prepare and furnish
to the Initial Purchasers upon request, either amendments or supplements to
the Time of Sale Memorandum so that the statements in the Time of Sale
Memorandum as so amended or supplemented will not, in the light of the
circumstances when delivered to a prospective purchaser, be misleading or
so that the Time of Sale Memorandum, as amended or supplemented, will
comply with law.
(j) For so long as any of the Notes remain outstanding and are
"restricted securities" within the meaning of Rule 144(a)(3) under the
Securities Act and not able to be sold in their entirety under Rule 144
under the Securities Act (or any successor provision), the Company will
make available, upon request, to any seller of such Notes the information
specified in Rule 144A(d)(4) under the Securities Act, unless the Company
is then subject to Section 13 or 15(d) of the Exchange Act.
(k) During the period from the Closing Date until two years after
the Closing Date, without the prior written consent of the Initial
Purchasers, the Company will not, and will not permit any of its
"affiliates" (as defined in Rule 144 under the Securities Act) to, resell
any of the Securities which constitute "restricted securities" under Rule
144 that have been reacquired by any of them.
(l) The Company will not take any action prohibited by Regulation
M under the Exchange Act, in connection with the distribution of the
Securities contemplated hereby.
(m) The Company will cooperate with the Initial Purchasers and
use its reasonable best efforts to (i) permit the Notes to be included for
quotation on the PORTALSM Market and (ii) permit the Notes to be eligible
for clearance and settlement through The Depository Trust Company.
(n) The Company will use its reasonable best efforts to list the
Conversion Shares for quotation on the NYSE, subject only to official
notice of issuance and evidence of satisfactory distribution.
(o) The Company will, at all times, reserve and keep available,
free of preemptive rights, enough shares of Common Stock for the purpose of
enabling the Company to satisfy its obligations to issue the Conversion
Shares upon conversion of the Notes.
(p) During the period of 60 days from the date of the Offering
Memorandum, without the prior written consent of the Initial Purchasers,
the Company (i) will not, directly or indirectly, issue, offer, sell, agree
to issue, offer or sell, solicit offers to purchase, grant any call option,
warrant or other right to purchase, purchase any put option or other right
to sell, pledge, borrow or otherwise dispose of any Relevant Security, or
make any announcement of any of
24
the foregoing, (ii) will not establish or increase any "put equivalent
position" or liquidate or decrease any "call equivalent position" (in each
case within the meaning of Section 16 of the Exchange Act and the rules and
regulations promulgated thereunder) with respect to any Relevant Security,
and (iii) will not otherwise enter into any swap, derivative or other
transaction or arrangement that transfers to another, in whole or in part,
any economic consequence of ownership of a Relevant Security, whether or
not such transaction is to be settled by delivery of Relevant Securities,
other securities, cash or other consideration, other than the sale of Notes
as contemplated by this Agreement, the issuance of the Conversion Shares,
and the Company's issuance of Common Stock upon (i) the conversion or
exchange of convertible or exchangeable securities outstanding on the date
hereof; (ii) the exercise of currently outstanding options; (iii) the
exercise of currently outstanding warrants; and (iv) the grant and exercise
of options under, or the issuance and sale of shares pursuant to, employee
stock option plans in effect on the date hereof, each as described in the
Time of Sale Memorandum. The Company will not file a registration statement
under the Securities Act in connection with any transaction by the Company
or any person that is prohibited pursuant to the foregoing, except for (i)
the Company's filing of registration statements pursuant to the
Registration Rights Agreement, and (ii) registration statements on Form S-8
relating to employee benefit plans or on Form S-4 relating to corporate
reorganizations or other transactions under Rule 145.
(q) The Company will do and perform all things required to be
done and performed by them under this Agreement and the other Offering
Documents prior to or after the Closing Date and will use its reasonable
best efforts to satisfy all conditions precedent on their part to the
obligations of the Initial Purchasers to purchase and accept delivery of
the Notes.
6. Expenses. Whether or not the Offering is consummated or this
Agreement is terminated (pursuant to Section 12 or otherwise), each of the
Company and the Guarantors, jointly and severally, agrees to pay (or reimburse
the Initial Purchasers for) the following costs and expenses and all other costs
and expenses incident to the performance by the Company of its obligations
hereunder: (a) the preparation, printing, typing, reproduction, execution and
delivery of this Agreement and of the other Offering Documents, any amendment or
supplement to or modification of any of the foregoing and any and all other
documents furnished pursuant hereto or thereto or in connection herewith or
therewith; (b) the preparation, printing or reproduction of each Preliminary
Offering Memorandum, the Offering Memorandum and each amendment or supplement to
any of them; (c) the delivery (including postage, air freight charges and
charges for counting and packaging) of such copies of each Preliminary Offering
Memorandum, the Offering Memorandum and all amendments or supplements to any of
them as may be reasonably requested for use in connection with the offering and
sale of the Notes; (d) the preparation, printing, authentication, issuance and
delivery of certificates for the Notes and the Conversion Shares, including any
stamp taxes in connection with the original issuance and sale of the Securities
and trustees' fees; (e) the reproduction and delivery of this Agreement and the
other Offering Documents, the preliminary and supplemental "Blue Sky" memoranda
and all other agreements or documents reproduced and delivered
25
in connection with the offering of the Securities; (f) the registration or
qualification of the Securities for offer and sale under the securities or Blue
Sky laws of the several states (including filing fees and the reasonable fees,
expenses and disbursements of counsel to the Initial Purchasers relating to such
registration and qualification); (g) the transportation and other expenses
incurred by or on behalf of Company representatives in connection with
presentations to and related communications with prospective purchasers of the
Notes; (h) the fees and expenses of the Company's and the Guarantors'
accountants and the fees and expenses of counsel (including local and special
counsel, if any) for the Company and the Guarantors; (i) fees and expenses of
the Trustee including fees and expenses of its counsel; (j) all expenses and
listing fees incurred in connection with the application for quotation of the
Notes on the PORTALSM Market; (k) all expenses and listing fees incurred in
connection with the application for listing for quotation of the Conversion
Shares on the NYSE; (l) all expenses incurred in connection with the performance
of the Company's obligations under the Registration Rights Agreement; and (m)
any fees charged by investment rating agencies for the rating of the Notes.
7. Conditions of the Initial Purchasers' Obligations. For purposes of
this Section 7, "Closing Date" shall refer to the Closing Date for the Firm
Notes and any Additional Closing Date for the Optional Notes. The obligations of
the Initial Purchasers to purchase and pay for the Notes are subject to the
absence from any certificates, opinions, written statements or letters furnished
to the Initial Purchasers pursuant to this Section 7 of any misstatement or
omissions and to the following additional conditions unless waived in writing by
the Initial Purchasers:
(a) The Initial Purchasers shall have received opinions of
counsel in form and substance satisfactory to the Initial Purchasers and
Xxxxxx, Xxxx & Xxxxxxxx LLP, counsel to the Initial Purchasers, dated the
Closing Date, of (i) Xxxxxx, Xxxxxxx & Xxxxxxx LLP, counsel to the Company,
substantially in the form of Annex I hereto, (ii) Norriss X. Xxxx, general
counsel for the Company, substantially in the form of Annex II hereto, and
(iii) XxXxxxxx Xxxxxxxx LLP, Canadian regulatory counsel for the Company,
substantially in the form of Xxxxx XXX hereto.
(b) The Initial Purchasers shall have received an opinion, dated
the Closing Date, of Xxxxxx, Xxxx & Xxxxxxxx LLP, counsel to the Initial
Purchasers, with respect to the sufficiency of certain legal matters
relating to this Agreement and such other related matters as the Initial
Purchasers may require.
(c) The Initial Purchasers shall have received from Deloitte &
Touche LLP, independent public accountants for the Company, a "comfort"
letter dated the date hereof and the Closing Date, in form and substance
reasonably satisfactory to the Initial Purchasers and Xxxxxx, Xxxx &
Xxxxxxxx LLP, counsel to the Initial Purchasers.
(d) The Initial Purchasers shall have received from each of the
officers and directors listed on Schedule 2 hereto an executed Lock-Up
Agreement substantially in the form of Exhibit D hereto.
26
(e) The representations and warranties of the Company and the
Guarantors contained in this Agreement shall be true and correct on and as
of the Closing Date; the Company and the Guarantors shall have complied in
all material respects with all agreements and satisfied all conditions on
their part to be performed or satisfied hereunder at or prior to the
Closing Date.
(f) None of the issuance and sale of the Securities pursuant to
this Agreement or any of the transactions contemplated by any of the other
Offering Documents shall be enjoined (temporarily or permanently) and no
restraining order or other injunctive order shall have been issued; and
there shall not have been any legal action, statute, order, decree or other
administrative proceeding enacted, instituted or, to the knowledge of the
Company or Initial Purchasers, threatened against the Company or against
the Initial Purchasers relating to the issuance of the Securities or the
Initial Purchasers' activities in connection therewith or any other
transactions contemplated by this Agreement, the Time of Sale Memorandum or
the Offering Memorandum, or the other Offering Documents.
(g) Since the date as of which information is given in the Time
of Sale Memorandum, other than as updated for pricing information or any
increase in the aggregate principal amount of the Notes and changes
resulting from any such increase, there shall not have occurred (i) any
change, or any development involving a prospective change, in or affecting
the general affairs, management, business, condition (financial or other),
properties, prospects or results of operations of the Company or any of the
Subsidiaries, not contemplated by the Time of Sale Memorandum that is, in
the judgment of the Initial Purchasers, so material and adverse as to make
it impracticable or inadvisable to proceed with the offering of the
Securities on the terms and in the manner contemplated by the Offering
Documents, or (ii) any event or development relating to or involving the
Company or any of the Subsidiaries, or any of their respective officers or
directors that makes any statement of a material fact made in the Time of
Sale Memorandum untrue or that, in the opinion of the Company and its
counsel or the Initial Purchasers and their counsel, require the making of
any addition to or change in the Time of Sale Memorandum in order to state
a material fact required by any applicable law, rule or regulation to be
stated therein or necessary in order to make the statements made therein,
in light of the circumstances in which they were made, not misleading.
(h) The Initial Purchasers shall have received certificates,
dated the Closing Date and signed by the chief executive officer and the
chief financial officer of the Company and each of the Guarantors (in their
capacities as such), to the effect that:
(i) All of the representations and warranties of the Company
and each Guarantor, as applicable, set forth in this Agreement are
true and correct as if made on and as of the Closing Date and, as of
the Closing Date all agreements, conditions and obligations of the
Company and
27
each Guarantor, as applicable, to be performed, satisfied or complied
with hereunder on or prior the Closing Date have been duly performed,
satisfied or complied with.
(ii) The issuance and sale of the Notes pursuant to this
Agreement, the Time of Sale Memorandum or the Offering Memorandum and
the consummation of the transactions contemplated by the Offering
Documents have not been enjoined (temporarily or permanently) and no
restraining order or other injunctive order has been issued and there
has not been any legal action, order, decree or other administrative
proceeding instituted or, to such officers' knowledge, threatened
against the Company relating to the issuance of the Securities or the
Initial Purchasers' activities in connection therewith or in
connection with any other transactions contemplated by this Agreement,
the Time of Sale Memorandum or the Offering Memorandum or the other
Offering Documents.
(iii) Since the date as of which information is given in the
Time of Sale Memorandum, other than as updated for pricing information
or any increase in the aggregate principal amount of the Notes and
changes resulting from any such increase, there has not occurred (A)
any Material Adverse Effect with respect to the business, condition
(financial or other), results of operations, stockholders' equity,
properties or prospects of the Company and its Subsidiaries, taken as
a whole, or (B) any event or development relating to or involving the
Company or any of the Subsidiaries, or any of their respective
officers or directors that makes any statement of a material fact made
in the Time of Sale Memorandum untrue or that requires the making of
any addition to or change in the Time of Sale Memorandum in order to
state a material fact required by any applicable law, rule or
regulation to be stated therein or necessary in order to make the
statements made therein, in light of the circumstances under which
they were made, not misleading.
(iv) At the Closing Date and after giving effect to the
consummation of the transactions contemplated by the Offering
Documents, there exists no Default or Event of Default (as defined in
the Indenture).
(i) Each of the Offering Documents and each other agreement or
instrument executed in connection with the transactions contemplated
thereby shall be reasonably satisfactory in form and substance to the
Initial Purchasers and shall have been executed and delivered by all the
respective parties thereto and shall be in full force and effect, and there
shall have been no material amendments, alterations, modifications or
waivers of any provision thereof since the date of this Agreement, except
as agreed to by the Company and the Initial Purchasers.
(j) All proceedings taken in connection with the issuance of the
Notes and the transactions contemplated by this Agreement, the other
Offering Documents and all documents and papers relating thereto shall be
reasonably
28
satisfactory to the Initial Purchasers and counsel to the Initial
Purchasers. The Initial Purchasers and counsel to the Initial Purchasers
shall have received copies of such papers and documents as they may
reasonably request in connection therewith, all in form and substance
reasonably satisfactory to them.
(k) The Notes shall have been approved for trading on the
PORTAL(SM) Market.
(l) The Conversion Shares shall have been approved for listing on
the NYSE, subject to official notice of issuance.
(m) Since the date of this Agreement, there shall not have been
any announcement by any "nationally recognized statistical rating
organization," as defined for purposes of Rule 436(g) under the Securities
Act, that (i) it is downgrading its rating assigned to any debt securities
of the Company, or (ii) it is reviewing its rating assigned to any debt
securities of the Company with a view to possible downgrading, or with
negative implications, or direction not determined.
(n) On or before the Closing Date, the Initial Purchasers shall
have received the Registration Rights Agreement executed by the Company and
the Guarantors and such agreement shall be in full force and effect.
(o) The Company and the Guarantors shall have furnished or caused
to be furnished to the Initial Purchasers such further certificates and
documents as the Initial Purchasers shall have reasonably requested.
(p) At the Closing Date, the Company, the Guarantors and the
Trustee shall have entered into the Indenture and the Initial Purchasers
shall have received counterparts, conformed as executed, thereof and the
Notes shall have been duly executed and delivered by the Company and duly
authenticated by the Trustee.
All such opinions, certificates, letters, schedules, documents or
instruments delivered pursuant to this Agreement will comply with the provisions
hereof only if they are reasonably satisfactory in all material respects to the
Initial Purchasers and counsel to the Initial Purchasers. The Company shall
furnish to the Initial Purchasers such conformed copies of such opinions,
certificates, letters, schedules, documents and instruments in such quantities
as the Initial Purchasers shall reasonably request.
8. Indemnification.
(a) The Company and the Guarantors, jointly and severally, shall
indemnify and hold harmless (i) each Initial Purchaser, (ii) each person,
if any, who controls an Initial Purchaser within the meaning of Section 15
of the Securities Act or Section 20 of the Exchange Act and (iii) the
respective officers, directors, partners, and employees of each of the
Initial Purchasers or any controlling person, from and against any and all
losses, liabilities, claims, damages and expenses whatsoever as incurred
(including but not limited to
29
reasonable attorneys' fees and any and all expenses whatsoever incurred in
investigating, preparing or defending against any investigation or
litigation, commenced or threatened, or any claim whatsoever, and any and
all amounts paid in settlement of any claim or litigation), joint or
several, to which they or any of them may become subject under the
Securities Act, the Exchange Act or otherwise, insofar as such losses,
liabilities, claims, damages or expenses (or actions in respect thereof)
arise out of or are based upon (i) any untrue statement or alleged untrue
statement of a material fact contained in (A) the Time of Sale Memorandum
or the Offering Memorandum, or in any supplement thereto or amendment
thereof, or (B) any materials or information provided to investors by, or
with the approval of, the Company in connection with the marketing of the
Securities, including any road show or investor presentations made to
investors by the Company (whether in person or electronically) ("Marketing
Materials") but only if such Marketing Materials are provided to investors
together with the Time of Sale Memorandum or the Offering Memorandum, or
(ii) the omission or alleged omission to state in the Time of Sale
Memorandum or the Offering Memorandum, or in any supplement thereto or
amendment thereof, or in any Marketing Materials, a material fact required
to be stated therein or necessary to make the statements therein, in light
of the circumstances under which they were made, not misleading; provided,
however, that neither the Company nor any Guarantor will be liable in any
such case to the extent, but only to the extent, that any such loss,
liability, claim, damage or expense arises out of or is based upon any such
untrue statement or alleged untrue statement or omission or alleged
omission made therein in reliance upon and in conformity with written
information furnished to the Company and the Guarantors by or on behalf of
the Initial Purchasers expressly for use therein. The parties acknowledge
and agree that such information provided by or on behalf of the Initial
Purchasers consists solely of the material identified in Section 16 hereof.
This indemnity agreement will be in addition to any liability that the
Company and the Guarantors may otherwise have, including under this
Agreement.
(b) Each Initial Purchaser, severally and not jointly, shall
indemnify and hold harmless (i) the Company, (ii) each person, if any, who
controls the Company or any of the Guarantors within the meaning of Section
15 of the Securities Act or Section 20 of the Exchange Act, and (iii) the
officers, directors, partners, and employees of the Company, the Guarantors
or any controlling person, against any losses, liabilities, claims, damages
and expenses whatsoever as incurred (including but not limited to
attorneys' fees and any and all expenses whatsoever incurred in
investigating, preparing or defending against any investigation or
litigation, commenced or threatened, or any claim whatsoever and any and
all amounts paid in settlement of any claim or litigation), joint or
several, to which they or any of them may become subject under the
Securities Act, the Exchange Act or otherwise, insofar as such losses,
liabilities, claims, damages or expenses (or actions in respect thereof)
arise out of or are based upon any untrue statement or alleged untrue
statement of a material fact contained in the Time of Sale Memorandum or
the Offering Memorandum, or in any amendment thereof or supplement thereto,
or arise out of or are based upon the
30
omission or alleged omission to state therein a material fact required to
be stated therein or necessary to make the statements therein not
misleading, in each case to the extent, but only to the extent, that any
such loss, liability, claim, damage or expense arises out of or is based
upon any untrue statement or alleged untrue statement or omission or
alleged omission made therein in reliance upon and in conformity with
written information furnished to the Company and the Guarantors by or on
behalf of such Initial Purchaser expressly for use therein; provided,
however, that in no case shall any Initial Purchaser be liable or
responsible for any amount in excess of the discounts and commissions
received by such Initial Purchaser. The parties acknowledge and agree that
such information provided by or on behalf of the Initial Purchasers
consists solely of the material identified in Section 16 hereof. This
indemnity will be in addition to any liability that the Initial Purchasers
may otherwise have, including under this Agreement.
(c) Promptly after receipt by an indemnified party under
subsection (a) or (b) above of notice of any claims or the commencement of
any action, such indemnified party shall, if a claim in respect thereof is
to be made against the indemnifying party under such subsection, notify
each party against whom indemnification is to be sought in writing of the
commencement thereof (but the failure so to notify an indemnifying party
shall not relieve it from any liability which it may have under this
Section 8 to the extent that it is not materially prejudiced through the
forfeiture of substantive rights or defenses as a result thereof and in any
event shall not relieve it from any liability that such indemnifying party
may have otherwise than on account of the indemnity agreement hereunder).
In case any such claim or action is made or brought against any indemnified
party, and it notifies an indemnifying party of the commencement thereof,
the indemnifying party will be entitled to participate, at its own expense
in the defense of such action, and to the extent it may elect by written
notice delivered to the indemnified party promptly after receiving the
aforesaid notice from such indemnified party, to assume the defense thereof
with counsel reasonably satisfactory to such indemnified party; provided,
however, that counsel to the indemnifying party shall not (except with the
written consent of the indemnified party) also be counsel to the
indemnified party. Notwithstanding the foregoing, the indemnified party or
parties shall have the right to employ its or their own counsel in any such
case, but the fees and expenses of such counsel shall be at the expense of
such indemnified party or parties unless (i) the employment of such counsel
shall have been authorized in writing by one of the indemnifying parties in
connection with the defense of such action, (ii) the indemnifying parties
shall not have employed counsel to take charge of the defense of such
action within a reasonable time after notice of commencement of the action,
(iii) the indemnifying party does not diligently defend the action after
assumption of the defense, or (iv) such indemnified party or parties shall
have reasonably concluded that there may be defenses available to it or
them which are different from or additional to those available to one or
all of the indemnifying parties (in which case the indemnifying party or
parties shall not have the right to direct the defense of such action on
behalf of the indemnified party or parties), in
31
any of which events such fees and expenses of counsel shall be borne by the
indemnifying parties. No indemnifying party shall, without the prior
written consent of the indemnified parties, effect any settlement or
compromise of, or consent to the entry of judgment with respect to, any
pending or threatened claim, investigation, action or proceeding in respect
of which indemnity or contribution may be or could have been sought by an
indemnified party under this Section 8 or Section 9 hereof (whether or not
the indemnified party is an actual or potential party thereto), unless (x)
such settlement, compromise or judgment (A) includes an unconditional
release of the indemnified party from all liability arising out of such
claim, investigation, action or proceeding and (B) does not include a
statement as to or an admission of fault, culpability or any failure to
act, by or on behalf of the indemnified party, and (y) the indemnifying
party confirms in writing its indemnification obligations hereunder with
respect to such settlement, compromise or judgment.
9. Contribution. In order to provide for contribution in circumstances
in which the indemnification provided for in Section 8 is for any reason held to
be unavailable from an indemnifying party or is insufficient to hold harmless a
party indemnified thereunder, the Company and the Guarantors, on the one hand,
and the Initial Purchasers, on the other hand, shall contribute to the aggregate
losses, liabilities, claims, damages and expenses of the nature contemplated by
such indemnification provision (including any investigation, legal and other
expenses incurred in connection with, and any amount paid in settlement of, any
action, suit or proceeding or any claims asserted, but after deducting in the
case of losses, liabilities, claims, damages and expenses suffered by the
Company or any Guarantor, any contribution received by the Company and the
Guarantors from persons, other than the Initial Purchasers, who may also be
liable for contribution, including persons who control the Company or any of the
Guarantors within the meaning of Section 15 of the Securities Act or Section 20
of the Exchange Act) to which the Company, the Guarantors and the Initial
Purchasers may be subject, in such proportion as is appropriate to reflect the
relative benefits received by the Company and the Guarantors, on the one hand,
and the Initial Purchasers, on the other hand, from the offering of the Notes
or, if such allocation is not permitted by applicable law, in such proportion as
is appropriate to reflect not only the relative benefits referred to above but
also the relative fault of the Company and the Guarantors, on the one hand, and
the Initial Purchasers, on the other hand, in connection with the statements or
omissions which resulted in such losses, liabilities, claims, damages or
expenses, as well as any other relevant equitable considerations. The relative
benefits received by the Company and the Guarantors, on the one hand, and the
Initial Purchasers, on the other hand, shall be deemed to be in the same
proportion as (i) the total proceeds from the offering of the Notes (net of
discounts and commissions but before deducting expenses) received by the Company
and the Guarantors bear to (ii) the discounts and commissions received by the
Initial Purchasers, respectively. The relative fault of the Company and the
Guarantors, on the one hand, and of the Initial Purchasers, on the other hand,
shall be determined by reference to, among other things, whether the untrue or
alleged untrue statement of a material fact or the omission or alleged omission
to state a material fact relates to information supplied by the Company or any
Guarantor or the Initial Purchasers and the parties' relative intent, knowledge,
access to information and opportunity to
32
correct or prevent such statement or omission. The Company, the Guarantors and
the Initial Purchasers agree that it would not be just and equitable if
contribution pursuant to this Section 9 were determined by pro rata allocation
(even if the Initial Purchasers were treated as one entity for such purpose) or
by any other method of allocation which does not take into account the equitable
considerations referred to above. The aggregate amount of losses, liabilities,
claims, damages and expenses incurred by an indemnified party and referred to
above in this Section 9 shall be deemed to include any legal or other expenses
reasonably incurred by such indemnified party in investigating, preparing or
defending against any litigation, or any investigation or proceeding by any
judicial, regulatory or other legal or governmental agency or body, commenced or
threatened, or any claim whatsoever based upon any such untrue or alleged untrue
statement or omission or alleged omission. Notwithstanding the provisions of
this Section 9, (i) in no case shall any Initial Purchaser be required to
contribute any amount in excess of the amount by which the discounts and
commissions applicable to the Notes purchased by such Initial Purchaser pursuant
to this Agreement exceeds the amount of any damages which such Initial Purchaser
has otherwise been required to pay by reason of any untrue or alleged untrue
statement or omission or alleged omission and (ii) no person guilty of
fraudulent misrepresentation (within the meaning of Section 11(f) of the
Securities Act) shall be entitled to contribution from any person who was not
guilty of such fraudulent misrepresentation. For purposes of this Section 9, (A)
each person, if any, who controls any Initial Purchaser within the meaning of
Section 15 of the Securities Act or Section 20 of the Exchange Act and (B) the
respective officers, directors, partners, employees, representatives and agents
of any Initial Purchaser or any controlling person shall have the same rights to
contribution as such Initial Purchaser, and (1) each person, if any, who
controls the Company or any Guarantor within the meaning of Section 15 of the
Securities Act or Section 20 of the Exchange Act and (2) the officers,
directors, employees, representatives and agents of the Company and the
Guarantors shall have the same rights to contribution as the Company and the
Guarantors, as applicable, subject in each case to clauses (i) and (ii) of this
Section 9. Any party entitled to contribution will, promptly after receipt of
notice of commencement of any action, suit or proceeding against such party in
respect of which a claim for contribution may be made against another party or
parties under this Section 9, notify such party or parties from whom
contribution may be sought, but the failure to so notify such party or parties
shall not relieve the party or parties from whom contribution may be sought from
any obligation it or they may have under this Section 9 or otherwise. No party
shall be liable for contribution with respect to any action or claim settled
without its prior written consent, provided that such written consent was not
unreasonably withheld. The Initial Purchasers' obligations to contribute
pursuant to this Section 9 are several in proportion to the respective principal
amount of the Notes purchased by each of the Initial Purchasers hereunder and
not joint.
10. Offering of Securities; Restrictions on Transfer. Each Initial
Purchaser represents and warrants that it is a QIB. Each Initial Purchaser
agrees with the Company as to itself only that (i) is not acquiring the Notes
with a view to any distribution thereof that would violate the Securities Act or
the securities laws of any state of the United States or any other applicable
jurisdiction, (ii) it has not and will not solicit offers for, or offer or sell,
the Securities by any form of general solicitation or
33
general advertising (as those terms are used in Regulation D under the
Securities Act) or in any manner involving a public offering within the meaning
of Section 4(2) of the Securities Act; (iii) it has and will solicit offers for
the Securities only from, and will offer the Securities only to, persons within
the United States whom such Initial Purchaser reasonably believe to be QIBs (or,
if any such person is buying for one or more institutional accounts for which
such person is acting as fiduciary or agent, only when such person has
represented to such Initial Purchaser that each such account is a QIB), to whom
notice has been given that such sale or delivery is being made in reliance on
Rule 144A and, in each case, in transactions under Rule 144A, and (iv) it has
not distributed, and prior to the later of the Closing Date (and, if any
Optional Notes are purchased, the Additional Closing Date) or completion of the
distribution of the Notes, will not distribute any free writing prospectus, as
defined in the Securities Act, in connection with the offering and sale of the
Notes other than the Time of Sale Memorandum and the Offering Memorandum. The
Initial Purchasers acknowledge that the Securities will be subject to
restrictions on transfer as described in the Time of Sale Memorandum.
11. Survival Clause. The respective representations, warranties,
agreements, covenants, indemnities and other statements of the Company, the
Guarantors, their respective officers and the Initial Purchasers set forth in
this Agreement or made by or on behalf of them, respectively, pursuant to this
Agreement shall remain in full force and effect, regardless of (a) any
investigation made by or on behalf of the Company, any Guarantor, any of their
officers or directors, the Initial Purchasers or any controlling person referred
to in Sections 8 and 9 hereof and (b) delivery of and payment for the Notes, and
shall be binding upon and shall inure to the benefit of, any successors,
assigns, heirs, personal representatives of the Company, the Guarantors, the
Initial Purchasers and indemnified parties referred to in Section 8 hereof. The
respective agreements, covenants, indemnities and other statements set forth in
Sections 6, 8, 9, 11 and 12 hereof shall remain in full force and effect,
regardless of any termination or cancellation of this Agreement.
12. Termination. (a) This Agreement may be terminated in the sole
discretion of the Initial Purchasers by notice to the Company given in the event
that the Company or any Guarantor has failed, refused or been unable to satisfy
all conditions on its respective part to be performed or satisfied hereunder on
or prior to the Closing Date or if, at or prior to the Closing Date or at or
prior to the Additional Closing Date, as the case may be:
(i) any domestic or international event or act or occurrence
has materially disrupted, or in the opinion of the Initial Purchasers
will in the immediate future materially disrupt, the market for the
Company's securities or securities in general;
(ii) trading on the NYSE shall have been suspended or made
subject to material limitations, or minimum or maximum prices for
trading shall have been fixed, or maximum ranges for prices for
securities
34
shall have been required, on the NYSE, or by order of the Commission
or other regulatory body or governmental authority having
jurisdiction;
(iii) a banking moratorium has been declared by any state or
federal authority or if any material disruption in commercial banking
or securities settlement or clearance services shall have occurred;
(iv) (A) there shall have occurred any outbreak or
escalation of hostilities or acts of terrorism involving the United
States or there is a declaration of a national emergency or war by the
United States, or (B) there shall have been any other calamity or
crisis or any change in political, financial or economic conditions if
the effect of any such event in (A) or (B), in the judgment of the
Initial Purchasers, makes it impracticable or inadvisable to proceed
with the offering, sale and delivery of the Notes or the Optional
Notes, as the case may be, on the terms and in the manner contemplated
by the Offering Memorandum; or
(v) any debt securities of the Company shall have been
downgraded or placed on any "watch list" for possible downgrading by
any "nationally recognized statistical rating organization" as defined
for purposes of Rule 436(g) under the Securities Act.
(b) Subject to paragraph (c) below, termination of this Agreement
pursuant to this Section 12 shall be without liability of any party to any
other party except as provided in Section 11 hereof.
(c) If this Agreement shall be terminated pursuant to any of the
provisions hereof (other than a failure or refusal by the Initial
Purchasers to purchase Notes, pursuant to Section 18 hereof), or if the
sale of the Notes provided for herein is not consummated because any
condition to the obligations of the Initial Purchasers set forth herein is
not satisfied or because of any refusal, inability or failure on the part
of the Company to perform any agreement herein or comply with any provision
hereof, the Company will, subject to demand by the Initial Purchasers,
reimburse the Initial Purchasers for all out-of-pocket expenses (including
the reasonable fees and expenses of their counsel), incurred by the Initial
Purchasers in connection herewith.
13. Notices. All communications hereunder shall be in writing and, if
sent to the Initial Purchasers, shall be hand delivered, mailed by first-class
mail, couriered by next-day air courier or telecopied and confirmed in writing
to the Initial Purchasers c/o Bear, Xxxxxxx & Co. Inc., 000 Xxxxxxx Xxxxxx, Xxx
Xxxx, Xxx Xxxx 00000, Attention: Xxxxxxx Xxxxxx, Equity Capital Markets, and
with a copy to Xxxxxx, Xxxx & Xxxxxxxx LLP, 000 Xxxxx Xxxxx Xxxxxx, Xxx Xxxxxxx,
Xxxxxxxxxx 00000, Attention: Xxxxx X. Xxxxxxx. If sent to the Company or the
Guarantors, shall be hand delivered, mailed by first-class mail, couriered by
next-day air courier or telecopied and confirmed in writing, to the Company at
Xxx Xxxxxxxxxxxx Xxxxx, Xxxxx 000, Xxxx Xxxxxx, Xxxxxx 00000, Attention: Xxxxxx
X. Xxxxxxx, and with a copy to Xxxxxx, Xxxxxxx & Xxxxxxx L.L.P.,
35
0000 Xxxxxxxxxx Center, 00 Xxxxx Xxxx Xxxxxx, Xxxxxxxx, Xxxx 00000, Attention:
Xxxxxx X. Xxxxx.
14. Successors. This Agreement shall inure to the benefit of and be
binding upon each Initial Purchaser, the Company and each Guarantor and their
respective successors and legal representatives, and nothing expressed or
mentioned in this Agreement is intended or shall be construed to give any other
person any legal or equitable right, remedy or claim under or in respect of this
Agreement, or any provisions herein contained; this Agreement and all conditions
and provisions hereof being intended to be and being for the sole and exclusive
benefit of such persons and for the benefit of no other person except that (i)
the indemnities of the Company and the Guarantors contained in Section 8 of this
Agreement shall also be for the benefit of any person or persons who control the
Initial Purchasers within the meaning of Section 15 of the Securities Act or
Section 20 of the Exchange Act and (ii) the indemnities of the Initial
Purchasers contained in Section 8 of this Agreement shall also be for the
benefit of the directors of the Company and the Guarantors, their respective
officers, employees and agents and any person or persons who controls the
Company or any of the Guarantors within the meaning of Section 15 of the
Securities Act or Section 20 of the Exchange Act. No purchaser of Notes from the
Initial Purchasers will be deemed a successor because of such purchase.
15. No Waiver; Modifications in Writing. No failure or delay on the
part of the Company, any Guarantor or any Initial Purchaser in exercising any
right, power or remedy hereunder shall operate as a waiver thereof, nor shall
any single or partial exercise of any such right, power or remedy preclude any
other or further exercise thereof or the exercise of any other right, power or
remedy. The remedies provided for herein are cumulative and are not exclusive of
any remedies that may be available to the Company, any Guarantor or any Initial
Purchaser at law or in equity or otherwise. No waiver of or consent to any
departure by the Company, any Guarantor or any Initial Purchaser from any
provision of this Agreement shall be effective unless signed in writing by the
party entitled to the benefit thereof; provided that notice of any such waiver
shall be given to each party hereto as set forth above. Except as otherwise
provided herein, no amendment, modification or termination of any provision of
this Agreement shall be effective unless signed in writing by or on behalf of
the Company, each Guarantor and each Initial Purchaser. Any amendment,
supplement or modification of or to any provision of this Agreement, any waiver
of any provision of this Agreement, and any consent to any departure by the
Company, the Guarantors or the Initial Purchasers from the terms of any
provision of this Agreement shall be effective only in the specific instance and
for the specific purpose for which made or given. Except where notice is
specifically required by this Agreement, 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.
16. Information Supplied by the Initial Purchasers. The statements set
forth in the (i) first sentence of the third paragraph, (ii) second sentence of
the fifth paragraph, (iii) second and third sentences of the eleventh paragraph,
and (iv) thirteenth and fourteenth paragraphs under the heading "Plan of
Distribution" constitute the only
36
information furnished by the Initial Purchasers to the Company for purposes of
Sections 2(a), 8(a) and 8(b) hereof.
17. APPLICABLE LAW. THE VALIDITY AND INTERPRETATION OF THIS AGREEMENT,
AND THE TERMS AND CONDITIONS SET FORTH HEREIN SHALL BE GOVERNED BY AND CONSTRUED
IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT GIVING EFFECT TO
ANY PROVISIONS RELATING TO CONFLICTS OF LAW.
18. Default of One or More of the Initial Purchasers. If any one or
more of the Initial Purchasers shall fail or refuse to purchase Notes that it or
they have agreed to purchase hereunder on the Closing Date, and the aggregate
number of Notes which such defaulting Initial Purchaser or Initial Purchasers
agreed but failed or refused to purchase does not exceed 10% of the aggregate
number of the Notes to be purchased on such date, the other Initial Purchasers
shall be obligated, severally, in the proportions that the number of Notes set
forth opposite their respective names on Schedule 1 bears to the aggregate
number of Notes set forth opposite the names of all such non-defaulting Initial
Purchasers, or in such other proportions as may be specified by the Initial
Purchasers with the consent of the non-defaulting Initial Purchasers, to
purchase the Notes which such defaulting Initial Purchaser or Initial Purchasers
agreed but failed or refused to purchase on the Closing Date. If any one or more
of the Initial Purchasers shall fail or refuse to purchase Notes and the
aggregate number of Notes with respect to which such default occurs exceeds 10%
of the aggregate number of Notes to be purchased on the Closing Date, and
arrangements satisfactory to the Initial Purchasers and the Company for the
purchase of such Notes are not made within 48 hours after such default, this
Agreement shall terminate without liability of any party to any other party
except that the provisions of Sections 6, 8 and 9 hereof shall at all times be
effective and shall survive such termination. In any such case either the
Initial Purchasers or the Company shall have the right to postpone the Closing
Date, as the case may be, but in no event for longer than seven days in order
that the required changes, if any, to the Offering Memorandum or any other
documents or arrangements may be effected.
As used in this Agreement, the term "Initial Purchaser" shall be
deemed to include any person substituted for a defaulting Initial Purchaser
under this Section 18. Any action taken under this Section 18 shall not relieve
the Initial Purchasers from liability in respect of any default of such Initial
Purchasers under this Agreement.
19. Counterparts. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
[SIGNATURE PAGES FOLLOW]
37
If the foregoing correctly sets forth our understanding, please
indicate your acceptance thereof in the space provided below for that purpose,
whereupon this letter shall constitute a binding agreement among the Company,
the Guarantors and the Initial Purchasers.
Very truly yours,
THE GREENBRIER COMPANIES, INC.
By: /s/ Xxxxxx X. Xxxxxxx
------------------------------------
Name: Xxxxxx X. Xxxxxxx
Title: Senior Vice President
GREENBRIER-CONCARRIL, LLC
By: /s/ Xxxxxx X. Xxxxxxx
------------------------------------
Name: Xxxxxx X. Xxxxxxx
Title: Vice President
GREENBRIER LEASING COMPANY LLC
By: /s/ Xxxxxx X. Xxxxxxx
------------------------------------
Name: Xxxxxx X. Xxxxxxx
Title: Vice President
GREENBRIER LEASING LIMITED PARTNER, LLC
BY: GREENBRIER LEASING COMPANY LLC,
SOLE MEMBER AND MANAGER
By: /s/ Xxxxxx X. Xxxxxxx
------------------------------------
Name: Xxxxxx X. Xxxxxxx
Title: Vice President
GREENBRIER MANAGEMENT SERVICES, LLC
BY: GREENBRIER LEASING COMPANY LLC,
SOLE MEMBER AND MANAGER
By: /s/ Xxxxxx X. Xxxxxxx
------------------------------------
Name: Xxxxxx X. Xxxxxxx
Title: Vice President
GREENBRIER LEASING, L.P.
BY: GREENBRIER LEASING COMPANY LLC,
SOLE MEMBER AND MANAGER
By: /s/ Xxxxxx X. Xxxxxxx
------------------------------------
Name: Xxxxxx X. Xxxxxxx
Title: Vice President
XXXXXXXXX LLC
By: /s/ Xxxxxx X. Xxxxxxx
------------------------------------
Name: Xxxxxx X. Xxxxxxx
Title: Vice President
XXXXXXXXX MARINE LLC
By: /s/ Xxxxxx X. Xxxxxxx
------------------------------------
Name: Xxxxxx X. Xxxxxxx
Title: Vice President
XXXXXXXXX RAIL SERVICES LLC
By: /s/ Xxxxxx X. Xxxxxxx
------------------------------------
Name: Xxxxxx X. Xxxxxxx
Title: Vice President
XXXXXXXXX SPECIALTY PRODUCTS, LLC
BY: XXXXXXXXX LLC,
SOLE MEMBER AND MANAGER
By: /s/ Xxxxxx X. Xxxxxxx
------------------------------------
Name: Xxxxxx X. Xxxxxxx
Title: Vice President
AUTOSTACK COMPANY LLC
By: /s/ Xxxxxx X. Xxxxxxx
------------------------------------
Name: Xxxxxx X. Xxxxxxx
Title: Vice President
GREENBRIER RAILCAR LLC
By: /s/ Xxxxxx X. Xxxxxxx
------------------------------------
Name: Xxxxxx X. Xxxxxxx
Title: Vice President
The foregoing Agreement is hereby confirmed and accepted as of the date first
above written.
BEAR, XXXXXXX & CO. INC.
By: /s/ Xxxx X. Xxxxxx
---------------------------------
Name: Xxxx X. Xxxxxx
Title: Senior Managing Director
BANC OF AMERICA SECURITIES LLC
By: /s/ Xxxxx Xxxxxx
---------------------------------
Name: Xxxxx Xxxxxx
Title: Managing Director
Schedule 1
Principal Amount
Initial Purchasers of Notes
------------------ ----------------
Bear, Xxxxxxx & Co. Inc. ................................ $55,250,000
Banc of America Securities LLC .......................... $29,750,000
-----------
Total ................................................ $85,000,000
===========
Schedule 2
DIRECTORS AND OFFICERS
Name Position
---- --------
Xxxxxxx X. Xxxxxx President, Chief Executive Officer and Director
Xxxxx X. Xxxxxx Senior Vice President Marketing and Sales and President of
Greenbrier Railcar LLC
Xxxxx X. Xxxxxxx Vice President and Corporate Controller
Xxxx X. Xxxxxxxxxx Senior Vice President and Treasurer
Xxxxx X. Xxxxx President of Greenbrier Leasing Company LLC
Xxxxxxx X. Xxxxxxx President of Xxxxxxxxx Rail Services LLC
Xxxxxxx X. Xxxx Executive Vice President and General Counsel
Xxxxxx X. Xxxxxxx Senior Vice President and Chief Financial Officer
X. Xxxxx Xxxx President of Manufacturing Operations
Xxxxxx X. Xxxxxx Director
Xxxxx X. XxXxxxxxx Director
X. Xxxxxx X'Xxxx Director
Xxxxxxx X. Xxxxxxxxx Director
X. Xxxxx Xxxx Director
Xxxxxx X. Xxxxxxxx Director
Xxxxxxxx X. Xxxxxxxx Chairman of the Board of Directors
Exhibit A
Subsidiaries
3048389 Nova Scotia Limited
Alliance Castings Company, LLC
Autostack Company LLC
Chicago Castings Company, LLC
Greenbrier-Concarril, LLC
Greenbrier Europe B.V.
Greenbrier Germany GmbH
Greenbrier Leasing Company LLC
Greenbrier Leasing, L.P.
Greenbrier Leasing Limited
Greenbrier Leasing Limited Partner, LLC
Greenbrier Management Services, LLC
Greenbrier Railcar LLC
Greenbrier U.K. Limited
Xxxxxxxxx LLC
Xxxxxxxxx-Concarril, S.A. de X.X.
Xxxxxxxxx Marine LLC
Xxxxxxxxx Rail Services LLC
Gunderson Specialty Products, LLC
Ohio Castings Company, LLC
TrentonWorks Limited
WagonySwidnica S.A.
Exhibit B
Ohio Castings Company, LLC Xxxxxxxxx Specialty Products, LLC owns 33 1/3%
of the entity.
Alliance Castings Company, LLC Ohio Castings Company, LLC owns 100% of this
entity.
Chicago Castings Company, LLC Ohio Castings Company, LLC owns 100% of this
entity.
WagonySwidnica S.A. Greenbrier Europe B.V. owns 98.56% of this
entity.
Exhibit C
COMPANY STATEMENTS
1. "Although no formal statistics are available for the European market, we
believe we are the second largest new freight car manufacturer with an
estimated 20% market share."
2. "...we believe we also hold a leading market position in the manufacturing
of railcars in Europe."
3. "We believe we operate one of the largest repair and refurbishment networks
in North America..."
Exhibit D
Form of Lock-Up Agreement
May 17, 2006
Bear, Xxxxxxx & Co. Inc.
Banc of America Securities LLC
c/o Bear, Xxxxxxx & Co. Inc.
000 Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Equity Capital Markets
The Greenbrier Companies, Inc. Lock-Up Agreement
Ladies and Gentlemen:
This letter agreement (this "Agreement") relates to the proposed offering
(the "Offering") by The Greenbrier Companies, Inc., an Oregon corporation (the
"Company"), of its 2.375% Convertible Senior Notes due 2026 (the "Notes") in an
aggregate principal amount of up to $100 million (including the Initial
Purchasers' over-allotment option).
In order to induce you (the "Initial Purchasers") to purchase Notes in the
Offering, the undersigned hereby agrees that, without the prior written consent
of Bear, Xxxxxxx & Co. Inc. ("Bear Xxxxxxx"), during the period from the date
hereof until sixty (60) days from the date of the final offering memorandum for
the Offering (the "Lock-Up Period"), the undersigned (a) will not, directly or
indirectly, offer, sell, agree to offer or sell, solicit offers to purchase,
grant any call option or purchase any put option with respect to, pledge, borrow
or otherwise dispose of any Relevant Security (as defined below), and (b) will
not establish or increase any "put equivalent position" or liquidate or decrease
any "call equivalent position" with respect to any Relevant Security (in each
case within the meaning of Section 16 of the Securities Exchange Act of 1934, as
amended, and the rules and regulations promulgated thereunder), or otherwise
enter into any swap, derivative or other transaction or arrangement that
transfers to another, in whole or in part, any economic consequence of ownership
of a Relevant Security, whether or not such transaction is to be settled by
delivery of Relevant Securities, other securities, cash or other consideration;
provided, however, that the foregoing restrictions shall not preclude or
otherwise limit (i) the transfer to the Company of common stock of the Company,
no par value ("Common Stock"), in connection with the exercise of outstanding
options to purchase that are scheduled to expire during the 60-day period solely
to pay the option exercise price or any taxes required to be withheld by the
Company to the extent such transfer is permitted to satisfy such obligations
pursuant to the Company's equity compensation plans or the agreements pursuant
to which such options were granted (but not the sale or other disposition of
shares of Common Stock
issued in respect of such exercise) or (ii) a bona fide gift of Common Stock
approved by Bear Xxxxxxx so long as the recipient of such Common Stock agrees in
writing to be bound by the restrictions of this Lock-Up Letter Agreement;
provided as to (ii) above, each resulting transferee of Relevant Securities
executes and delivers to you an agreement satisfactory to you certifying that
such transferee is bound by the terms of this Agreement and has been in
compliance with the terms hereof since the date first above written as if it had
been an original party hereto. As used herein "Relevant Security" means the
Common Stock, any other equity security of the Company or any of its
subsidiaries and any security convertible into, or exercisable or exchangeable
for, any Common Stock or other such equity security.
The undersigned hereby authorizes the Company during the Lock-Up Period to
cause any transfer agent for the Relevant Securities to decline to transfer, and
to note stop transfer restrictions on the stock register and other records
relating to, Relevant Securities for which the undersigned is the record holder
and, in the case of Relevant Securities for which the undersigned is the
beneficial but not the record holder, agrees during the Lock-Up Period to cause
the record holder to cause the relevant transfer agent to decline to transfer,
and to note stop transfer restrictions on the stock register and other records
relating to, such Relevant Securities. The undersigned hereby further agrees
that, without the prior written consent of Bear Xxxxxxx, during the Lock-up
Period the undersigned (x) will not file or participate in the filing with the
Securities and Exchange Commission of any registration statement, or circulate
or participate in the circulation of any preliminary or final prospectus or
other disclosure document with respect to any proposed offering or sale of a
Relevant Security and (y) will not exercise any rights the undersigned may have
to require registration with the Securities and Exchange Commission of any
proposed offering or sale of a Relevant Security.
If:
(1) during the period that begins on the date that is 15 calendar days
plus three business days before the last day of the Lock-Up Period and ends
on the last day of the Lock-Up Period, the Company issues a earnings
release or material news or a material event relating to the Company
occurs; or
(2) prior to the expiration of the Lock-Up Period, the Company
announces that it will release earnings results during the 16-day period
beginning on the last day of the Lock-Up Period,
the restrictions imposed by this Agreement shall continue to apply until the
expiration of the date that is 15 calendar days plus three business days after
the date on which the issuance of the earnings release or the material news or
material event occurs; provided, however, this paragraph will not apply if,
within three days of the termination of the Lock-Up Period, the Company delivers
to Bear Xxxxxxx a certificate, signed by the Chief Financial Officer or Chief
Executive Officer of the Company, certifying on behalf of the Company that the
Company's shares of Common Stock are, as of the date of delivery of
such certificate, "actively traded securities," as defined in Regulation M, 17
CFR 242.101(c)(1).
The undersigned hereby represents and warrants that the undersigned has
full power and authority to enter into this Agreement and that this Agreement
constitutes the legal, valid and binding obligation of the undersigned,
enforceable in accordance with its terms. Upon request, the undersigned will
execute any additional documents necessary in connection with enforcement
hereof. Any obligations of the undersigned shall be binding upon the successors
and assigns of the undersigned from the date first above written.
This Agreement shall be governed by and construed in accordance with the
laws of the State of New York. Delivery of a signed copy of this letter by
facsimile transmission shall be effective as delivery of the original hereof.
Very truly yours,
By:
------------------------------------
Print Name:
----------------------------
Exhibit E
(THE GREENBRIER COMPANIES LOGO)
SUMMARY PRICING SHEET
ISSUER: The Greenbrier Companies, Inc.
SECURITY TYPE: Convertible Senior Notes
FORM OF OFFERING: Rule 144A with Registration Rights
INITIAL PROCEEDS: $85.0 million Aggregate Principal Amount
INITIAL PURCHASER'S OPTION: $15.0 million Aggregate Principal Amount
OFFER PRICE: 100.0% of Par
MATURITY: May 15, 2026
RANKING: Senior Unsecured
SUBSIDIARY GUARANTEES: Guaranteed on a senior unsecured basis by
existing and future restricted material
domestic subsidiaries
COUPON: 2.375% of Par per Note
FIRST COUPON PAYMENT DATE: November 15, 2006
PRINCIPAL AMOUNT PER NOTE: $1,000.00
CONVERSION PREMIUM: 30.00%
LAST SALE PRICE (MAY 16, 2006): $36.96
INITIAL CONVERSION PRICE: $48.05
CONVERSION RATE PER NOTE: 20.8125 Shares Per Note
CONVERSION RIGHTS: - During any calendar quarter after
June 30, 2006 subject to 130%
Conversion Trigger ($62.46)
- If the average trading price of the
Notes is less than 98% of conversion
value
- On or after May 15, 2021;
- If the Notes are called for
redemption;
- Upon the occurrence of specified
corporate transactions
OPTIONAL REDEMPTION: After May 15, 2013
PURCHASE OF NOTES AT HOLDER'S OPTION: May 15, 2013, 2016 and 2021 at 100% of
Principal Amount
CONTINGENT INTEREST: 0.375%, payable after May 15, 2013 if the
trading price of the Notes exceeds 120%
of par
FUNDAMENTAL CHANGE PROTECTION: Adjustment for Conversion Upon Certain
Corporate Transactions
DIVIDEND PROTECTION: Conversion rate adjustment for quarterly
common stock dividends paid above $0.08.
JOINT-BOOKRUNNERS: Bear, Xxxxxxx & Co. Inc., Banc of America
Securities LLC
GROSS SPREAD (%): 3.000%
GROSS SPREAD PER NOTE: $30.00
TRADE DATE: May 17, 2006
SETTLEMENT DATE: May 22, 2006
NYSE STOCK TICKER: "GBX"
144A CUSIP: 000000XX0
FOR QUALIFIED INSTITUTIONAL BUYERS ONLY. FOR INFORMATIONAL PURPOSES ONLY. THIS
COMMUNICATION IS NEITHER AN OFFER TO SELL NOR A SOLICITATION OF AN OFFER TO BUY
ANY OF THESE NOTES.
THE NOTES, THE GUARANTEES AND THE COMMON STOCK ISSUABLE UPON CONVERSION OF THE
NOTES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR
ANY OTHER STATE SECURITIES LAWS. UNLESS THEY ARE REGISTERED, THE NOTES AND THE
COMMON STOCK ISSUABLE UPON CONVERSION OF THE NOTES MAY BE OFFERED ONLY IN
TRANSACTIONS EXEMPT FROM OR NOT SUBJECT TO REGISTRATION UNDER THE SECURITIES ACT
OF 1933, AS AMENDED, OR ANY OTHER STATE SECURITIES LAWS. ACCORDINGLY, THE NOTES
HAVE BEEN OFFERED ONLY TO QUALIFIED INSTITUTIONAL BUYERS UNDER RULE 144A.
A COPY OF THE OFFERING MEMORANDUM FOR THE OFFERING MAY BE OBTAINED BY CONTACTING
BEAR, XXXXXXX & CO. INC. 000 XXXXXXX XXX, XXX XXXX, XXX XXXX 00000.
Annex I
FORM OF OPINION OF COMPANY COUNSEL
(a) The Company is a corporation validly existing and in good standing
under the laws of the State of Oregon, with the corporate power and authority to
own its properties and conduct its business as described in the Offering
Memorandum (including the information set forth in the Company's Annual Report
on Form 10-K for the year ended August 31, 2005, filed with the Commission on
November 4, 2005 (the "2005 Annual Report") which is incorporated by reference
therein).
(b) Each of the Company and the Guarantors has all requisite corporate,
limited liability company or limited partnership (as applicable) power and
authority to execute and deliver and perform its obligations under the Purchase
Agreement and the Registration Rights Agreement, to perform under the Indenture
and to consummate the transactions contemplated thereby, including, without
limitation, the corporate, limited liability company or limited partnership (as
applicable) power and authority to issue, sell and deliver the Notes and to
issue and deliver the Guarantees as provided in the Purchase Agreement.
(c) The Purchase Agreement has been duly authorized, executed and delivered
by the Company and each of the Guarantors.
(d) The Registration Rights Agreement has been duly authorized, executed
and delivered by the Company and each of the Guarantors, and is the legal, valid
and binding agreement of the Company and each of the Guarantors, enforceable
against each of them in accordance with its terms.
(e) The Indenture has been duly authorized, executed and delivered by the
Company and each of the Guarantors and is the legal, valid and binding agreement
of the Company and each of the Guarantors, enforceable against each of them in
accordance with its terms.
(f) The Notes have been duly authorized and executed by the Company for
issuance and sale to the Initial Purchasers pursuant to the Purchase Agreement,
and, when authenticated in accordance with the terms of the Indenture and
delivered against payment therefor in accordance with the terms of the Purchase
Agreement, the Notes will be the legal, valid and binding obligations of the
Company, enforceable against it in accordance with their terms and entitled to
the benefits of the Indenture.
(g) The Guarantees of the Notes have been duly authorized by each of the
Guarantors and, when the Notes have been issued and authenticated in accordance
with the terms of the Indenture and delivered against payment therefor in
accordance with the terms of the Purchase Agreement, such Guarantees will be the
legal, valid and binding obligations of each of the Guarantors, enforceable
against each of them in accordance with their terms and entitled to the benefits
of the Indenture.
(h) The Conversion Shares issuable upon conversion of the Notes have been
duly authorized and have been duly reserved for issuance from the Company's
authorized and unissued shares of Common Stock. When issued upon conversion of
the Notes in accordance with the terms of the Notes, the Conversion Shares will
be validly issued, fully paid and non-assessable, and the issuance of the
Conversion Shares will not be subject to any preemptive rights under the
Company's Articles of Incorporation or Bylaws or the Oregon Business Corporation
Act or, to the best of such counsel's knowledge, any similar rights that entitle
or will entitle any person to acquire shares of Common Stock upon issuance of
the Conversion Shares.
(i) The execution, delivery and performance of the Purchase Agreement and
the Registration Rights Agreement, the performance of the Indenture and the
consummation of the transactions contemplated by the Purchase Agreement, the
Registration Rights Agreement, the Indenture and the Offering Memorandum do not
and will not result in a violation of any law, rule or regulation of the United
States of America or the State of New York applicable to the Company and its
Subsidiaries.
(j) No consent, approval, authorization, order, registration, filing,
qualification, license or permit of or with any court or any judicial,
regulatory or other legal or governmental agency or body is required for the
execution, delivery and performance of the Purchase Agreement and the
Registration Rights Agreement, the performance of the Indenture or the
consummation of the transactions contemplated by the Purchase Agreement, the
Registration Rights Agreement, the Indenture and the Offering Memorandum except
(i) for such as may be required under state securities or Blue Sky laws in
connection with the purchase and distribution of the Notes and the Guarantees of
the Notes by the Initial Purchasers, and (ii) for the registration of the Notes,
the Guarantees and the Common Stock under the Securities Act as contemplated by
the Registration Rights Agreement.
(k) Each of the Company and the Subsidiaries is not now and, after giving
effect to the offering and sale of the Notes and the application of the proceeds
thereof as described in the Offering Memorandum, will not be, an "investment
company" as such term is defined in the Investment Company Act of 1940, as
amended.
(l) The statements under the captions "Description of Notes," "Description
of Capital Stock," and "United States Federal Income Tax Considerations" in the
Time of Sale Memorandum and the Offering Memorandum, insofar as such statements
constitute a summary of the legal matters or documents referred to therein,
fairly present in all material respects such legal matters and documents in the
context in which presented in the Time of Sale Memorandum and the Offering
Memorandum.
(m) Assuming the accuracy of the representations, warranties and covenants
of the Company and the Initial Purchasers contained in the Purchase Agreement,
no registration of the Notes or the Guarantees of the Notes under the Securities
Act, and no qualification of an indenture under the Trust Indenture Act with
respect thereto, is required in connection with the purchase of the Notes by the
Initial Purchasers or the initial resale of the Notes pursuant to Rule 144A by
the Initial Purchasers to Qualified Institutional Buyers in the manner
contemplated by the Purchase Agreement, the Time of Sale Memorandum and the
Offering Memorandum.
(n) Assuming the accuracy of the representations, warranties and covenants
of the Company and the Initial Purchasers contained in the Purchase Agreement,
the Notes are eligible for resale pursuant to Rule 144A.
(o) When the Notes are issued and delivered to the Initial Purchasers
pursuant to the Purchase Agreement, none of the Notes will be of the same class
(within the meaning of Rule 144A under the Securities Act) as securities of the
Company or any of the Subsidiaries that are listed on a national securities
exchange registered under Section 6 of the Exchange Act or that are quoted in a
United States automated inter-dealer quotation system.
(p) The Indenture complies as to form in all material respects with the
rules and regulations of the Commission applicable to an indenture that is
qualified under the Trust Indenture Act.
(q) The Incorporated Documents (except for the financial statements,
related schedules and other financial data included or incorporated by reference
therein, as to which such counsel need express no opinion) at the time filed
with the Commission complied as to form in all material respects with the
Exchange Act and the rules and regulations of the Commission promulgated
thereunder.
Our opinions in paragraphs (d), (e), (f), and (g) above also are subject to
bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium and
similar laws of general applicability relating to or affecting creditors' rights
and to general principles of equity (whether considered in a proceeding at law
or in equity), and our opinion in paragraph (d) above is additionally subject to
limitations upon the rights of indemnification and contribution that may be
imposed by federal or state securities laws or principles of public policy.
In addition, such counsel shall state that it has participated in
conferences with officers and other representatives of the Company and the
Guarantors, representatives of the independent auditors of the Company and the
Guarantors and the Initial Purchasers and its representatives at which the
contents of the Time of Sale Memorandum and the Offering Memorandum and related
matters were discussed and, although it is not passing upon, and does not assume
any responsibility for, the accuracy, completeness or fairness of the statements
contained in the Time of Sale Memorandum and the Offering Memorandum and has not
made any independent check or verification thereof, during the course of such
participation, no facts have come to its attention that led it to believe that
the Time of Sale Memorandum and the Offering Memorandum, as of their respective
dates and the Closing Date, contained or contains an untrue statement of a
material fact or omitted or omits to state any material fact necessary to make
the statements therein, in the light of the circumstances under which they were
made, not misleading (except as to financial statements and other financial data
included or incorporated by reference therein or omitted therefrom, as to which
no opinion need be rendered).
Xxxxx XX
FORM OF OPINION OF GENERAL COUNSEL OF THE COMPANY
(a) Each of the Company's Subsidiaries has been duly organized and is
validly existing and in good standing under the laws of its jurisdiction of
organization and has all necessary corporate power and authority to own, lease
and operate its property and to conduct its business as described in the
Offering Memorandum, including the information incorporated by reference into
the Offering Memorandum from Item 1, Business, of the Company's Annual Report on
Form 10-K for the year ended August 31, 2005, as filed with the Securities and
Exchange Commission on November 4, 2005 (the "2005 Annual Report"). Each of the
Company and its Subsidiaries is duly qualified to do business and is in good
standing as a foreign corporation in each jurisdiction in which the character or
location of its properties (owned, leased or licensed) or the nature or conduct
of its business makes such qualification necessary, except for those failures to
be so qualified or in good standing which would not (individually or when
aggregated with other such instances) have a material adverse effect on the
business, condition (financial or otherwise), results of operations,
stockholders' equity, properties or prospects of the Company and its
Subsidiaries taken as a whole (a "Material Adverse Effect").
(b) Neither the Company nor any of its Subsidiaries is in violation of its
respective charter or by-laws and, to such counsel's knowledge, neither the
Company nor any of its Subsidiaries is in default in the performance of any
obligation, agreement, covenant or condition contained in any indenture, loan
agreement, mortgage, lease or other agreement or instrument to which the Company
or any of its Subsidiaries is a party or by which the Company or any of its
Subsidiaries or their respective property is bound, except for defaults that,
singly or in the aggregate, would not have a Material Adverse Effect.
(c) Except as disclosed in the Time of Sale Memorandum and the Offering
Memorandum, to such counsel's knowledge, neither the Company nor any of its
Subsidiaries has violated any environmental law, any provisions of the Employee
Retirement Income Security Act of 1974, as amended, or any provisions of the
Foreign Corrupt Practices Act, or the rules and regulations promulgated
thereunder, except for such violations which, singly or in the aggregate, would
not have a Material Adverse Effect.
(d) Each of the Company and its Subsidiaries has such authorizations of,
and has made all filings with and notices to, all governmental or regulatory
authorities and self-regulatory organizations and all courts and other
tribunals, including, without limitation, under any applicable environmental
laws, as are necessary to own, lease, license and operate its respective
properties and to conduct its business, except where the failure to have any
such authorization or to make any such filing or notice would not, singly or in
the aggregate, have a Material Adverse Effect; each such authorization is valid
and in full force and effect and each of the Company and its Subsidiaries is in
compliance with all the terms and conditions thereof and with the rules and
regulations of the authorities and governing bodies having jurisdiction with
respect thereto; and no event has occurred (including, without limitation, the
receipt of any notice from any authority or governing body) which allows or,
after notice or lapse of time or
both, would allow, revocation, suspension or termination of any such
authorization or results or, after notice or lapse of time or both, would result
in any other impairment of the rights of the holder of any such authorization;
and such authorizations contain no restrictions that are burdensome to the
Company or any of its Subsidiaries; except where such failure to be valid and in
full force and effect or to be in compliance, the occurrence of any such event
or the presence of any such restriction would not, singly or in the aggregate,
have a Material Adverse Effect.
(e) Other than as set forth in the Time of Sale Memorandum and the Offering
Memorandum, there are no judicial, regulatory or other legal or governmental
proceedings pending to which the Company or any of its Subsidiaries is a party
or of which any property of the Company or any of its Subsidiaries is the
subject which, if determined adversely to the Company or any of its
Subsidiaries, would singly or in the aggregate have a Material Adverse Effect;
and, to such counsel's knowledge, no such proceedings are threatened or
contemplated.
(f) The execution, delivery, and performance of the Purchase Agreement, the
Registration Rights Agreement, and the Indenture and the consummation of the
transactions contemplated by the Purchase Agreement, the Registration Rights
Agreement, the Indenture and the Offering Memorandum do not and will not (i)
conflict with, require consent under (except for any consent previously
obtained) or result in a breach of any of the terms and provisions of, or
constitute a default (or an event which with notice or lapse of time, or both,
would constitute a default) under, or result in the creation or imposition of
any Lien upon property or assets of the Company or any of its Subsidiaries
pursuant to, any indenture, mortgage, deed of trust, loan agreement or any other
material agreement, instrument, franchise, license or permit to which the
Company or any of its Subsidiaries is a party or by which the Company or any of
its Subsidiaries or their respective properties or assets may be bound, except
for breaches that, singly or in the aggregate, would not have a Material Adverse
Effect, or (ii) violate or conflict with any provision of the articles of
incorporation, by-laws or other organizational documents of the Company or any
of its Subsidiaries, or (iii) violate any judgment, decree, order, statute, rule
or regulation of any court or any judicial, regulatory or other legal or
governmental agency or body of the United States of America or the State of
Oregon applicable to the Company or any of its Subsidiaries.
(g) The Company has an authorized capitalization as set forth in the Time
of Sale Memorandum, the Preliminary Offering Memorandum and the Offering
Memorandum. All shares of Common Stock outstanding on the date of the Offering
Memorandum have been duly authorized and validly issued, are fully paid and non
assessable and were not issued in violation of any preemptive or similar rights
under (i) the Company's Articles of Incorporation or Bylaws, (ii) the Oregon
Business Corporation Act or, (iii) to the best of such counsel's knowledge, the
terms or provisions of any material document, agreement or other instrument to
which the Company is a party. To the best of such counsel's knowledge, except as
set forth in the Time of Sale Memorandum, the Preliminary Offering Memorandum
and the Offering Memorandum, there are (i) no outstanding securities of the
Company convertible into or evidencing the right to purchase or subscribe for
any shares of capital stock of the Company, (ii) no outstanding or authorized
options, warrants, calls, subscriptions, rights, commitments or any other
instruments or agreements of any character obligating the Company to issue any
shares of its capital stock or any securities convertible into or evidencing the
right to purchase or subscribe for any shares of
such stock, and (iii) no agreements or understandings with respect to the
voting, sale or transfer of any shares of capital stock of the Company to which
the Company is a party. All of the outstanding shares of capital stock or other
equity securities of each Subsidiary are owned of record and beneficially,
directly or indirectly, by the Company, free and clear of all Liens and
limitations on voting rights (except as set forth on Exhibit A to such opinion)
and are duly authorized, validly issued, fully paid and non-assessable, and have
not been issued in violation of any preemptive or similar rights under (i) the
applicable Subsidiary's organizational documents, (ii) the laws of its
jurisdiction of organization or, (iii) to the best of such counsel's knowledge,
the terms or provisions of any material document, agreement or other instrument
to which the applicable Subsidiary is a party. To the best of such counsel's
knowledge, there are (i) no outstanding or authorized options, warrants, calls,
subscriptions, rights, commitments or other instruments or agreements of any
character obligating the Company or any Subsidiary to issue any shares of
capital stock of any Subsidiary or any securities convertible into or evidencing
the right to purchase or subscribe for any shares of such stock, and (ii) no
agreements or understandings with respect to the voting, sale or transfer of any
shares of capital stock of any Subsidiary. To the best of such counsel's
knowledge, there are no outstanding contractual obligations of the Company or
any Subsidiary to repurchase, redeem or otherwise acquire any outstanding shares
of capital stock or other ownership interests of any Subsidiary or to provide
funds to or make any investment (in the form of a loan, capital contribution or
otherwise) in any Subsidiary or any other entity.
(h) The statements under Item 3, "Legal Proceedings" in the Company's
Annual Report on Form 10-K for the year ended August 31, 2005, and Part II, Item
1, "Legal Proceedings" in the Company's Quarterly Report on Form 10-Q for the
quarter ended February 28, 2006 incorporated by reference in the Time of Sale
Memorandum and the Offering Memorandum, insofar as such statements constitute a
summary of the legal matters, documents or proceedings referred to therein,
present fairly in all material respects such legal matters, documents and
proceedings in the context in which presented in the Time of Sale Memorandum and
the Offering Memorandum.
Xxxxx XXX
FORM OF OPINION OF CANADIAN REGULATORY COUNSEL OF THE COMPANY
1. No consent or approval of, or notice to or filing with Transport Canada under
any provision of the federal laws of Canada and the laws of the Province of
Ontario is required by the Company in connection with the execution and delivery
by it of the Purchase Agreement or the offer, sale and issuance of the Notes as
contemplated by the Time of Sale Memorandum and the Offering Memorandum defined
therein.
The opinion may be subject to the following qualification:
1. Equipment owned by the Company or its Subsidiaries may be leased by a
"railway company" as that term is defined in the Canada Transportation Act
("CTA"). In the event of an insolvency of a "railway company", a scheme of
arrangement and associated filings pursuant to the CTA might apply.
