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EXHIBIT 10.18
CROWN PACIFIC LIMITED PARTNERSHIP
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NOTE PURCHASE AGREEMENT
Dated as of December 15, 1997
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Re: $95,000,000 Senior Notes, Series A, B and C
Due 2010 - 2018
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TABLE OF CONTENTS
SECTION HEADING PAGE
SECTION 1. DESCRIPTION OF NOTES AND COMMITMENT. . . . . . . . . . . . . 1
Section 1.1. Description of the Transaction; Notes. . . . . . . . . . 1
Section 1.2. Commitment, Closing Date . . . . . . . . . . . . . . . . 2
Section 1.3. Failure to Deliver . . . . . . . . . . . . . . . . . . . 2
Section 1.4. Expenses . . . . . . . . . . . . . . . . . . . . . . . . 2
Section 1.5. Several Commitments. . . . . . . . . . . . . . . . . . . 3
Section 1.6. Pre-funding of Commitment. . . . . . . . . . . . . . . . 3
SECTION 2. REPRESENTATIONS. . . . . . . . . . . . . . . . . . . . . . . 4
Section 2.1. Representations of the Company . . . . . . . . . . . . . 4
Section 2.2. Representations of the Managing General Partner. . . . . 4
Section 2.3. Representations of the Purchasers. . . . . . . . . . . . 4
SECTION 3. CLOSING CONDITIONS . . . . . . . . . . . . . . . . . . . . . 6
Section 3.1. Execution of Agreement and Notes . . . . . . . . . . . . 6
Section 3.2. Closing Certificates . . . . . . . . . . . . . . . . . . 6
Section 3.3. Opinions of Counsel. . . . . . . . . . . . . . . . . . . 6
Section 3.4. Legal Existence and Authority. . . . . . . . . . . . . . 6
Section 3.5. Insurance. . . . . . . . . . . . . . . . . . . . . . . . 7
Section 3.6. Environmental Audit. . . . . . . . . . . . . . . . . . . 7
Section 3.7. Appraisals . . . . . . . . . . . . . . . . . . . . . . . 7
Section 3.8. Related Transactions . . . . . . . . . . . . . . . . . . 7
Section 3.9. Acquisition Facility; Working Capital Facility . . . . . 7
Section 3.10. Legality . . . . . . . . . . . . . . . . . . . . . . . . 7
Section 3.11. Payment of Special Counsel Fees. . . . . . . . . . . . . 8
Section 3.12. Private Placement Number . . . . . . . . . . . . . . . . 8
Section 3.13. [Intentionally Reserved] . . . . . . . . . . . . . . . . 8
Section 3.14. Satisfactory Proceedings . . . . . . . . . . . . . . . . 8
SECTION 4. COMPANY COVENANTS. . . . . . . . . . . . . . . . . . . . . . 8
Section 4.1. Legal Existence, Etc . . . . . . . . . . . . . . . . . . 8
Section 4.2. Insurance. . . . . . . . . . . . . . . . . . . . . . . . 9
Section 4.3. Taxes, Claims for Labor and Materials, Compliance
with Laws; Environmental and Natural Resource Matters. . 9
Section 4.4. Maintenance, Etc . . . . . . . . . . . . . . . . . . . .12
Section 4.5. Nature of Business . . . . . . . . . . . . . . . . . . .12
Section 4.6. Limitations on Current Debt and Funded Debt. . . . . . .12
Section 4.7. Distributions. . . . . . . . . . . . . . . . . . . . . .13
Section 4.8. Investments. . . . . . . . . . . . . . . . . . . . . . .13
Section 4.9. Mergers and Consolidations . . . . . . . . . . . . . . .15
Section 4.10. Sales of Assets. . . . . . . . . . . . . . . . . . . . .16
Section 4.11. Sale of Equity Interests in Restricted Subsidiaries. . .18
Section 4.12. Limitation on Harvesting . . . . . . . . . . . . . . . .19
Section 4.13. Payment of Dividends by Restricted Subsidiaries. . . . .20
Section 4.14. Guaranties . . . . . . . . . . . . . . . . . . . . . . .20
Section 4.15. Transactions with Affiliates . . . . . . . . . . . . . .20
Section 4.16. Multiemployer Plan Liability and Termination of
Pension Plans. . . . . . . . . . . . . . . . . . . . . .20
Section 4.17. Reports and Rights of Inspection.. . . . . . . . . . . .21
Section 4.18. Changes in Status of Subsidiaries. . . . . . . . . . . .23
Section 4.19. Repurchase of Notes. . . . . . . . . . . . . . . . . . .24
Section 4.20. Liens. . . . . . . . . . . . . . . . . . . . . . . . . .24
Section 4.21. Ratings. . . . . . . . . . . . . . . . . . . . . . . . .26
SECTION 5. PREPAYMENT OF NOTES. . . . . . . . . . . . . . . . . . . . .26
Section 5.1. Required Prepayments . . . . . . . . . . . . . . . . . .26
Section 5.2. Optional Prepayment With Premium . . . . . . . . . . . .27
Section 5.3. Notice of Optional Prepayments . . . . . . . . . . . . .27
Section 5.4. Application of Prepayments . . . . . . . . . . . . . . .28
Section 5.5. Direct Payment . . . . . . . . . . . . . . . . . . . . .28
SECTION 6. EVENTS OF DEFAULT AND REMEDIES THEREFOR. . . . . . . . . . .28
Section 6.1. Events of Default. . . . . . . . . . . . . . . . . . . .28
Section 6.2. Notice to Holders. . . . . . . . . . . . . . . . . . . .30
Section 6.3. Acceleration of Maturities . . . . . . . . . . . . . . .30
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Section 6.4. Rescission of Acceleration . . . . . . . . . . . . . . .31
SECTION 7. AMENDMENTS, WAIVERS AND CONSENTS . . . . . . . . . . . . . .31
Section 7.1. Consent Required . . . . . . . . . . . . . . . . . . . .31
Section 7.2. Solicitation of Holders. . . . . . . . . . . . . . . . .32
Section 7.3. Effect of Amendment or Waiver. . . . . . . . . . . . . .32
SECTION 8. INTERPRETATION OF AGREEMENT; DEFINITIONS . . . . . . . . . .32
Section 8.1. Definitions. . . . . . . . . . . . . . . . . . . . . . .32
Section 8.2. Accounting Principles. . . . . . . . . . . . . . . . . .50
Section 8.3. Directly or Indirectly . . . . . . . . . . . . . . . . .50
SECTION 9. MISCELLANEOUS. . . . . . . . . . . . . . . . . . . . . . . .50
Section 9.1. Registered Notes . . . . . . . . . . . . . . . . . . . .50
Section 9.2. Exchange of Notes. . . . . . . . . . . . . . . . . . . .51
Section 9.3. Loss, Theft, Etc. of Notes . . . . . . . . . . . . . . .51
Section 9.4. Powers and Rights Not Waived; Remedies Cumulative. . . .51
Section 9.5. Notices. . . . . . . . . . . . . . . . . . . . . . . . .51
Section 9.6. Reproduction of Documents. . . . . . . . . . . . . . . .52
Section 9.7. Survival . . . . . . . . . . . . . . . . . . . . . . . .52
Section 9.8. Successors and Assigns . . . . . . . . . . . . . . . . .52
Section 9.9. Governing Law. . . . . . . . . . . . . . . . . . . . . .52
Section 9.10. Submission to Jurisdiction . . . . . . . . . . . . . . .52
Section 9.11. Limitations of Liability . . . . . . . . . . . . . . . .53
Section 9.12. Severability . . . . . . . . . . . . . . . . . . . . . .53
Section 9.13. Captions . . . . . . . . . . . . . . . . . . . . . . . .53
Section 9.14. Duplicate Originals. . . . . . . . . . . . . . . . . . .53
Signatures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .54
ATTACHMENTS TO NOTE PURCHASE AGREEMENT:
SCHEDULE I -- Names and Commitments of Purchasers
SCHEDULE II -- Investments
EXHIBIT A-1 -- Form of 7.76% Senior Notes, Series A
EXHIBIT A-2 -- Form of 7.76% Senior Notes, Series B
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EXHIBIT A-3 -- Form of 7.93% Senior Notes, Series C
EXHIBIT B-1 -- Closing Certificate of the Company
EXHIBIT B-2 -- Closing Certificate of the Managing General Partner
EXHIBIT C -- Description of Closing Opinion of Counsel to the
Company
EXHIBIT D -- Description of Closing Opinion of Special Counsel to
the Company
EXHIBIT E -- [Intentionally Reserved]
EXHIBIT F -- Description of Closing Opinion of Special Counsel to
the Purchasers
EXHIBIT G -- Subordination Provisions
EXHIBIT H -- Pre-Funding Agreement
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CROWN PACIFIC LIMITED PARTNERSHIP
000 X.X. Xxxxxxxx Xxxxxx
Xxxxxxxx, Xxxxxx 00000
NOTE PURCHASE AGREEMENT
Re: $95,000,000 Senior Notes, Series A, B and C
Due 2010 - 2018
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Dated as of
December 15, 1997
To the Purchasers named in Schedule I
to this Agreement
Gentlemen:
CROWN PACIFIC LIMITED PARTNERSHIP, a Delaware limited partnership (together
with any Person who succeeds to all or substantially all Crown Pacific Limited
Partnership's assets and business, the "COMPANY"), agrees with the Purchasers
named on Schedule I to this Agreement (the "PURCHASERS") as follows:
SECTION 1. DESCRIPTION OF NOTES AND COMMITMENT.
SECTION 1.1. DESCRIPTION OF THE TRANSACTION; NOTES. The Company has duly
authorized the issuance and sale of its Senior Notes due 2010 - 2018 in an
aggregate principal amount not to exceed $95,000,000, to be comprised of
Series A Notes in an aggregate principal amount of $15,000,000, Series B Notes
in an aggregate principal amount of $55,000,000 and Series C Notes in an
aggregate principal amount of $25,000,000. The Notes (such term and all other
capitalized terms not otherwise defined herein shall have the respective
meanings assigned thereto in Section 8) Are to be dated the date of issue, to
bear interest at the rate of
7.76%, in the case of the Series A Notes, 7.76%, in the case of the Series B
Notes and 7.93%, in the case of the Series C Notes, per annum prior to maturity
payable semiannually in arrears on February 1 and August 1 in each year
(commencing February 1, 1998) until the principal amount thereof shall be due
and payable, to bear interest on overdue principal (including any overdue
prepayment of principal) and premium, if any, and (to the extent permitted by
law) on any overdue installment of interest at the Overdue Rate, to be expressed
to mature on February 1, 2012, in the case of the Series A Notes, February 1,
2013, in the case of the Series B Notes and February 1, 2018, in the case of the
Series C Notes, and to be substantially in the respective forms attached hereto
as Exhibits X-0, X-0 and A-3. Interest on the Notes will be computed on the
basis of a 360-day year of twelve 30-day months. The Notes are not subject to
prepayment or redemption at the option of the Company prior to their expressed
maturity dates except on the terms and conditions and in the amounts and with
the premium, if any, set forth in Section 5.
SECTION 1.2. COMMITMENT, CLOSING DATE. Subject to the terms and
conditions hereof and on the basis of the representations and warranties
hereinafter set forth, the Company agrees to issue and sell to each Purchaser,
and such Purchaser agrees to purchase from the Company, on the closing date
specified below such Purchaser's name in Schedule I, or in the event that the
Company cannot perform all of the conditions set forth in Section 3 by such
date, then such other Business Day not later than the commitment expiration date
specified below such Purchaser's name in Schedule I as such conditions can be
satisfied or such other Business Day as the Company and the Purchasers shall
specifically agree upon (the "CLOSING DATES"), the Notes specified opposite such
Purchaser's name in Schedule I at a price of 100% of the principal amount
thereof.
Delivery of the Notes to be purchased on each Closing Date will be made at
the offices of Xxxxxxx and Xxxxxx, 000 X. Xxxxxx Xxxxxx, Xxxxxxx, Xxxxxxxx 00000
at or about 12:00, noon, Chicago, Illinois time, on such Closing Date against
payment therefor in Federal funds or other immediately available funds at the
principal office of Bank of America National Trust and Savings
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Association, San Francisco, ABA# 000000000, Account Name, Crown Pacific Limited
Partnership, Account No. 12330-26768, in the amount of the purchase price. The
Note to be delivered to each Purchaser on such Closing Date will be delivered to
such Purchaser in the form of a single registered Note of each series to be
purchased by such Purchaser on such Closing Date in the form attached hereto as
Exhibit X-0, X-0 xxx/xx X-0, as the case may be, for the full amount of such
Purchaser's purchase of such series (unless different denominations are
specified by such Purchaser), registered in such Purchaser's name or in the name
of such Purchaser's nominee specified in Schedule I.
SECTION 1.3. FAILURE TO DELIVER. If, on any Closing Date, the Company
fails to tender to any Purchaser the Notes to be issued to such Purchaser on
such Closing Date or if the conditions specified in Section 3 hereof have not
been fulfilled, such Purchaser may thereupon elect to be relieved of all further
obligations under this Agreement; PROVIDED that such election shall not relieve
the Company from any of its obligations hereunder or waive any of such
Purchaser's rights against the Company. Without limiting the foregoing, if the
conditions specified in Section 3 hereof for any Closing Date have not been
fulfilled, each Purchaser purchasing Notes on such Closing Date may waive
compliance by the Company with any such condition to such extent as such
Purchaser in its sole discretion may determine.
SECTION 1.4. EXPENSES. Whether or not the transactions herein
contemplated shall be consummated, the Company agrees to pay all expenses
relating to the transactions contemplated by this Agreement, including but not
limited to:
(a) the cost of reproducing this Agreement, the Notes and all other
documents required or contemplated hereunder;
(b) the reasonable fees and expenses of Xxxxxxx and Xxxxxx, special
counsel to the Purchasers;
(c) reasonable out-of-pocket expenses of the Purchasers;
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(d) the cost of delivering to each Purchaser at its home office,
insured to its satisfaction, the Notes purchased thereby on the Closing
Dates;
(e) all reasonable fees and expenses (including, without limitation,
reasonable attorney's fees) incurred by any Holder in connection with the
enforcement of the obligations of the Company under this Agreement or the
Notes; and
(f) all expenses (including reasonable attorney's fees) in connection
with any amendments, waivers or consents requested or agreed to by the
Company in connection with this Agreement or the Notes (whether or not the
same are actually executed and delivered), including, without limitation,
any amendments, waivers, or consents resulting from any work-out,
renegotiation or restructuring relating to the performance by the Company
of its obligations under this Agreement and the Notes;
PROVIDED that each Person that has incurred or incurs expenses related to the
subject matter of this Agreement shall use its best efforts to submit promptly
to the Company invoices with respect to such expenses. The Company also agrees
that it will pay and save the Purchasers harmless against any and all liability
with respect to stamp and other taxes (except for taxes on any Purchaser's gross
or net income), if any, which may be payable or which may be determined to be
payable in connection with the execution and delivery of this Agreement or the
Notes, whether or not any Notes are then outstanding. The Company agrees to
protect and indemnify the Purchasers against any liability for any and all
brokerage fees and commissions payable or claimed to be payable to any Person in
connection with the transactions contemplated by this Agreement. Each Purchaser
hereby represents and warrants that it has not engaged any investment banker or
broker in connection with its purchase of the Notes, it being understood that
BancAmerica Xxxxxxxxx Xxxxxxxx has acted as placement agent of the Company.
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The obligations of the Company under this Section 1.4 shall survive the
payment or prepayment of the Notes and the termination of this Agreement.
SECTION 1.5. SEVERAL COMMITMENTS. The obligations of each Purchaser
shall be several and not joint and no Purchaser shall be liable or responsible
for the acts or defaults of any other Purchaser. The obligation of the Company
to consummate the sale of the Notes on each Closing Date is contingent upon the
purchase by the Purchasers of 100% of the aggregate principal amount of the
Notes scheduled to be purchased on such Closing Date pursuant to this Agreement.
SECTION 1.6. PRE-FUNDING OF COMMITMENT. In order to facilitate an
orderly closing on each Closing Date, each Purchaser purchasing Notes on such
Closing Date agrees that upon the request of the Company made at least 5 days
prior to such Closing Date, such Purchaser shall make its funds required to
purchase the Notes to be purchased by it on such Closing Date available to Bank
of America National Trust and Savings Association, as funding agent (the
"FUNDING AGENT"), at or prior to 12:00, noon, Chicago, Illinois time, on the
Business Day prior to such Closing Date, in Federal funds or other immediately
available funds. The foregoing obligation of each Purchaser to so make its
funds available shall be subject to the condition precedent that it shall have
received a Pre-Funding Agreement executed by the Company and the Funding Agent
in substantially the form attached hereto as Exhibit H. Each Purchaser agrees
by its execution hereof that funds so made available by it may be invested by
the Funding Agent as provided in said Pre-Funding Agreement.
SECTION 2. REPRESENTATIONS.
SECTION 2.1. REPRESENTATIONS OF THE COMPANY. The Company represents and
warrants that all representations set forth in the form of Closing Certificate
attached hereto as Exhibit B-1 are true and correct as of the date hereof and
are incorporated herein by reference with the same force and effect as though
herein set forth in full.
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SECTION 2.2. REPRESENTATIONS OF THE MANAGING GENERAL PARTNER. Crown
Pacific Management Limited Partnership, a Delaware limited partnership (together
with any Person who succeeds to all or substantially all of Crown Pacific
Management Limited Partnership's assets and business, the "MANAGING GENERAL
PARTNER"), represents and warrants that all representations set forth in the
form of Closing Certificate attached hereto as Exhibit B-2 are true and correct
as of the date hereof and are incorporated herein by reference with the same
force and effect as though herein set forth in full.
SECTION 2.3. REPRESENTATIONS OF THE PURCHASERS. Each Purchaser
represents and warrants to the Company that such Purchaser is acquiring the
Notes for the purpose of investment and not with a view to the distribution
thereof, and that such Purchaser has no present intention of selling,
negotiating or otherwise disposing of the Notes; it being understood, however,
that the disposition of such Purchaser's Property shall at all times be and
remain within its control. Each Purchaser further represents and warrants to
the Company that such Purchaser has such knowledge and experience in financial
and business matters that it is capable of evaluating the merits and risks of
investing in the Notes and is aware that the Notes have not been registered
under the Securities Act or the securities laws of any state, and that the sale
of each Note is predicated upon such sale being exempt from registration as an
exempt transaction under applicable federal and state securities laws, and that
no state or federal governmental authorities have made any finding or
determination relating to the Notes, and that no state or federal governmental
authority has or will recommend or endorse the Notes. Each Purchaser further
represents and warrants to the Company that at least one of the following
statements is an accurate representation as to the source of funds to be used by
such Purchaser to pay the purchase price of the Notes purchased by it hereunder
(respectively, the "SOURCE"):
(a) The Source is an "insurance company general account" within the
meaning of Department of Labor Prohibited Transaction Exemption ("PTE")
95-60 (issued July 12, 1995), and there is no employee benefit plan
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(treating as a single plan, all employee benefit plans maintained by the
same employer or employee organization) with respect to which the amount of
the general account reserves and liabilities for all contracts held by or
on behalf of such employee benefit plan exceed ten percent (10%) of the
total reserves and liabilities of such general account (exclusive of
separate account liabilities) plus surplus, as set forth in the NAIC Annual
Statement filed with such Purchaser's state of domicile;
(b) The Source is one or more separate accounts, trusts or a
commingled pension trust maintained by the Purchaser within the meaning of
PTE 90-1 (issued January 29, 1990) and the Purchaser has disclosed to the
Company the names of such employee benefit plans whose assets in such
separate account or accounts or pension trusts exceed 10% of the total
assets or are expected to exceed 10% of the total assets of such account or
accounts or trusts as of the date of such purchase (for the purpose of this
clause (b), all employee benefit plans maintained by the same employer or
employee organization are deemed to be a single plan);
(c) The Source is a bank collective investment fund maintained by the
Purchaser within the meaning of PTE 91-38 (issued July 12, 1991) and the
Purchaser has disclosed to the Company the names of such employee benefit
plans whose assets in such collective investment fund exceed 10% of the
total assets or are expected to exceed 10% of the total assets of such fund
as of the date of such purchase (for the purpose of this clause (c), all
employee benefit plans maintained by the same employer or employee
organization are deemed to be a single plan);
(d) The Source is one or more employee benefit plans, each of which
has been identified to the Company in writing;
(e) The Source is one or more pension funds, trust funds or agency
accounts, each of which is a "governmental plan" as defined in Section
3(32) of ERISA;
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(f) The Source is an "investment fund" managed by a "qualified
professional asset manager" or "QPAM" (as defined in Part V of PTE 84-14,
issued March 13, 1984), provided that no other party to the transactions
described in this Agreement and no "affiliate" of such other party (as
defined in Section V(c) of PTE 84-14) has at this time, and during the
immediately preceding one year has exercised the authority to appoint or
terminate said QPAM as manager of the assets of any plan identified in
writing pursuant to this clause (f) or to negotiate the terms of said
QPAM's management agreement on behalf of any such identified plans; or
(g) The Source consists of funds which do not constitute "plan
assets".
The Company shall deliver a certificate on each Closing Date which
certificate shall either state that (i) it is neither a "party in interest" (as
defined in Title I, Section 3(14) of ERISA) nor a "disqualified person" (as
defined in Section 4975(e)(2) of the Internal Revenue Code of 1986, as amended),
with respect to any plan identified pursuant to clauses (b), (c) or (d) above,
or (ii) with respect to any plan identified pursuant to clause (f) above,
neither it nor any "affiliate" (as defined in Section V(c) of PTE 84-14) is
described in the proviso to said clause (f). As used in this Section 2.3, the
term "SEPARATE ACCOUNT" shall have the meaning assigned thereto in ERISA, the
term "PLAN ASSETS" shall have the meaning assigned thereto in Department of
Labor Regulation 29 C.F.R. Section 2510.3-101 and the term "EMPLOYEE BENEFIT
PLAN" shall have the meaning assigned thereto in ERISA and shall also include a
plan as defined in Section 4975(e)(1) of the Internal Revenue Code of 1986, as
amended. The representations contained in such certificate shall be made in
reliance upon and subject to the accuracy of the representation of the
Purchasers in this Section 2.3 as to the source of funds to be used by the
Purchasers to pay the purchase price of the Notes to be purchased by the
Purchasers.
SECTION 3. CLOSING CONDITIONS.
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The obligation of each Purchaser to purchase the Notes to be purchased by
such Purchaser on each Closing Date shall be subject to the performance by the
Company of its agreements hereunder which, by the terms hereof, are to be
performed at or prior to the time of delivery of the Notes and of the following
further conditions precedent:
SECTION 3.1. EXECUTION OF AGREEMENT AND NOTES. On or prior to such
Closing Date this Agreement and the Notes shall have been duly authorized,
executed and delivered by the Company and shall be in full force and effect and
no Default or Event of Default shall exist in the performance by the Company of
any of its obligations thereunder.
SECTION 3.2. CLOSING CERTIFICATES. On such Closing Date, each Purchaser
purchasing Notes on such Closing Date shall have received (i) from the Company a
certificate dated the Closing Date, substantially in the form attached hereto as
Exhibit B-1, and (ii) from the Managing General Partner a certificate dated such
Closing Date, substantially in the form attached hereto as Exhibit B-2, the
truth and accuracy of each of which shall be a condition to such Purchaser's
obligation to purchase the Notes proposed to be sold to such Purchaser.
SECTION 3.3. OPINIONS OF COUNSEL. On such Closing Date, each Purchaser
purchasing Notes on such Closing Date shall have received the written opinions,
dated in each case as of such Closing Date, from Ball Xxxxx LLP, counsel to the
Company and the Managing General Partner, from Xxxxxxx & Xxxxx L.L.P., special
counsel to the Company, and from Xxxxxxx and Xxxxxx, special counsel to the
Purchasers, their respective opinions substantially described in Exhibits C, D
and F hereto, reasonably satisfactory in form and substance to such Purchaser.
SECTION 3.4. LEGAL EXISTENCE AND AUTHORITY. On such Closing Date, each
Purchaser purchasing Notes on such Closing Date shall have received, in form and
substance reasonably satisfactory to such Purchaser and such Purchaser's special
counsel, such documents and evidence with respect to the Company and the
Managing General Partner as such Purchaser or such Purchaser's
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special counsel may reasonably request in order to establish the existence and
good standing of the Company and the Managing General Partner, the authorization
of the transactions contemplated by this Agreement, the taking of all
appropriate proceedings in connection therewith and compliance with the
conditions set forth in this Section 3.
SECTION 3.5. INSURANCE. Prior to such Closing Date, each Purchaser
purchasing Notes on such Closing Date shall have received from the Company a
certificate of the Company evidencing compliance with the provisions of
Section 4.2.
SECTION 3.6. ENVIRONMENTAL AUDIT. Prior to such Closing Date, each
Purchaser purchasing Notes on such Closing Date shall have received from the
Company reasonably requested environmental information with respect to the
Properties owned by the Company or to be owned by the Company after giving
effect to the issuance of the Notes and the consummation of the transactions
described in Section 3.8 (including environmental information with respect to
the conversion facilities and endangered species).
SECTION 3.7. APPRAISALS. Prior to such Closing Date, each Purchaser
purchasing Notes on such Closing Date shall have received existing appraisal
reports reasonably requested by the Purchasers with respect to the timberlands
owned by the Company or to be owned by the Company after giving effect to the
issuance of the Notes.
SECTION 3.8. RELATED TRANSACTIONS. Concurrently with the issuance and
sale of the Notes to the Purchasers on such Closing Date:
(i) the Company shall consummate the sale of the entire aggregate
principal amount of the Notes scheduled to be sold on such Closing Date
(and in the case of the second Closing Date, the sale of the Notes
scheduled to be sold on the first Closing Date shall also have been
consummated) pursuant to this Agreement; and
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(ii) The net proceeds of the sale of the Notes pursuant to this
Agreement shall be applied by the Company to repay indebtedness in
connection with the acquisitions of timberlands and other Property and to
the payment, or provision for payment, of expenses in consummating the
transactions contemplated by this Agreement.
SECTION 3.9. ACQUISITION FACILITY; WORKING CAPITAL FACILITY. On or prior
to such Closing Date, the Company shall have executed and delivered and there
shall be in full force and effect an Amended and Restated Credit Agreement dated
as of July 31, 1996, as amended (the "ACQUISITION CREDIT AGREEMENT"), with Bank
of America National Trust and Savings Association and the other banks named
therein, pursuant to which there shall from time to time be available to the
Company (subject to certain conditions precedent set forth therein) not less
than $150,000,000 to fund future acquisitions by the Company of timberlands and
related assets (the "ACQUISITION FACILITY"), and the Company shall have executed
and delivered and there shall be in full force and effect an Amended and
Restated Facility B Credit Agreement dated as of July 31, 1996, as amended (the
"WORKING CAPITAL CREDIT AGREEMENT"), with Bank of America National Trust and
Savings Association and the other banks named therein, pursuant to which there
shall from time to time be available to the Company (subject to certain
conditions precedent set forth therein) not less than $40,000,000 for working
capital and general partnership purposes of the Company.
SECTION 3.10. LEGALITY. On such Closing Date, the purchase by each
Purchaser of the Notes proposed to be sold to such Purchaser on such Closing
Date shall not be prohibited by any applicable law or governmental regulation,
shall not be subject to any penalty or other onerous condition under or pursuant
to any applicable law or governmental regulation, and such Purchaser shall have
received from the Company such certificates or other evidence as to matters of
fact as such Purchaser may reasonably request to establish compliance with this
condition.
SECTION 3.11. PAYMENT OF SPECIAL COUNSEL FEES. On such Closing Date, the
Company shall have paid the reasonable fees and
-16-
expenses of Xxxxxxx and Xxxxxx, special counsel to the Purchasers, in connection
with the purchase of the Notes by the Purchasers on such Closing Date.
SECTION 3.12. PRIVATE PLACEMENT NUMBER. Prior to such Closing Date, the
appropriate filings shall have been duly made with Standard & Poor's CUSIP
Service Bureau, as agent for the National Association of Insurance
Commissioners, in order to obtain a private placement number for each series of
the Notes.
SECTION 3.13. [INTENTIONALLY RESERVED].
SECTION 3.14. SATISFACTORY PROCEEDINGS. All proceedings taken in
connection with the transactions contemplated by this Agreement and all
documents necessary to the consummation thereof, shall have been taken or
delivered, as the case may be, shall be satisfactory in form and substance to
special counsel to the Purchasers, and each Purchaser shall have received a copy
(executed or certified as may be appropriate) of all legal documents or
proceedings taken in connection with the consummation of said transactions.
SECTION 4. COMPANY COVENANTS.
From and after the first Closing Date and continuing so long as any amount
remains unpaid on any Note:
SECTION 4.1. LEGAL EXISTENCE, ETC. The Company will preserve and keep in
force and effect its legal existence as a limited partnership not taxable as a
corporation, and will cause each Restricted Subsidiary to preserve and keep in
force and effect, its legal existence as a limited partnership, general
partnership or corporation, as the case may be, and all material licenses,
franchises and permits necessary to the proper conduct of its business, PROVIDED
that the foregoing shall not prevent any transaction permitted by Section 4.9;
and PROVIDED FURTHER that the Company shall not be obligated to preserve its
status as a partnership not taxable as a corporation if (i) the Company's
failure to preserve such status shall be the result of an amendment to the tax
laws enacted by the Congress of the United
-17-
States and (ii) after giving effect to the loss of such status the ratio of
Consolidated Cash Flow for the immediately preceding Four Quarter Period to Pro
Forma Maximum Debt Service, determined as of the date of the loss of such
status, would be greater than 1.1 to 1.0, assuming, for the purposes of the
computation of Consolidated Cash Flow, that Consolidated Cash Flow would be
reduced by taxes at the applicable tax rate of the Company for such period had
the Company been taxable as a corporation.
SECTION 4.2. INSURANCE. The Company will maintain, and will cause each
Restricted Subsidiary to maintain, insurance coverage by financially sound and
reputable insurers in such forms and amounts (including such deductibles and
self insurance) and against such risks as are customary for companies of
established reputation engaged in the same or similar business activities and
owning and operating similar Properties.
SECTION 4.3. TAXES, CLAIMS FOR LABOR AND MATERIALS, COMPLIANCE WITH LAWS;
ENVIRONMENTAL AND NATURAL RESOURCE MATTERS. (a) The Company will promptly pay
and discharge, and will cause each Restricted Subsidiary promptly to pay and
discharge, all lawful taxes, assessments and governmental charges or levies
imposed upon the Company or such Restricted Subsidiary, respectively, or upon or
in respect of all or any part of the Property or business of the Company or such
Restricted Subsidiary, all trade accounts payable in accordance with usual and
customary business terms, and all claims for work, labor or materials, which if
unpaid would become a Lien or charge upon any Property of the Company or such
Restricted Subsidiary, PROVIDED that the Company or such Restricted Subsidiary
shall not be required to pay any such tax, assessment, charge, levy, account
payable or claim if (i) the validity, applicability or amount thereof is being
contested in good faith by appropriate actions or proceedings which will prevent
the forfeiture or sale of any Property of the Company or such Restricted
Subsidiary or any material interference with the use thereof by the Company or
such Restricted Subsidiary, and (ii) the Company or such Restricted Subsidiary
shall set aside on its books, reserves deemed by it to be adequate with respect
thereto. The Company will promptly comply, and will cause each Subsidiary to
comply, with all laws,
-18-
ordinances or governmental rules and regulations to which it is subject,
including without limitation, ERISA, the violation of which would materially and
adversely affect the Properties, business, profits or condition of the Company
and its Restricted Subsidiaries, taken as a whole, or would result in any Lien
not permitted under Section 4.20.
(b) (1) The Company and its Subsidiaries and their Properties shall
comply in all material respects with any applicable Environmental and
Natural Resource Law;
(2) The Company and its Subsidiaries shall obtain and maintain in
good standing all material Governmental Approvals required for their
operations and their Properties by any applicable Environmental and Natural
Resource Law;
(3) The Company and its Subsidiaries shall not, and shall not permit
any Person to, own or operate on any of its Properties any (i) landfill or
dump or (ii) hazardous waste treatment, storage or disposal facility as
defined pursuant to RCRA or any comparable state law; the Company and its
Subsidiaries shall not use, generate, treat, store, release or dispose of
Hazardous Materials at or on any of its Properties in quantities materially
greater than that which is customary for operations similar to those of the
Company and its Subsidiaries;
(4) The Company and its Subsidiaries shall within ten Business Days
notify the Holders in writing of, and specify the action the Company is
taking and proposes to take with respect thereto and provide any reasonably
requested documents upon learning of, any of the following:
(A) any material liability for response or corrective action,
natural resource damage or other harm pursuant to CERCLA, RCRA or any
comparable state law;
(B) any material Environmental and Natural Resource Claim
arising from the Company and its
-19-
Subsidiaries, their operations, their Properties or any other Property
previously owned or operated by the Company or its Subsidiaries or
their predecessors;
(C) any conditions or occurrences at the Properties of the
Company and its Subsidiaries which could reasonably form the basis for
a material Environmental and Natural Resource Claim against the
Company or its Subsidiaries or their Properties;
(D) any material and actual or imminent restriction on the
ownership, occupancy, use, productivity or transferability of the
Properties of the Company or its Subsidiaries (i) arising in
connection with any Release, threatened Release or disposal of a
Hazardous Material, or any Environmental and Natural Resource Law or
(ii) as a consequence of any Harvest/Yield Restriction; or
(E) any other environmental, natural resource, health or safety
condition, which could materially and adversely affect the ability of
the Company to perform its obligations under this Agreement or the
Notes;
(5) At its sole expense (but without thereby waiving any claims it
may have against third parties), the Company and its Subsidiaries will
conduct any investigation, study, sampling and testing, and undertake any
cleanup, removal, remedial or other response action necessary to remove,
clean up or xxxxx any material quantity of Hazardous Material which is
Released or disposed of at or on the Properties in accordance with any
applicable Environmental and Natural Resource Law and any order or
directive from a Governmental Authority having jurisdiction, except to the
extent the Company or its Subsidiaries are diligently contesting any
applicable Environmental and Natural Resource Law or any order or directive
from a Governmental Authority, so long as such contest is in good faith and
by appropriate proceedings and as to which reserves deemed by the Company
to be adequate are maintained and no forfeiture or material
-20-
interference with the use of the Properties of the Company and its
Restricted Subsidiaries will result from a failure to comply with the
contested requirement;
(6) (A) The Company agrees, at its sole cost and expense, to defend
(with attorneys reasonably satisfactory to the Holders holding at least a
majority in aggregate principal amount of outstanding Notes), protect,
indemnify and hold harmless the Purchasers, and any Holder, and their
respective officers, directors, trustees, employees and agents (the
"INDEMNITEES") from and against any and all liabilities, obligations
(including removal and remedial actions), losses, damages (including
foreseeable and unforeseeable consequential damages and punitive damages,
which consequential or punitive damages do not result from an Indemnitee's
gross negligence or willful misconduct), penalties, actions, judgments,
suits, orders (whether administrative or judicial), consent decrees,
claims, costs, expenses and disbursements (including reasonable
consultants' fees and disbursements and including all reasonable attorneys'
fees whether incurred in a suit or action or any appeals from a judgment or
decree therein or in connection with non-judicial action) of any kind or
nature whatsoever that may at any time be incurred by, imposed on or
asserted against the Indemnitees, the Company or its Subsidiaries directly
or indirectly based on, or arising or resulting from (i) the actual or
alleged presence or Release of any Hazardous Material on the Properties of
the Company or its Subsidiaries or the removal, handling, transportation,
disposal or storage of such Hazardous Material, (ii) any Environmental and
Natural Resource Claim with respect to the Properties of the Company or its
Subsidiaries, or (iii) any failure to comply, and the resulting cost to
come into compliance, with any applicable Environmental and Natural
Resource Laws with respect to the Properties of the Company or its
Subsidiaries and the requirements of any permits issued under such
Environmental and Natural Resource Laws (collectively, the "INDEMNIFIED
MATTERS"), regardless of when such Indemnified Matters arise, but excluding
as to any Indemnitee any Indemnified
-21-
Matter resulting directly from gross negligence or willful misconduct by
such Indemnitee or its representative. To the extent that this indemnity
is unenforceable because it violates any law or public policy, the Company
agrees to contribute the maximum portion that it is permitted to contribute
under applicable law to the payment and satisfaction of all Indemnified
Matters;
(B) The Company hereby waives, releases and covenants not to bring
any demand, claim, cost recovery action or lawsuit it may now or hereafter
have or accrue against any Indemnitee arising from the subject matter of an
Indemnified Matter, except as a direct result of the gross negligence or
willful misconduct of such Indemnitee;
(C) The Company agrees to reimburse each Indemnitee for all sums paid
and costs incurred by each Indemnitee with respect to any Indemnified
Matter, within ten (10) Business Days following written demand therefor,
with interest thereon at the Overdue Rate from the initial date of such
written demand, if not paid within such ten (10) Business Day period; and
(D) Should any Indemnitee institute any action or proceeding at law
or in equity, or in arbitration, to enforce any provision of the above
indemnification (including an action for declaratory relief or for damages
by reason of an alleged breach of any provision of the above
indemnification) or otherwise in connection with the above indemnification,
it shall be entitled to recover from the Company its reasonable fees and
disbursements incurred in connection therewith if it is the prevailing
party in such action or proceeding.
SECTION 4.4. MAINTENANCE, ETC. The Company will maintain, preserve and
keep, and will cause each Restricted Subsidiary to maintain, preserve and keep,
its Properties (other than timber) which are used or useful in the conduct of
its business (whether owned in fee or a leasehold interest) in good repair and
working order and from time to time will make all necessary repairs,
-22-
replacements, renewals and additions so that at all times such Properties shall
remain usable in the Company's business. The Company will follow, and will
cause each Restricted Subsidiary to follow, prudent industry management
standards with respect to its timber and timber Properties, including the
growing and harvesting of its timber. Nothing in this Section 4.4 shall be
construed to (i) limit the Company's ability to sell or otherwise dispose of
assets in accordance with Section 4.10, or (ii) prevent the Company from ceasing
to operate any sawmill or other conversion facility if the Board of Control
determines in good faith that such cessation is in the best interest of the
Company. The Company shall engage in prudent management practices with respect
to any acquisition of assets, including conducting any environmental
investigation as is prudent under the circumstances. The Company shall deliver
to each Holder a copy of any environmental report obtained by the Company in
connection with any such acquisition.
SECTION 4.5. NATURE OF BUSINESS. Neither the Company nor any Restricted
Subsidiary will engage in any business if, as a result, the general nature of
the business, taken on a consolidated basis, which would then be engaged in by
the Company and its Restricted Subsidiaries would be substantially changed from
the growing and harvesting of timber and manufacture and sale of lumber, plywood
and wood products and related businesses engaged in by the Company and its
Restricted Subsidiaries on the date of this Agreement and described in the
Private Placement Memorandum and other businesses incidental or reasonably
related thereto.
Section 4.6. Limitations on Current Debt and Funded Debt. (a) The
Company will not, and will not permit any Restricted Subsidiary to, create,
assume, incur, guarantee or in any manner be or become liable in respect of any
Current Debt or Funded Debt, except:
(1) Funded Debt evidenced by the Notes;
-23-
(2) Funded Debt of the Company outstanding on the first Closing Date
and described in Part II of Annex C to Exhibit B-1;
(3) Current Debt and Funded Debt of the Company incurred under the
Working Capital Facility, PROVIDED that the aggregate principal amount of
such Current Debt and Funded Debt outstanding at any one time shall not
exceed $40,000,000;
(4) Additional Current Debt and Funded Debt of the Company and Funded
Debt of a Restricted Subsidiary secured by Liens permitted by Section
4.20(g), PROVIDED that on the date that any such Current Debt or Funded
Debt is incurred and after giving effect to the application of the proceeds
thereof:
(i) the ratio of Consolidated Cash Flow for the immediately
preceding Four Quarter Period to Pro Forma Interest Expense for such
period is greater than 2.5 to 1.0; and
(ii) the ratio of Consolidated Cash Flow for the immediately
preceding Four Quarter Period to Pro Forma Maximum Debt Service is
greater than 1.25 to 1.0;
(5) unsecured Subordinated Funded Debt of the Company to the Managing
General Partner or any Affiliate of the Managing General Partner, PROVIDED
that the aggregate principal amount of such Subordinated Funded Debt
outstanding at any one time shall not exceed $10,000,000; and
(6) Current Debt or Funded Debt of a Restricted Subsidiary to the
Company or to a Wholly-owned Restricted Subsidiary.
(b) The renewal, extension or refunding of any Current Debt or Funded Debt
issued, incurred or outstanding pursuant to Section 4.6(a) shall constitute the
issuance of additional Current Debt
-24-
or Funded Debt which is, in turn, subject to the limitations of the applicable
provisions of this Section 4.6, PROVIDED that, except to the extent of any
increase in the outstanding principal amount thereof, the commencement of a new
interest period for any Current Debt or Funded Debt as to which interest is
computed with reference to the London Interbank Offered Rate or any other base
rate or the conversion of the base rate used for any such interest computation
shall not be considered a renewal, extension, or refunding of such Current Debt
or Funded Debt for purposes of this Section 4.6.
(c) Any business entity which becomes a Restricted Subsidiary after the
date hereof shall for all purposes of this Section 4.6 be deemed to have
created, assumed or incurred at the time it becomes a Restricted Subsidiary all
Current Debt and Funded Debt of such business entity existing immediately after
it becomes a Restricted Subsidiary.
SECTION 4.7. DISTRIBUTIONS. The Company will not make any Distribution
if at the time of such Distribution and after giving effect thereto a Default or
Event of Default shall have occurred and be continuing. In addition, the
Company will not authorize or make any Distribution (i) on any date other than a
Business Day, (ii) in Property other than cash, (iii) which is payable more than
60 days after the date of authorization or declaration, or (iv) in an amount
which, together with all previous Distributions made by the Company for the
quarterly fiscal period most recently ended prior to the date of such
Distribution, exceeds the amount of Available Cash for such quarterly fiscal
period.
SECTION 4.8. INVESTMENTS. The Company will not, and will not permit any
Restricted Subsidiary to, make any Investments in any Person, except:
(a) Investments by the Company and its Restricted Subsidiaries in and
to Restricted Subsidiaries, including any Investment in a business entity
which, after giving effect to such Investment, becomes a Restricted
Subsidiary;
-25-
(b) Investments in commercial paper maturing in 270 days or less from
the date of issuance which, at the time of acquisition by the Company or
any Restricted Subsidiary, is rated at least A-1 by Standard & Poor's
Ratings Group, a division of XxXxxx-Xxxx, Inc., or P-1 by Xxxxx'x Investors
Service, Inc. or, if such commercial paper is not rated by either Standard
& Poor's Ratings Group, a division of XxXxxx-Xxxx, Inc., or Xxxxx'x
Investors Service, Inc., the highest rating of another nationally
recognized credit rating agency of similar standing approved in writing by
the Holders holding at least 66-2/3% in aggregate principal amount of
outstanding Notes;
(c) Investments in direct obligations of the United States of America
or any agency or instrumentality of the United States of America, the
payment or guarantee of which constitutes a full faith and credit
obligation of the United States of America, in either case, maturing in
twelve months or less from the date of acquisition thereof;
(d) Investments in certificates of deposit maturing within one year
from the date of origin, issued by a bank or trust company organized under
the laws of the United States or any state thereof, having capital, surplus
and undivided profits aggregating at least $250,000,000 and having
unsecured Funded Debt outstanding and rated at least AA by Standard &
Poor's Ratings Group, a division of XxXxxx-Xxxx, Inc., or Aa by Xxxxx'x
Investors Service, Inc. or, if such unsecured Funded Debt is not rated by
either Standard & Poor's Ratings Group, a division of XxXxxx-Xxxx, Inc., or
Xxxxx'x Investors Service, Inc., a comparable rating by another nationally
recognized credit rating agency of similar standing approved in writing by
the Holders holding at least 66-2/3% in aggregate principal amount of
outstanding Notes;
(e) receivables arising from the sale of goods and services in the
ordinary course of business of the Company and its Restricted Subsidiaries,
and prepayments, advances or deposits made by the Company or any Restricted
Subsidiary
-26-
to any Person in the ordinary course of business in connection with
contracts for timber harvesting or the acquisition of stumpage entered into
in the ordinary course of business;
(f) loans or advances in the usual and ordinary course of business to
officers, directors and employees of the Managing General Partner or the
Company for expenses (including moving expenses related to a transfer)
incidental to carrying on the business of the Company or any Restricted
Subsidiary;
(g) Investments in bankers acceptances maturing within 180 days from
the issuance thereof, accepted by a bank or trust company organized under
the laws of the United States or any state thereof, having capital, surplus
and undivided profits aggregating at least $500,000,000 and having
unsecured Funded Debt outstanding and rated at least AA by Standard &
Poor's Ratings Group, a division of XxXxxx-Xxxx, Inc., or Aa by Xxxxx'x
Investors Service, Inc. or, if such unsecured Funded Debt is not rated by
either Standard & Poor's Ratings Group, a division of XxXxxx-Xxxx, Inc., or
Xxxxx'x Investors Service, Inc., a comparable rating by another nationally
recognized credit rating agency of similar standing approved in writing by
the Holders holding at least 66-2/3% in aggregate principal amount of
outstanding Notes;
(h) Investments by the Company and its Restricted Subsidiaries
existing on the date of this Agreement and described in Schedule II hereto;
(i) Investments in any Subsidiary or any other Person organized under
the laws of the United States or Canada or any state or province thereof
which conducts substantially all of its business and has substantially all
of its assets within the United States or Canada and which is engaged in
substantially the same business as the Company, PROVIDED that the aggregate
amount of all such Investments made pursuant to this clause (i) shall not
exceed $10,000,000 in
-27-
any twelve-month period ending on the date of such Investment or
$52,900,000 from and after the first Closing Date (adjusting each such
amount annually for the percentage increase or decrease from the prior
calendar year in the Consumer Price Index); and
(j) Guaranties issued in compliance with Section 4.14 constituting an
obligation, warranty or indemnity of the Company, not guaranteeing
Indebtedness of any Person, which is undertaken or made in the ordinary
course of business.
SECTION 4.9. MERGERS AND CONSOLIDATIONS. The Company will not, and will
not permit any Restricted Subsidiary to, consolidate with, or be a party to a
merger with, or sell, lease or otherwise dispose of all or substantially all of
its assets to, any other Person; PROVIDED, HOWEVER, that:
(1) any Restricted Subsidiary may merge or consolidate with or into,
or sell, lease or otherwise dispose of all or substantially all of its
assets to, the Company or any Wholly-owned Restricted Subsidiary so long as
in any merger or consolidation involving the Company, the Company shall be
the surviving or continuing entity; and
(2) the Company may consolidate or merge with, or sell all or
substantially all of its assets to, any business entity if:
(i) the surviving or continuing entity or the entity to which
all or substantially all of the Company's assets are sold (the
"SURVIVING ENTITY") shall be either the Company or an entity organized
under the laws of the United States or any state thereof which
conducts substantially all of its business and has substantially all
of its assets within the United States, and in the case of any such
consolidation or merger in which the Company is not the Surviving
Entity or in the case of any such sale, the Surviving Entity shall (x)
expressly assume in writing the due and punctual payment of the
principal of,
-28-
premium, if any, and the interest on all of the Notes outstanding
according to their tenor and the due and punctual performance and
observance of all of the covenants in the Notes and this Agreement to
be performed or observed by the Company, and (y) furnish to the
Holders an opinion of independent counsel to the effect that the
instrument of assumption has been duly authorized, executed and
delivered and constitutes the legal, valid and binding contract and
agreement of the Surviving Entity enforceable in accordance with its
terms, which counsel and opinion shall be satisfactory to Holders
holding at least 66-2/3% in aggregate principal amount of the then
outstanding Notes;
(ii) at the time of such consolidation or merger or such sale
and after giving effect thereto (a) no Default or Event of Default
shall have occurred and be continuing and (b) the Consolidated Net
Worth of the Surviving Entity shall not be less than the Consolidated
Net Worth of the Company immediately prior to such consolidation or
merger or such sale; and
(iii) after giving effect to such consolidation or merger or
such sale, the Surviving Entity would be permitted to incur at least
$1.00 of additional Funded Debt under the provisions of Section
4.6(a)(4).
SECTION 4.10. SALES OF ASSETS. (a) The Company will not, and will not
permit any Restricted Subsidiary to sell, lease or otherwise dispose of all or
any substantial part (as defined in paragraph (b) of this Section 4.10) of the
assets of the Company and its Restricted Subsidiaries, except as permitted by
Section 4.9; PROVIDED, HOWEVER, that:
(1) any Restricted Subsidiary may sell, lease or otherwise dispose of
any substantial part of its assets to the Company or any Wholly-owned
Restricted Subsidiary;
(2) the Company or any Restricted Subsidiary may sell Properties
constituting a substantial part of the assets of
-29-
the Company and its Restricted Subsidiaries if (i) such sale shall be for
an amount not less than the fair market value (as determined in good faith
by the Board of Control) of such Properties; (ii) after giving effect to
such sale, no Default or Event of Default shall have occurred and be
continuing; (iii) the Net Proceeds of the sale of such Properties (to the
extent that the Net Proceeds of such sale exceed the minimum amount
required to define a substantial part pursuant to Section 4.10(b)) are
either:
(A) applied within the Application Period to pay Senior Funded
Debt of the Company or any Restricted Subsidiary (other than Senior
Funded Debt of a Restricted Subsidiary to the Company or another
Restricted Subsidiary) selected by the Company, which in the case of
the Notes shall be applied if and to the extent a prepayment pursuant
to Section 5.1 is required to be made within such Application Period
then in accordance with Section 5.1 and otherwise pursuant to Section
5.2; PROVIDED, HOWEVER, in the event that a Lien encumbering the
Property that is the subject of the sale was given to secure
Indebtedness incurred in connection with the acquisition thereof, the
Net Proceeds of such sale may be applied first to the payment of such
Indebtedness and any remaining Net Proceeds shall be applied as set
forth above, or
(B) deposited and held in a separate trust account with a bank
or trust company satisfactory to the Holders holding at least a
majority in aggregate principal amount of the outstanding Notes (which
account may be invested in Investments of the type described in
Section 4.8(b), (c), or (d)) and such Net Proceeds shall be either (x)
applied within such Application Period to the acquisition of
productive assets useful in the Company's business, or (y) committed,
pursuant to a binding written contract entered into by the Company
during such Application Period, to be applied to the acquisition of
productive assets useful in the Company's business (in either
-30-
case, having a fair market value, determined in good faith by the
Board of Control, but excluding in the case of any timberlands any
value based on a higher or better use thereof) not less than the
amount of such Net Proceeds so applied, PROVIDED that the acquisition
contemplated by such binding contract shall be consummated
substantially in accordance with the terms thereof within 90 days
after the end of such Application Period, and PROVIDED, FURTHER, that
the Net Proceeds of the sale of any Property shall be considered to
have been applied to an acquisition of Property although the
acquisition occurred prior to the sale of Property giving rise to such
Net Proceeds so long as such acquisition and sale were a series of
related transactions occurring within a 180-day period; and
(iv) within ten Business Days after any sale pursuant to this clause (2),
the Company shall have delivered to the Holders a certificate of the Board
of Control certifying that such sale was for fair market value received by
the Company and that after giving effect to such sale no Default or Event
of Default has occurred and is continuing, and within ten Business Days
after the earlier to occur of (a) the application pursuant to this clause
(2) of the Net Proceeds of any sale or (b) the last day of any Application
Period with respect to any sale, the Company shall have delivered to the
Holders a certificate of the Board of Control certifying as to the
application of the Net Proceeds of such sale and establishing compliance
with the requirements of this clause (2);
(3) the Company may sell timberlands in a like-kind exchange for a
like interest in other timberlands having a fair market value (determined
in good faith by the Board of Control, but excluding any value based on a
higher and better use thereof) of at least the fair market value of the
timberlands so sold, PROVIDED that 30 days prior to any like-kind exchange,
the Company shall have delivered to the
-31-
Holders a description of such exchange in sufficient detail to
establish compliance with the foregoing requirements; and
(4) the Company may sell not more than 25,000 acres in the
aggregate of timberlands owned by the Company designated in good faith
by a Responsible Officer for a higher and better use, PROVIDED that
ten Business Days after any such sale, the Company shall have
delivered to the Holders a certificate of a Responsible Officer
notifying the Holders of such sale and certifying as to the number of
acres sold pursuant to this clause (4) and the amount of gross
proceeds from such sale and establishing compliance herewith.
(b) As used in this Section 4.10, a sale, lease or other disposition of
assets (other than timber harvested and sold and inventory sold, in each case,
in the ordinary course of business) shall be deemed to be a "SUBSTANTIAL PART"
of the assets of the Company and its Restricted Subsidiaries if the book value
of such assets, when added to the book value of all other assets sold, leased or
otherwise disposed of by the Company and its Restricted Subsidiaries (other than
pursuant to clauses (1) through (4) above) (x) during the 12-month period ending
with the date of such sale, lease or other disposition, exceeds $10,000,000 or
(y) since December 22, 1994, exceeds $52,900,000, PROVIDED that each such amount
shall be adjusted annually from the first Closing Date for the percentage
increase or decrease from the prior calendar year in the Consumer Price Index.
Section 4.11. SALE OF EQUITY INTERESTS IN RESTRICTED SUBSIDIARIES.
(a) The Company will not permit any Restricted Subsidiary to issue or sell any
Equity Interest (including as "Equity Interest" for the purposes of this Section
4.11, any warrants, rights or options to purchase or otherwise acquire an Equity
Interest or other Securities exchangeable for or convertible into an Equity
Interest) of such Restricted Subsidiary to any Person other than the Company or
a Wholly-owned Restricted Subsidiary, except for the purpose of qualifying
directors, or except in satisfaction of the validly pre-existing preemptive
rights of minority shareholders in connection with the simultaneous issuance of
stock to the Company and/or a Restricted Subsidiary
-32-
whereby the Company and/or such Restricted Subsidiary maintain their same
proportionate interest in such Restricted Subsidiary.
(b) The Company will not sell, transfer or otherwise dispose of any Equity
Interest in any Restricted Subsidiary (except to qualify directors) or any
Indebtedness of any Restricted Subsidiary, and will not permit any Restricted
Subsidiary to sell, transfer or otherwise dispose of (except to the Company or a
Wholly-owned Restricted Subsidiary) any Equity Interest in or any Indebtedness
of any other Restricted Subsidiary, unless:
(1) simultaneously with such sale, transfer, or disposition, all the
Equity Interests and all Indebtedness of such Restricted Subsidiary at the
time owned by the Company and by every other Restricted Subsidiary shall be
sold, transferred or disposed of as an entirety;
(2) the Board of Control shall have determined, as evidenced by a
resolution thereof, that the proposed sale, transfer or disposition of said
Equity Interest and Indebtedness is in the best interests of the Company;
(3) said Equity Interest and Indebtedness are sold, transferred or
otherwise disposed of to a Person, for a cash consideration and on terms
reasonably deemed by the Board of Control to be adequate and satisfactory;
(4) the Restricted Subsidiary being disposed of shall not have any
continuing Investment in the Company or any other Restricted Subsidiary not
being simultaneously disposed of; and
(5) such sale or other disposition is not prohibited by Section 4.10.
SECTION 4.12. LIMITATION ON HARVESTING. The Company will not, and will
not permit any Restricted Subsidiary to, harvest timber on its or such
Restricted Subsidiary's timberlands in excess in the aggregate of the following
limitations:
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150% of the Planned Volume during any fiscal year of the Company,
140% of the Planned Volume during any period of two consecutive fiscal
years of the Company,
130% of the Planned Volume during any period of three consecutive fiscal
years of the Company, and
120% of the Planned Volume during any period of four consecutive fiscal
years of the Company;
PROVIDED, HOWEVER, that the Company and its Restricted Subsidiaries may harvest
timber from their timberlands exceeding the limitations set forth above (the
"EXCESS HARVEST") if (i) after giving effect to such Excess Harvest, no Default
or Event of Default shall have occurred and be continuing, (ii) the Net Proceeds
of the sale of such Excess Harvest (based upon the average price received by the
Company and its Restricted Subsidiaries for timber sold during such period) are
either:
(A) applied within the Application Period to pay Senior Funded Debt
of the Company or any Restricted Subsidiary (other than Senior Funded Debt
of a Restricted Subsidiary to the Company or another Restricted Subsidiary)
selected by the Company, which in the case of the Notes shall be applied if
and to the extent a prepayment pursuant to Section 5.1 is required to be
made within such Application Period then in accordance with Section 5.1 and
otherwise pursuant to Section 5.2, or
(B) deposited and held in a separate trust account with the bank or
trust company satisfactory to the Holders holding at least a majority in
aggregate principal amount of the outstanding Notes (which account may be
invested in Investments of the type described in Section 4.8(b), (c), or
(d)) and such Net Proceeds shall be either (x) applied by the Company
within the Application Period to the acquisition of timber or timberland or
(y) committed, pursuant to a binding written contract entered into by the
Company during such
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Application Period, to be applied to the acquisition of timber or
timberland (in either case, having a fair market value, determined in good
faith by the Board of Control, but excluding any value based on a higher or
better use thereof) not less than the amount of such Net Proceeds so
applied, PROVIDED that the acquisition contemplated by such binding
contract shall be consummated substantially in accordance with the terms
thereof within 90 days after the end of such Application Period, and
(iii) within ten Business Days after any Excess Harvest, the Company shall have
delivered to the Holders a certificate of the Board of Control certifying that
after giving effect to such Excess Harvest no Default or Event of Default has
occurred and is continuing, and within ten Business Days after the earlier to
occur of (a) the application of the Net Proceeds as set forth clause (ii) of
this Section 4.12 or (b) the last day of any Application Period with respect to
any Excess Harvest, the Company shall have delivered to the Holders a
certificate of the Board of Control certifying as to the application of the Net
Proceeds of such Excess Harvest and establishing compliance with the
requirements of clause (ii) of this Section 4.12.
SECTION 4.13. PAYMENT OF DIVIDENDS BY RESTRICTED SUBSIDIARIES. The
Company will not and will not permit any Restricted Subsidiary to enter into any
agreement which restricts the ability of any Restricted Subsidiary to declare
any dividend or to make any distribution on any Equity Interest of such
Restricted Subsidiary, PROVIDED that the limited partnership agreement of any
Restricted Subsidiary which is a limited partnership may limit the amount of any
distribution by such Restricted Subsidiary to the amount of available cash for
such Restricted Subsidiary (calculated on the same basis as Available Cash
hereunder) for the period in respect of which such distribution is being made.
SECTION 4.14. GUARANTIES. The Company will not and will not permit any
Restricted Subsidiary to become or be liable in respect of any Guaranty except
(i) Guaranties by the Company which are limited in amount to a stated maximum
dollar exposure,
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(ii) Guaranties of obligations incurred by any Restricted Subsidiary in
compliance with the provisions of this Agreement and (iii) bonds posted by the
Company or a Restricted Subsidiary in the ordinary course of business in
connection with timber harvest contracts, permits for road construction or work
in respect of environmental remediation.
SECTION 4.15. TRANSACTIONS WITH AFFILIATES. The Company will not, and
will not permit any Restricted Subsidiary to, enter into or be a party to any
transaction or arrangement with any Affiliate (including without limitation, the
purchase from, sale to or exchange of Property with, or the rendering of any
service by or for, any Affiliate), except in the ordinary course of, and
pursuant to the reasonable requirements of, the Company's or such Restricted
Subsidiary's business and upon fair and reasonable terms no less favorable to
the Company or such Restricted Subsidiary than would be obtained in a comparable
arm's-length transaction with a Person other than an Affiliate; PROVIDED,
HOWEVER, the Company shall be entitled to reimburse the Managing General Partner
for Specified Expenses. The Managing General Partner shall determine the
Specified Expenses that are allocable to the Company in any reasonable manner
determined by the Managing General Partner.
SECTION 4.16. MULTIEMPLOYER PLAN LIABILITY AND TERMINATION OF PENSION
PLANS. The Company will not and will not permit any ERISA Affiliate to withdraw
from any Multiemployer Plan if such withdrawal would result in withdrawal
liability (as described in Part 1 of Subtitle E of Title IV of ERISA) that could
reasonably be expected to have a material adverse effect on the business,
profits or financial condition of the Company and its Restricted Subsidiaries,
taken as a whole. The Company will not and will not permit any ERISA Affiliate
to permit any employee benefit plan maintained by it to be terminated in a
manner which could result in the imposition of a Lien on any Property of the
Company or any Subsidiary pursuant to Section 4068 of ERISA.
SECTION 4.17. REPORTS AND RIGHTS OF INSPECTION. The Company will keep,
and will cause each Subsidiary to keep, proper books of record and account in
which full and correct entries will be
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made of all dealings or transactions of or in relation to the business and
affairs of the Company or such Subsidiary, in accordance with GAAP consistently
applied (except for changes disclosed in the financial statements furnished to
the Holders pursuant to this Section 4.17 and concurred in by the independent
public accountants referred to in Section 4.17(b) hereof), and will furnish to
each Holder of any Note (in duplicate if so specified below or otherwise
requested), and in the case of the financial statements delivered pursuant to
Section 4.17(b), to the Securities Valuation Office, National Association of
Insurance Commissioners, 000 Xxxxxxxx, Xxxxx 0000, Xxx Xxxx, Xxx Xxxx 00000:
(a) QUARTERLY STATEMENTS. As soon as available and in any event
within 60 days after the end of each quarterly fiscal period (except the
last) of each fiscal year, duplicate copies of:
(1) consolidated balance sheets of the Company and its
Restricted Subsidiaries as of the close of such quarter setting forth
in comparative form the amount as of the close of the corresponding
period of the preceding fiscal year and the amount as of the close of
said preceding fiscal year, and
(2) consolidated statements of income and cash flows of the
Company and its Restricted Subsidiaries for such quarterly period and
the year to date period setting forth in comparative form the amount
for the corresponding periods of the preceding fiscal year,
all in reasonable detail and certified as complete and correct, by an
authorized financial officer of the Company;
(b) ANNUAL STATEMENTS. As soon as available and in any event within
120 days after the close of each fiscal year of the Company, duplicate
copies of:
(1) consolidated balance sheets of the Company and its
Restricted Subsidiaries as of the close of such fiscal year, and
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(2) consolidated statements of income and cash flows of the
Company and its Restricted Subsidiaries for such fiscal year,
in each case setting forth in comparative form the consolidated figures for
the preceding fiscal year, all in reasonable detail and accompanied by an
opinion thereon of a firm of independent public accountants of recognized
national standing selected by the Company to the effect that the
consolidated financial statements have been prepared in accordance with
GAAP consistently applied (except for changes in application in which such
accountants concur) and present fairly the financial condition and results
of operations of the Company and its Restricted Subsidiaries and that the
examination of such accountants in connection with such financial
statements has been made in accordance with generally accepted auditing
standards and accordingly, includes such tests of the accounting records
and such other auditing procedures as were considered necessary in
connection therewith;
(c) SEC AND OTHER REPORTS. Promptly upon their becoming available,
one copy of each financial statement, report, notice or proxy statement
sent by the Company to all holders of Equity Interests in the Company
generally and of each regular or periodic report, and any registration
statement or prospectus filed by the Company, any Subsidiary or the
Partnership with any securities exchange or the Securities and Exchange
Commission or any successor agency, and copies of any orders in any
proceedings to which the Company or any of its Subsidiaries is a party,
issued by any governmental agency, Federal or state, having jurisdiction
over the Company or any of its Subsidiaries, other than reports or licenses
granted by any such governmental agency with respect to the timber;
(d) REQUESTED INFORMATION. With reasonable promptness, such other
data and information as any Holder may reasonably request including,
without limitation, any information required to be provided to such Holder
or a
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prospective purchaser of the Notes by Rule 144A(d)(4) under the Securities
Act;
(e) OFFICER'S CERTIFICATES. Within the periods provided in
paragraphs (a) and (b) above, a certificate signed by the chief financial
officer of the Company stating that such officer has reviewed the
provisions of this Agreement and setting forth: (i) the information and
computations (in sufficient detail) required in order to establish whether
the Company was in compliance with the requirements of Section 4.6 through
Section 4.12, inclusive, and Section 4.20 at the end of the period covered
by the financial statements then being furnished (including with respect to
Section 4.10(a)(2) and Section 4.12, a certification as to the application
of any Net Proceeds during such period and the amount of Net Proceeds
remaining to be applied in accordance with each such Section as of such
date) and (ii) whether there existed as of the date of such financial
statements and whether, to the best of his knowledge, there exists on the
date of the certificate or existed at any time during the period covered by
such financial statements any Default or Event of Default and, if any such
condition or event exists on the date of the certificate, specifying the
nature and period of existence thereof and the action the Company is taking
and proposes to take with respect thereto;
(f) ACCOUNTANT'S CERTIFICATES. Within the period provided in
paragraph (b) above, a letter, addressed to the Holders, of the accountants
who render an opinion with respect to such financial statements, stating
that they have reviewed this Agreement and stating further that nothing
came to their attention that caused them to believe that the Company was
not in compliance with any of the provisions of Section 4.6 through Section
4.12, both inclusive, or Section 4.20 insofar as said provisions relate to
accounting matters, and if any non-compliance has come to their attention
specifying the nature and period of existence thereof, PROVIDED that such
accountants may state that their audit was not directed primarily toward
obtaining knowledge of any noncompliance by
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the Company with any of the terms or provisions of this Agreement;
(g) ERISA REPORTING. Prompt written notice, and in any event within
five Business Days upon learning of its occurrence, of the following and
the action the Company has taken, is taking or proposes to take with
respect thereto and, when known, any action taken or threatened by the
Internal Revenue Service, Department of Labor or the Pension Benefit
Guaranty Corporation ("PBGC") with respect thereto: (i) a Reportable Event
with respect to any employee benefit plan; (ii) the institution of any
steps by the Company, any ERISA Affiliate, the PBGC or any other Person to
terminate any employee benefit plan pursuant to Sections 4041(c) or 4042 of
ERISA; (iii) the institution of any steps by the Company or any ERISA
Affiliate to withdraw from any Multiemployer Plan, within the meaning of
ERISA which would result in a material adverse effect on the business,
profits or financial condition of the Company and its Restricted
Subsidiaries taken as a whole; (iv) a "prohibited transaction" within the
meaning of Section 406 of ERISA in connection with any employee benefit
plan which would result in a material adverse effect on the business,
profits or financial condition of the Company and its Restricted
Subsidiaries, taken as a whole; or (v) any increase in the liability of the
Company or any Subsidiary with respect to any post-retirement welfare
benefits which would result in a material adverse effect on the business,
profits or financial condition of the Company and its Restricted
Subsidiaries, taken as a whole; and
(h) NOTICE OF LITIGATION. Prompt written notice, and in any event
within five Business Days after the Company first obtains knowledge
thereof, with respect to the institution of any suit or proceeding against
the Company or any Restricted Subsidiary which if determined adversely
could, individually or in the aggregate with other suits and proceedings,
reasonably be expected to have a material adverse effect on the business,
profits, Properties or
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financial condition of the Company or any Restricted Subsidiary.
Without limiting the foregoing, the Company will permit each Holder (or such
Persons as such Holder may designate) to visit and inspect any of the Properties
of the Managing General Partner, the Company or any Subsidiary, to examine all
their books of account, records, reports and other papers, to make copies and
extracts therefrom, and to discuss their respective affairs, finances and
accounts with their respective officers, employees, and independent public
accountants (and by this provision the Company authorizes said accountants to
discuss with such Holder or Person so designated the finances and affairs of the
Company and its Subsidiaries with or without an officer or employee of the
Company or any of its Subsidiaries being present) all at such reasonable times
and as often as may be reasonably requested; PROVIDED that unless a Default or
Event of Default shall have occurred and shall be continuing, such Holders shall
give the Company at least 10 days' prior written notice of any such visit. The
Company shall not be required to pay or reimburse any Holder for expenses which
it may incur in connection with any such visitation or inspection except in the
case of any such visitation or inspection which shall occur while a Default or
Event of Default shall have occurred and shall be continuing.
SECTION 4.18. CHANGES IN STATUS OF SUBSIDIARIES. So long as no Default or
Event of Default shall have occurred and be continuing, the Board of Control may
at any time and from time to time, upon not less than 30 days' prior written
notice given to each Holder, designate a previously Unrestricted Subsidiary as a
Restricted Subsidiary, PROVIDED that immediately after such designation and
after giving effect thereto (i) no Default or Event of Default shall have
occurred and be continuing and (ii) the Company could incur at least $1.00 of
additional Funded Debt under the provisions of Section 4.6(a)(4).
Any notice of designation pursuant to this Section 4.18 shall be
accompanied by a certificate signed by the chief financial officer of the
Company stating that the provisions of this Section 4.18
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have been complied with in connection with such designation and setting forth
the name of each other Subsidiary (if any) which has or will become a Restricted
Subsidiary, as the case may be, as a result of such designation.
SECTION 4.19. REPURCHASE OF NOTES. Neither the Company nor any Restricted
Subsidiary, directly or indirectly or through any Affiliate, may repurchase or
make any offer to repurchase any Notes unless an offer has been made to
repurchase Notes, PRO RATA, from all Holders at the same time and upon the same
terms (without regard to the different maturities but taking into account the
interest rates applicable to each series of Notes). In case the Company
repurchases or otherwise acquires any Notes, such Notes shall immediately
thereafter be cancelled and no Notes shall be issued in substitution therefor.
Without limiting the foregoing, upon the repurchase or other acquisition of any
Notes by the Company, any Restricted Subsidiary or any Affiliate, such Notes
shall no longer be outstanding for purposes of any section of this Agreement
relating to the taking by the Holders of any actions with respect hereto,
including, without limitation, SECTIONS 6.3, 6.4 and 7.1.
SECTION 4.20. LIENS. The Company will not, and will not permit any
Restricted Subsidiary to, create or incur, or suffer to be incurred or to exist,
any Lien on its or their Property, whether now owned or hereafter acquired, or
upon any income or profits therefrom, or transfer any Property for the purpose
of subjecting the same to the payment of obligations in priority to the payment
of its or their general creditors, or acquire or agree to acquire, or permit any
Restricted Subsidiary to acquire, any Property upon conditional sales agreements
or other title retention devices, except:
(a) Liens for property taxes and assessments or governmental charges
or levies and Liens securing claims or demands of carriers, loggers,
mechanics and materialmen incurred in the ordinary course of business,
PROVIDED that payment thereof is not at the time required by
SECTION 4.3(a);
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(b) Liens of or resulting from any judgment or award, the time for
the appeal or petition for rehearing of which shall not have expired, or in
respect of which the Company or a Restricted Subsidiary shall at any time
in good faith be prosecuting an appeal or proceeding for a review, and in
respect of which a stay of execution pending such appeal or proceeding for
review shall have been secured;
(c) Liens incidental to the conduct of business or the ownership of
Properties (including Liens in connection with worker's compensation,
unemployment insurance and other like laws, warehousemen's and attorneys'
liens and statutory landlords' liens) and Liens to secure the performance
of bids, tenders or trade contracts, or to secure statutory obligations,
surety or appeal bonds or other Liens of like general nature incurred in
the ordinary course of business and not in connection with the borrowing of
money; PROVIDED in each case, the obligation secured is not overdue or, if
overdue, is being contested in good faith by appropriate actions or
proceedings which will prevent the forfeiture or sale of any Property of
the Company or such Restricted Subsidiary or any material interference with
the use thereof by the Company or such Restricted Subsidiary;
(d) minor survey exceptions or minor encumbrances, easements or
reservations, rights of others for rights-of-way, utilities and other
similar purposes, zoning or other restrictions as to the use of real
properties, and leases and subleases thereof, in each case, which (i) are
necessary or appropriate for the conduct of the activities of the Company
and its Restricted Subsidiaries or customarily exist on Properties of
business entities engaged in similar activities and similarly situated and
(ii) do not in any event materially impair the use of such real property in
the operation of the business of the Company and its Restricted
Subsidiaries;
(e) Liens securing Indebtedness of a Restricted Subsidiary to the
Company or to a Wholly-owned Restricted Subsidiary;
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(f) Liens on inventory and receivables securing Indebtedness incurred
pursuant to the Working Capital Facility, PROVIDED that the aggregate
outstanding principal amount so secured shall not exceed $40,000,000 at any
time;
(g) Liens incurred in connection with the acquisition of any fixed
asset useful and intended to be used in carrying on the business of the
Company or a Restricted Subsidiary, including Liens existing on such fixed
asset at the time of acquisition by the Company or a Restricted Subsidiary
of any business entity then owning such fixed asset, whether or not such
existing Liens were given to secure the payment of the purchase price of
the fixed asset to which they attach so long as they were not incurred,
extended or renewed in contemplation of such acquisition, PROVIDED in any
case that (i) the Lien shall attach solely to the fixed asset acquired or
purchased, (ii) at the time of acquisition of such fixed asset, the amount
remaining unpaid on all Indebtedness secured by Liens on such fixed asset
whether or not assumed by the Company or a Restricted Subsidiary shall not
exceed an amount equal to 85% (or 100% in the case of Capitalized Leases)
of the total purchase price of such fixed asset, and the aggregate amount
remaining unpaid on all Indebtedness secured by Liens on fixed assets
acquired or purchased subsequent to the first Closing Date (including such
fixed asset) shall not exceed the following amounts:
On or before November 30, 1999 $25,000,000
December 1, 1999 to November 30, $50,000,000
2004
December 1, 2004 and thereafter $100,000,000,
(iii) all such Indebtedness shall have been incurred within the applicable
limitations provided in SECTION 4.6, and (iv) after giving effect to such
acquisition no Default or Event of Default shall have occurred and be
continuing; and
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(h) Liens existing on the first Closing Date and described in Part II
of Annex C to Exhibit B-1.
In the event that any Property of the Company or its Restricted
Subsidiaries is subjected to a Lien in violation of this Section 4.20 (an
"EXCESS LIEN"), (1) the Company or such Restricted Subsidiary shall make or
cause to be made provision whereby the obligations of the Company under the
Notes and this Agreement will be secured equally and ratably with all other
obligations secured by such Excess Lien pursuant to security arrangements
reasonably satisfactory in form, scope and substance to the Holders holding not
less than 66-2/3% in aggregate principal amount of the outstanding Notes and (2)
the Company or such Restricted Subsidiary shall deliver an opinion of counsel
satisfactory to the Holders holding not less than 66-2/3% in aggregate principal
amount of the outstanding Notes regarding the validity of such security interest
and to the effect that the Notes are secured equally and ratably with such other
obligations; PROVIDED, HOWEVER, that satisfaction of the conditions set forth in
clauses (1) and (2) above does not remedy the Event of Default resulting from
such Excess Lien. In the case of any Excess Lien, said obligations of the
Company under the Notes and this Agreement shall have the benefit, to the full
extent that the Holders may be entitled thereto under applicable law, of an
equitable lien on such Property subject to the Excess Lien.
SECTION 4.21. RATINGS. Upon receipt of a request from any Holder, the
Company will, and will cause its Subsidiaries to, provide such information as
shall be reasonably requested for the purpose of maintaining any rating
applicable to the Notes, whether by a governmental authority or private
association; and, if requested, the Company shall make a presentation relevant
to the maintenance of any such rating to such authority or association, PROVIDED
that the Company shall not be obligated to maintain any specific rating with
respect to the Notes with any such authority or association.
SECTION 5. PREPAYMENT OF NOTES.
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SECTION 5.1. REQUIRED PREPAYMENTS. The Company agrees that it will
prepay and apply and there shall become due and payable on the principal
indebtedness evidenced by the Series B Notes on each of the following dates an
amount equal to the lesser of (i) the amount set forth opposite such date or
(ii) the principal amount of the Series B Notes then outstanding:
February 1, 2010 $ 8,250,000
February 1, 2011 $ 8,250,000
February 1, 2012 $19,250,000
The entire remaining principal amount of the Series B Notes shall become due and
payable on February 1, 2013.
No premium shall be payable in connection with a required prepayment made
pursuant to this Section 5.1. For purposes of this Section 5.1, any prepayment
of less than all of the outstanding Series B Notes pursuant to Section 5.2 shall
reduce the principal amount of the Series B Notes required to be prepaid on
February 1 in each subsequent year to and including the stated maturity of the
Series B Notes in the same proportion as the aggregate principal amount of the
Series B Notes outstanding immediately prior to such prepayment has been reduced
by such prepayment.
SECTION 5.2. OPTIONAL PREPAYMENT WITH PREMIUM. In addition to the
payments required by Section 5.1, upon compliance with Section 5.3 the Company
shall have the privilege, at any time and from time to time, of prepaying the
outstanding Notes of all series, either in whole or in part (but if in part then
in an aggregate minimum principal amount of $1,000,000 or such lesser amount as
permitted in connection with a sale of assets under Section 4.10 or an excess
harvest under Section 4.12) by payment of the outstanding principal amount of
the Notes or portion thereof to be prepaid, and accrued interest thereon to the
date of such prepayment, together with a premium equal to the Make-Whole Amount,
determined as of three Business Days prior to the date of such prepayment
pursuant to this Section 5.2.
SECTION 5.3. NOTICE OF OPTIONAL PREPAYMENTS. The Company will give
notice of any prepayment of the Notes pursuant to Section 5.2
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to each Holder thereof not less than 10 days nor more than 30 days before the
date fixed for such optional prepayment specifying (i) such date (which shall be
a Business Day), (ii) the outstanding principal amount of the Holder's Notes to
be prepaid on such date, (iii) that a premium may be payable, (iv) the date when
such premium will be calculated, (v) the estimated premium, and (vi) the accrued
interest applicable to the prepayment. Such notice of prepayment shall also
certify all facts, if any, which are conditions precedent to any such
prepayment. Notice of prepayment having been so given, the aggregate principal
amount of the Notes to be prepaid specified in such notice, together with
accrued interest thereon and the premium, if any, payable with respect thereto
shall become due and payable on the prepayment date specified in said notice.
Not later than two Business Days prior to the prepayment date specified in such
notice, the Company shall provide written notice by facsimile communication
followed by delivery on the next succeeding Business Day by overnight air
courier to each Holder of Notes to be prepaid of the amount of premium, if any,
payable in connection with such prepayment and, whether or not any premium is
payable, a reasonably detailed computation of the Make-Whole Amount. In the
event the Company shall incorrectly compute the Make-Whole Amount payable in
connection with any Note to be prepaid pursuant to Section 5.2, or declared to
be immediately due and payable pursuant to Section 6.3, the Holder shall not be
bound by such incorrect computation, but instead shall be entitled to receive an
amount equal to the correct Make-Whole Amount, if any, computed in compliance
with the terms of this Agreement.
SECTION 5.4. APPLICATION OF PREPAYMENTS. All partial prepayments of the
Notes of a series pursuant to Section 5.1 shall be applied on all outstanding
Notes of such series ratably in accordance with the unpaid principal amounts
thereof. All partial prepayments of the Notes pursuant to Section 5.2 shall be
applied on all outstanding Notes ratably in accordance with the unpaid principal
amounts thereof.
SECTION 5.5. DIRECT PAYMENT. Notwithstanding anything to the contrary
contained in this Agreement or the Notes, in the case of any note owned by a
Purchaser or any Purchaser's nominee or owned
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by any subsequent Holder which has given written notice to the Company
requesting that the provisions of this Section 5.5 shall apply, the Company will
punctually pay when due the principal thereof, interest thereon and premium, if
any, due with respect to said principal, without any presentment thereof,
directly to such Purchaser, to its nominee or to such subsequent Holder at its
address or such nominee's address set forth herein or such other address as such
Purchaser, its nominee or such subsequent Holder may from time to time designate
in writing to the Company or, if a bank account with a United States bank is so
designated for such Holder, the Company will make such payments in immediately
available funds to such bank account no later than 10:00 A.M. Portland, Oregon
time on the date due, marked for attention as indicated, or in such other manner
or to such other account in any United States bank as such Purchaser, its
nominee or any such subsequent Holder may from time to time direct in writing.
Such payments will be made without notations being made on such Note, except
that (a) any such Note so paid or prepaid in full (including the payment of all
interest accrued to the date of such payment or prepayment and premium, if any)
shall be surrendered to the Company within a reasonable time after such payment
or prepayment in full, and (b) before any sale or other transfer by any Holder
of any Note in respect of which any principal payments have been made in the
manner provided in this Agreement, such Holder will make appropriate notation of
such payments on such Note.
SECTION 6. EVENTS OF DEFAULT AND REMEDIES THEREFOR.
SECTION 6.1. EVENTS OF DEFAULT. Any one or more of the following shall
constitute an "EVENT OF DEFAULT" as such term is used herein:
(a) Default shall occur in the payment of interest on any Note
when the same shall have become due and such default shall continue
for more than five Business Days; or
(b) Default shall occur in the making of any required prepayment
on any of the Notes as provided in Section 5.1; or
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(c) Default shall occur in the making of any other payment of
the principal of any Note or premium, if any, thereon at the expressed
or any accelerated maturity date or at any date fixed for prepayment;
or
(d) Default continuing beyond the period of grace, if any,
allowed with respect thereto shall be made in the payment when due
(whether by lapse of time, by declaration, by call for redemption or
otherwise) of the principal of or interest on any Funded Debt (other
than the Notes) or Current Debt of the Company or any Restricted
Subsidiary, and, individually or in the aggregate, the principal
amount of such Funded Debt and Current Debt shall be in excess of
$5,000,000; or
(e) Default or the happening of any event shall occur under any
indenture, agreement or other instrument under which any Funded Debt
or Current Debt of the Company or any Restricted Subsidiary may be or
has been issued and, individually or in the aggregate, the aggregate
principal amount of such Funded Debt and Current Debt which has been
issued or may be issued thereunder shall be in excess of $5,000,000,
and such default or event shall continue for a period of time
sufficient to permit the acceleration of the maturity of such Funded
Debt or Current Debt; or
(f) Default shall occur in the observance or performance of any
covenant or agreement contained in Section 4.6 through Section 4.12,
both inclusive; or
(g) Default shall occur in the observance or performance of the
covenant contained in Section 4.20 which is not remedied within ten
days after the earlier of (i) the day on which the Company first
obtains knowledge of such default, or (ii) the day on which written
notice thereof is given to the Company by any Holder; or
(h) Default shall occur in the observance or performance of any
other provision of this Agreement which is not remedied within 30 days
after the earlier of (i) the
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day on which the Company first obtains knowledge of such default, or
(ii) the day on which written notice thereof is given to the Company
by any Holder; or
(i) Any representation or warranty made by the Company or the
Managing General Partner herein, or by the Company or the Managing
General Partner in any statement or certificate furnished by the
Company or the Managing General Partner in connection with the
consummation of the issuance and delivery of the Notes or furnished by
the Company or the Managing General Partner pursuant hereto, is untrue
in any material respect as of the date of the issuance or making
thereof; or
(j) Final judgment or judgments for the payment of money
aggregating in excess of $5,000,000 is or are outstanding against the
Company or any Restricted Subsidiary or against any Property of either
and such judgment or judgments have remained unpaid, unvacated,
unbonded or unstayed by appeal or otherwise for a period of 60
consecutive days from the date of its entry; or
(k) The Company, or any Person on behalf of the Company, shall
contest or deny the validity or enforceability of this Agreement or
the Notes or its obligations hereunder and thereunder; or
(l) An order or decree requiring a split-up or divestiture of
the Company is outstanding against the Company and such order or
decree remains unstayed and in effect for more than 30 consecutive
days; or
(m) A custodian, liquidator, trustee, receiver or similar
official is appointed for the Company or any Restricted Subsidiary or
for the major part of the Property of either and is not discharged
within 60 days after such appointment; or
(n) The Company, any Restricted Subsidiary or the Managing
General Partner becomes insolvent or bankrupt, is
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generally not paying its debts as they become due or makes an
assignment for the benefit of creditors, or the Company or any
Restricted Subsidiary or the Managing General Partner applies for or
consents to the appointment of a custodian, liquidator, trustee,
receiver or similar official for the Company, such Restricted
Subsidiary or the Managing General Partner or for the major part of
the Property of any of them; or
(o) Bankruptcy, reorganization, arrangement or insolvency
proceedings, or other proceedings for relief under any bankruptcy or
similar law or laws for the relief of debtors, are instituted by or
against the Company, any Restricted Subsidiary or the Managing General
Partner and, if instituted against the Company, any Restricted
Subsidiary or the Managing General Partner, are consented to or are
not dismissed within 60 days after such institution.
SECTION 6.2. NOTICE TO HOLDERS. When any Default or Event of Default
described in the foregoing Section 6.1 has occurred, or if the holder of any
Note or of any other evidence of Indebtedness of the Company or any Restricted
Subsidiary gives any notice or takes any other action with respect to a claimed
default, the Company agrees to give notice within three Business Days of such
event to all Holders.
SECTION 6.3. ACCELERATION OF MATURITIES. When any Event of Default
described in paragraph (a), (b) or (c) of Section 6.1 has happened and is
continuing, any Holder may, by notice to the Company, declare the entire
principal, premium, if any, and all interest accrued on the Note or Notes held
by such Holder to be, and such Note or Notes shall thereupon become forthwith
due and payable, without any presentment, demand, protest or other notice of any
kind, all of which are hereby expressly waived. When any Event of Default
described in paragraphs (a) through (l), inclusive, of Section 6.1 has happened
and is continuing, the Holders holding not less than 50% of the principal amount
of the outstanding Notes may, by notice to the Company, declare the entire
principal, premium, if any, and all interest accrued on all Notes to be, and all
Notes shall thereupon become, forthwith
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due and payable, without any presentment, demand, protest or other notice of any
kind, all of which are hereby expressly waived. When any Event of Default
described in paragraph (m), (n) or (o) of Section 6.1 has occurred, then all
outstanding Notes shall immediately become due and payable without presentment,
demand or notice of any kind, all of which are hereby expressly waived. Upon
any Notes becoming due and payable as a result of any Event of Default as
aforesaid, the Company will forthwith pay to the Holders of such Notes the
entire principal and interest accrued on the Notes so accelerated and, in the
case of an Event of Default specified in paragraphs (a) through (l), inclusive
of Section 6.1, to the extent not prohibited by applicable law, the Company will
pay an amount as liquidated damages for the loss of the bargain evidenced hereby
(and not as a penalty) equal to the Make-Whole Amount, determined as of the date
on which such Notes shall so become due and payable. No course of dealing on
the part of the Holders nor any delay or failure on the part of any Holder to
exercise any right shall operate as a waiver of such right or otherwise
prejudice such Holder's rights, powers and remedies. The Company further
agrees, to the extent permitted by law, to pay to the Holders all costs and
expenses incurred by them in the collection of any Notes upon any default
hereunder or thereon, including reasonable compensation to such Holders'
attorneys and financial advisors for all services rendered in connection
therewith.
SECTION 6.4. RESCISSION OF ACCELERATION. The provisions of Section 6.3
are subject to the condition that if the principal of, premium, if any, and
accrued interest on all or any outstanding Notes have been declared immediately
due and payable by reason of the occurrence of any Event of Default described in
paragraphs (a) through (l), inclusive, of Section 6.1, the Holders holding
66-2/3% in aggregate principal amount of the Notes then outstanding may, by
written instrument filed with the Company, rescind and annul such declaration
and the consequences thereof, PROVIDED that at the time such declaration is
annulled and rescinded:
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(a) no judgment or decree has been entered for the payment of any
monies due pursuant to the Notes or this Agreement;
(b) all arrears of interest upon all the Notes and all other sums
payable under the Notes and under this Agreement (except any principal,
interest or premium on the Notes which has become due and payable solely by
reason of such declaration under Section 6.3) shall have been duly paid;
and
(c) each and every other Default and Event of Default shall have been
made good, cured or waived pursuant to Section 7.1;
and PROVIDED FURTHER, that no such rescission and annulment shall extend to or
affect any subsequent Default or Event of Default or impair any right consequent
thereto.
SECTION 7. AMENDMENTS, WAIVERS AND CONSENTS.
SECTION 7.1. CONSENT REQUIRED. Any term, covenant, agreement or
condition of this Agreement may, with the consent of the Company, be amended or
compliance therewith may be waived (either generally or in a particular instance
and either retroactively or prospectively) if the Company shall have obtained
the consent in writing of the Holders holding at least 55% in aggregate
principal amount of outstanding Notes, PROVIDED that without the written consent
of the Holders holding all of the Notes then outstanding, no such amendment or
waiver shall be effective (i) which will change the time of payment (including
any prepayment required by Section 5.1) of the principal of or the interest on
any Note or change the principal amount thereof or change the rate of interest
thereon, (ii) which will change any of the provisions with respect to optional
prepayments, (iii) which will change the percentage of Holders required to
consent to any such amendment or waiver of any of the provisions of Section 6 or
this Section 7 or (iv) which will change any provision of Section 4.19 or
Section 7.2.
SECTION 7.2. SOLICITATION OF HOLDERS. So long as there are any Notes
outstanding, the Company will not solicit, request or negotiate for or with
respect to any proposed waiver or amendment
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of any of the provisions of this Agreement or the Notes unless each Holder
(irrespective of the amount of Notes then owned by it) shall be informed thereof
by the Company and shall be afforded the opportunity of considering the same and
shall be supplied by the Company with sufficient information to enable it to
make an informed decision with respect thereto. The Company will not, directly
or indirectly, pay or cause to be paid any remuneration, whether by way of
supplemental or additional interest, fee or otherwise, to any Holder as
consideration for or as an inducement to entering into by any Holder of any
waiver or amendment of any of the terms and provisions of this Agreement or the
Notes unless such remuneration is concurrently paid, on the same terms, ratably
to the Holders.
SECTION 7.3. EFFECT OF AMENDMENT OR WAIVER. Any such amendment or waiver
shall apply equally to all of the Holders and shall be binding upon them, upon
each future Holder and upon the Company, whether or not such Note shall have
been marked to indicate such amendment or waiver. No such amendment or waiver
shall extend to or affect any obligation not expressly amended or waived or
impair any right consequent thereon.
SECTION 8. INTERPRETATION OF AGREEMENT; DEFINITIONS.
SECTION 8.1. DEFINITIONS. Unless the context shall otherwise require,
the terms hereinafter set forth when used herein shall have the following
meanings and the following definitions shall be equally applicable to both the
singular and plural forms of any of the terms herein defined:
"ACQUISITION" means any transaction in which the Company or any Restricted
Subsidiary acquires (through an asset acquisition, merger, stock acquisition or
other form of investment) control over all or a portion of the Properties or
business of another Person for the purpose of increasing the operating capacity
of the Company and its Restricted Subsidiaries, taken as a whole, from the
operating capacity of the Company and its Restricted Subsidiaries, taken as a
whole, existing immediately prior to such transaction.
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"ACQUISITION CREDIT AGREEMENT" AND "ACQUISITION FACILITY" are defined in
Section 3.9.
"AFFILIATE" shall mean any Person (other than a Wholly-owned Restricted
Subsidiary) (i) which directly or indirectly through one or more intermediaries
controls, or is controlled by, or is under common control with, the Company,
(ii) which beneficially owns or holds 5% or more of the Voting Equity Interest
of the Company or (iii) 5% or more of the Voting Equity Interest of which is
beneficially owned or held by the Company or a Subsidiary. The term "CONTROL"
means the possession, directly or indirectly, of the power to direct or cause
the direction of the management and policies of a Person, whether through the
ownership of Voting Equity Interest, by contract or otherwise.
"APPLICATION PERIOD" shall mean, with respect to any sale of assets
pursuant to Section 4.10(a)(2), the 180-day period following the date of such
sale; and, with respect to any sale of harvested timber subject to Section 4.12,
the 180-day period following the last day of the fiscal year of the Company in
which such Excess Harvest occurred.
"AVAILABLE CASH" shall mean, with respect to any fiscal quarter of the
Company and without duplication,
(a) the sum of:
(i) all cash receipts of the Company during such quarter from
all sources,
(ii) any reduction with respect to such quarter in a cash
reserve previously established pursuant to clause (b)(ii) below
(either by reversal or utilization) from the level of such reserve at
the end of the prior quarter, and
(iii) any utilization with respect to such quarter of the
Working Capital Reserve; LESS
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(b) the sum of:
(i) all cash disbursements of the Company during such quarter;
and
(ii) any cash reserves established with respect to such
quarter, and any increase with respect to such quarter in a cash
reserve established pursuant to this clause (b)(ii) from the level of
such reserve at the end of the prior quarter, in such amounts as the
Managing General Partner determines in its reasonable discretion to be
necessary or appropriate (A) to provide for the proper conduct of the
business of the Company, (B) to comply with the provisions of the
Partnership Agreement, (C) to provide funds for distributions to
Partners in respect of any one or more of the next four quarters or
(D) because the distribution of such amounts would be prohibited by
applicable law or by any loan agreement, security agreement, mortgage,
debt instrument or other agreement or obligation to which the Company
is a party or by which any of its assets are subject, PROVIDED that
Available Cash shall reflect (x) in each fiscal quarter a reserve
equal to at least 50% of the aggregate amount of all interest to be
paid in respect of the Notes, the 1994 Notes, the 1995 Notes and the
1996 Notes on the next interest payment date, and (y) in the third
fiscal quarter immediately preceding each fiscal quarter in which any
scheduled principal payment is due with respect to the Notes, the 1994
Notes, the 1995 Notes and/or the 1996 Notes (a "PRINCIPAL PAYMENT
QUARTER"), a reserve equal to at least 25% of the aggregate amount of
all principal to be paid in respect of such Notes, 1994 Notes, 1995
Notes and 1996 Notes in such principal payment quarter; in the second
calendar quarter immediately preceding a principal payment quarter, a
reserve equal to at least 50% of the aggregate amount of all principal
to be paid in respect of such Notes, 1994 Notes, 1995 Notes and 1996
Notes in such principal payment quarter; and in the calendar
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quarter immediately preceding a principal payment quarter, a reserve
equal to at least 75% of the aggregate amount of all principal to be
paid in respect of such Notes, 1994 Notes, 1995 Notes and 1996 Notes
in such principal payment quarter.
So long as the Company is not a taxpaying entity, taxes paid by the Company
on behalf of, or amounts withheld with respect to, all or less than all of the
Partners shall not be considered cash disbursements of the Company that reduce
Available Cash, but the payment or withholding thereof shall be deemed to be a
distribution of Available Cash to such Partners. Alternatively, in the
discretion of the Managing General Partner, so long as the Company is not a
taxpaying entity, such taxes (if pertaining to all Partners) may be considered
to be cash disbursements of the Company which reduce Available Cash, but the
payment or withholding thereof shall not be deemed to be a distribution of
Available Cash to such Partners.
"BOARD OF CONTROL" shall mean the Board of Control of the Managing General
Partner.
"BUSINESS DAY" shall mean any day other than a Saturday, Sunday or a day on
which banks in the States of New York, California or Oregon are authorized or
permitted to be closed in the observance of a legal holiday.
"CAPITAL ADDITIONS AND IMPROVEMENTS" means (i) additions or improvements to
the capital assets owned by the Company or any Restricted Subsidiary or (ii) the
acquisition of existing or the construction of new capital assets (including,
without limitation, timberlands and timber processing and manufacturing
facilities and related assets) made to increase the operating capacity of the
Company and its Restricted Subsidiaries, taken as a whole, from the operating
capacity of the Company and its Restricted Subsidiaries, taken as a whole,
existing immediately prior to such addition, improvement, acquisition or
construction.
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"CAPITALIZED LEASE" shall mean any lease the obligation for Rentals with
respect to which is required to be capitalized on a balance sheet of the lessee
in accordance with GAAP.
"CAPITALIZED RENTALS" of any Person shall mean as of the date of any
determination the amount at which the aggregate Rentals due and to become due
under all Capitalized Leases under which such Person is a lessee would be
reflected as a liability on a consolidated balance sheet of such Person in
accordance with GAAP.
"CERCLA" shall mean the Comprehensive Environmental Response, Compensation
and Liability Act of 1980, as amended by the Superfund Amendments and
Reauthorization Act of 1986, 42 U.S.C. Sections 9601 ET SEQ., and any future
amendments.
"CLOSING DATE" is defined in Section 1.2.
"COMPANY" is defined in the introductory paragraph of this Agreement.
"CONSOLIDATED CASH FLOW" for any period shall mean Operations Cash for such
period adjusted to include (a) in the case of any acquisition of timber or
timberland by the Company or a Restricted Subsidiary during such period, an
amount equal to the projected cash flow of the timber or timberland so acquired,
based on the harvest plan for the first harvest year, PROVIDED that such harvest
plan shall not include more than 8-1/3% of the total volume of merchantable
timber so acquired, and PROVIDED, FURTHER, that in determining projected cash
flow from acquired timber or timberlands, prices shall be assumed to equal the
average price realized by the Company for comparable timber sold during such
period, and (b) in the case of any acquisition of any other productive asset by
the Company or a Restricted Subsidiary during such period, an amount equal to
80% of the average annual cash flow of the productive asset so acquired for the
preceding two years, which amount will be increased if and to the extent a
Responsible Officer of the Company shall certify in writing to the Holders (x)
specified cost savings that can be effected by the Company in the operation of
such productive asset or (y) the
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net additional resources to be allocated to increase productivity of such asset,
PLUS (to the extent deducted in determining Operations Cash) (i) all cash debt
service payments of the Company and its Restricted Subsidiaries during such
period, (ii) all cash capital expenditures (except capital expenditures relating
to Acquisitions and Capital Additions and Improvements) of the Company and its
Restricted Subsidiaries during such period, and (iii) the amount deducted from
Operations Cash as a result of the increase in any reserve for the future cash
payment of items of the type referred to in the foregoing clauses (i) or (ii).
"CONSOLIDATED NET WORTH" of any Person shall mean, as of the date of any
determination, the amount by which the total assets of such Person and its
subsidiaries appearing on a balance sheet of such Person and its subsidiaries
prepared in accordance with GAAP on a consolidated basis exceeds the total
liabilities of such Person and its subsidiaries appearing on a balance sheet of
such Person and its subsidiaries prepared in accordance with GAAP on a
consolidated basis, in each case after eliminating all intercompany
transactions.
"CONSUMER PRICE INDEX" shall mean the consumer price index for goods and
services for the United States, as published by the U. S. Bureau of Labor
Statistics, or if such index is no longer printed, its successor publications.
"CONTROLLING GENERAL PARTNERSHIP INTEREST" shall mean a General Partnership
Interest which permits the owner of such General Partnership Interest to direct
the management of a general partnership or a limited partnership.
"CP INLAND" shall mean Crown Pacific Inland Limited Partnership, an Oregon
limited partnership, previously merged into the Company.
"CP INLAND LUMBER" is defined in Exhibit C.
"CPLP" shall mean Crown Pacific Limited Partnership, an Oregon limited
partnership, previously merged into the Company.
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"CREDIT AGREEMENTS" means the Acquisition Credit Agreement and the Working
Capital Credit Agreement.
"CURRENT DEBT" of any Person shall mean, as of the date of any
determination thereof, (i) all Indebtedness of such Person for borrowed money or
for the acquisition of assets, other than Funded Debt of such Person and (ii)
Guaranties by such Person of Current Debt of others.
"DAW" is defined in Exhibit B.
"DEFAULT" shall mean any event or condition the occurrence of which would,
with the lapse of time or the giving of notice, or both, constitute an Event of
Default.
"DISTRIBUTION" in respect of the Company shall mean:
(a) dividends, distributions or other payments of any kind whatsoever
on or in respect of the Partnership Interests (except distributions payable
solely in Partnership Interests or in rights or options to acquire
Partnership Interests);
(b) the redemption or acquisition of Partnership Interests or of
rights or other options to purchase Partnership Interests; and
(c) any payment of or on account of Subordinated Funded Debt owed to
the Managing General Partner or any payment on account of the purchase,
redemption or other retirement thereof.
"ENVIRONMENTAL AND NATURAL RESOURCE CLAIM" shall mean any administrative,
regulatory or judicial action, judgment, order, consent decree, suit, demand,
demand letter, claim, Lien, notice of non-compliance or violation, investigation
or other proceeding arising (a) pursuant to any Environmental and Natural
Resource Law or Governmental Approval issued under any such Environmental and
Natural Resource Law, (b) from the presence, use, generation, storage,
treatment, Release, threatened Release, disposal,
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remediation or other existence of any Hazardous Material, (c) from any removal,
remedial, corrective or other response action pursuant to an Environmental and
Natural Resource Law or the order of a Governmental Authority, (d) from any
third party seeking damages, contribution, indemnification, cost recovery,
compensation, injunctive or other relief in connection with a Hazardous Material
or arising from alleged injury or threat of injury to health, safety, natural
resources or the environment, or (e) from any Lien against the Properties of the
Company or any Subsidiary in favor of a Governmental Authority in connection
with a Release, threatened Release or disposal of a Hazardous Material.
"ENVIRONMENTAL AND NATURAL RESOURCE LAW" shall mean any statute, law,
regulation, ordinance, order, consent decree, judgment, permit, license, code,
common law, treaty, convention or other requirement of a Governmental Authority,
pertaining to protection of the environment, health or safety of persons,
natural resources, forestry, conservation, wildlife, waste management, hazardous
substances or wastes, and pollution (including, without limitation, regulation
of releases and disposals to air, land, water and groundwater), now or hereafter
enacted, and includes, without limitation, the Idaho Reforestation Law, Idaho
Code Sections 38-201, ET SEQ., Idaho Forest Practices Act, Idaho Code Sections
38-1301 ET SEQ., Idaho Hazardous Substances Emergency Response Act, Idaho Code
Sections 39-7101 ET SEQ., Montana Timber Resources Code, Mont. Code Xxx.
Sections 00-00-000 ET SEQ., Montana Environmental Protection Code, Mont. Code
Xxx. Sections 00-0-000 XX XXX., Xxxxxx Forest Practices Act, Or. Rev. Stat.
Sections 527.610 ET SEQ., Oregon Hazardous Waste and Hazardous Materials Code,
Or. Rev. Stat. Sections 465.003 ET SEQ., Washington Forest Practice Code, Wash.
Rev. Code Sections 76.09.010 ET SEQ., Washington Model Toxic Control Act, Wash.
Rev. Code Sections 70.105D.010 ET SEQ., Endangered Species Act of 1973, 16
U.S.C. Sections 1531 ET SEQ., Comprehensive Environmental Response, Compensation
and Liability Act of 1980, as amended by the Superfund Amendments and
Reauthorization Act of 1986, 42 U.S.C. Sections 9601 ET SEQ., Solid Waste
Disposal Act, as amended by the Resource Conservation and Recovery Act of 1976
and Hazardous and Solid Waste Amendments of 1984, 42 U.S.C. Sections 6901 ET
SEQ., Federal Water Pollution Control
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Act, as amended by the Clean Water Act of 1977, 33 U.S.C. Sections 1251 ET SEQ.,
Clean Air Act of 1966, as amended, 42 U.S.C. Sections 7401 ET SEQ., Toxic
Substances Control Act of 1976, 15 U.S.C. Sections 2601 ET SEQ., Occupational
Safety and Health Act of 1970, as amended, 29 U.S.C. Sections 651 ET SEQ., Oil
Pollution Act of 1990, 33 U.S.C. Sections 2701 ET SEQ., Emergency Planning and
Community Right-to-Know Act of 1986, 42 U.S.C. Sections 11001 ET SEQ., National
Environmental Policy Act of 1975, 42 U.S.C. Sections 4321 ET SEQ., Safe Drinking
Water Act of 1974, as amended, 42 U.S.C. Sections 300(f) ET SEQ., and all
similar or implementing laws, rules, regulations, approvals, guidance documents
and amendments promulgated thereunder.
"EQUITY INTEREST" shall mean, in the case of a corporation, stock of any
class, and in the case of a partnership or a limited partnership, a General
Partnership Interest or Limited Partnership Interest.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended, and any successor statute of similar import, together with the
regulations thereunder, in each case as in effect from time to time. References
to sections of ERISA shall be construed to also refer to any successor sections.
"ERISA AFFILIATE" shall mean any corporation, trade or business that is,
along with the Company, a member of a controlled group of corporations or a
controlled group of trades or businesses, as described in Section 414(b) and
414(c), respectively, of the Internal Revenue Code of 1986, as amended, or
Section 4001 of ERISA.
"EVENT OF DEFAULT" is defined in Section 6.1.
"EXCESS HARVEST" is defined in Section 4.12.
"EXCESS LIEN" is defined in Section 4.20.
"FOUR QUARTER PERIOD" shall mean a period of four full consecutive
quarterly fiscal periods of the Company, taken together as one accounting
period.
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"FUNDED DEBT" of any Person shall mean (i) all Indebtedness of such Person
for borrowed money or which has been incurred in connection with the acquisition
of assets in each case having a final maturity of one or more than one year from
the date of origin thereof (or which is renewable or extendible at the option of
the obligor for a period or periods more than one year from the date of origin),
including all payments in respect thereof that are required to be made within
one year from the date of any determination of Funded Debt, (ii) all Capitalized
Rentals of such Person, and (iii) all Guaranties by such Person of Funded Debt
of others.
"FUNDING AGENT" is defined in Section 1.6.
"GAAP" shall mean generally accepted accounting principles at the time in
the United States.
"GENERAL PARTNERSHIP INTEREST" shall mean the interest of a general partner
in a general partnership and the interest of a general partner in a limited
partnership.
"GOVERNMENTAL APPROVAL" shall mean any written permit, license, variance,
certification, consent, no-action letter, clearance, exemption or other approval
granted by a Governmental Authority.
"GOVERNMENTAL AUTHORITY" shall mean any international, foreign, federal,
state, regional, county, local or other body or authority of a governmental
entity.
"GUARANTIES" by any Person shall mean all obligations (other than
endorsements in the ordinary course of business of negotiable instruments for
deposit or collection) of such Person guaranteeing or in effect guaranteeing any
Indebtedness, dividend or other obligation, of any other Person (the "PRIMARY
OBLIGOR") in any manner, whether directly or indirectly, including, without
limitation, all obligations incurred through an agreement, contingent or
otherwise (including, without limitation, such obligations that arise as a
matter of law including obligations of a joint venturer in connection with a
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joint venture and of a partner in connection with a partnership), by such
Person: (i) to purchase such Indebtedness or obligation or any Property
constituting security therefor, (ii) to advance or supply funds (x) for the
purchase or payment of such Indebtedness or obligation or (y) to maintain
working capital or other balance sheet condition or otherwise to advance or make
available funds for the purchase or payment of such Indebtedness or obligation,
(iii) to lease Property or to purchase Securities or other Property or services
primarily for the purpose of assuring the owner of such Indebtedness or
obligation of the ability of the primary obligor to make payment of the
Indebtedness or obligation, or (iv) otherwise to assure the owner of the
Indebtedness or obligation of the primary obligor against loss in respect
thereof. For the purposes of all computations made under this Agreement, a
Guaranty in respect of any Indebtedness for borrowed money shall be deemed to be
Indebtedness equal to the principal amount of such Indebtedness for borrowed
money which has been guaranteed, and a Guaranty in respect of any other
obligation or liability or any dividend shall be deemed to be Indebtedness equal
to the maximum aggregate amount of such obligation, liability or dividend.
"HARVEST/YIELD RESTRICTION" shall mean any restriction, limitation,
prohibition, constraint, event, occurrence or condition which materially impairs
the cultivation, harvest or yield of timber at a property, including but not
limited to the following conditions or an Environmental and Natural Resource Law
concerning such following conditions:
(1) natural phenomena, including fire, drought, disease or pests;
(2) threatened or endangered species of wildlife, fish or flora;
(3) protected or sensitive habitats (including brooding, nesting,
feeding and sheltering areas) of sensitive, threatened, endangered or other
species of wildlife or fish;
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(4) critical natural resources (including soil, water, wetlands,
riparian areas, forestland and visually sensitive areas);
(5) cultural resource sites (including Properties of historic,
archaeological or tribal significance);
(6) condemnation or other regulation of forestland for public uses
(such as for recreation, wilderness or park purposes);
(7) timber export;
(8) agrichemicals (including fertilizers and pesticides);
(9) environmental quality standards (including non-point source best
management practices);
(10) access and transportation factors (including road construction
and improvement and riparian logging crossings); and
(11) forest practices (including harvest rates, clear cuts and
reforestation).
"HAZARDOUS MATERIAL" shall mean any hazardous or toxic chemical, waste,
byproduct, pollutant, contaminant, compound, product or substance, including,
without limitation, asbestos, polychlorinated biphenyls, petroleum (including
crude oil or any fraction thereof), and any material the exposure to, or
manufacture, possession, presence, use, generation, storage, transportation,
treatment, release, disposal, abatement, cleanup, removal, remediation or
handling of which, is prohibited, controlled or regulated by any Environmental
and Natural Resource Law.
"HOLDER" shall mean any Person which is, at the time of reference, the
registered holder of any outstanding Note.
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"HS CORP." is defined in Exhibit C.
"INDEBTEDNESS" of any Person shall mean and include all obligations of such
Person which in accordance with GAAP shall be classified upon a balance sheet of
such Person as liabilities of such Person and in any event shall include all
(i) obligations of such Person for borrowed money, (ii) obligations secured by
any Lien or other charge upon Property owned by such Person, even though such
Person has not assumed or become liable for the payment of such obligations,
(iii) obligations created or arising under any conditional sale or other title
retention agreement with respect to Property acquired by such Person,
notwithstanding the fact that the rights and remedies of the seller, lender or
lessor under such agreement in the event of default are limited to repossession
or sale of Property, PROVIDED that the preceding provisions of this clause (iii)
shall not include obligations of such Person in respect of Operating Leases,
(iv) Capitalized Rentals of such Person, and (v) Guaranties by such Person of
Indebtedness of others.
"INDEMNIFIED MATTERS" is defined in Section 4.3(b)(6)(A).
"INDEMNITEES" is defined in Section 4.3(b)(6)(A).
"INSTITUTIONAL HOLDER" shall mean any insurance company, bank, savings and
loan association, trust company, investment company, charitable foundation,
broker or dealer registered under the Securities Exchange Act of 1934, as
amended, employee benefit plan (as defined in ERISA) or other institutional
investor or financial institution, including, without limitation, each
Purchaser.
"INTEREST EXPENSE" for any period shall mean all interest (including the
interest component of Rentals payable by the Company and its Restricted
Subsidiaries on Capitalized Leases) and all amortization of debt discount and
expense expensed during such period in accordance with GAAP on any Indebtedness
of the Company and its Restricted Subsidiaries for which such calculations are
being made.
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"INTERIM CAPITAL TRANSACTIONS" means (i) borrowings, refinancings or
refundings of Current Debt and Funded Debt of the Company or any Restricted
Subsidiary and sales of debt securities (other than for working capital purposes
and other than for items purchased on open account in the ordinary course of
business) by the Company or any Restricted Subsidiary, (ii) sales of Equity
Interests by the Company and (iii) sales or other voluntary or involuntary
dispositions of any assets of the Company or any Restricted Subsidiary (other
than (x) sales or other dispositions of inventory, accounts receivable and other
assets in the ordinary course of business, including the exchange of timber or
real property for other timber or real property, to the extent that the timber
or real property received in exchange is of equal or greater value, or the sale
of timber or real property, to the extent the proceeds from which are invested
within 180 days in other timber or real property, and (y) sales or other
dispositions of assets as a part of normal retirements or replacements), other
than in the context of the commencement of the dissolution and liquidation of
the Company.
"INVESTMENTS" shall mean all investments, in cash or by delivery of
Property made, directly or indirectly in any Person, whether by acquisition of
shares of capital stock, indebtedness or other obligations or Securities or by
loan, advance, capital contribution or otherwise.
"LIEN" shall mean any interest in Property securing an obligation owed to,
or a claim by, a Person other than the owner of the Property, whether such
interest is based on the common law, statute or contract, and including but not
limited to the security interest lien arising from a mortgage, encumbrance,
pledge, conditional sale or trust receipt or a lease, consignment or bailment
for security purposes. The term "Lien" shall include reservations, exceptions,
encroachments, easements, rights-of-way, covenants, conditions, restrictions,
leases and other title exceptions and encumbrances (including, with respect to
stock, stockholder agreements, voting trust agreements, buy-back agreements and
all similar arrangements) affecting Property. For the purposes of this
Agreement, the Company or a Restricted Subsidiary shall be deemed to be the
owner of any Property which
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it has acquired or holds subject to a conditional sale agreement, Capitalized
Lease or other arrangement pursuant to which title to the Property has been
retained by or vested in some other Person for security purposes, and such
retention or vesting shall constitute a Lien.
"LIMITED PARTNERSHIP INTEREST" shall mean the interest of a limited partner
in a limited partnership.
"MAKE-WHOLE AMOUNT" shall mean in connection with any prepayment or
acceleration of the Notes of a series the excess, if any, of (i) the aggregate
present value as of the date of such prepayment or acceleration of each dollar
of principal being prepaid or accelerated of the Notes of such series (taking
into account the application of such prepayment required by Section 5.1) and the
amount of interest (exclusive of interest accrued to the date of prepayment or
acceleration) that would have been payable in respect of such dollar if such
prepayment or acceleration had not been made, determined by discounting on a
semiannually compounded basis such amounts at the Reinvestment Rate from the
respective dates on which they would have been payable, over (ii) 100% of the
principal amount of the outstanding Notes of the series being prepaid. The
Make-Whole Amount shall not be less than zero. For purposes of any
determination of the Make-Whole Amount:
"REINVESTMENT RATE" shall mean (a) the sum of 0.50%, plus the yield
reported at 10:00 A.M. (New York time) on the date of determination of the
Make-Whole Amount by the Dow Xxxxx Markets, a Division of Dow Xxxxx &
Company (formerly known as Telerate Access Service) on the display
designated "Page 5" for United States government Securities having a
maturity (rounded to the nearest month) corresponding to the remaining
Weighted Average Life to Maturity of the principal of such series being
prepaid or accelerated (taking into account the application of such
prepayment required by Section 5.1), or (b) in the event that such Dow
Xxxxx Markets is no longer available or such yield is not reported as of
such time, "REINVESTMENT RATE" shall mean the sum of 0.50%, plus the
arithmetic mean of the two yields under the heading "WEEK ENDING" published
in the Statistical Release under
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the caption "TREASURY CONSTANT MATURITIES" for the maturity (rounded to the
nearest month) corresponding to the Weighted Average Life to Maturity of
the principal of such series being prepaid or accelerated (taking into
account the application of such prepayment required by Section 5.1). If no
maturity exactly corresponds to such Weighted Average Life to Maturity,
yields for the maturity next longer than the Weighted Average Life to
Maturity and for the maturity next shorter than the Weighted Average Life
to Maturity shall be calculated and the Reinvestment Rate shall be
interpolated from such yields on a straight-line basis, rounding in each of
such relevant periods to the nearest month. For the purposes of
calculating the Reinvestment Rate pursuant to clause (b), the most recent
Statistical Release published prior to the date of determination of the
Make-Whole Amount shall be used.
"STATISTICAL RELEASE" shall mean the statistical release designated
"H.15(519)" or any successor publication which is published weekly by the
Federal Reserve System and which establishes yields on actively traded
United States government Securities adjusted to constant maturities or, if
such statistical release is not published at the time of any determination
hereunder, then such other reasonably comparable index which shall be
designated by the Holders holding 66-2/3% in aggregate principal amount of
the outstanding Notes.
"WEIGHTED AVERAGE LIFE TO MATURITY" of the principal amount of the
Notes of a series being prepaid or accelerated shall mean, as of the time
of any determination thereof, the number of years obtained by dividing the
then Remaining Dollar-Years of such principal by the aggregate amount of
such principal. The term "REMAINING DOLLAR-YEARS" of such principal shall
mean the amount obtained by (i) multiplying (x) the remainder of (1) the
amount of principal of such series that would have become due on each
scheduled payment date if such prepayment or acceleration and the
application thereof in accordance with the provisions of Section 5.1 had
not been made, less (2) the amount of principal on the Notes of
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such series being prepaid or accelerated scheduled to become due on such
date after giving effect to such prepayment or acceleration, by (y) the
number of years (calculated to the nearest one-twelfth) which will elapse
between the date of determination and such scheduled payment date, and
(ii) totaling the products obtained in (i).
"MANAGING GENERAL PARTNER" is defined in Section 2.2.
"MULTIEMPLOYER PLAN" shall have the same meaning as in ERISA.
"NET PROCEEDS" shall mean the gross proceeds of the disposition or sale of
Property, LESS (i) all reasonable expenses incurred in connection with such
disposition or sale of such Property and (ii) with respect to any Excess
Harvest, all reasonable expenses properly allocable to the harvesting of the
timber constituting the Excess Harvest and other costs incidental thereto.
"1994 NOTES" shall mean the $275,000,000 9.78% Senior Notes due December 1,
2009 of the Company issued under and pursuant to the Note Purchase Agreement
dated as of December 1, 1994 among the Company and the purchasers listed in
Schedule I thereto.
"1995 NOTES" shall mean the $25,000,000 9.60% Senior Notes due December 1,
2009 of the Company issued under and pursuant to the Note Purchase Agreement
dated as of March 15, 1995 among the Company and the purchasers listed in
Schedule I thereto.
"1996 NOTES" shall mean the $91,000,000 Senior Notes due 2006 to 2013 of
the Company issued under and pursuant to the Note Purchase Agreement dated as of
August 1, 1996 among the Company and the purchasers listed in Schedule I
thereto.
"NOTE" shall mean each Series A Note, Series B Note and Series C Note.
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"OPERATING LEASE" shall mean, with respect to any Person, any lease which
is not a Capitalized Lease pursuant to which such Person shall lease real or
personal Property.
"OPERATIONS CASH" for any period shall mean the sum of all cash receipts of
the Company and its Restricted Subsidiaries during such period, on a cumulative
basis and without duplication (including cash receipts from operations of
Restricted Subsidiaries prior to the acquisition thereof by the Company; but
excluding (a) cash proceeds from Interim Capital Transactions, and (b) net cash
receipts from operations in respect of assets sold during such period), LESS the
sum of:
(1) all cash operating expenditures of the Company and its Restricted
Subsidiaries during such period (including, without limitation, (x) cash
operating expenditures of Restricted Subsidiaries prior to the acquisition
thereof by the Company, (y) taxes, if any, paid by the Company as an entity
and by its Restricted Subsidiaries, and (z) amounts owed to the Managing
General Partner as reimbursement for Specified Expenses);
(2) all cash debt service payments of the Company and its Restricted
Subsidiaries during such period (other than payments or prepayments of
principal and premium (x) required by reason of loan agreements (including,
without limitation, covenants and default provisions therein) or by
lenders, in each case, in connection with sales or other dispositions of
assets or (y) made in connection with refinancings or refundings of
Indebtedness with the proceeds from new Indebtedness or from the sale of
Equity Interests, PROVIDED, that any payment or prepayment of principal and
premium, whether or not then due, shall be deemed, at the election and in
the discretion of the Managing General Partner, to be refunded or
refinanced by any Indebtedness incurred or to be incurred by the Company
simultaneously with or within 180 days prior to or after such payment or
prepayment to the extent of the principal amount of such Indebtedness so
incurred);
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(3) all cash capital expenditures of the Company and its Restricted
Subsidiaries during such period, except capital expenditures (including
associated transaction costs) relating to (x) Acquisitions, (y) Capital
Additions and Improvements and (z) Interim Capital Transactions;
(4) the amount, if any, by which cash reserves outstanding as of the
end of such period that the Managing General Partner has determined in its
reasonable discretion to be necessary or appropriate in order to provide
funds for the future cash payment of items of the type referred to in
clauses (1) through (3) above exceeds such cash reserves outstanding at the
beginning of such period;
(5) the amount, if any, by which any cash reserves outstanding at the
end of such period that the Managing General Partner has determined in its
reasonable discretion to be necessary or appropriate in order to provide
funds for Distributions in respect of any one or more of the four
consecutive fiscal quarters following the end of such period exceeds such
cash reserves outstanding at the beginning of the such period; and
(6) any cash receipts of any Restricted Subsidiary which for any
reason (including pursuant to its organizational documents) is unavailable
for distribution to the Company or any other Restricted Subsidiary,
all determined on a consolidated basis. Where cash capital expenditures are
made in part in respect of Acquisitions or Capital Additions and Improvements
and in part for other purposes, the Managing General Partner's good faith
allocation thereof between the portion made for Acquisitions or Capital
Additions and Improvements and the portion made for other purposes shall be
conclusive.
So long as the Company is not a taxpaying entity, taxes paid by the Company
on behalf of, or amounts withheld with respect to, all or less than all of the
Partners shall not be considered cash operating expenditures of the Company that
reduce Operations
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Cash, but the payment or withholding thereof shall be deemed to be a
distribution of Available Cash to such Partners. Alternatively, in the
discretion of the Managing General Partner, so long as the Company is not a
taxpaying entity, such taxes (if pertaining to all Partners) may be considered
to be cash operating expenditures of the Company which reduce Operations Cash,
but the payment or withholding thereof shall not be deemed to be a distribution
of Available Cash to such Partners.
"OVERDUE RATE" with respect to each series of Notes shall mean a rate per
annum equal to the lesser of (i) the maximum rate of interest allowable by law
and (ii) the rate of interest then borne by the Notes of such series plus 2%.
"PARTNERS" shall mean the Managing General Partner and each other Person
owning a Partnership Interest in the Company.
"PARTNERSHIP" shall mean Crown Pacific Partners, L.P., a Delaware limited
partnership, together with any Person who succeeds to all, or substantially all
Crown Pacific Partners, L.P.'s assets and business.
"PARTNERSHIP AGREEMENT" shall mean the Amended and Restated Agreement of
Limited Partnership of the Company dated as of December 22, 1994 between the
Managing General Partner and the Partnership, as the same may from time to time
be supplemented, amended, or restated as permitted thereby.
"PARTNERSHIP INTEREST" shall mean Limited Partnership Interests and General
Partnership Interests.
"PBGC" is defined in Section 4.17(g).
"PERSON" shall mean an individual, partnership, corporation, trust or
limited liability company or other unincorporated organization, and a government
or agency or political subdivision thereof.
"PLAN" shall mean a "pension plan," as such term is defined in ERISA and
which is covered by Title IV of ERISA, other
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than a Multiemployer Plan, established or maintained by the Company or any ERISA
Affiliate or as to which the Company or any ERISA Affiliate contributed or is a
member or otherwise may have any liability.
"PLANNED VOLUME" shall mean as of the first Closing Date 325,000,000 board
feet per annum of timber, and shall be adjusted for any Annual Timber Increase,
as of the Effective Date for such Annual Timber Increase, by increasing such per
annum amount by an amount equal to 8-1/3% of such Annual Timber Increase. In
addition, such per annum amount shall, if there shall be an Annual Timber
Decrease in any Determination Period, be permanently (with respect to such
Annual Timber Decrease) adjusted, effective as of the Effective Date for such
Annual Timber Decrease, by decreasing such per annum amount in the same
proportion that the Predisposition Timber Amount in respect of such Annual
Timber Decrease is reduced by such Annual Timber Decrease; PROVIDED that such
adjustment shall not be made if the percentage decrease represented by such
adjustment would be less than 5% and if the Asset Coverage Ratio as of the last
day of such Determination Period is at least 2:1. For purposes of the
foregoing:
"ANNUAL TIMBER INCREASE" shall mean, for any Determination Period, the
amount, in board feet, by which the number of board feet of timber acquired
by the Company and its Restricted Subsidiaries during such Determination
Period shall exceed the number of board feet of timber sold or otherwise
disposed of by the Company and its Restricted Subsidiaries during such
Determination Period; and "ANNUAL TIMBER DECREASE" shall mean, for any
Determination Period, the amount, in board feet, by which the number of
board feet of timber sold or otherwise disposed of by the Company and its
Restricted Subsidiaries during such Determination Period shall exceed the
number of board feet of timber acquired by the Company and its Restricted
Subsidiaries during such Determination Period; PROVIDED that, neither such
calculation shall include timber acquired with the Net Proceeds of an
Excess Harvest pursuant to Section 4.12.
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"ASSET COVERAGE RATIO" shall mean, as of the date of determination,
the ratio of (a) the fair market value (determined in good faith by a
Responsible Officer, but excluding any value based on a higher and better
use thereof) of the timberlands owned by the Company and its Restricted
Subsidiaries on such determination date to (b) Funded Debt of the Company
and its Restricted Subsidiaries on a consolidated basis on such
determination date.
"DETERMINATION PERIOD" shall mean the period from and including the
first Closing Date to and including December 31, 1998 and each calendar
year thereafter.
"EFFECTIVE DATE" for any Annual Timber Increase or Annual Timber
Decrease shall be July 1 of the Determination Period for which such Annual
Timber Increase or Annual Timber Decrease, as the case may be, occurs.
"PREDISPOSITION TIMBER AMOUNT" with respect to any Annual Timber
Decrease shall mean the amount of timber owned by the Company and its
Restricted Subsidiaries as of the first day of the Determination Period for
which such Annual Timber Decrease occurred.
"PREDECESSOR PARTNERSHIPS" shall mean CPLP and CP Inland.
"PRIVATE PLACEMENT MEMORANDUM" shall mean the Placement Memorandum, dated
November, 1997, prepared by the Company with the assistance of BancAmerica
Xxxxxxxxx Xxxxxxxx.
"PRO FORMA INTEREST EXPENSE" for any Four Quarter Period shall mean the
Interest Expense payable by the Company and its Restricted Subsidiaries during
such Four Quarter Period on all Current Debt and Funded Debt of the Company and
its Restricted Subsidiaries on a consolidated basis, PLUS the Interest Expense
which would have been payable during such Four Quarter Period in respect of (i)
any Current Debt and Funded Debt to be issued on the date of determination of
Pro Forma Interest Expense and (ii) the Current Debt or Funded Debt issued after
the end of such Four Quarter Period and prior to such date of determination, in
each
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case, giving effect as of the beginning of such Four Quarter Period (y) to the
incurrence of all such Current Debt and Funded Debt described in clauses (i) and
(ii), and (z) to the application of any such Funded Debt or Current Debt to the
substantially concurrent repayment of any other Current Debt or Funded Debt
outstanding during such Four Quarter Period. Computations of Pro Forma Interest
Expense for Current Debt and Funded Debt having a variable interest rate shall
be calculated at the rate in effect on the date of such determination.
"PRO FORMA MAXIMUM DEBT SERVICE" shall mean, as of any date of
determination, the highest total amount payable by the Company and its
Restricted Subsidiaries on a consolidated basis, during any Four Quarter Period,
commencing with the fiscal quarter in which such date of determination occurs
and ending on March 31, 2018, in respect of scheduled principal payments and all
Interest Expense with respect to all Current Debt and Funded Debt of the Company
and its Restricted Subsidiaries outstanding on such date of determination, after
giving effect to any Current Debt and Funded Debt proposed to be incurred on
such date and to the substantially concurrent repayment of any other Current
Debt and Funded Debt (i) assuming, in the case of Current Debt or Funded Debt
having a variable interest rate, that the rate in effect on the date of
determination will remain in effect throughout such period, (ii) including only
actual interest payments with respect to the Current Debt and Funded Debt
incurred pursuant to the Working Capital Facility during the most recent Four
Quarter Period and (iii) treating the principal amount of all Current Debt and
Funded Debt outstanding as of such date of determination under a revolving
credit or similar agreement (other than the Working Capital Facility) as
maturing and becoming due and payable on the scheduled maturity date or dates
thereof (including the maturity of any payment required by any commitment
reduction or similar amortization provision), without regard to any provision
permitting such maturity date to be extended; PROVIDED, HOWEVER, that for
purposes of the foregoing clause (iii), the Company shall be deemed to have
elected to have any amount outstanding under the Acquisition Facility to be
amortized in the manner and over the period
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provided for therein commencing at the expiration of the period during which the
Acquisition Facility is revolving in nature.
"PROPERTY" shall mean any interest in any kind of property or asset,
whether real, personal or mixed, or tangible or intangible.
"PTE" is defined in Section 2.3(a).
"PURCHASERS" is defined in the introductory paragraph to this Agreement.
"RCRA" shall mean the Solid Waste Disposal Act, as amended by the Resource
Conservation and Recovery Act of 1976 and Hazardous and Solid Waste Amendments
of 1984, 42 U.S.C. Sections 6901 ET SEQ., and any future amendments.
"RELEASE" shall mean any spilling, leaking, pumping, pouring, emitting,
emptying, discharging, injecting, escaping, leaching, dumping, or disposing into
the environment, including, without limitation, the abandonment or discarding of
barrels, drums, containers, tanks and other receptacles containing or previously
containing any Hazardous Material.
"RENTALS" of any Person shall mean and include as of the date of
determination thereof all fixed payments (including as such all payments which
the lessee is obligated to make to the lessor on termination of the lease or
surrender of the Property) payable by such Person, as lessee or sublessee under
a lease of real or personal Property, but shall be exclusive of any amounts
required to be paid by such Person (whether or not designated as rents or
additional rents) on account of maintenance, repairs, insurance, taxes and
similar charges. Fixed rents under any so-called "percentage leases" shall be
computed solely on the basis of the minimum rents, if any, required to be paid
by the lessee regardless of sales volume or gross revenues.
"REPORTABLE EVENT" shall mean a "reportable event" as described in Section
4043 of ERISA for which the notice requirement to the PBGC has not been waived,
PROVIDED that the
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loss of qualification of a Plan and the failure to meet the minimum funding
standard of Section 412 of the Internal Revenue Code of 1986, as amended, or
Section 302 of ERISA shall be a Reportable Event regardless of the issuance of
any waiver of the reporting requirement by the PBGC.
"RESPONSIBLE OFFICER" shall mean any of the Chief Executive Officer,
President, Chief Financial Officer, General Counsel and any Executive Vice
President of the Managing General Partner.
"RESTRICTED SUBSIDIARY" shall mean any Subsidiary (i) which is organized
under the laws of the United States or Canada or any state or province thereof;
(ii) which conducts substantially all of its business and has substantially all
of its assets within the United States or Canada; (iii) of which (A) in the case
of any corporation, more than 50% of the Voting Stock is beneficially owned,
directly or indirectly by the Company, or (B) in the case of any partnership,
more than 50% of each of the Limited Partnership Interest and the General
Partnership Interest is beneficially owned, directly or indirectly by the
Company; and (iv) which is designated as a Restricted Subsidiary in the most
recent written notice with respect to such Subsidiary given by the Company
pursuant to Section 4.18.
"SECURITIES ACT" shall mean the Securities Act of 1933, as amended.
"SECURITY" shall have the same meaning as in Section 2(1) of the Securities
Act.
"SENIOR FUNDED DEBT" shall mean all Funded Debt other than Subordinated
Funded Debt.
"SERIES A NOTE" shall mean each 7.76% Senior Note, Series A, due
February 1, 2012 issued under and pursuant to this Agreement, including any Note
issued in substitution therefor or replacement thereof pursuant to Section 9.1,
Section 9.2, or Section 9.3.
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"SERIES B NOTE" shall mean each 7.76% Senior Note, Series B, due
February 1, 2013 issued under and pursuant to this Agreement, including any Note
issued in substitution therefor or replacement thereof pursuant to Section 9.1,
Section 9.2, or Section 9.3.
"SERIES C NOTE" shall mean each 7.93% Senior Note, Series C, due
February 1, 2018 issued under and pursuant to this Agreement, including any Note
issued in substitution therefor or replacement thereof pursuant to Section 9.1,
Section 9.2, or Section 9.3.
"SOURCE" is defined in Section 2.3.
"SPECIFIED EXPENSES" shall mean (i) all reasonable direct and indirect
expenses the Managing General Partner incurs or payments it makes on behalf of
the Company (including, without limitation, salary, bonus, incentive
compensation, and other amounts paid to any Person to perform services for the
Company or for the Managing General Partner in the discharge of its duties to
the Company), and (ii) all other necessary or appropriate reasonable expenses
allocable to the Company or otherwise reasonably incurred by the Managing
General Partner in connection with operating the Company's business (including
without limitation reasonable expenses allocated to the Managing General Partner
by its affiliates and, for so long as Fremont Group, Inc. owns an interest in
the Managing General Partner, an annual fee of $100,000, payable semi-annually
in arrears in consideration of management services).
"SUBORDINATED FUNDED DEBT" shall mean all unsecured Funded Debt of the
Company which shall contain or have applicable thereto subordination provisions
substantially in the form set forth in Exhibit G attached hereto providing for
the subordination thereof to other Funded Debt of the Company, including,
without limitation, the Notes.
"SUBSIDIARY" shall mean, as to any particular parent business entity, any
business entity of which such parent business entity and/or one or more business
entities which are themselves subsidiaries of such parent business entity, (i)
in the case of any corporation, own more than 50% of the Voting
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Stock, or (ii) in the case of any partnership, own more than 50% of the Limited
Partnership Interest, or own a Controlling General Partnership Interest.
"SUBSIDIARY" shall mean a subsidiary of the Company.
"SURVIVING ENTITY" is defined in Section 4.9(2)(i).
"UNRESTRICTED SUBSIDIARY" shall mean any Subsidiary other than a Restricted
Subsidiary.
"VOTING EQUITY INTEREST" shall mean Voting Stock and General Partnership
Interests.
"VOTING STOCK" of any Person shall mean Securities of any class or classes,
the holders of which are entitled at such time to elect a majority of the
corporate directors of such Person (or Persons performing similar functions).
"W-I" is defined in Exhibit B.
"WHOLLY-OWNED" when used in connection with any Subsidiary shall mean (i)
in the case of a corporation, a Subsidiary of which all the issued and
outstanding shares of stock (except shares required as directors' qualifying
shares) and all Indebtedness shall be owned by the Company and/or one or more of
its Wholly-owned Subsidiaries, and (ii) in the case of any partnership shall
mean a Subsidiary of which all of the outstanding General Partnership Interests
are owned by the Managing General Partner and all of the Limited Partnership
Interests and all Indebtedness shall be owned by the Company and/or one or more
of its Wholly-owned Subsidiaries.
"WORKING CAPITAL CREDIT AGREEMENT" is defined in Section 3.9.
"WORKING CAPITAL FACILITY" shall mean the facility made available to the
Company for working capital and general partnership purposes pursuant to the
Working Capital Credit Agreement, as from time to time renewed, extended,
amended and supplemented and any other credit agreement from time to time
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entered into by the Company for purposes of obtaining working capital financing,
PROVIDED that such facility or facilities shall not be for an amount in excess
of $40,000,000 in the aggregate.
"WORKING CAPITAL RESERVE" shall mean the amount, if any, available to be
borrowed at the time of determination under the Working Capital Facility, up to
a maximum of $40,000,000.
SECTION 8.2. ACCOUNTING PRINCIPLES. Where the character or amount of any
asset or liability or item of income or expense is required to be determined or
any consolidation or other accounting computation is required to be made for the
purposes of this Agreement the same shall be done in accordance with GAAP, to
the extent applicable, except (i) that audit adjustments shall be effective as
of the related period and not as of the period made, and (ii) where such
principles are inconsistent with the requirements of this Agreement.
SECTION 8.3. DIRECTLY OR INDIRECTLY. Where any provision of this
Agreement refers to action to be taken by any Person, or which such Person is
prohibited from taking, such provision shall be applicable whether such action
is taken directly or indirectly by such Person.
SECTION 9. MISCELLANEOUS.
SECTION 9.1. REGISTERED NOTES. The Company shall cause to be kept at its
principal office a register for the registration and transfer of the Notes and
the Company will register or transfer or cause to be registered or transferred
as hereinafter provided any Note issued pursuant to this Agreement, PROVIDED
that nothing in this Section 9.1 shall be construed to require the Company to
register the Notes under the Securities Act or the United States Securities
Exchange Act of 1934, as amended.
At any time and from time to time the registered Holder holding any Note
which has been duly registered as hereinabove provided may transfer such Note
upon surrender thereof at the principal office of the Company duly endorsed or
accompanied by a
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written instrument of transfer duly executed by the registered Holder or its
attorney duly authorized in writing. Any transferee of a Note shall, by its
acceptance of such Note, be deemed to have made the same representations to the
Company regarding the purchase of the Note as the original Purchaser made
pursuant to Section 2.3; PROVIDED, HOWEVER, that with respect to the
representation made in the third sentence of Section 2.3, such transferee will
not be deemed to have chosen the options set forth in Section 2.3(b), (c), (d)
or (f) unless such transferee shall have made the disclosures referred to
therein at least ten Business Days prior to its acceptance of such Note and
shall have received prior to its acceptance of such Note written confirmation
from the Company to the effect set forth in the first sentence of Paragraph 20
of Exhibit B-1 hereto. The Company shall exercise such reasonable due diligence
as is necessary to respond to any such disclosure, PROVIDED THAT, if the Company
shall not respond within 10 Business Days following receipt of any such
disclosure, it shall be deemed to have made such confirmation.
The Person in whose name any registered Note shall be registered shall be
deemed and treated as the owner and Holder thereof for all purposes of this
Agreement. Payment of or on account of the principal, premium, if any, and
interest on any registered Note shall be made to or upon the written order of
such registered Holder.
SECTION 9.2. EXCHANGE OF NOTES. At any time and from time to time, upon
not less than ten days' notice to that effect given by the Holder holding any
Note initially delivered or of any Note substituted therefor pursuant to Section
9.1, this Section 9.2 or Section 9.3, and, upon surrender of such Note at its
office, the Company will deliver in exchange therefor, without expense to such
Holder, except as set forth below, a Note of the same series and for the same
aggregate principal amount as the then unpaid principal amount of the Note so
surrendered, or Notes of the same series in the denomination of $1,000,000 or
any amount in excess thereof as such Holder shall specify, dated as of the date
to which interest has been paid on the Note so surrendered or, if such surrender
is prior to the payment of any interest thereon, then dated as of
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the date of issue, registered in the name of such Person or Persons as may be
designated by such Holder, and otherwise of the same form and tenor as the Notes
so surrendered for exchange. The Company may require the payment of a sum
sufficient to cover any stamp tax or governmental charge imposed upon such
exchange or transfer.
SECTION 9.3. LOSS, THEFT, ETC. OF NOTES. Upon receipt of evidence
satisfactory to the Company of the loss, theft, mutilation or destruction of any
Note, and in the case of any such loss, theft or destruction upon delivery of a
bond of indemnity in such form and amount as shall be reasonably satisfactory to
the Company, or in the event of such mutilation upon surrender and cancellation
of the Note, the Company will make and deliver without expense to the Holder
thereof, a new Note, of the same series and of like tenor, in lieu of such lost,
stolen, destroyed or mutilated Note. If the Purchaser or any subsequent
Institutional Holder is the owner of any such lost, stolen or destroyed Note,
then the affidavit of an authorized officer of such owner, setting forth the
fact of loss, theft or destruction and of its ownership of such Note at the time
of such loss, theft or destruction shall be accepted as satisfactory evidence
thereof and no further indemnity shall be required as a condition to the
execution and delivery of a new Note other than the written agreement of such
owner to indemnify the Company.
SECTION 9.4. POWERS AND RIGHTS NOT WAIVED; REMEDIES CUMULATIVE. No delay
or failure on the part of any Holder in the exercise of any power or right shall
operate as a waiver thereof; nor shall any single or partial exercise of the
same preclude any other or further exercise thereof, or the exercise of any
other power or right, and the rights and remedies of any Holder are cumulative
to, and are not exclusive of, any rights or remedies any such Holder would
otherwise have, and no waiver or consent shall extend to or affect any
obligation or right not expressly waived or consented to.
SECTION 9.5. NOTICES. (a) All communications under this Agreement shall
be in writing and shall be mailed by registered
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or certified mail, postage prepaid or shall be sent by overnight courier:
(1) If to any Purchaser, at such Purchaser's address appearing on
Schedule I hereto, marked for attention as there indicated, or at such
other address as such Purchaser or any subsequent Holder may have furnished
to the Company in writing; or
(2) If to the Company, at its address beneath its signature at the
foot of this Agreement, or at such other address as it may have furnished
in writing to each Holder.
(b) Any notice so addressed and mailed by registered or certified mail to
any Holder shall be deemed to be given when delivered to such Holder and any
notice so addressed and sent by overnight courier to any Holder shall be deemed
to be given when delivered to such Holder.
SECTION 9.6. REPRODUCTION OF DOCUMENTS. This Agreement and all documents
relating thereto including, without limitation, (a) consents, waivers and
modifications which may hereafter be executed, (b) documents received by each
Purchaser at the closing of its purchase of the Notes (except the Notes
themselves), and (c) financial statements, certificates and other information
previously or hereafter furnished to such Purchaser, may be reproduced by such
Purchaser by any photographic, photostatic, microfilm, micro-card, miniature
photographic or other similar process and such Purchaser may destroy any
original document so reproduced. The Company agrees and stipulates that any
such reproduction shall be admissible in evidence as the original itself in any
judicial or administrative proceeding (whether or not the original is in
existence and whether or not such reproduction was made by such Purchaser in the
regular course of business) and that any enlargement, facsimile or further
reproduction of such reproduction shall likewise be admissible in evidence.
SECTION 9.7. SURVIVAL. All warranties, representations and covenants
made by the Company herein or on any certificate or
-84-
other instrument delivered by it or on its behalf under this Agreement shall be
considered to have been relied upon by each Purchaser and shall survive the
delivery to such Purchaser of the Notes regardless of any investigation made by
such Purchaser or on its behalf. All representations made by the Purchasers in
Section 2.3 shall be considered to have been relied upon by the Company and
shall survive the delivery to the Company of the purchase price of the Notes
regardless of any investigation made by the Company or on its behalf. All
statements in any such certificate or other instrument shall constitute
warranties and representations by the Company hereunder.
SECTION 9.8. SUCCESSORS AND ASSIGNS. This Agreement shall inure to the
benefit of and be binding upon the successors and assigns of each of the
parties. The provisions of this Agreement are intended to be for the benefit of
all Holders, from time to time, and shall be enforceable by any such Holder,
whether or not an express assignment to such Holder of rights under this
Agreement has been made by any Purchaser or its successor or assign.
SECTION 9.9. GOVERNING LAW. This Agreement and the Notes shall be
governed by and construed in accordance with the laws of the State of New York.
SECTION 9.10. SUBMISSION TO JURISDICTION. The Company hereby irrevocably
submits to the jurisdiction of the courts of the State of New York and of the
courts of the United States of America having jurisdiction in the State of New
York for the purpose of any legal action or proceeding in any such court with
respect to, or arising out of, this Agreement. The Company designates and
appoints Prentice Hall Legal & Financial Services, 00 Xxxxxxxx Xxxxxx, Xxx Xxxx,
Xxx Xxxx 00000 and its successors as the Company's lawful agent in the United
States of America upon which may be served and which may accept and acknowledge,
for and on behalf of the Company all process in any action, suit or proceedings
that may be brought against the Company in any of the courts referred to in this
Section 9.10, and agrees that such service of process, or the acceptance or
acknowledgment thereof by said agent, shall be valid, effective and binding in
every
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respect; PROVIDED, HOWEVER, that if said agency shall cease for any reason
whatsoever, the Company hereby designates and appoints, without power or
revocation, the Secretary of State of the State of New York to serve as its
agent for service of process. If any Holder shall cause process to be served
upon the Company by being served upon such agent, a copy of such process shall
also be mailed to the Company by registered mail, first class postage prepaid,
at the Company's address set forth at the foot of this Agreement. Nothing
contained in this Section 9.10 shall limit the right of any Holders to take
proceedings against the Company in any other court of competent jurisdiction
nor, by virtue of anything contained herein, shall the taking of proceedings in
one or more jurisdictions preclude the taking of proceedings in any other
jurisdiction whether concurrently or not.
SECTION 9.11. LIMITATIONS OF LIABILITY. Anything in this Agreement to the
contrary notwithstanding, neither the Holders nor the successors or assigns
thereof shall have any claim, remedy or right to proceed against (i) the
Managing General Partner or (ii) any past, present or future partner, employee,
director, officer, stockholder or incorporator of the Managing General Partner,
the Partnership or any subsidiary thereof (other than the Company) for the
payment of any deficiency or any other sum owing on account of the Indebtedness
evidenced by the Notes or for the payment of any liability resulting from the
breach of any covenant, agreement, warranty or representation of any nature
whatsoever in this Agreement or in any certificate delivered pursuant hereto,
except with respect to CP Acquisition Co. pursuant to the Collection Guaranty
dated as of January 2, 1998 relating to the Series A Notes. Nothing herein
contained shall limit, restrict or impair the rights of the Holders to
accelerate the maturity of the Notes upon an Event of Default, to bring suit and
obtain a judgment against the Company on the Notes, to execute any such judgment
on the Company's Properties or to exercise all other rights and remedies against
the Company provided under this Agreement.
SECTION 9.12. SEVERABILITY. Should any part of this Agreement for any
reason be declared invalid, such decision shall not
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affect the validity of any remaining portion, which remaining portion shall
remain in force and effect as if this Agreement had been executed with the
invalid portion thereof eliminated.
SECTION 9.13. CAPTIONS. The descriptive headings of the various Sections
or parts of this Agreement are for convenience only and shall not affect the
meaning or construction of any of the provisions hereof.
SECTION 9.14. DUPLICATE ORIGINALS. Two or more counterparts of this
Agreement may be signed by the parties, each of which shall be an original but
all of which together shall constitute one and the same instrument.
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The execution hereof by the Purchasers shall constitute a contract among
the Company and the Purchasers for the uses and purposes hereinabove set forth.
CROWN PACIFIC LIMITED
PARTNERSHIP, a Delaware
limited partnership
By: CROWN PACIFIC
MANAGEMENT
LIMITED PARTNERSHIP,
a Delaware
limited
partnership
Its General
Partner
By: HS Corp. of
Oregon, an Oregon
corporation
Its
General Partner
By
-----------------------
Its
Crown Pacific Limited Partnership
000 X.X. Xxxxxxxx Xxxxxx
Xxxxxxxx, Xxxxxx 00000
Attention: Xxxxx X. Xxxxx
Telefacsimile number: (000) 000-0000
Confirmation number: (000) 000-0000
Acknowledged (as to
representations made
pursuant to Section 2.2) by:
CROWN PACIFIC
MANAGEMENT
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LIMITED PARTNERSHIP,
a
Delaware
limited partnership
As
Managing General
Partner
By: HS Corp. of
Oregon, an Oregon
corporation
Its
General Partner
By
------------------
Its
Crown Pacific Management Limited
Partnership
000 X.X. Xxxxxxxx Xxxxxx
Xxxxxxxx, Xxxxxx 00000
Attention: Xxxxx X. Xxxxx
Telefacsimile number: (000) 000-0000
Confirmation number: (000) 000-0000
-89-
Accepted as of December 15, 1997:
XXXX XXXXXXX MUTUAL LIFE INSURANCE
COMPANY
By
Its
-90-
Accepted as of December 15, 1997:
XXXX XXXXXXX VARIABLE LIFE
INSURANCE COMPANY
By
Its
-91-
Accepted as of December 15, 1997:
TEACHERS INSURANCE AND ANNUITY
ASSOCIATION OF AMERICA
By
Its
-92-
Accepted as of December 15, 1997:
PROVIDENT LIFE AND ACCIDENT
INSURANCE COMPANY
By: Provident Investment
Management, LLC
Its Agent
By
Its Vice President
-93-
Accepted as of December 15, 1997
CONNECTICUT GENERAL LIFE INSURANCE
COMPANY
By CIGNA Investments, Inc.
By
Name:
Title:
-94-
Accepted as of December 15, 1997
CONNECTICUT GENERAL LIFE INSURANCE
COMPANY, on behalf of one
or more _________ separate accounts
By CIGNA Investments, Inc.
By
Name:
Title:
-95-
Accepted as of December 15, 1997
GENERAL ELECTRIC CAPITAL ASSURANCE
COMPANY
By
Its
-96-
Accepted as of December 15, 1997
THE MINNESOTA MUTUAL LIFE
INSURANCE COMPANY
By MIMLIC Asset Management
Company
By
Its
-97-
Accepted as of December 15, 1997
MUTUAL TRUST LIFE INSURANCE
COMPANY
By MIMLIC Asset Management
Company
By
Its
-98-
Accepted as of December 15, 1997
OHIO NATIONAL LIFE ASSURANCE
CORPORATION
By
Its
-99-
NAME AND ADDRESS PRINCIPAL AMOUNT OF
OF PURCHASERS NOTES TO BE PURCHASED
XXXX XXXXXXX MUTUAL LIFE INSURANCE Series A Series B Series C
COMPANY -------- --------
Xxxx Xxxxxxx Place $5,000,000 $6,000,000 $15,000,000
000 Xxxxxxxxx Xxxxxx (Two Notes: (Two Notes: (Three Notes:
Xxxxxx, Xxxxxxxxxxxxx 00000 $500,000 $1,500,000 $7,000,000
$4,500,000) $4,500,000) $5,000,000
$3,000,000)
Payments
All payments on or in respect of the Notes to be by bank wire transfer of
Federal or other immediately available funds (identifying each payment as "Crown
Pacific Limited Partnership, 7.76% Senior Notes, Series A, due February 1, 2012,
PPN 22844# AH 3, 7.76% Senior Notes, Series B, due February 1, 2013, PPN 22844#
AJ 9, 7.93% Senior Notes, Series C, due February 1, 2018, PPN 22844# AK 6, as
the case may be, principal or interest") to:
Bank Boston
ABA #000000000
Xxxxxx, Xxxxxxxxxxxxx 00000
For the account of: Xxxx Xxxxxxx Mutual Life Insurance Company
Private Placement Collection Account
Account Number 541-55417
On Order of: Crown Pacific Limited Partnership, [Applicable PPN]
Notices
Contemporaneous with the above wire transfer, advice setting forth (1) the full
name, interest rate and maturity date of the Notes or other obligations; (2)
allocation of payment between principal and interest and any special payment;
and (3) name and
SCHEDULE I
(to Note Purchase Agreement)
address of Bank (or Trustee) from which wire transfer was sent, shall be
delivered or mailed to:
Xxxx Xxxxxxx Mutual Life Insurance Company
000 Xxxxxxxxx Xxxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
Attention: Xxxxx Xxxxxxxx, Investment Accounting Division
T-10
All notices with respect to prepayments, both scheduled and unscheduled, whether
partial or in full, and notice of maturity shall be delivered or mailed to:
Xxxx Xxxxxxx Mutual Life Insurance Company
Xxxx Xxxxxxx Place
000 Xxxxxxxxx Xxxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
Attention: Xxxxx Xxxxxxxx, Investment Accounting Division T-10
All other communications which shall include, but not be limited to, financial
statements and certificates of compliance with financial covenants, shall be
delivered or mailed to:
Xxxx Xxxxxxx Mutual Life Insurance Company
Xxxx Xxxxxxx Place
000 Xxxxxxxxx Xxxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
Attention: Bond and Corporate Finance Department, T-57
and
Xxxx Xxxxxxx Xxxx and Corporate Finance Group
Paper and Forest Products Team
0000 Xxxxx Xxxx Xxx, Xxxxx 000
Xxxxxxxxxx, Xxxxxxxxxx 00000
Attention: Xxxx Xxxx, Assistant Investment Officer
Phone: (000) 000-0000
I-101
Fax: (000) 000-0000
and a copy of any notices relating to change in issuer's name, address or
principal place of business and a copy of any legal opinions shall be delivered
or mailed to:
Xxxx Xxxxxxx Mutual Life Insurance Company
Xxxx Xxxxxxx Place
000 Xxxxxxxxx Xxxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
Attention: Investment Law Division, T-50
Name of Nominee in which Notes are to be issued: None
Taxpayer I.D. Number: 00-0000000
Closing Date: December 30, 1997 for Series A Notes
Commitment Expiration Date: December 31, 1997 for Series A Notes
Closing Date: January 13, 1998 for Series B and C Notes
Commitment Expiration Date: January 30, 1998 for Series B and C Notes
PRINCIPAL AMOUNT OF
NAME AND ADDRESS NOTES TO BE PURCHASED
OF PURCHASERS
XXXX XXXXXXX VARIABLE LIFE INSURANCE Series A Series B Series C
COMPANY -------- --------
Xxxx Xxxxxxx Place $1,000,000 -0- -0-
000 Xxxxxxxxx Xxxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
Payments
All payments on or in respect of the Notes to be by bank wire transfer of
immediately available funds for credit, not later than 12 noon, Boston time,
(identifying each payment as "Crown Pacific Limited Partnership, 7.76% Senior
Notes, Series A, due February 1, 2012, PPN 22844# AH 3, 7.76% Senior Notes,
Series B,
I-102
due February 1, 2013, PPN 22844# AJ 9, 7.93% Senior Notes, Series C, due
February 1, 2018, PPN 22844# AK 6, as the case may be, principal or interest")
to:
Bank Boston
ABA #000000000
Xxxxxx, Xxxxxxxxxxxxx 00000
For the account of: Xxxx Xxxxxxx Mutual Life Insurance Company
Private Placement Collection Account
Account Number 541-55417
On Order of: Crown Pacific Limited Partnership, [Applicable PPN]
Notices
Contemporaneous with the above wire transfer, advice setting forth (1) the full
name, interest rate and maturity date of the Notes or other obligations; (2)
allocation of payment between principal and interest and any special payment;
and (3) name and address of Bank (or Trustee) from which wire transfer was sent,
shall be delivered or mailed to:
Xxxx Xxxxxxx Mutual Life Insurance Company
Xxxx Xxxxxxx Place
000 Xxxxxxxxx Xxxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
Attention: Xxxxx Xxxxxxxx, Investment Accounting Division T-10
All notices with respect to prepayments, both scheduled and unscheduled, whether
partial or in full, and notice of maturity shall be delivered or mailed to:
Xxxx Xxxxxxx Mutual Life Insurance Company
Xxxx Xxxxxxx Place
000 Xxxxxxxxx Xxxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
I-103
Attention: Xxxxx Xxxxxxxx, Investment Accounting Division
T-10
All other communications which shall include, but not be limited to, financial
statements and certificates of compliance with financial covenants, shall be
delivered or mailed to:
Xxxx Xxxxxxx Mutual Life Insurance Company
Xxxx Xxxxxxx Place
000 Xxxxxxxxx Xxxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
Attention: Bond and Corporate Finance Department, T-57
and
Xxxx Xxxxxxx Xxxx and Corporate Finance Group
Paper and Forest Products Team
0000 Xxxxx Xxxx Xxx, Xxxxx 000
Xxxxxxxxxx, Xxxxxxxxxx 00000
Attention: Xxxx Xxxx, Assistant Investment Officer
Phone: (000) 000-0000
Fax: (000) 000-0000
and a copy of any notices relating to change in issuer's name, address or
principal place of business and a copy of any legal opinions shall be delivered
or mailed to:
Xxxx Xxxxxxx Mutual Life Insurance Company
Xxxx Xxxxxxx Place
000 Xxxxxxxxx Xxxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
Attention: Investment Law Division, T-50
Name of Nominee in which Notes are to be issued: None
Taxpayer I.D. Number: 00-0000000
Closing Date: December 30, 1997 for Series A Notes
Commitment Expiration Date: December 31, 1997 for Series A Notes
I-104
NAME AND ADDRESS PRINCIPAL AMOUNT OF
OF PURCHASERS NOTES TO BE PURCHASED
TEACHERS INSURANCE AND ANNUITY Series A Series B Series C
ASSOCIATION OF AMERICA -------- -------- --------
000 Xxxxx Xxxxxx $9,000,000 -0- -0-
New York, New York 10017-3263
Attention: Xxxxxx Xxxxx-Xxxx,
Securities Division, Private
Placements
Telephone Number: (000) 000-0000
or (000) 000-0000 (general number)
Facsimile Number: (000) 000-0000
Payments
All payments on account of the Series A Notes shall be made in immediately
available funds at the opening of business on the due date by electronic funds
transfer through the Automated Clearing House System to:
Chase Manhattan Bank
New York, New York
ABA No. 000-000-000
Account Number: 000-0-000000
For Further Credit to the TIAA Account Number: G07040
Reference: PPN 22844# AH 3; Crown Pacific Limited Partnership;
Maturity Date: February 1, 2012; Interest Rate:
7.76%
per annum; P&I breakdown
Notices
Contemporaneous with the above electronic funds transfer, mail or send by
facsimile written confirmation of each such payment to be addressed as set forth
below including the following information:
I-105
(1) the full name, private placement number, interest rate, series and maturity
date of the Notes; (2) the allocation of payment between principal, interest,
premium and any special payment; and (3) the name and address of the bank from
which such electronic funds transfer was sent to:
Teachers Insurance and Annuity Association of America
000 Xxxxx Xxxxxx
Xxx Xxxx, XX 00000
Attention: Securities Accounting Division
Telephone Number: (000) 000-0000
Facsimile Number: (000) 000-0000
All other notices and communications to be addressed as first provided above.
Name of Nominee in which Notes are to be issued: None
Taxpayer I.D. Number: 00-0000000
Closing Date: December 30, 1997
Commitment Expiration Date: December 31, 1997
PRINCIPAL AMOUNT OF NOTES
NAME AND ADDRESS TO BE PURCHASED
OF PURCHASERS
PROVIDENT LIFE AND ACCIDENT INSURANCE Series A Series B Series C
COMPANY -------- --------
-0- -0- $10,000,000
(1) All payments on account of the
Notes shall be made by wire
transfer of immediately available
funds to:
XXXX & CO.
x/x Xxx Xxxxx Xxxxxxxxx Xxxx, X.X.
Xxx Xxxx, XX
ABA No. 021 000 021
SSG Private Income Processing
A/C #000-0-000000
I-106
Custodial Account No. G06704
Please reference: Issuer: Crown Pacific Limited Partnership
PPN: 22844# AK 6
Coupon: 7.93%
Maturity: February 1, 2018
Principal=$__________
Interest=$___________
(2) Address all communications with respect to payments and all other
communications to:
Provident Investment Management, LLC
Private Placements
Xxx Xxxxxxxx Xxxxxx
Xxxxxxxxxxx, Xxxxxxxxx 00000
Telephone: (000) 000-0000
Fax: (000) 000-0000
(3) Tax Identification Number: 00-0000000
Name of Nominee in which Notes are to be issued: (XXXX & CO.)
Closing Date: January 13, 1998
Closing Expiration Date: January 30, 1998
PRINCIPAL AMOUNT OF
NAME AND ADDRESS NOTES TO BE PURCHASED
OF PURCHASERS
CONNECTICUT GENERAL LIFE INSURANCE Series A Series B Series C
COMPANY -------- --------
c/o CIGNA Investments, Inc. -0- $6,200,000 -0-
000 Xxxxxxx Xxxxx Xxxx (Two Notes: $3,200,000 and $3,000,000)
Xxxxxxxx, Xxxxxxxxxxx 00000-0000
Attention: Private Securities
Division - S-307
Fax: 000-000-0000
I-107
Payments
All payments on or in respect of the Notes to be by Federal Funds Wire Transfer
to:
Chase NYC/CTR/
BNF=CIGNA Private Placements/AC=9009001802
ABA #000000000
OBI=Crown Pacific Limited Partnership, Series B Senior Notes, 7.76%, due
February 1, 2013, PPN 22844# AJ 9, (as among principal, premium and
interest of the payment being made); contact name and phone.
Address for Notices Related to Payments:
CIG & Co.
c/o CIGNA Investments, Inc.
Attention: Securities Processing S-309
000 Xxxxxxx Xxxxx Xxxx
Xxxxxxxx, Xxxxxxxxxxx 00000-0000
CIG & Co.
c/o CIGNA Investments, Inc.
Attention: Private Securities - S-307
Operations Group
000 Xxxxxxx Xxxxx Xxxx
Xxxxxxxx, Xxxxxxxxxxx 00000-0000
Fax: 000-000-0000
with a copy to:
Chase Manhattan Bank, N.A.
Private Placement Servicing
P. O. Box 0000
Xxxxxxx Xxxxx Xxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: CIGNA Private Placements
Fax: 000-000-0000/1005
Address for All Other Notices:
I-108
CIG & Co.
c/o CIGNA Investments, Inc.
Attention: Private Securities Division - S-307
000 Xxxxxxx Xxxxx Xxxx
Xxxxxxxx, Xxxxxxxxxxx 00000-0000
Fax: 000-000-0000
Name of Nominee in which Notes are to be issued: CIG & Co.
Taxpayer I.D. Number for CIG & Co.: 00-0000000
Taxpayer I.D. Number for Connecticut General Life Insurance Company: 00-0000000
Closing Date: January 13, 1998
Commitment Expiration Date: January 30, 1998
PRINCIPAL AMOUNT OF
NAME AND ADDRESS NOTES TO BE PURCHASED
OF PURCHASERS
Series A Series B Series C
-------- --------
CONNECTICUT GENERAL LIFE
INSURANCE COMPANY, on behalf
of one or more separate -0- $13,800,000 -0-
accounts
c/o CIGNA Investments, Inc. (Three Notes: $6,000,000,
000 Xxxxxxx Xxxxx Xxxx $4,212,000, and $3,588,000)
Hartford, Connecticut 06152-2307
Attention: Private Securities
Division - S-307
Fax: 000-000-0000
Payments
All payments on or in respect of the notes to be by Federal Funds Wire Transfer
to:
I-109
Chase NYC/CTR/
BNF=CIGNA Private Placements/AC=9009001802
ABA #000000000
OBI=Crown Pacific Limited Partnership, Series B Senior Notes, 7.76%, due
February 1, 2013, PPN 22844# AJ 9, (as among principal, premium and
interest of the payment being made); contact name and phone.
Address for Notices Related to Payments:
CIG & Co.
c/o CIGNA Investments, Inc.
Attention: Securities Processing S-309
000 Xxxxxxx Xxxxx Xxxx
Xxxxxxxx, Xxxxxxxxxxx 00000-0000
CIG & Co.
c/o CIGNA Investments, Inc.
Attention: Private Securities - S-307
Operations Group
000 Xxxxxxx Xxxxx Xxxx
Xxxxxxxx, Xxxxxxxxxxx 00000-0000
Fax: 000-000-0000
with a copy to:
Chase Manhattan Bank, N.A.
Private Placement Servicing
P. O. Box 0000
Xxxxxxx Xxxxx Xxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: CIGNA Private Placements
Fax: 000-000-0000/1005
Address for All Other Notices:
CIG & Co.
c/o CIGNA Investments, Inc.
Attention: Private Securities Division - S-307
000 Xxxxxxx Xxxxx Xxxx
X-000
Xxxxxxxx, Xxxxxxxxxxx 00000-0000
Fax: 000-000-0000
Name of Nominee in which Notes are to be issued: CIG & Co.
Taxpayer I.D. Number for CIG & Co.: 00-0000000
Taxpayer I.D. Number for Connecticut General Life Insurance Company, on behalf
of one or more separate accounts: 00-0000000
Closing Date: January 13, 1998
Commitment Expiration Date: January 30, 1998
PRINCIPAL AMOUNT OF
NAME AND ADDRESS NOTES TO BE PURCHASED
OF PURCHASERS
GENERAL ELECTRIC CAPITAL ASSURANCE Series A Series B Series C
COMPANY -------- -------- --------
c/o GE Financial Assurance -0- $15,000,000 -0-
Xxx Xxxxx Xxxxxx, 000 Xxxxx Xxxxxx
Xxxxxxx, Xxxxxxxxxx 00000
Attn: Investment Dept., X. Xx Xxxxx
Telephone No.: (000) 000-0000
Fax No.: (000) 000-0000
Payments
All payments on or in respect of the Notes to be by bank wire transfer of
Federal or other immediately available funds (identifying each payment as "Crown
Pacific Limited Partnership, 7.76% Senior Notes, Series B, due February 1, 2013,
PPN 22844# AJ 9, as the case may be, principal or interest") to:
Bankers Trust Company
00 Xxxx Xxxxxx
X-000
Xxx Xxxx, Xxx Xxxx 00000
ABA 000000000
Attention: 00-000-000
Account Number 097817
Notices
All notices and communications, including notices with respect to payments and
written confirmation of each such payment, to be addressed to:
General Electric Capital Assurance Company
c/o GE Financial Assurance
Two Union Square, 000 Xxxxx Xxxxxx
Xxxxxxx, Xxxxxxxxxx 00000
Attn: Investment Accounting, 14th Floor
Telephone No.: (000) 000-0000
Fax No.: (000) 000-0000
Name of Nominee in which Notes are to be issued: XXXXXXX & CO.
Taxpayer I.D. Number: 00-0000000
Closing Date: January 13, 1998
Commitment Expiration Date: January 30, 1998
PRINCIPAL AMOUNT OF
NAME AND ADDRESS NOTES TO BE PURCHASED
OF PURCHASERS
Series A Series B Series C
-------- -------- --------
THE MINNESOTA MUTUAL LIFE
INSURANCE COMPANY
000 Xxxxxx Xxxxxx Xxxxx -0- $8,000,000 -0-
Xx. Xxxx, Xxxxxxxxx 00000
Attention: MIMLIC Asset Management
Company
Payments
I-112
All payments on or in respect of the notes to be by bank wire transfer of
Federal or other immediately available funds (identifying each payment as "Crown
Pacific Limited Partnership, 7.76% Senior Notes, Series B, due February 1, 2013,
PPN 22844# AJ 9, as the case may be, principal or interest") to:
First Bank National Association
Minneapolis, Minnesota
ABA #000000000
BNF The Minnesota Mutual Life Insurance Company
Account number 1801-10-00600-4
Notices
All notices and communications, including notices with respect to payments and
written confirmation of each such payment, to be addressed as first provided
above.
Name of Nominee in which Notes are to be issued: None
Taxpayer I.D. Number: 00-0000000
Closing Date: January 13, 1998
Commitment Expiration Date: January 30, 1998
PRINCIPAL AMOUNT OF
NAME AND ADDRESS NOTES TO BE PURCHASED
OF PURCHASERS
Series A Series B Series C
-------- -------- --------
MUTUAL TRUST LIFE INSURANCE
COMPANY
c/o MIMLIC Asset Management Company -0- $1,000,000 -0-
000 Xxxxxx Xxxxxx Xxxxx
Xx. Xxxx, Xxxxxxxxx 00000
Attn: Client Administrator
Payments
I-113
All payments on or in respect of the Notes to be by bank wire transfer of
Federal or other immediately available funds (identifying each payment as "Crown
Pacific Limited Partnership, 7.76% Senior Notes, Series B, due February 1, 2013,
PPN 22844# AJ 9, as the case may be, principal or interest") to:
The Northern Chgo/Trust
ABA #000-000-000
For credit to: Account Number: 5186041000
For further credit to: Mutual Trust Life Insurance Company
Account Number: 26-00621
Attn: MBS Department
Notices
All notices and communications, including notices with respect to payments and
written confirmation of each such payment, to be addressed as first provided
above.
Name of Nominee in which Notes are to be issued: ELL & Co.
Taxpayer I.D. Number: 00-0000000
Closing Date: January 13, 1998
Commitment Expiration Date: January 30, 1998
PRINCIPAL AMOUNT OF
NAME AND ADDRESS NOTES TO BE PURCHASED
OF PURCHASERS
Series A Series B Series C
-------- -------- --------
OHIO NATIONAL LIFE
ASSURANCE CORPORATION
P. O. BOX 237 -0- $5,000,000 -0-
Xxxxxxxxxx, Xxxx 00000
Attention: Investment Department
Facsimile: (000) 000-0000
I-114
Overnight Delivery Address:
[One Xxxxxxxxx Xxx
Xxxxxxxxxx, Xxxx 00000]
Payments
All payments on or in respect of the Notes to be by bank wire transfer of
Federal or other immediately available funds (identifying each payment as "Crown
Pacific Limited Partnership, 7.76% Senior Notes, Series B, due February 1, 2013,
PPN 22844# AJ 9, as the case may be, principal or interest") to:
Star Bank, N.A. (ABA #042-0000-13)
Fifth and Xxxxxx Xxxxxxx
Xxxxxxxxxx, Xxxx 00000
for credit to: Ohio National Life Assurance Corporation
Account Number 000-000-0
Notices
All notices and communications, including notices with respect to payments and
written confirmation of each such payment, to be addressed as first provided
above.
Name of Nominee in which Notes are to be issued: None
Taxpayer I.D. Number: 00-0000000
Closing Date: January 13, 1998
Commitment Expiration Date: January 30, 1998
I-115
INVESTMENTS
Following the closing of the transactions contemplated by the Agreement, the
Company will have the following Investments:
1. Purchase money promissory note executed by J.S. & P.H. Bewick, with an
outstanding principal balance of approximately $49,444.53 as of November 30,
1997.
2. Purchase money promissory note executed by M. & X. Xxxxxx, with an
outstanding principal balance of approximately $2,109.00 as of November 30,
1997.
SCHEDULE II
(to Note Purchase Agreement)
CROWN PACIFIC LIMITED PARTNERSHIP
7.76% SENIOR NOTE, SERIES A, DUE FEBRUARY 1, 2012
PPN: 22844# AH 3
NO. R-A- ____________, 19___
$
CROWN PACIFIC LIMITED PARTNERSHIP, a Delaware Limited partnership (the
"COMPANY"), for value received, hereby promises to pay to
or registered assigns
on the first day of February, 2012
the principal amount of
DOLLARS
and to pay interest (computed on the basis of a 360-day year of twelve 30-day
months) on the principal amount from time to time remaining unpaid hereon at the
rate of 7.76% per annum from the date hereof until maturity, payable
semiannually on the first day of February and August in each year commencing
February 1, 1998, and at maturity. The Company agrees to pay interest (computed
on the same basis) on overdue principal (including any overdue optional
prepayment of principal) and premium, if any, and (to the extent legally
enforceable) on any overdue installment of interest, at the Overdue Rate (as
defined in the Note Purchase Agreement referred to below) after the date due,
whether by acceleration or otherwise, until paid. The principal hereof,
premium, if any, and interest hereon are payable at the principal office of the
Company in Portland, Oregon in coin or currency of the United States of America
which at the time of payment shall be legal tender for the payment of public and
private debts.
EXHIBIT A-1
(to Note Purchase Agreement)
This Note is one of the 7.76% Senior Notes, Series A, due February 1, 2012
of the Company in the aggregate principal amount of $15,000,000, which along
with the 7.76% Senior Notes, Series B, due February 1, 2013 of the Company in
the aggregate principal amount of $55,000,000 and the 7.93% Senior Notes,
Series C, due February 1, 2018 of the Company in the aggregate principal amount
of $25,000,000 (such Series A Notes, Series B Notes and Series C Notes of the
Company being herein referred to as the "NOTES"), are issued or to be issued
under and pursuant to the terms and provisions of the Note Purchase Agreement
dated as of December 15, 1997 (the "NOTE PURCHASE AGREEMENT"), entered into by
the Company with the original purchasers therein referred to and this Note and
the holder hereof are entitled equally and ratably with the holders of all other
Notes outstanding under the Note Purchase Agreement to all the benefits provided
for thereby or referred to therein, to which Note Purchase Agreement reference
is hereby made for the statement thereof.
This Note and the other Notes outstanding under the Note Purchase Agreement
may be declared or otherwise become due prior to their expressed maturity dates,
all in the events, on the terms and in the manner and amounts as provided in the
Note Purchase Agreement.
The Notes are not subject to prepayment or redemption at the option of the
Company prior to their expressed maturity dates except on the terms and
conditions and in the amounts and with the premium, if any, set forth in the
Note Purchase Agreement.
This Note is registered on the books of the Company and is transferable
only by surrender thereof at the principal office of the Company duly endorsed
or accompanied by a written instrument of transfer duly executed by the
registered holder of this Note or its attorney duly authorized in writing.
Payment of or on account of principal, premium, if any, and interest on this
Note shall be made only to or upon the order in writing of the registered
holder.
A-1-118
Any holder of this Note shall, by its acceptance of this Note, be deemed to
have made the representations to the Company regarding the purchase of this Note
pursuant to Section 2.3 of the Note Purchase Agreement; PROVIDED, HOWEVER, that
with respect to the representation made in the third sentence of Section 2.3,
such holder will not be deemed to have chosen the options set forth in Section
2.3(b), (c), (d) or (f) of the Note Purchase Agreement unless such holder shall
have made the disclosures referred to therein at least ten Business Days (as
defined in the Note Purchase Agreement) prior to its acceptance of this Note and
shall have received prior to its acceptance of this Note written confirmation
from the Company to the effect set forth in the first sentence of Paragraph 20
of Exhibit B-1 to the Note Purchase Agreement.
A-1-119
This Note and the Note Purchase Agreement are governed by the laws of the
State of New York.
CROWN PACIFIC LIMITED PARTNERSHIP,
a Delaware limited partnership
By: CROWN PACIFIC MANAGEMENT LIMITED PARTNERSHIP,
a Delaware limited partnership
Its General Partner
By: HS Corp. of Oregon, an Oregon corporation
Its General Partner
By
-------------------------------------------
Its
A-1-120
CROWN PACIFIC LIMITED PARTNERSHIP
7.76% SENIOR NOTE, SERIES B, DUE FEBRUARY 1, 2013
PPN: 22844# AJ 9
NO. R-B- ____________, 19___
$
CROWN PACIFIC LIMITED PARTNERSHIP, a Delaware limited partnership (the
"COMPANY"), for value received, hereby promises to pay to
or registered assigns
on the first day of February, 2013
the principal amount of
DOLLARS
and to pay interest (computed on the basis of a 360-day year of twelve 30-day
months) on the principal amount from time to time remaining unpaid hereon at the
rate of 7.76% per annum from the date hereof until maturity, payable
semiannually on the first day of February and August in each year commencing
February 1, 1998, and at maturity. The Company agrees to pay interest (computed
on the same basis) on overdue principal (including any overdue optional
prepayment of principal) and premium, if any, and (to the extent legally
enforceable) on any overdue installment of interest, at the Overdue Rate (as
defined in the Note Purchase Agreement referred to below) after the date due,
whether by acceleration or otherwise, until paid. The principal hereof,
premium, if any, and interest hereon are payable at the principal office of the
Company in Portland, Oregon in coin or currency of the United States of America
which at the time of payment shall be legal tender for the payment of public and
private debts.
EXHIBIT A-2
(to Note Purchase Agreement)
This Note is one of the 7.76% Senior Notes, Series B, due February 1, 2013
of the Company in the aggregate principal amount of $55,000,000, which along
with the 7.76% Senior Notes, Series A, due February 1, 2012 of the Company in
the aggregate principal amount of $15,000,000 and the 7.93% Senior Notes,
Series C, due February 1, 2018 of the Company in the aggregate principal amount
of $25,000,000 (such Series A Notes, Series B Notes and Series C Notes of the
Company being herein referred to as the "NOTES"), are issued or to be issued
under and pursuant to the terms and provisions of the Note Purchase Agreement
dated as of December 15, 1997 (the "NOTE PURCHASE AGREEMENT"), entered into by
the Company with the original purchasers therein referred to and this Note and
the holder hereof are entitled equally and ratably with the holders of all other
Notes outstanding under the Note Purchase Agreement to all the benefits provided
for thereby or referred to therein, to which Note Purchase Agreement reference
is hereby made for the statement thereof.
This Note and the other Notes outstanding under the Note Purchase Agreement
may be declared or otherwise become due prior to their expressed maturity dates
and certain prepayments are required to be made thereon by the Company, all in
the events, on the terms and in the manner and amounts as provided in the Note
Purchase Agreement.
The Notes are not subject to prepayment or redemption at the option of the
Company prior to their expressed maturity dates except on the terms and
conditions and in the amounts and with the premium, if any, set forth in the
Note Purchase Agreement.
This Note is registered on the books of the Company and is transferable
only by surrender thereof at the principal office of the Company duly endorsed
or accompanied by a written instrument of transfer duly executed by the
registered holder of this Note or its attorney duly authorized in writing.
Payment of or on account of principal, premium, if any, and interest on this
Note shall be made only to or upon the order in writing of the registered
holder.
A-2-122
Any holder of this Note shall, by its acceptance of this Note, be deemed to
have made the representations to the Company regarding the purchase of this Note
pursuant to Section 2.3 of the Note Purchase Agreement; PROVIDED, HOWEVER, that
with respect to the representation made in the third sentence of Section 2.3,
such holder will not be deemed to have chosen the options set forth in Section
2.3(b), (c), (d) or (f) of the Note Purchase Agreement unless such holder shall
have made the disclosures referred to therein at least ten Business Days (as
defined in the Note Purchase Agreement) prior to its acceptance of this Note and
shall have received prior to its acceptance of this Note written confirmation
from the Company to the effect set forth in the first sentence of Paragraph 20
of Exhibit B-1 to the Note Purchase Agreement.
A-2-123
This Note and the Note Purchase Agreement are governed by the laws of the
State of New York.
CROWN PACIFIC LIMITED PARTNERSHIP,
a Delaware limited partnership
By: CROWN PACIFIC MANAGEMENT LIMITED PARTNERSHIP,
a Delaware limited partnership
Its General Partner
By: HS Corp. of Oregon, an Oregon corporation
Its General Partner
By
-------------------------------------------
Its
A-2-124
CROWN PACIFIC LIMITED PARTNERSHIP
7.93% SENIOR NOTE, SERIES C, DUE FEBRUARY 1, 2018
PPN: 22844# AK 6
NO. R-C- ____________, 19___
$
CROWN PACIFIC LIMITED PARTNERSHIP, a Delaware limited partnership (the
"COMPANY"), for value received, hereby promises to pay to
or registered assigns
on the first day of February, 2018
the principal amount of
DOLLARS
and to pay interest (computed on the basis of a 360-day year of twelve 30-day
months) on the principal amount from time to time remaining unpaid hereon at the
rate of 7.93% per annum from the date hereof until maturity, payable
semiannually on the first day of February and August in each year commencing
February 1, 1998, and at maturity. The Company agrees to pay interest (computed
on the same basis) on overdue principal (including any overdue optional
prepayment of principal) and premium, if any, and (to the extent legally
enforceable) on any overdue installment of interest, at the Overdue Rate (as
defined in the Note Purchase Agreement referred to below) after the date due,
whether by acceleration or otherwise, until paid. The principal hereof,
premium, if any, and interest hereon are payable at the principal office of the
Company in Portland, Oregon in coin or currency of the United States of America
which at the time of payment shall be legal tender for the payment of public and
private debts.
This Note is one of the 7.93% Senior Notes, Series C, due February 1, 2018
of the Company in the aggregate principal amount
EXHIBIT A-3
(to Note Purchase Agreement)
of $25,000,000, which along with the 7.76% Senior Notes, Series A, due
February 1, 2012 of the Company in the aggregate principal amount of $15,000,000
and the 7.76% Senior Notes, Series B, due February 1, 2013 of the Company in the
aggregate principal amount of $55,000,000 (such Series A Notes, Series B Notes
and Series C Notes of the Company being herein referred to as the "NOTES"), are
issued or to be issued under and pursuant to the terms and provisions of the
Note Purchase Agreement dated as of December 15, 1997 (the "NOTE PURCHASE
AGREEMENT"), entered into by the Company with the original purchasers therein
referred to and this Note and the holder hereof are entitled equally and ratably
with the holders of all other Notes outstanding under the Note Purchase
Agreement to all the benefits provided for thereby or referred to therein, to
which Note Purchase Agreement reference is hereby made for the statement
thereof.
This Note and the other Notes outstanding under the Note Purchase Agreement
may be declared or otherwise become due prior to their expressed maturity dates,
all in the events, on the terms and in the manner and amounts as provided in the
Note Purchase Agreement.
The Notes are not subject to prepayment or redemption at the option of the
Company prior to their expressed maturity dates except on the terms and
conditions and in the amounts and with the premium, if any, set forth in the
Note Purchase Agreement.
This Note is registered on the books of the Company and is transferable
only by surrender thereof at the principal office of the Company duly endorsed
or accompanied by a written instrument of transfer duly executed by the
registered holder of this Note or its attorney duly authorized in writing.
Payment of or on account of principal, premium, if any, and interest on this
Note shall be made only to or upon the order in writing of the registered
holder.
Any holder of this Note shall, by its acceptance of this Note, be deemed to
have made the representations to the Company regarding the purchase of this Note
pursuant to Section 2.3 of the Note
A-3-126
Purchase Agreement; PROVIDED, HOWEVER, that with respect to the representation
made in the third sentence of Section 2.3, such holder will not be deemed to
have chosen the options set forth in Section 2.3(b), (c), (d) or (f) of the Note
Purchase Agreement unless such holder shall have made the disclosures referred
to therein at least ten Business Days (as defined in the Note Purchase
Agreement) prior to its acceptance of this Note and shall have received prior to
its acceptance of this Note written confirmation from the Company to the effect
set forth in the first sentence of Paragraph 20 of Exhibit B-1 to the Note
Purchase Agreement.
A-3-127
This Note and the Note Purchase Agreement are governed by the laws of the
State of New York.
CROWN PACIFIC LIMITED
PARTNERSHIP, a Delaware
limited partnership
By: CROWN PACIFIC
MANAGEMENT LIMITED PARTNERSHIP,
a Delaware limited partnership
Its General Partner
By: HS Corp. of Oregon, an Oregon
corporation Its General Partner
By
---------------------------------
Its
A-3-128
CROWN PACIFIC LIMITED PARTNERSHIP
CLOSING CERTIFICATE
To the Purchasers named
in Schedule I attached hereto
Gentlemen:
This certificate is delivered to you in compliance with the requirements of
the Note Purchase Agreement dated as of December 15, 1997 (the "AGREEMENT")
entered into by the undersigned, Crown Pacific Limited Partnership, a Delaware
limited partnership (the "COMPANY"), with the Purchasers named therein, and as
an inducement to and as part of the consideration for your several purchases on
this date of the Senior Notes (the "NOTES") of the Company to be purchased by
you on the date hereof pursuant to the Agreement. The capitalized terms used
herein shall have the same meanings as in the Agreement.
The Company hereby represents and warrants to you on the date hereof as
follows:
(1) SUBSIDIARIES. The Company has no Subsidiaries.
(2) ORGANIZATION AND AUTHORITY. (a) The Company:
(i) is a limited partnership duly organized, validly existing
and in good standing under the laws of the State of Delaware;
(ii) has all requisite power and authority and all necessary
licenses and permits to own and operate its Properties and to carry on
its business as described in the Private Placement Memorandum;
(iii) is duly licensed or qualified and is in good standing as a
foreign partnership (to the extent qualification as a foreign
partnership is permitted by
EXHIBIT B-1
(to Note Purchase Agreement)
statute) in each jurisdiction wherein the failure to be so qualified
would have a material adverse effect on the business, operations or
financial condition of the Company; and
(iv) does not believe that the inability of the Company to
qualify as a foreign partnership in any state in which such
qualification is not permitted by law will have a material adverse
effect on the business, operations or financial condition of the
Company.
(b) Annex A attached hereto states the name of each Person holding
either a General Partnership Interest or Limited Partnership Interest in
the Company.
(3) REPRESENTATIONS AND WARRANTIES OF MANAGING GENERAL PARTNER. The
representations and warranties of the Managing General Partner given to you in
its Certificate of even date herewith are true and correct.
(4) BUSINESS AND PROPERTY. The Private Placement Memorandum sets forth a
substantially accurate and complete description of the business conducted and
proposed to be conducted by the Company and the principal Properties of the
Company.
(5) FINANCIAL STATEMENTS. (a) The unaudited pro forma combined balance
sheet of the Partnership as of September 30, 1994 and the unaudited pro forma
combined statement of operations of the Partnership for the year ended
December 31, 1993 and the nine-month period ended September 30, 1994 attached
hereto as Annex B have been prepared in accordance with GAAP, are correct and
complete and present fairly the pro forma financial position of the Partnership
as of September 30, 1994 and the pro forma results of its operations for the
year ended December 31, 1993 and the nine-month period ended September 30, 1994.
The combined balance sheets of the predecessors of the Partnership as of
December 31, 1992 and December 31, 1993 and the combined statements of
operations and changes in partners' and
B-1-130
shareholders' equity and in cash flows for the fiscal years ended on
December 31, 1991, 1992 and 1993, and the combined balance sheet of the
predecessors of the Partnership as of September 30, 1994 and the combined
statement of operations and changes in partners' and shareholders' equity and in
cash flows for the nine-month period ended on said date, all as attached hereto
as Annex B, accompanied by a report thereon containing an opinion unqualified as
to scope imposed by the Partnership or its predecessors and otherwise without
qualification except as therein noted, by Price Waterhouse LLP, have been
prepared in accordance with GAAP consistently applied except as therein noted,
are correct and complete and present fairly the financial position of the
predecessors of the Partnership as of such dates and the results of their
operations and cash flows for such periods. The consolidated balance sheets of
CPLP as of December 31 in each of the years 1991 to 1993, both inclusive, and CP
Inland as of December 31, 1993, and the statements of operations, changes in
partners' equity and cash flows for the fiscal years ended on said dates, each
as attached hereto as Annex B and each accompanied by a report thereon
containing an opinion unqualified as to scope limitations imposed by the
Predecessor Partnerships and otherwise without qualification except as therein
noted, by Price Waterhouse LLP, have been prepared in accordance with GAAP
consistently applied except as therein noted, are correct and complete and
present fairly the financial position of the Predecessor Partnerships and their
respective subsidiaries as of such dates and the results of their operations and
cash flows for such periods. The statement of operations and changes in
partners' equity and in cash flows for each of DAW Forest Products Company,
L.P., a Delaware limited partnership ("DAW"), and W-I Forest Products Limited
Partnership, a Washington limited partnership ("W-I"), for the fiscal year ended
on December 31, 1992 and for the period from January 1, 1993 to October 28,
1993, each as attached hereto as Annex B and each accompanied by a report
thereon containing an opinion unqualified as to scope limitations imposed by the
Company, its predecessors or DAW or W-I, respectively, and otherwise without
qualification except as therein noted, by Price Waterhouse LLP, have, to the
knowledge of the Company, been prepared in accordance with GAAP consistently
applied except as
B-1-131
therein noted, to the knowledge of the Company (x) are correct and complete and
(y) present fairly the financial position of DAW and W-I, respectively, as of
such dates and the results of their operations and cash flows for such periods.
The combined balance sheets of the Company as of December 31 in each of the
years 1994 and 1995 and the balance sheet of the Company as of December 31, 1996
and the statements of income (or of operations, as the case may be), of changes
in partners' and shareholders' equity and of cash flows for the fiscal years
ended on said dates (combined in the case of 1994 and 1995), each attached
hereto as Annex B and each accompanied by a report thereon containing an opinion
unqualified as to scope limitations imposed by the Company and otherwise without
qualification except as therein noted, by Price Waterhouse LLP, have been
prepared in accordance with GAAP consistently applied except as therein noted,
are correct and complete and present fairly the financial position of the
Company and its affiliates as of such dates and the results of their combined
operations and combined cash flows for such periods. The unaudited balance
sheet of the Company as of September 30, 1997, and the statement of income, of
cash flows and of changes in partners' capital for the nine-month period ended
on said date, attached hereto as Annex B, have been prepared in accordance with
GAAP consistently applied except as therein noted, are correct and complete and
present fairly the financial position of the Company as of such date and the
results of its operations and cash flows for such period, subject only for
year-end audit adjustments in the ordinary course.
(b) Since December 31, 1996, there has been no change in the condition,
financial or otherwise, of the Company as shown on the balance sheet of the
Company as of such date, except changes in the ordinary course of business, none
of which individually or in the aggregate has been materially adverse.
(6) INDEBTEDNESS. Annex C attached hereto correctly describes all Funded
Debt (other than Capitalized Rentals), Current Debt and Capitalized Rentals of
the Company outstanding as of the first Closing Date.
B-1-132
(7) FULL DISCLOSURE. The Private Placement Memorandum, the financial
statements referred to in paragraph 5, the Agreement and all other written
statements furnished by or on behalf of the Company to you in connection with
the negotiation of the sale of the Notes, do not, taken as a whole, contain any
untrue statement of a material fact or omit a material fact necessary to make
the statements contained therein or herein not misleading. There is no fact
peculiar to the Company which the Company has not disclosed to you in writing
which materially affects adversely nor, so far as the Company can now foresee,
will materially affect adversely the business, Properties, profits or financial
condition of the Company or the ability of the Company to perform its
obligations under the Agreement or the sale and issuance of the Notes.
(8) PENDING LITIGATION. There are no proceedings pending, or to the
knowledge of the Company threatened, against or affecting the Company or the
Managing General Partner in any court or before any governmental authority or
arbitration board or tribunal which if adversely determined would materially and
adversely affect the business, profits or financial condition of the Company or
the ability of the Company to perform the Agreement or to issue and sell the
Notes. The Company is not in default with respect to any order of any court,
governmental authority or arbitration board or tribunal.
(9) TITLE TO PROPERTIES. The Company has good and marketable title in fee
simple (or its equivalent under applicable law) to all material parcels of real
property it purports to own and has good and marketable title to all the other
Property it purports to own subject to no Liens other than Liens permitted by
the Agreement.
(10) SALE IS LEGAL AND AUTHORIZED. The sale of the Notes and compliance by
the Company with all of the provisions of the Agreement and of the Notes:
(a) are within the partnership powers of the Company;
B-1-133
(b) will not result in the violation of any provisions of any law or
any order of any court or governmental authority or agency and will not
conflict with or result in any breach of any of the terms, conditions or
provisions of, or constitute a default under, or result in the creation of
any Lien upon any Property of the Company under the provisions of, any
agreement or any indenture or other instrument to which the Company is a
party or by which it may be bound; and
the Agreement and the Notes delivered to the Purchasers on the date hereof have
been duly authorized by proper action on the part of the Company, executed and
delivered by the Company and constitute the legal, valid and binding
obligations, contracts and agreements of the Company enforceable in accordance
with their respective terms, subject to bankruptcy, insolvency, fraudulent
conveyance, and similar laws affecting creditors' rights generally, and to
general principles of equity (regardless of whether the application of such
principles is considered in equity or at law).
(11) NO DEFAULTS. No Default or Event of Default has occurred and is
continuing. The Company is not in default in the payment of principal or
interest on any Indebtedness, is not in violation in any respect of any terms of
the Partnership Agreement and is not in default, and no event of default has
occurred, under any instrument or instruments or agreements (i) under and
subject to which any Current Debt or Funded Debt has been issued, or (ii)
pursuant to which the Company has any material obligations; and no event has
occurred and is continuing under the provisions of any such instrument or
agreement which with the lapse of time or the giving of notice, or both, would
constitute an event of default thereunder.
(12) NO MATERIALLY ADVERSE CONTRACTS. The Company is not a party to, or
bound or affected by, any contract or agreement or subject to any judgment,
order, writ, injunction, rule or regulation or decree or other action of any
court or other governmental authority or agency, or the award of any arbitrator,
or any charter or contractual restriction that materially
B-1-134
adversely affects or in the future may (so far as the Company can now reasonably
foresee based on facts known to the Company) materially adversely affect the
business, Properties, profits, or financial condition of the Company.
(13) GOVERNMENTAL CONSENT. Neither the nature of the Company or of any of
its business or Properties, nor any relationship between the Company and any
other Person, nor any circumstance in connection with the offer, issue, sale or
delivery of the Notes or the execution and delivery of the Agreement is such as
to require a consent, approval or authorization of, or filing, registration or
qualification with, any regulatory body, state, Federal or local on the part of
the Company as a condition to the execution and delivery of the Agreement or the
offer, issue, sale or delivery of the Notes.
(14) USE OF PROCEEDS. The net proceeds from the sale of the Notes will be
used by the Company to repay indebtedness incurred in connection with
acquisitions of timberlands and other Property and expenses in consummating the
transactions contemplated by the Agreement. None of the transactions
contemplated in the Agreement (including, without limitation thereof, the use of
the proceeds from the sale of the Notes) will violate or result in a violation
of Section 7 of the Securities Exchange Act of 1934, as amended, or any
regulations issued pursuant thereto including, without limitation, Regulation G,
T or X of the Board of Governors of the Federal Reserve System, 12 C.F.R.,
Chapter II. The Company does not own or intend to carry or purchase any "MARGIN
STOCK" within the meaning of said Regulation G. None of the proceeds from the
sale of the Notes will be used to purchase, or refinance any borrowing, the
proceeds of which were used to purchase any "SECURITY" within the meaning of the
Securities Exchange Act of 1934, as amended.
(15) PRIVATE OFFERING. Neither the Company, directly or indirectly, nor
any agent on its behalf has offered or will offer the Notes or any similar
Security or has solicited or will solicit an offer to acquire the Notes or any
similar Security from or has otherwise approached or negotiated or will approach
or negotiate in respect of the Notes or any similar Security with
B-1-135
any Person other than you and not more than 30 other institutional investors,
each of whom was offered a portion of the Notes at private sale for investment.
Neither the Company, directly or indirectly, nor any agent on its behalf has
offered or will offer the Notes or any similar Security or has solicited or will
solicit an offer to acquire the Notes or any similar Security from any Person so
as to bring the issuance and sale of the Notes within the provisions of Section
5 of the Securities Act.
(16) TAXES. All tax returns required to be filed by the Company or the
Predecessor Partnerships in any jurisdiction have, in fact, been filed, and all
taxes, assessments, fees and other governmental charges upon the Company or the
Predecessor Partnerships or upon any of their respective Properties, income or
franchises, which are shown to be due and payable in such returns have been
paid. The Company does not know of any material proposed additional tax
assessment against it or the Predecessor Partnerships for which adequate
provision has not been made on its accounts and no material controversy in
respect of additional income taxes due is pending or to the knowledge of the
Company threatened. The provisions for taxes on the books of the Company are
adequate for all open years, and for its current fiscal period.
(17) COMPLIANCE WITH LAW. The Company:
(a) is not, to the knowledge of the Company after due inquiry, in
violation of any laws, ordinances, governmental rules or regulations to
which it is subject, or
(b) has not failed to obtain any license, permit, franchise or other
governmental authorization (and in the case of any temporary permits,
application for permanent permits have been made and are pending) necessary
to the ownership or operation of its Property or to the conduct of its
business,
B-1-136
which violation or failure to obtain would materially adversely affect the
business, profits, Properties or financial condition of the Company or the
issuance and sale of the Notes.
(18) RESTRICTIONS ON COMPANY. The Company is not a party to or bound by
any security, contract, indenture, agreement, instrument, order of any court or
governmental agency, law or rule or regulation which restricts the right or
ability of the Company to incur Indebtedness, other than the Agreement and the
Credit Agreements and the Note Purchase Agreement dated as of December 1, 1994,
the Note Purchase Agreement dated as of March 1, 1995, the Note Purchase
Agreement dated as of August 1, 1996 in each case between the Company and the
Note Purchasers named therein, the $55,000,000 Purchase Price Note issued by the
Company to Trillium Corporation on October 15, 1997, the $52,500,000 Purchase
Price Note issued by the Company to Trillium Corporation on October 15, 1997,
the Lease Agreement dated as of December 19, 1997 between SELCO Service
Corporation, as lessor, and the Company, as lessee and construction agent,
relating to the Port Angeles Sawmill Complex, and the Lease Agreement dated as
of December 19, 1997 between SELCO Service Corporation, as lessor, and the
Company, as lessee and construction agent, relating to the Bonners Ferry Circle
Mill.
(19) PATENTS AND TRADEMARKS. The Company owns or possesses all the
patents, trademarks, trade names, service marks, copyrights, licenses and rights
with respect to the foregoing necessary for the present and planned future
conduct of its business, without any known conflict with the rights of others.
(20) EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974. The consummation of
the transactions provided for in the Agreement and compliance by the Company
with the provisions thereof and the Notes issued thereunder will not involve any
prohibited transaction within the meaning of ERISA or Section 4975 of the
Internal Revenue Code of 1986, as amended. The representation of the Company in
the preceding sentence is made in reliance upon and subject to the accuracy of
the representation of each Purchaser in Section 2.3 of the Agreement as to the
source of funds to be used by such Purchaser to pay the purchase price of the
Notes
B-1-137
to be purchased by such Purchaser. Each Plan complies in all material respects
with all applicable statutes and governmental rules and regulations, and (a) no
Reportable Event has occurred and is continuing with respect to any Plan, (b)
neither the Company nor any ERISA Affiliate has withdrawn from any Multiemployer
Plan or instituted steps to do so, and (c) no steps have been instituted to
terminate any Plan. No condition exists or event or transaction has occurred in
connection with any Plan which could result in the incurrence by the Company or
any ERISA Affiliate of any material liability, fine or penalty. No Plan
maintained by the Company or any ERISA Affiliate, nor any trusts created
thereunder, have incurred any "ACCUMULATED FUNDING DEFICIENCY" as defined in
Section 302 of ERISA nor does the present value of all benefits vested under all
Plans exceed, as of the last annual valuation date, the value of the assets of
the Plans allocable to such vested benefits. Neither the Company nor any ERISA
Affiliate has any contingent liability with respect to any post-retirement
"WELFARE BENEFIT PLAN" (as such term is defined in ERISA) that could reasonably
be expected to have a material adverse affect on the business, profits or
financial condition of the Company.
(21) ENVIRONMENTAL AND NATURAL RESOURCE MATTERS. Except as disclosed in
the reports listed on Annex D attached hereto, none of which disclosures could
materially adversely affect the business, profits, Properties or financial
condition of the Company, to the knowledge of the Company after due inquiry:
(a) neither the Company nor its Properties are in material violation
of any applicable Environmental and Natural Resource Law;
(b) the Company has obtained all material Governmental Approvals
required for its current operations and its Properties by any applicable
Environmental and Natural Resource Law;
(c) there is no and has never been a material Release or threatened
material Release or disposal of any Hazardous Material at the Properties of
the Company; to the knowledge
B-1-138
of the Company, its Properties are not adversely affected by any Release or
threatened Release originating or emanating from any other Property;
(d) the Properties of the Company do not contain and have not
contained any: (i) underground storage tank, (ii) material amounts of
asbestos containing building material, (iii) any landfills or dumps, (iv)
hazardous waste treatment, storage or disposal facility as defined pursuant
to RCRA or any comparable state law, or (v) site on or nominated for the
National Priority List promulgated pursuant to CERCLA or any state priority
list promulgated pursuant to any comparable state law;
(e) the Company is not subject to any material liability for response
or corrective action, natural resource damage or other harm pursuant to
CERCLA, RCRA or any comparable state law; the Company is not subject to,
has no notice or knowledge of and is not required to give any notice of any
Environmental and Natural Resource Claim arising from the Company, its
operations, its Properties or any other property previously owned or
operated by the Company or its predecessors (including without limitation
the Predecessor Partnerships, but excluding predecessors of the Company
only with respect to title to such property); there are no conditions or
occurrences at the Properties of the Company which could reasonably form
the basis for an Environmental and Natural Resource Claim against the
Company or its Properties;
(f) the Properties of the Company are not subject to, and the Company
has no knowledge of any imminent, material restriction on its ownership,
occupancy, use, productivity or transferability (i) in connection with any
Release, threatened Release or disposal of a Hazardous Material, or
Environmental and Natural Resource Law or (ii) as a consequence of any
Harvest/Yield Restriction;
(g) in connection with any acquisition of real properties by the
Company or its predecessors, the Company
B-1-139
or its predecessors (including without limitation the Predecessor
Partnerships, but excluding predecessors of the Company only with respect
to title to such property) conducted due and diligent inquiry of any
environmental liability of, compliance with any applicable Environmental
and Natural Resource Law of and the environmental condition of such
acquired Properties, which due and diligent inquiry (i) constituted at the
time of such acquisition all appropriate inquiry into the previous
ownership and uses of such Property consistent with good commercial or
customary practice in an effort to minimize liability, and (ii) constituted
at the time of such acquisition the due diligence a reasonable and prudent
purchaser would have conducted as to environmental, health and safety
matters, when acquiring similar Properties.
(22) The obligations of the Company under the Agreement and the Notes rank
PARI PASSU in priority of payment with the Indebtedness incurred or to be
incurred pursuant to the Working Capital Facility, the Acquisition Facility, the
1994 Notes, the 1995 Notes and the 1996 Notes.
Dated:
CROWN PACIFIC LIMITED PARTNERSHIP,
a Delaware limited partnership
By: CROWN PACIFIC MANAGEMENT LIMITED PARTNERSHIP,
a Delaware limited partnership
Its General Partner
By: HS Corp. of Oregon, an Oregon corporation
B-1-140
Its General Partner
By
------------------------------------------
Its
B-1-141
SCHEDULE I
NOTE PURCHASERS (1)
------------------------
(1) The Purchasers purchasing Notes on such Closing Date
SCHEDULE I
(to Company Closing Certificate)
GENERAL PARTNER AND LIMITED PARTNER OF THE COMPANY
GENERAL PARTNER:
Crown Pacific Management Limited Partnership, a Delaware limited
partnership, which owns a 1.0101% Equity Interest in the Company
LIMITED PARTNER:
Crown Pacific Partners, L.P., a Delaware limited partnership, which owns
directly or indirectly a 98.9899% Equity Interest in the Company
ANNEX A
(to Company Closing Certificate)
FINANCIAL STATEMENTS
OF THE COMPANY AND ITS PREDECESSORS
[Financial Statements delivered separately and as a
Part of the Company Closing Certificate delivered on each Closing Date]
ANNEX B
(to Company Closing Certificate)
CURRENT DEBT AND FUNDED DEBT AND CAPITALIZED RENTALS
OF THE COMPANY
PART I. The Current Debt and Funded Debt (other than Capitalized Rentals)
and Capitalized Rentals of the Company as of the first Closing Date but
immediately prior to the funding of the Notes is as follows:
Item Principal Amount ($000)
---- -----------------------
CURRENT DEBT: Purchase Price Note
payable to Trillium
Corporation $ 55,000
FUNDED DEBT
(other than Capitalized
Rentals):
Working Capital $ 16,500
Facility $275,000
9.78% Senior Notes $ 25,000
9.60% Senior Notes $ 6,490
8.01% Senior Notes $ 50,000
8.16% Senior Notes $ 19,510
8.21% Senior Notes $ 15,000
8.25% Senior Notes $ 59,000
Acquisition Facility
Purchase Price Note $ 52,500
payable
to Trillium
Corporation
CAPITALIZED RENTALS:
CAPITALIZED
LEASE DATE PARTY AMOUNT ($000)
----- ---- ----- -------------
ANNEX C
(to Company Closing Certificate)
NONE
C-146
PART II. The Current Debt and Funded Debt (other than Capitalized Rentals)
and Capitalized Rentals of the Company (including any Current Debt and Funded
Debt and Capitalized Rentals to which the Properties distributed to the Company
on the first Closing Date are subject) as of the first Closing Date but
immediately after the funding of the Notes (2) is as follows:
Item Principal Amount ($000)
---- -----------------------
CURRENT DEBT: Purchase Price Note
payable to Trillium
Corporation $ 55,000(3)
FUNDED DEBT
(other than Capitalized
Rentals):
Working capital $ 16,500
Facility $275,000
9.78% Senior Notes $ 25,000
9.60% Senior Notes $ 6,490
8.01% Senior Notes $ 50,000
8.16% Senior Notes $ 19,510
8.21% Senior Notes $ 15,000
8.25% Senior Notes $ 59,000
Acquisition Facility
Purchase Price Note $ 52,500
payable
to Trillium
Corporation
CAPITALIZED RENTALS:
---------------------
(2) Funded Debt and Current Debt which is to be incurred on the Closing Date
and which is specifically permitted by Section 4.6(a)(1) and (3) is not
reflected in this Part II.
(3) To be refinanced with the proceeds of the Series B and C Notes.
C-147
CAPITALIZED RENTALS:
CAPITALIZED
LEASE DATE PARTY AMOUNT ($000)
----- ---- ----- -------------
NONE
EXISTING LIENS:
NONE
C-148
ENVIRONMENTAL REPORTS
ANNEX D
(to Company Closing Certificate)
CROWN PACIFIC MANAGEMENT LIMITED PARTNERSHIP
CLOSING CERTIFICATE
To the Purchasers named
in Schedule I attached hereto
Ladies and Gentlemen:
This certificate is delivered to you in compliance with the requirements of
the Note Purchase Agreement dated as of December 15, 1997 (the "AGREEMENT")
entered into by Crown Pacific Limited Partnership, a Delaware limited
partnership (the "COMPANY"), with the Purchasers named therein, and as an
inducement to and as part of the consideration for your several purchases on
this date of the Senior Notes (the "NOTES") of the Company to be purchased by
you on the date hereof pursuant to the Agreement. The capitalized terms used
herein shall have the same meanings as in the Agreement.
Crown Pacific Management Limited Partnership, a Delaware limited
partnership and the managing general partner of the Company (the "MANAGING
GENERAL PARTNER") hereby represents and warrants to you on the date hereof as
follows:
(1) SUBSIDIARIES. The Managing General Partner has no subsidiaries.
(2) ORGANIZATION AND AUTHORITY. (a) The Managing Partner:
(i) is a limited partnership duly organized, validly existing
and in good standing under the laws of the State of Delaware;
(ii) has all requisite power and authority and all necessary
licenses and permits to own and operate its Properties and to carry on
its present business as now conducted and as presently proposed to be
conducted;
EXHIBIT B-2
(to Note Purchase Agreement)
(iii) is duly licensed or qualified and is in good standing as a
foreign partnership (to the extent qualification as a foreign
partnership is permitted by statute) in each jurisdiction wherein the
failure to be so qualified would have a material adverse effect on the
Properties, business, prospects, profits or financial condition of the
Managing General Partner; and
(iv) has the power and authority under the Partnership Agreement
of the Company to execute and deliver on behalf of the Company the
Agreement, the Notes and the other certificates and agreements to be
delivered by the Company in connection with the transactions
contemplated by the Agreement.
(b) Annex A attached hereto states the name of each Person holding
either a General Partnership Interest or a Limited Partnership Interest in
the Managing General Partner.
(3) NO CONFLICTS. The execution and delivery by the Managing General
Partner on behalf of the Company of the Agreement, the Notes and the other
certificates and agreements to be delivered by the Company in connection with
the transactions contemplated by the Agreement do not and will not contravene
any law or any order of any court or governmental authority or agency applicable
to or binding on the Managing General Partner or contravene the provisions of,
or constitute a default under, its limited partnership agreement or any
indenture, mortgage, contract or any agreement or instrument to which the
Managing General Partner is a party or by which it or any of its Property may be
bound or affected.
(4) PENDING LITIGATION. There are no proceedings pending, or to the
knowledge of the Managing General Partner threatened, against or affecting the
Managing General Partner, in any court or before any governmental authority or
arbitration board or tribunal which if adversely determined would materially and
adversely affect the Properties, business, profits or financial
B-2-151
condition of the Managing General Partner. The Managing General Partner is not
in default with respect to any order of any court, governmental authority or
arbitration board or tribunal.
(5) NO DEFAULTS. The Managing General Partner is not in default in the
payment of principal or interest on any Indebtedness, is not in violation in any
respect of any terms of its limited partnership agreement and is not in default
under any instrument or instruments or agreements under and subject to which any
Indebtedness has been issued and no event has occurred and is continuing under
the provisions of any such instrument or agreement which with the lapse of time
or the giving of notice, or both, would constitute an event of default
thereunder.
(6) COMPLIANCE WITH LAWS. The Managing General Partner:
(a) is not in violation of any laws, ordinances, governmental rules
or regulations to which it is subject, and
(b) has not failed to obtain any license, permit, franchise or other
governmental authorization (and in the case of any temporary permits,
application for permanent permits have been made and are pending) necessary
to the ownership or operation of its Property or to the conduct of its
business,
which violation or failure to obtain might materially adversely affect the
Properties, business, profits or financial condition of the Managing General
Partner.
Dated:
CROWN PACIFIC MANAGEMENT LIMITED
PARTNERSHIP
By: HS Corp. of
Oregon, an Oregon
B-2-152
corporation
Its
General Partner
By
----------------------------
Its
B-2-153
SCHEDULE I
NOTE PURCHASERS(4)
---------------------
(4) The Purchasers purchasing Notes on such Closing Date.
SCHEDULE I
(to Managing General Partner Closing Certificate)
GENERAL PARTNERS AND LIMITED PARTNERS OF
THE MANAGING GENERAL PARTNER
GENERAL PARTNERS:
Fremont Timber, Inc., a Delaware corporation
HS Corp. of Oregon, an Oregon corporation
LIMITED PARTNERS:
Fremont Timber, Inc., a Delaware Corporation
Xxxxx X. Xxxxx
Xxxxx X. Xxxxx
ANNEX A
(to Managing General Partner Closing Certificate)
DESCRIPTION OF CLOSING OPINION OF COUNSEL
TO THE COMPANY
The closing opinion of Ball Xxxxx LLP, counsel for the Company, which is
called for on each Closing Date by section 3.3 of the Agreement, shall be dated
such Closing Date and addressed to the Purchasers purchasing Notes on such
Closing Date, shall be satisfactory in form and substance to the purchasers, and
shall be to the effect that:
1. The Company is a limited partnership, duly organized, validly
existing and in good standing under the laws of the State of Delaware and
has full power and authority to enter into and perform its obligations
under the Agreement and to issue the Notes;
2. The Company (i) has full power and authority to own or hold under
lease its property, and (ii) is duly authorized to conduct the activities
in which it is now engaged and (iii) is duly licensed or qualified and is
in good standing as a foreign limited partnership in each jurisdiction in
which such qualification is permitted by law and in which the failure to so
qualify would reasonably be expected to have a material adverse effect on
the business, operations or financial condition of the company; and the
inability of the Company to qualify as a foreign limited partnership in any
state in which such qualification is not permitted by law would not
reasonably be expected to have a material adverse effect on the business,
operations or financial condition of the Company;
3. The Managing General Partner is a limited partnership, duly
organized, validly existing and in good standing under the laws of the
State of Delaware and has full power and authority, in its capacity as the
sole general partner of the Company, to execute and deliver the Agreement
and the Notes on behalf of the Company;
4. The execution and delivery of the Agreement and the Notes by the
Managing General Partner on behalf of the
EXHIBIT C
(to Note Purchase Agreement)
Company do not conflict with or result in a breach of any provision of the
Partnership Agreement;
5. The Agreement has been duly authorized, executed and delivered by
HS Corp. of Oregon, an Oregon corporation ("HS CORP."), acting in its
capacity as a general partner of the Managing General Partner, acting in
its capacity as the sole general partner of, and on behalf of, the Company,
and constitutes the legal, valid and binding obligation of the Company,
enforceable against the Company in accordance with its terms, subject to
(i) bankruptcy, insolvency, fraudulent conveyance and similar laws
affecting creditors' rights generally, (ii) limitations on enforceability
resulting from public policy and the judicial imposition of an implied
covenant of good faith and fair dealing, (iii) limitations on the
enforceability of equitable rights and remedies resulting from equitable
defenses and judicial discretion, and (iv) to general principles of equity
(regardless of whether the application of such principles is considered in
a proceeding in equity or at law);
6. The Notes delivered on the date hereof have been duly authorized,
executed and delivered by HS Corp., acting in its capacity as a general
partner of the Managing General Partner, acting in its capacity as the sole
general partner of, and on behalf of, the Company, and constitute the
legal, valid and binding obligations of the Company enforceable in
accordance with their terms, subject to (i) bankruptcy, insolvency,
fraudulent conveyance and similar laws affecting creditors' rights
generally, (ii) limitations on enforceability resulting from public policy
and the judicial imposition of an implied covenant of good faith and fair
dealing, (iii) limitations on the enforceability of equitable rights and
remedies resulting from equitable defenses and judicial discretion, and
(iv) to general principles of equity (regardless of whether the application
of such principles is considered in a proceeding in equity or law);
C-157
7. No approval, consent or withholding of objection on the part of,
or filing, registration or qualification with, any Federal, state or local
governmental body is necessary in connection with the execution, delivery
and performance of the Agreement or the Notes by the Company;
8. The issuance and sale of the Notes and the execution, delivery
and performance by the Company of the Agreement do not (i) contravene any
law, governmental rule or regulation or any order of any court or
governmental authority or agency known to such counsel after due inquiry
and applicable to or binding on the Company, or (ii) conflict with, result
in any breach of any of the provisions of, constitute a default under, or
result in the creation or imposition of any lien or encumbrance upon any of
the Property of the Company pursuant to any agreement or other instrument
known to such counsel to which the Company is a party or by which the
Company or any of its Property is bound;
9. To the knowledge of such counsel, there are no proceedings
pending or threatened against or affecting the Company or the Managing
General Partner in any court or before any governmental authority or
arbitration board or tribunal which, if determined adversely to the Company
or the Managing General Partner, would reasonably be expected to have a
materially adverse effect on the business, operations or financial
condition of the Company or the ability of the Company to perform its
obligations under the Agreement. To the knowledge of such counsel, neither
the Company nor the Managing General Partner is in default with respect to
any order of any court, governmental authority or arbitration board or
tribunal and, to the knowledge of such counsel, neither the Company nor the
Managing Partner has received any notice of any such default;
10. Neither the purchase of the Notes nor the use by the Company of
all or any portion of the proceeds of the sale of the Notes in the manner
provided in the Agreement
C-158
will violate Regulation G, T or X of the Board of Governors of the Federal
Reserve System (12 C.F.R. Chapter II);
11. The Company is not an "investment company," a company controlled
by an "investment company" or an "affiliated person" thereof, as such terms
are defined in the Investment Company Act of 1940, as amended; and
12. HS Corp. is a corporation, duly organized, validly existing, and
in good standing under the laws of the state of Oregon and has full power
and authority, in its capacity as a general partner of the Managing General
Partner, to execute and deliver the Agreement and the Notes on behalf of
the Managing General Partner, acting in its capacity as the sole general
partner of the Company.
The opinion of Ball Xxxxx LLP shall cover such other matters relating to
the sale of the Notes as the Purchasers may reasonably request. With respect to
matters of fact on which such opinion is based, such counsel shall be entitled
to rely on appropriate certificates of public officials and officers of the
Managing General Partner and the Company. Such counsel may assume that the laws
of the State of New York are the same as the laws of the State of Oregon. In
rendering an opinion on the qualification of the Company as a foreign limited
partnership under the laws of any jurisdiction (other than the State of Oregon),
such counsel may rely on appropriate certificates of such public official or
officials as may be responsible for certifying as to such qualification.
C-159
DESCRIPTION OF CLOSING OPINION OF SPECIAL COUNSEL
TO THE COMPANY
The closing opinion of Xxxxxxx & Xxxxx L.L.P., special counsel for the
Company, which is called for on each Closing Date by Section 3.3 of the
Agreement, shall be dated such Closing Date and addressed to the Purchasers
purchasing Notes on such Closing Date, shall be satisfactory in form and
substance to the Purchasers, and shall be to the effect that:
1. The issuance, sale and delivery of the Notes under the
circumstances contemplated by the Agreement do not, under existing law,
require the registration of the Notes under the Securities Act, or the
qualification of an indenture under the Trust Indenture Act of 1939, as
amended; and
2. The Company shall be taxed as a partnership for Federal income
tax purposes.
EXHIBIT D
(to Note Purchase Agreement)
[INTENTIONALLY RESERVED]
EXHIBIT E
(to Note Purchase Agreement)
DESCRIPTION OF CLOSING OPINION OF SPECIAL COUNSEL
TO THE PURCHASERS
The closing opinion of Xxxxxxx and Xxxxxx, special counsel to the
Purchasers, which is called for on each Closing Date by Section 3.3 of the
Agreement, shall be dated such Closing Date and addressed to the Purchasers
purchasing Notes on such Closing Date, shall be satisfactory in form and
substance to the Purchasers and shall be to the effect that:
1. The Company is a limited partnership, validly existing under the
laws of the State of Delaware and has the power to enter into and perform
the Agreement and to issue the Notes;
2. The Managing General Partner is a limited partnership, validly
existing under the laws of the State of Delaware and has the power to
execute and deliver the Agreement and the Notes on behalf of the Company;
3. The issuance and sale of the Notes and the execution and delivery
of the Agreement by the Managing General Partner on behalf of the Company
do not conflict with or result in a breach of any provision of the
Partnership Agreement;
4. The Agreement has been duly authorized, executed and delivered by
the Managing General Partner on behalf of the Company and constitutes the
legal valid and binding contract of the Company enforceable in accordance
with its terms, subject to bankruptcy, insolvency, fraudulent conveyance
and similar laws affecting creditors' rights generally, and to general
principles of equity (regardless of whether the application of such
principles is considered in a proceeding in equity or at law);
5. The Notes delivered on the date hereof have been duly authorized,
executed and delivered by the Managing
EXHIBIT F
(to Note Purchase Agreement)
General Partner on behalf of the Company and constitute the legal, valid
and binding obligations of the Company enforceable in accordance with their
terms, subject to bankruptcy, insolvency, fraudulent conveyance and similar
laws affecting creditors' rights generally, and to general principles of
equity (regardless of whether the application of such principles is
considered in a proceeding in equity or at law); and
6. The issuance, sale and delivery of the Notes under the
circumstances contemplated by the Agreement do not, under existing law,
require the registration of the Notes under the Securities Act, or the
qualification of an indenture under the Trust Indenture Act of 1939, as
amended.
The opinion of Xxxxxxx and Xxxxxx shall also state that the opinions of
Ball Xxxxx LLP and Xxxxxxx & Xxxxx L.L.P. are satisfactory in scope and form to
Xxxxxxx and Xxxxxx and that, in their opinion, the Purchasers are justified in
relying thereon. With respect to matters of fact upon which such opinion is
based, Xxxxxxx and Xxxxxx may rely on appropriate certificates of public
officials and officers of the Managing General Partner and the Company and upon
the representations of the Managing General Partner, the Company and the
Purchasers delivered in connection with the issuance and sale of the Notes.
In rendering the opinion set forth in paragraphs 1 and 3 above, Xxxxxxx and
Xxxxxx may rely, as to matters referred to in paragraphs 1 and 3, solely upon an
examination of the Partnership Agreement certified by the Managing General
Partner, and a certificate of limited partnership and certificate of existence
of the Company certified by the Secretary of State of the State of Delaware. In
rendering the opinion set forth in paragraph 2 above, Xxxxxxx and Xxxxxx may
rely, as to matters referred to in paragraph 2, solely upon an examination of
the limited partnership agreement of the Managing General Partner certified by a
general partner thereof, and a certificate of limited partnership and a
certificate of existence of the Managing General Partner certified by the
Secretary of State of the State of Delaware. In rendering the opinions set
forth in paragraphs 4
F-2
and 5 above as to the due authorization, execution and delivery of the Agreement
and the Notes by the Managing General Partner on behalf of the Company, Xxxxxxx
and Xxxxxx may state that they have not examined the business records of the
Managing General Partner or the Company but have relied on the certificates of
appropriate officers of the Managing General Partner and the Company. The
opinion of Xxxxxxx and Xxxxxx is limited to the laws of the State of New York,
the limited partnership law of the State of Delaware and the Federal laws of the
United States.
F-2
SUBORDINATION PROVISIONS APPLICABLE TO
SUBORDINATED FUNDED DEBT
(a) The indebtedness evidenced by the subordinated notes(5) and any
renewals or extensions thereof, shall at all times be
-----------------
(5) Or debentures or other designation as may be
EXHIBIT G
(to Note Agreement)
wholly subordinate and junior in right of payment to any and all indebtedness of
the Company [here insert description of indebtedness to which Subordinated
Funded Debt is subordinated which in all events must include the Notes] (herein
called "SUPERIOR INDEBTEDNESS"), in the manner and with the force and effect
hereafter set forth:
(1) In the event of any liquidation, dissolution or winding up of the
Company, or of any execution, sale, receivership, insolvency, bankruptcy,
liquidation, readjustment, reorganization or other similar proceeding
relative to the Company or its property, all principal and interest owing
on all Superior Indebtedness shall first be irrevocably paid in full before
any payment is made upon the indebtedness evidenced by the subordinated
notes; and in any such event any payment or distribution of any kind or
character, whether in cash, property or securities (other than in
securities, including equity securities, or other evidences of
indebtedness, the payment of which is subordinated to the payment of all
Superior Indebtedness which may at the time be outstanding) which shall be
made upon or in respect of the subordinated notes shall be paid over to the
holders of such Superior Indebtedness, PRO RATA, for application in payment
thereof unless and until such Superior Indebtedness shall have been paid or
satisfied in full;
(2) In the event that the subordinated notes are declared or become
due and payable because of the occurrence of any event of default
thereunder (or under the agreement or indenture, as appropriate) or
otherwise than at the option of the Company, under circumstances when the
foregoing clause (l) shall not be applicable, the holders of the
subordinated notes shall be entitled to payments only after there shall
first have been paid in full all Superior Indebtedness outstanding at the
time the subordinated notes so become due and payable because of any such
event, or payment shall have been provided for in a manner satisfactory to
the holders of such Superior Indebtedness; and
G-166
(3) During the continuance of any default with respect to any
Superior Indebtedness which would permit the holders thereof to accelerate
the maturity of such Superior Indebtedness, no payment of principal,
premium or interest shall be made on the subordinated notes, if written
notice of such default (a "DEFAULT NOTICE") has been given to the Company
by any holder or holders of any Superior Indebtedness. Upon receipt of any
Default Notice from the holders of Superior Indebtedness pursuant to this
clause (3), the Company shall forthwith send a copy thereof to each holder
of the subordinated notes at the time outstanding. Any payment or
distribution of any kind or character, whether in cash, property or
securities made with respect to any subordinated note after receipt by the
Company of a Default Notice shall be held by the holder of such
subordinated note in trust for the benefit of, and shall be paid over to,
the holders of such Superior Indebtedness for application on a PRO RATA
basis to the payment of such Superior Indebtedness unless and until such
Superior Indebtedness shall have been paid or satisfied in full; and
(b) The holder of each subordinated note undertakes and agrees for the
benefit of each holder of Superior Indebtedness to execute, verify, deliver and
file any proofs of claim which any holder of Superior Indebtedness may at any
time require in order to prove and realize upon any rights or claims pertaining
to the subordinated notes and to effectuate the full benefit of the
subordination contained herein; and upon failure of the holder of any
subordinated note so to do, any such holder of Superior Indebtedness shall be
deemed to be irrevocably appointed the agent and attorney-in-fact of the holder
of such note to execute, verify, deliver and file any such proofs of claim.
(c) No right of any holder of any Superior Indebtedness to enforce
subordination as herein provided shall at any time or in any way be affected or
impaired by any failure to act on the part of the Company or the holders of
Superior Indebtedness, or by any noncompliance by the Company with any of the
terms, provisions and covenants of the subordinated notes or the agreement under
G-167
which they are issued, regardless of any knowledge thereof that any such holder
of Superior Indebtedness may have or be otherwise charged with.
(d) The Company agrees, for the benefit of the holders of Superior
Indebtedness, that in the event that any subordinated note is declared due and
payable before its expressed maturity because of the occurrence of a default
hereunder, the Company will give prompt notice in writing of such happening to
the holders of Superior Indebtedness.
(e) The foregoing provisions are solely for the purpose of defining the
relative rights of the holders of Superior Indebtedness on the one hand, and the
holders of the subordinated notes on the other hand, and nothing herein shall
impair, as between the Company and the holders of the subordinated notes, the
obligation of the Company which is unconditional and absolute, to pay the
principal, premium, if any, and interest on the subordinated notes in accordance
with their terms, nor shall anything herein prevent the holders of the
subordinated notes from exercising all remedies otherwise permitted by
applicable law or hereunder upon default hereunder, subject to the rights of the
holders of Superior Indebtedness as herein provided for.
G-168
PRE-FUNDING AGREEMENT
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To the Purchasers Listed
on the Attached Schedule
Re: $95,000,000 Senior Notes, Series A, B and C
Due 2010 - 2018
of
CROWN PACIFIC LIMITED PARTNERSHIP
Ladies and Gentlemen:
In connection with the above-referenced transaction and in consideration of
each of you, as purchasers of the above-captioned Notes (the "PURCHASERS"),
depositing your respective commitments in escrow in a separate trust account on
_______________ (the "FUNDING DATE") with Bank of America National Trust and
Savings Association, as funding agent (the "FUNDING AGENT"), in anticipation of,
and in order to facilitate, a closing on ______________ (the "CLOSING DATE"),
the undersigned, Crown Pacific Limited Partnership, a Delaware limited
partnership (the "COMPANY"), agrees to reimburse each of you, whether or not
your funds are invested hereunder, for (i) any loss of principal you may suffer
as a result of such deposit, and (ii) the loss of the use of your funds by
paying to you (with respect only to the loss referred to in this clause (ii)) a
sum equal to interest at the rate per annum (computed on the basis of a 360-day
year) borne by the series of Notes to be purchased with such funds so advanced
by you on the amount of such funds for the period from and including such
Funding Date to but excluding, as the case may be, (x) the Closing Date, if such
EXHIBIT H
(to Note Purchase Agreement)
closing occurs on such date, (y) such other Business Day not more than two
calendar days after the Closing Date on which the closing occurs (the
"RESCHEDULED CLOSING DATE") or (z) the Business Day on which your funds are
returned if the wire transfer of such funds is initiated by the Funding Agent by
10:00 a.m. Houston, Texas time or the next following Business Day if such return
is not made by such time. The Company shall pay such amounts referred to in
clauses (i) and (ii) of the preceding sentence to the Funding Agent on behalf of
the Purchasers in immediately available funds by wire transfer to be received by
the Funding Agent no later than 9:00 a.m. Houston, Texas time on the last day of
the period in respect of which interest is payable, and the Funding Agent shall
pay each Purchaser its respective amount due in immediately available funds by
wire transfer on such day to the account specified for such Purchaser on
Schedule I to the Note Purchase Agreement dated as of December 15, 1997 (the
"NOTE AGREEMENT") pursuant to which the above-captioned Notes are to be issued
or to such other account specified by such Purchaser in writing to the Company
and the Funding Agent. "BUSINESS DAY" means any day other than a Saturday,
Sunday or a day on which banks in the States of Texas or California are
authorized or permitted to be closed in observance of a legal holiday.
The funds furnished by you shall be held in a separate trust account and
shall be invested upon the instruction of the Company by the Funding Agent on
your behalf in obligations of the United States of America or obligations fully
guaranteed as to principal and interest by the United States of America, in
either case having a stated maturity not later than one week from the date of
acquisition, PROVIDED that, any of such investments may be made through a
repurchase agreement in commercially reasonable form with the Funding Agent or
any other bank or other financial institution having capital, surplus and
undivided profits of at least $500,000,000 so long as title to the underlying
obligations shall pass to the Funding Agent, and that such underlying
obligations shall be segregated in a custodial or trust account of, or for the
benefit of, the Funding Agent for your further benefit and such account shall be
overcollateralized by 102% (such investments being hereinafter referred to as
H-170
"INVESTMENTS"). All income and profits on the Investments not in excess of the
sums payable to you pursuant to clause (ii) of the first sentence of the
preceding paragraph shall be for your respective accounts (such income and
profits to be credited against the obligation of the Company to reimburse each
of you for the loss of use of funds made available to the Funding Agent) and all
other income and profits shall be for the account of the Company. All losses on
the Investments shall be borne by the Company and the Company shall reimburse
the Funding Agent therefor for your ratable benefit pursuant to the preceding
paragraph.
Your execution of the Note Agreement shall indicate your acceptance of the
terms and conditions of this letter and your authorization to the Funding Agent
to invest the funds provided by you as specified herein.
Very truly yours,
CROWN PACIFIC LIMITED PARTNERSHIP,
a Delaware limited partnership
By: CROWN PACIFIC MANAGEMENT
LIMITED PARTNERSHIP,
a Delaware limited partnership
Its General Partner
By: HS Corp. of Oregon,
an Oregon corporation
Its General Partner
By
---------------------------------
Its:
H-171
The undersigned, as Funding Agent, hereby acknowledges the foregoing and
agrees (i) to hold such funds in a separate trust account pursuant to the terms
of which such funds may not be commingled with assets of the Funding Agent and
may not be withdrawn unless and until verbal instructions (the "INSTRUCTIONS")
are received from Xxxxxx X. Xxxxx, Esq., Xxxxxxx X. Xxxxx, Esq., Xxxxxx X. Xxxx,
Esq. or Xxxxxxxx X. Xxxx-Xxxxxxx of the law firm of Xxxxxxx and Xxxxxx, Chicago,
Illinois to withdraw such funds and apply such funds as described in either
clause (iii)(x) or (iii)(y) as specified, (ii) prior to receiving such
Instructions, to invest, if possible, said funds on behalf of each of the
Purchasers in Investments at the instruction of the Company, (iii) immediately
following receipt of such Instructions, (x) if a closing shall have occurred on
the Closing Date or the Rescheduled Closing Date, to withdraw such funds and pay
and apply the same to or upon the instructions of the Company in accordance with
the terms of the Note Agreement, and to disburse all income and profits on the
Investments not in excess of the sums payable to the respective Purchasers in
accordance with the provisions of the foregoing letter and all other income and
profits actually earned thereon to the Company, and (y) if a closing shall not
have occurred on the Closing Date or the Rescheduled Closing Date, to deliver to
each of the Purchasers in immediately available funds by wire transfer to the
account specified in the foregoing letter any funds which are to be returned to
such Purchasers, including any amounts furnished by the Company to reimburse the
Purchasers for losses, if any, incurred on the Investments. The Funding Agent
agrees to initiate a wire transfer to each of the Purchasers by 10:00 a.m.
Chicago, Illinois time of funds it receives from the Company prior to 9:00 a.m.
Chicago, Illinois time.
BANK OF AMERICA NATIONAL TRUST AND
SAVINGS ASSOCIATION
By
Its:
H-172
SCHEDULE
PURCHASER AMOUNT OF COMMITMENT
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