Exhibit 1.1
$56,600,000
Aggregate Principal Amount at Maturity of
13 1/8% Series A Senior Discount Debentures due 2009
of Great Lakes Acquisition Corp.
PURCHASE AGREEMENT
May 18, 1998
XXXXXXXXX, XXXXXX & XXXXXXXX
SECURITIES CORPORATION
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Dear Sirs:
Great Lakes Acquisition Corp., a Delaware corporation
(the "COMPANY"), proposes to issue and sell to Xxxxxxxxx, Xxxxxx & Xxxxxxxx
Securities Corporation (the "INITIAL PURCHASER") an aggregate of $56,600,000
in principal amount at maturity of its 13 1/8% Series A Senior Discount
Debentures due 2009 (the "SERIES A DEBENTURES"), subject to the terms and
conditions set forth herein. The Series A Debentures are to be issued
pursuant to the provisions of an indenture (the "INDENTURE"), to be dated as
of the Closing Date (as defined below), among the Company and State Street
Bank and Trust Company of California, N.A., as trustee (the "TRUSTEE"). The
Series A Debentures and the Series B Debentures (as defined below) issuable
in exchange therefor are collectively referred to herein as the "DEBENTURES."
Pursuant to the terms of an Agreement and Plan of Merger
(the "MERGER AGREEMENT") dated as of April 21, 1998, between the Company and
Great Lakes Carbon Corporation, a Delaware corporation ("GLCC"), a wholly
owned subsidiary of the Company will merge (the "MERGER") with and into GLCC.
Upon consummation of the Merger, GLCC will continue as the surviving
corporation and will be a wholly owned subsidiary of the Company. In
connection with the Merger, American Industrial Partners Capital Fund II,
L.P. ("AIP") will contribute $65.0 million to the Company in exchange for
common equity of the Company (the "AIP EQUITY CONTRIBUTION"), (ii) the
Company will contribute $92.0 million to the equity of GLCC (the "HOLDINGS
EQUITY CONTRIBUTION"), (iii) GLCC and the Company will enter into a
syndicated senior secured credit agreement (the "NEW CREDIT AGREEMENT")
providing for term loan borrowings in an aggregate principal amount of
approximately $111.0 million and a revolving loan facility for borrowings of
up to $25.0 million, and will borrow all term loans available, and (iv) GLCC
will issue and sell (the "NOTES OFFERING") $175.0 million aggregate principal
amount of its 10 1/4% Senior Subordinated Notes due 2008 (the "NOTES").
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In connection with the Merger, GLCC will purchase (the
"TENDER OFFER") all $65.0 million aggregate principal amount of its
outstanding 10% Senior Secured Notes due 2006 (the "EXISTING NOTES") and has
solicited (the "SOLICITATION") consents to certain amendments to, and waivers
under, the indenture governing the Existing Notes and certain related
collateral documents (the "PROPOSED AMENDMENTS"). As of May 8, 1998, all of
the Existing Notes had been tendered and the requisite consents had been
received pursuant to the Solicitation and a supplemental indenture giving
effect to the Proposed Amendments (the "SUPPLEMENTAL INDENTURE") was executed
and will become effective upon consummation of the Tender Offer. The Tender
Offer will be consummated concurrently with the Merger, the Notes Offering
and the offering of the Series A Debentures.
The Merger, the AIP Equity Contribution, the Holdings
Equity Contribution, the offering of the Series A Debentures, the execution
of and initial borrowings under the New Credit Agreement, the Notes Offering,
the Tender Offer, the Solicitation and execution of the Supplemental
Indenture are referred to collectively herein as the "ACQUISITION
TRANSACTIONS."
1. OFFERING MEMORANDUM. The Series A Debentures will
be offered and sold to the Initial Purchaser pursuant to one or more
exemptions from the registration requirements under the Securities Act of
1933, as amended (the "ACT"). The Company has prepared a preliminary
offering memorandum, dated May 5, 1998 (the "PRELIMINARY OFFERING
MEMORANDUM"), and a final offering memorandum, dated May 18, 1998 (the
"OFFERING MEMORANDUM"), relating to the Series A Debentures.
Upon original issuance thereof, and until such time as
the same is no longer required pursuant to the Indenture, the Series A
Debentures (and all securities issued in exchange therefor, in substitution
thereof or upon conversion thereof) shall bear the following legend:
"THIS DEBENTURE (OR ITS PREDECESSOR) HAS NOT BEEN REGISTERED UNDER THE
U.S. SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), AND, ACCORDINGLY,
MAY NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED WITHIN THE
UNITED STATES OR TO, OR FOR THE ACCOUNT OR BENEFIT OF, U.S. PERSONS,
EXCEPT AS SET FORTH IN THE NEXT SENTENCE. BY ITS ACQUISITION HEREOF
OR OF A BENEFICIAL INTEREST HEREIN, THE HOLDER: (1) REPRESENTS THAT
(A) IT IS A "QUALIFIED INSTITUTIONAL BUYER" (AS DEFINED IN RULE 144A
UNDER THE ACT)(A "QIB"), (B) IT HAS ACQUIRED THIS DEBENTURE IN AN
OFFSHORE TRANSACTION IN COMPLIANCE WITH REGULATION S UNDER THE ACT OR
(C) IT IS AN INSTITUTIONAL "ACCREDITED INVESTOR" (AS DEFINED IN RULE
501(A)(1), (2), (3) OR (7) OF REGULATION D UNDER THE ACT (AN "IAI"),
(2) AGREES THAT IT WILL NOT RESELL OR OTHERWISE TRANSFER THIS
DEBENTURE EXCEPT (A) TO THE ISSUER OR ANY OF ITS SUBSIDIARIES, (B) TO
A PERSON WHOM THE SELLER REASONABLY BELIEVES IS A QIB PURCHASING FOR
ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QIB IN A TRANSACTION MEETING
THE REQUIREMENTS OF RULE 144A, (C) IN AN OFFSHORE TRANSACTION MEETING
THE REQUIREMENTS OF RULE 903 OR 904 OF THE ACT, (D) IN A TRANSACTION
MEETING THE REQUIREMENTS OF RULE 144 UNDER THE ACT, (E) TO AN IAI
THAT, PRIOR TO SUCH TRANSFER, FURNISHES THE TRUSTEE A SIGNED
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LETTER CONTAINING CERTAIN REPRESENTATIONS AND AGREEMENTS RELATING TO THE
TRANSFER OF THIS DEBENTURE (THE FORM OF WHICH CAN BE OBTAINED FROM THE
TRUSTEE) AND, IF SUCH TRANSFER IS IN RESPECT OF AN AGGREGATE PRINCIPAL
AMOUNT OF DEBENTURES LESS THAN $250,000, AN OPINION OF COUNSEL
ACCEPTABLE TO THE ISSUER THAT SUCH TRANSFER IS IN COMPLIANCE WITH THE
ACT, (F) IN ACCORDANCE WITH ANOTHER EXEMPTION FROM THE REGISTRATION
REQUIREMENTS OF THE ACT (AND, IF REQUESTED, BASED UPON AN OPINION OF
COUNSEL ACCEPTABLE TO THE ISSUER) OR (G) PURSUANT TO AN EFFECTIVE
REGISTRATION STATEMENT AND, IN EACH CASE, IN ACCORDANCE WITH THE
APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES OR ANY
OTHER APPLICABLE JURISDICTION AND (3) AGREES THAT IT WILL DELIVER TO
EACH PERSON TO WHOM THIS DEBENTURE OR AN INTEREST HEREIN IS
TRANSFERRED A NOTICE SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND. AS
USED HEREIN, THE TERMS "OFFSHORE TRANSACTION" AND "UNITED STATES" HAVE
THE MEANINGS GIVEN TO THEM BY RULE 902 OF REGULATION S UNDER THE ACT.
THE INDENTURE CONTAINS A PROVISION REQUIRING THE TRUSTEE TO REFUSE TO
REGISTER ANY TRANSFER OF THIS DEBENTURE IN VIOLATION OF THE
FOREGOING."
2. AGREEMENTS TO SELL AND PURCHASE. On the basis of
the representations, warranties and covenants contained in this Agreement,
and subject to the terms and conditions contained herein, the Company agrees
to issue and sell to the Initial Purchaser, and the Initial Purchaser agrees
to purchase from the Company, $56,600,000 aggregate principal amount at
maturity of Series A Debentures at a purchase price equal to 51.499% of the
principal amount at maturity thereof (the "PURCHASE PRICE").
3. TERMS OF OFFERING. The Initial Purchaser has
advised the Company that the Initial Purchaser will make offers (the "EXEMPT
RESALES") of the Series A Debentures purchased hereunder on the terms set
forth in the Offering Memorandum, as amended or supplemented, solely to (i)
persons whom the Initial Purchaser reasonably believes to be "qualified
institutional buyers" as defined in Rule 144A under the Act ("QIBS"), and
(ii) to persons permitted to purchase the Series A Debentures in offshore
transactions in reliance upon Regulation S under the Act (each, a "REGULATION
S PURCHASER") (such persons specified in clauses (i) and (ii) being referred
to herein as the "ELIGIBLE PURCHASERS"). The Initial Purchaser will offer the
Series A Debentures to Eligible Purchasers initially at a price equal to
53.092% of the principal amount at maturity thereof. Such price may be
changed at any time without notice.
Holders (including subsequent transferees) of the Series
A Debentures will have the registration rights set forth in the registration
rights agreement (the "REGISTRATION RIGHTS AGREEMENT"), to be dated the
Closing Date, in substantially the form of Exhibit A hereto, for so long as
such Series A Debentures constitute "TRANSFER RESTRICTED SECURITIES" (as
defined in the Registration Rights Agreement). Pursuant to the Registration
Rights Agreement, the Company will agree to file with the Securities and
Exchange Commission (the "COMMISSION") under the circumstances set forth
therein, (i) a registration statement under the Act (the "EXCHANGE OFFER
REGISTRATION STATEMENT") relating to the Company's 13 1/8% Series B Senior
Subordinated Debentures due 2009 (the "SERIES B DEBENTURES"), to be offered
in exchange for the Series A Debentures (such offer to exchange being
referred to as the
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"EXCHANGE OFFER") and (ii) a shelf registration statement pursuant to Rule
415 under the Act (the "SHELF REGISTRATION STATEMENT" and, together with the
Exchange Offer Registration Statement, the "REGISTRATION STATEMENTS")
relating to the resale by certain holders of the Series A Debentures and to
use its best efforts to cause such Registration Statements to be declared and
remain effective and usable for the periods specified in the Registration
Rights Agreement and to consummate the Exchange Offer. This Agreement, the
Indenture, the Debentures, the Registration Rights Agreement, the Merger
Agreement and the New Credit Facility are hereinafter sometimes referred to
collectively as the "OPERATIVE DOCUMENTS."
4. DELIVERY AND PAYMENT.
(a) Delivery of, and payment of the Purchase Price for, the
Series A Debentures shall be made at the offices of Skadden, Arps, Slate,
Xxxxxxx & Xxxx LLP, 000 Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000 or such other
location as may be mutually acceptable. Such delivery and payment shall be
made at 9:00 a.m. New York City time, on May 22, 1998 or at such other time
on the same date or such other date as shall be agreed upon by the Initial
Purchaser and the Company in writing. The time and date of such delivery and
the payment for the Series A Debentures are herein called the "CLOSING DATE."
(b) One or more of the Series A Debentures in definitive
global form, registered in the name of Cede & Co., as nominee of the
Depository Trust Company ("DTC"), having an aggregate principal amount
corresponding to the aggregate principal amount of the Series A Debentures
(collectively, the "GLOBAL DEBENTURE"), shall be delivered by the Company to
the Initial Purchaser (or as the Initial Purchaser directs) in each case with
any transfer taxes thereon duly paid by the Company against payment by the
Initial Purchaser of the Purchase Price thereof by wire transfer in same day
funds to the order of the Company. The Global Debenture shall be made
available to the Initial Purchaser for inspection not later than 9:30 a.m.,
New York City time, on the business day immediately preceding the Closing
Date.
5. AGREEMENTS OF THE COMPANY. The Company hereby agrees with the
Initial Purchaser as follows:
(a) To advise the Initial Purchaser promptly and, if
requested by the Initial Purchaser, to confirm such advice in writing, (i) of
the issuance by any state securities commission of any stop order suspending
the qualification or exemption from qualification of any Series A Debentures
for offering or sale in any jurisdiction designated by the Initial Purchaser
pursuant to Section 5(e) hereof, or the initiation of any proceeding by any
state securities commission or any other federal or state regulatory
authority for such purpose and (ii) of the happening of any event during the
period referred to in Section 5(c) below that makes any statement of a
material fact made in the Preliminary Offering Memorandum or the Offering
Memorandum untrue or that requires any additions to or changes in the
Preliminary Offering Memorandum or the Offering Memorandum in order to make
the statements therein not misleading. The Company shall use its best
efforts to prevent the issuance of any stop order or order suspending the
qualification or exemption of any Series A Debentures under any state
securities or Blue Sky laws and, if at any time any state securities
commission or other federal or state regulatory authority shall issue an
order suspending the qualification or exemption of any Series A Debentures
under any state securities or Blue Sky laws, the Company shall use its best
efforts to obtain the withdrawal or lifting of such order at the earliest
possible time.
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(b) To furnish the Initial Purchaser and those persons
identified by the Initial Purchaser to the Company as many copies of the
Preliminary Offering Memorandum and the Offering Memorandum, and any
amendments or supplements thereto, as the Initial Purchaser may reasonably
request for the time period specified in Section 5(c). Subject to the
Initial Purchaser's compliance with its representations and warranties and
agreements set forth in Section 7 hereof, the Company consents to the use of
the Preliminary Offering Memorandum and the Offering Memorandum, and any
amendments and supplements thereto required pursuant hereto, by the Initial
Purchaser in connection with Exempt Resales.
(c) During such period as in the opinion of counsel for the
Initial Purchaser an Offering Memorandum is required by law to be delivered
in connection with Exempt Resales by the Initial Purchaser and in connection
with market-making activities of the Initial Purchaser for so long as any
Series A Debentures are outstanding, (i) not to make any amendment or
supplement to the Offering Memorandum of which the Initial Purchaser shall
not previously have been advised or to which the Initial Purchaser shall
reasonably object after being so advised and (ii) to prepare promptly upon
the Initial Purchaser's reasonable request, any amendment or supplement to
the Offering Memorandum which may be necessary or advisable in connection
with such Exempt Resales or such market-making activities.
(d) If, during the period referred to in Section 5(c)
above, any event shall occur or condition shall exist as a result of which,
in the opinion of counsel to the Initial Purchaser, it becomes necessary to
amend or supplement the Offering Memorandum in order to make the statements
therein, in the light of the circumstances when such Offering Memorandum is
delivered to an Eligible Purchaser, not misleading, or if, in the opinion of
counsel to the Initial Purchaser, it is necessary to amend or supplement the
Offering Memorandum to comply with any applicable law, forthwith to prepare
an appropriate amendment or supplement to such Offering Memorandum so that
the statements therein, as so amended or supplemented, will not, in the light
of the circumstances when it is so delivered, be misleading, or so that such
Offering Memorandum will comply with applicable law, and to furnish to the
Initial Purchaser and such other persons as the Initial Purchaser may
designate such number of copies thereof as the Initial Purchaser may
reasonably request.
(e) Prior to the sale of all Series A Debentures pursuant
to Exempt Resales as contemplated hereby, to cooperate with the Initial
Purchaser and counsel to the Initial Purchaser in connection with the
registration or qualification of the Series A Debentures for offer and sale
to the Initial Purchaser and pursuant to Exempt Resales under the securities
or Blue Sky laws of such United States jurisdictions as the Initial Purchaser
may request and to continue such registration or qualification in effect so
long as required for Exempt Resales and to file such consents to service of
process or other documents as may be necessary in order to effect such
registration or qualification; PROVIDED, HOWEVER, that neither the Company
nor any of its subsidiaries shall be required in connection therewith to
qualify as a foreign corporation in any jurisdiction in which it is not now
so qualified or to take any action that would subject it to general consent
to service of process or taxation other than as to matters and transactions
relating to the Preliminary Offering Memorandum, the Offering Memorandum or
Exempt Resales, in any jurisdiction in which it is not now so subject.
(f) So long as the Debentures are outstanding, (i) to mail
and make generally available as soon as practicable after the end of each
fiscal year to the record holders of the Debentures a financial report of the
Company and its subsidiaries on a consolidated basis (and a similar financial
report of all unconsolidated subsidiaries, if any), all such financial
reports to include a
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consolidated balance sheet, a consolidated statement of operations, a
consolidated statement of cash flows and a consolidated statement of
stockholders' equity as of the end of and for such fiscal year, together with
comparable information as of the end of and for the preceding year, certified
by the Company's independent public accountants and (ii) to mail and make
generally available as soon as practicable after the end of each quarterly
period (except for the last quarterly period of each fiscal year) to such
holders, a consolidated balance sheet, a consolidated statement of operations
and a consolidated statement of cash flows (and similar financial reports of
all unconsolidated subsidiaries, if any) as of the end of and for such
period, and for the period from the beginning of such year to the close of
such quarterly period, together with comparable information for the
corresponding periods of the preceding year.
(g) So long as the Debentures are outstanding, to furnish
to the Initial Purchaser as soon as available copies of all reports or other
communications furnished by the Company to its security holders or furnished
to or filed with the Commission or any national securities exchange on which
any class of securities of the Company is listed and such other publicly
available information concerning the Company and/or its subsidiaries
published, issued, created or filed by the Company or its subsidiaries as the
Initial Purchaser may reasonably request.
(h) So long as any of the Series A Debentures remain
outstanding and during any period in which the Company is not subject to
Section 13 or 15(d) of the Securities Exchange Act of 1934, as amended (the
"EXCHANGE ACT"), to make available to any holder of Series A Debentures in
connection with any sale thereof and any prospective purchaser of such Series
A Debentures from such holder, the information ("RULE 144A INFORMATION")
required by Rule 144A(d)(4) under the Act.
(i) Whether or not the transactions contemplated in this
Agreement are consummated or this Agreement is terminated, to pay or cause to
be paid all expenses incident to the performance of the obligations of the
Company under this Agreement, including: (i) the fees, disbursements and
expenses of counsel to the Company and accountants of the Company in
connection with the sale and delivery of the Series A Debentures to the
Initial Purchaser and pursuant to Exempt Resales, and all other fees and
expenses in connection with the preparation, printing, filing and
distribution of the Preliminary Offering Memorandum, the Offering Memorandum
and all amendments and supplements to any of the foregoing (including
financial statements), including the mailing and delivering of copies thereof
to the Initial Purchaser and persons designated by it in the quantities
specified herein, (ii) all costs and expenses related to the transfer and
delivery of the Series A Debentures to the Initial Purchaser and pursuant to
Exempt Resales, including any transfer or other taxes payable thereon, (iii)
all costs of printing or producing this Agreement, the other Operative
Documents and any other agreements or documents in connection with the
offering, purchase, sale or delivery of the Series A Debentures, (iv) all
expenses in connection with the registration or qualification of the Series A
Debentures for offer and sale under the securities or Blue Sky laws of the
several states and all costs of printing or producing any preliminary and
supplemental Blue Sky memoranda in connection therewith (including the filing
fees and fees and disbursements of counsel for the Initial Purchaser in
connection with such registration or qualification and memoranda relating
thereto), (v) the cost of printing certificates representing the Series A
Debentures, (vi) all expenses and listing fees in connection with the
application for quotation of the Series A Debentures in the National
Association of Securities Dealers, Inc. ("NASD") Automated Quotation
System--PORTAL ("PORTAL"), (vii) the fees and expenses of the Trustee and the
Trustee's counsel in connection with the Indenture and the Debentures, (viii)
the costs and charges of any transfer agent, registrar and/or depositary
(including DTC), (ix) any fees charged by rating agencies for the rating of
the Debentures, (x) all costs and expenses of the Exchange Offer and any
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Registration Statement, as set forth in the Registration Rights Agreement,
and (xi) and all other costs and expenses incident to the performance of the
obligations of the Company hereunder for which provision is not otherwise
made in this Section.
(j) To use its best efforts to effect the inclusion of the
Series A Debentures in PORTAL and to maintain the listing of the Series A
Debentures on PORTAL for so long as the Series A Debentures are outstanding.
(k) To obtain the approval of DTC for "book-entry" transfer
of the Debentures, and to comply with all of its agreements set forth in the
representation letter of the Company to DTC relating to the approval of the
Debentures by DTC for "book-entry" transfer.
(l) During the period beginning on the date hereof and
continuing to and including the Closing Date, not to offer, sell, contract to
sell or otherwise transfer or dispose of any debt securities of the Company or
any warrants, rights or options to purchase or otherwise acquire debt securities
of the Company substantially similar to the Debentures (other than (i) the
Debentures, (ii) borrowings under the New Credit Agreement, and (iii) commercial
paper issued in the ordinary course of business), without the prior written
consent of the Initial Purchaser which shall not be unreasonably withheld.
(m) Not to sell, offer for sale or solicit offers to buy or
otherwise negotiate in respect of any security (as defined in the Act) that
would be integrated with the sale of the Series A Debentures to the Initial
Purchaser or pursuant to Exempt Resales in a manner that would require the
registration of any such sale of the Series A Debentures under the Act.
(n) Not to voluntarily claim, and to actively resist any
attempts to claim, the benefit of any usury laws against the holders of any
Debentures.
(o) To cause the Exchange Offer to be made in the appropriate
form to permit Series B Debentures registered pursuant to the Act to be offered
in exchange for the Series A Debentures and to comply with all applicable
federal and state securities laws in connection with the Exchange Offer.
(p) To comply with all of its agreements set forth in the
Registration Rights Agreement.
(q) To use its best efforts to do and perform all things
required or necessary to be done and performed under this Agreement by it prior
to the Closing Date and to satisfy all conditions precedent to the delivery of
the Series A Debentures.
6. REPRESENTATIONS, WARRANTIES AND AGREEMENTS OF THE COMPANY. As of
the date hereof, of the Company represents and warrants to, and agrees with, the
Initial Purchaser that:
(a) The Preliminary Offering Memorandum and the Offering
Memorandum do not, and any supplement or amendment to them will not, contain any
untrue statement of a material fact or omit to state any material fact required
to be stated therein or necessary to make the statements therein, in the light
of the circumstances under which they were made, not misleading, except that the
representations and warranties contained in this paragraph (a) shall not apply
to statements in or
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omissions from the Preliminary Offering Memorandum or the Offering Memorandum
(or any supplement or amendment thereto) based upon information relating to
the Initial Purchaser furnished to the Company in writing by the Initial
Purchaser expressly for use therein. No stop order preventing the use of the
Preliminary Offering Memorandum or the Offering Memorandum, or any amendment
or supplement thereto, or any order asserting that any of the transactions
contemplated by this Agreement are subject to the registration requirements
of the Act, has been issued.
(b) Each of the Company, GLCC and their respective
subsidiaries has been duly incorporated, is validly existing as a corporation in
good standing under the laws of its jurisdiction of incorporation and has the
corporate power and authority to carry on its business as described in the
Preliminary Offering Memorandum and the Offering Memorandum and to own, lease
and operate its properties, and each is duly qualified and is in good standing
as a foreign corporation authorized to do business in each jurisdiction in which
the nature of its business or its ownership or leasing of property requires such
qualification, except where the failure to be so qualified would not (x) have a
material adverse effect on the business, prospects, financial condition or
results of operations of the Company and its subsidiaries, taken as a whole,
(y) adversely affect the Company's ability to issue the Debentures or (z)
adversely affect the validity of this Agreement or any other Operative Document
or otherwise adversely affect the Company's ability to consummate any of the
Acquisition Transactions (any of the events set forth in clauses (x), (y) or
(z), a "MATERIAL ADVERSE EFFECT").
(c) All outstanding shares of capital stock of the Company
have been duly authorized and validly issued and are fully paid, non-assessable
and not subject to any preemptive or similar rights; all of such shares are
owned by AIP (except certain shares representing less than 1.0% of the issued
and outstanding shares of the Company which are owned by affiliates and other
individuals associated with AIP) free and clear of any security interest, claim,
lien, encumbrance or adverse interest of any nature (each, a "LIEN"). Upon
consummation of the Merger, all outstanding shares of capital stock of GLCC will
have been duly authorized and validly issued and will be fully paid,
non-assessable and not subject to any preemptive or similar rights and will be
owned by the Company free and clear of any Lien, except that the Company will
guarantee GLCC's obligations under the New Credit Agreement and such guarantee
will be secured by a pledge of all of the capital stock of GLCC.
(d) The entities listed on Schedule A hereto are the only
subsidiaries, direct or indirect, of the Company or GLCC, and GLCC owns a
minority interest in India Carbon, Ltd., an Indian corporation. All of the
outstanding shares of capital stock of each of the Company's and GLCC's
respective subsidiaries have been duly authorized and validly issued and are
fully paid and non-assessable, and are, or upon consummation of the Merger will
be, owned by the Company directly or indirectly through one or more subsidiaries
(except an approximate 0.2% interest in Copetro, S.A., an Argentine corporation)
free and clear of any Lien, other than the pledge of such shares to secure the
obligations of GLCC under the New Credit Agreement; provided, however, that the
Company makes no representation in this paragraph as to the outstanding capital
stock of GLCC prior to the effectiveness of the Merger.
(e) This Agreement has been duly authorized, executed and
delivered by the Company.
(f) The Indenture has been duly authorized by the Company,
and, on the Closing Date, will have been validly executed and delivered by the
Company. When the Indenture has
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been validly executed and delivered by the Company, and assuming the due
authorization, execution and delivery of the Indenture by the Trustee, the
Indenture will be a valid and binding agreement of the Company, enforceable
against the Company in accordance with its terms, except to the extent
enforcement thereof may be limited by (x) bankruptcy, insolvency,
reorganization, moratorium or other similar laws now or hereafter in effect
relating to creditors' rights generally and (y) general principles of equity
(regardless of whether enforceability is considered in law or at equity). On
the Closing Date, the Indenture will conform in all material respects to the
requirements of the Trust Indenture Act of 1939, as amended (the "TIA" or
"TRUST INDENTURE ACT"), and the rules and regulations of the Commission
applicable to an indenture which is qualified thereunder.
(g) The Series A Debentures have been duly authorized by the
Company and, on the Closing Date, will have been validly executed and delivered
by the Company. When the Series A Debentures have been issued, executed and
authenticated in accordance with the provisions of the Indenture and delivered
to and paid for by the Initial Purchaser in accordance with the terms of this
Agreement, the Series A Debentures will be entitled to the benefits of the
Indenture and will be valid and binding obligations of the Company, enforceable
in accordance with their terms except to the extent enforcement thereof may be
limited by (x) bankruptcy, insolvency, reorganization, moratorium or other
similar laws now or hereafter in effect relating to creditors' rights generally
and (y) general principles of equity (regardless of whether enforceability is
considered in law or at equity). On the Closing Date, the Series A Debentures
will conform in all material respects as to legal matters to the description
thereof contained in the Offering Memorandum.
(h) On the Closing Date, the Series B Debentures will have
been duly authorized by the Company. When the Series B Debentures are issued,
executed and authenticated in accordance with the terms of the Exchange Offer
and the Indenture, the Series B Debentures will be entitled to the benefits of
the Indenture and will be the valid and binding obligations of the Company,
enforceable against the Company in accordance with their terms, except to the
extent enforcement thereof may be limited by (x) bankruptcy, insolvency,
reorganization, moratorium or other similar laws now or hereafter in effect
relating to creditors' rights generally and (y) general principles of equity
(regardless of whether enforceability is considered in law or at equity).
(i) The Registration Rights Agreement has been duly
authorized by the Company and, on the Closing Date, will have been duly executed
and delivered by the Company. When the Registration Rights Agreement has been
duly executed and delivered by the Company, assuming the due authorization,
execution and delivery of the Registration Rights Agreement by the Initial
Purchasers, the Registration Rights Agreement will be a valid and binding
agreement of the Company, enforceable against the Company in accordance with its
terms except to the extent enforcement thereof may be limited by (x) bankruptcy,
insolvency, reorganization, moratorium or other similar laws now or hereafter in
effect relating to creditors' rights generally and (y) general principles of
equity (regardless of whether enforceability is considered in law or at equity),
and any rights to indemnity or contribution thereunder may be limited by federal
and state securities laws and public policy considerations. On the Closing
Date, the Registration Rights Agreement will conform in all material respects as
to legal matters to the description thereof in the Offering Memorandum.
(j) The Merger Agreement has been duly authorized, executed
and delivered by the Company and constitutes a valid and binding agreement of
the Company in accordance with its terms, except to the extent enforcement
thereof may be limited by (x) bankruptcy, insolvency,
9
reorganization, moratorium or other similar laws now or hereafter in effect
relating to creditors' rights generally and (y) general principles of equity
(regardless of whether enforceability is considered in law or at equity). The
Company has delivered to the Initial Purchaser true and correct copies of the
Merger Agreement and all documents and agreements related thereto, including
all amendments, alterations, modifications or waivers thereto and all
exhibits and schedules thereto.
(k) The New Credit Agreement has been duly authorized by the
Company and, on the Closing Date, will have been validly executed and delivered
by the Company. When the New Credit Agreement has been duly executed and
delivered by the Company, assuming the due authorization, execution and delivery
of the New Credit Agreement by the parties thereto (other than the Company), the
New Credit Agreement will be a valid and binding agreement of the Company
enforceable against the Company in accordance with its terms except to the
extent enforcement thereof may be limited by (x) bankruptcy, insolvency,
reorganization, moratorium or other similar laws now or hereafter in effect
relating to creditors' rights generally and (y) general principles of equity
(regardless of whether enforceability is considered in law or at equity). On the
Closing Date, the New Credit Agreement will conform in all material respects as
to legal matters to the description thereof in the Offering Memorandum.
(l) Neither the Company nor any of its subsidiaries is in
violation of its respective charter, by-laws or other organizational documents
or in default in the performance of any obligation, agreement, covenant or
condition contained in any indenture, loan agreement, mortgage, lease or other
agreement or instrument that is material to the Company and its subsidiaries,
taken as a whole, to which the Company or any of its subsidiaries is a party or
by which the Company or any of its subsidiaries or their respective property is
bound.
(m) The execution, delivery and performance of this Agreement
and the other Operative Documents by the Company, compliance by the Company with
all provisions hereof and thereof and the consummation of the transactions
contemplated hereby and thereby will not (i) require any consent, approval,
authorization or other order of, or qualification with, any court or
governmental body or agency (except such as may be required under the securities
or Blue Sky laws of the various states or as have been obtained), (ii) conflict
with or constitute a breach of any of the terms or provisions of, or a default
under, the charter, by-laws or other organizational documents of the Company or
any indenture, loan agreement, mortgage, lease or other agreement or instrument
to which the Company is a party or by which the Company or its property is
bound, (ii) conflict with or constitute a breach of any of the terms or
provisions of, or a default under, the charter, by-laws or other organizational
documents of GLCC or any of its subsidiaries or any indenture, loan agreement,
mortgage, lease or other agreement or instrument listed on Schedule 2.10 of the
Merger Agreement that is material to GLCC and its subsidiaries, taken as a
whole, to which GLCC or any of its subsidiaries is a party or by which GLCC or
any of its subsidiaries or their respective property is bound, (iv) violate or
conflict with any applicable law or any rule, regulation, judgment, order or
decree of any court or any governmental body or agency having jurisdiction over
GLCC or any of its subsidiaries or their respective property, (v) result in the
imposition or creation of (or the obligation to create or impose) a Lien under,
any agreement or instrument to which the Company, GLCC or any of its
subsidiaries is a party or by which the Company, GLCC or any of its subsidiaries
or their respective property is bound, or (vi) result in the termination,
suspension or revocation of any Authorization (as defined below) of the Company,
GLCC or any of its subsidiaries or result in any other impairment of the rights
of the holder of any such Authorization.
10
(n) Except as described in the Preliminary Offering
Memorandum and the Offering Memorandum, there are no legal or governmental
proceedings pending to which the Company, GLCC or any of its subsidiaries is a
party or to which any of their respective property is subject, or, to the
Company's knowledge, threatened to which the Company, GLCC or any of its
subsidiaries could be a party or to which any of their respective property could
be subject, which might result, singly or in the aggregate, in a Material
Adverse Effect.
(o) Except as described in the Preliminary Offering
Memorandum and the Offering Memorandum, neither the Company, GLCC nor any of its
subsidiaries has violated any foreign, federal, state or local law or regulation
relating to the protection of human health and safety, the environment or
hazardous or toxic substances or wastes, pollutants or contaminants
("ENVIRONMENTAL LAWS"), any provisions of the Employee Retirement Income
Security Act of 1974, as amended ("ERISA"), or any provisions of the Foreign
Corrupt Practices Act or the rules and regulations promulgated thereunder,
except for such violations which, singly or in the aggregate, would not have a
Material Adverse Effect.
(p) Except as described in the Preliminary Offering
Memorandum and the Offering Memorandum, there are no costs or liabilities
associated with Environmental Laws (including, without limitation, any capital
or operating expenditures required for clean-up, closure of properties or
compliance with Environmental Laws or any Authorization, any related constraints
on operating activities and any potential liabilities to third parties) which
would, singly or in the aggregate, have a Material Adverse Effect.
(q) Except as described in the Preliminary Offering
Memorandum and the Offering Memorandum, each of the Company, GLCC and its
subsidiaries has such permits, licenses, consents, exemptions, franchises,
authorizations and other approvals (each, an "AUTHORIZATION") of, and has made
all filings with and notices to, all governmental or regulatory authorities and
self-regulatory organizations and all courts and other tribunals, including
without limitation, under any applicable Environmental Laws, as are necessary to
own, lease, license and operate its respective properties and to conduct its
business, except where the failure to have any such Authorization or to make any
such filing or notice would not, singly or in the aggregate, have a Material
Adverse Effect. Each such Authorization is valid and in full force and effect
and each of the Company, GLCC and its subsidiaries is in compliance with all the
terms and conditions thereof and with the rules and regulations of the
authorities and governing bodies having jurisdiction with respect thereto; and
no event has occurred (including, without limitation, the receipt of any notice
from any authority or governing body) which allows or, after notice or lapse of
time or both, would allow, revocation, suspension or termination of any such
Authorization or results or, after notice or lapse of time or both, would result
in any other impairment of the rights of the holder of any such Authorization;
and such Authorizations contain no restrictions that are burdensome to the
Company, GLCC or any of its subsidiaries; except where such failure to be valid
and in full force and effect or to be in compliance, the occurrence of any such
event or the presence of any such restriction would not, singly or in the
aggregate, have a Material Adverse Effect.
(r) Xxxxx & Young LLP, the accountants that have certified
the financial statements included in the Preliminary Offering Memorandum and the
Offering Memorandum, are independent public accountants with respect to the
Company, GLCC and its subsidiaries, as required by the Act and the Exchange Act.
The historical financial statements, together with related notes, set forth in
11
the Preliminary Offering Memorandum and the Offering Memorandum comply as to
form in all material respects with the requirements applicable to registration
statements on Form S-1 under the Act.
(s) The historical financial statements, together with
related notes forming part of the Offering Memorandum (and any amendment or
supplement thereto), present fairly in all material respects the consolidated
financial position, results of operations and changes in financial position of
GLCC and its subsidiaries on the basis stated in the Offering Memorandum at the
respective dates or for the respective periods to which they apply; such
statements and related notes have been prepared in accordance with generally
accepted accounting principles consistently applied throughout the periods
involved, except as disclosed therein; and the other financial information
regarding the Company or GLCC set forth in the Offering Memorandum (and any
amendment or supplement thereto) is, in all material respects, accurately
presented and prepared on a basis consistent with such financial statements and
the books and records of the Company or GLCC, as applicable.
(t) The pro forma financial statements included in the
Preliminary Offering Memorandum and the Offering Memorandum have been prepared
on a basis consistent with the historical financial statements of GLCC and its
subsidiaries and give effect to assumptions used in the preparation thereof on a
reasonable basis and in good faith and on such basis present fairly the
historical and proposed transactions contemplated by the Preliminary Offering
Memorandum and the Offering Memorandum; and such pro forma financial statements
comply as to form in all material respects with the requirements of Rule 11-02
of Regulation S-X under the Act. The other pro forma financial information
included in the Offering Memorandum is, in all material respects, fairly
presented and prepared on a basis consistent with the pro forma financial
statements, provided that the Company makes no representation as to whether the
Adjusted Credit Data presented in the Offering Memorandum under the caption
"Summary Consolidated Financial and Other Data" complies with Rule 11-02 of
Regulation S-X under the Act.
(u) Neither the Company nor GLCC is and, after giving effect
to the offering and sale of the Series A Debentures and the application of the
net proceeds thereof as described in the Offering Memorandum, will not be, an
"investment company," as such term is defined in the Investment Company Act of
1940, as amended.
(v) Except for the Registration Rights Agreement, there are
no contracts, agreements or understandings between the Company and any person
granting such person the right to require the Company to file a registration
statement under the Act with respect to any securities of the Company or to
require the Company to include such securities with the Debentures registered
pursuant to any Registration Statement.
(w) The issuance or sale of the Series A Debentures, and the
use of proceeds therefrom as described in the Preliminary Offering Memorandum
and the Offering Memorandum will not violate Regulation T (12 C.F.R. Part 220),
Regulation U (12 C.F.R. Part 221) or Regulation X (12 C.F.R. Part 224) of the
Board of Governors of the Federal Reserve System.
(x) No "nationally recognized statistical rating
organization" as such term is defined for purposes of Rule 436(g)(2) under the
Act (i) has imposed (or has informed the Company that it is considering
imposing) any condition (financial or otherwise) on the Company's retaining any
rating assigned to the Company, or any securities of the Company or (ii) has
indicated to the Company that it is
12
considering (a) the downgrading, suspension, or withdrawal of, or any review
for a possible change that does not indicate the direction of the possible
change in, any rating so assigned or (b) any change in the outlook for any
rating of the Company or any securities of the Company.
(y) Since the respective dates as of which information is
given in the Offering Memorandum other than as set forth in the Offering
Memorandum (exclusive of any amendments or supplements thereto subsequent to the
date of this Agreement), (i) there has not occurred any material adverse change
or any development involving a prospective material adverse change in the
condition, financial or otherwise, or the earnings, business, management or
operations of the Company and its subsidiaries, taken as a whole, (ii) there has
not been any material adverse change or any development involving a prospective
material adverse change in the capital stock or in the long-term debt of the
Company or any of its subsidiaries and (iii) neither the Company nor any of its
subsidiaries has incurred any material liability or obligation, direct or
contingent except in the ordinary course of business.
(z) Each of the Preliminary Offering Memorandum and the
Offering Memorandum, as of its date, contains all the information specified in,
and meeting the requirements of, Rule 144A(d)(4) under the Act.
(aa) When the Series A Debentures are issued and delivered
pursuant to this Agreement, the Series A Debentures will not be of the same
class (within the meaning of Rule 144A under the Act) as any security of the
Company that is listed on a national securities exchange registered under
Section 6 of the Exchange Act or that is quoted in a United States automated
inter-dealer quotation system.
(bb) No form of general solicitation or general advertising
(each as defined in Regulation D under the Act) was used by the Company or any
of its representatives (other than the Initial Purchaser, as to whom the Company
makes no representation) in connection with the offer and sale of the Series A
Debentures contemplated hereby, including, but not limited to, articles, notices
or other communications published in any newspaper, magazine, or similar medium
or broadcast over television or radio, or any seminar or meeting whose attendees
have been invited by any general solicitation or general advertising. No
securities of the same class as the Series A Debentures have been issued and
sold by the Company within the six-month period immediately prior to the date
hereof.
(cc) Prior to the effectiveness of any Registration Statement,
the Indenture is not required to be qualified under the TIA.
(dd) None of the Company nor any of its affiliates or any
person acting on its or their behalf (other than the Initial Purchaser, as to
whom the Company makes no representation) has engaged or will engage in any
directed selling efforts within the meaning of Regulation S under the Act
("REGULATION S") with respect to the Series A Debentures.
(ee) All Series A Debentures offered and sold in reliance on
Regulation S by the Company and its affiliates and all persons acting on their
behalf (other than the Initial Purchasers, as to whom the Company makes no
representation) have been and will be offered and sold only in offshore
transactions.
13
(ff) The Company and its affiliates and all persons acting on
their behalf (other than the Initial Purchaser, as to whom the Company makes no
representation) have complied with and will comply with the offering
restrictions requirements of Regulation S in connection with the offering of the
Series A Debentures outside the United States and, in connection therewith, the
Offering Memorandum will contain the disclosure required by Rule 902(h).
(gg) GLCC is a "reporting issuer," as defined in Rule 902
under the Act.
(hh) The sale of the Series A Debentures pursuant to
Regulation S is not part of a plan or scheme to evade the registration
provisions of the Act.
(ii) No registration under the Act of the Series A Debentures
is required for the sale of the Series A Debentures to the Initial Purchaser as
contemplated hereby or for the Exempt Resales assuming the accuracy of the
Initial Purchaser's representations and warranties and agreements set forth in
Section 7 hereof.
(jj) Neither the Company, GLCC nor any of its subsidiaries
intends to or believes that it will incur debts beyond its ability to pay as
such debts mature. Immediately before and after giving effect to the issuance
of the Debentures and consummation of the Acquisition Transactions, (i) the
present fair saleable value of the assets of the Company, GLCC and its
subsidiaries, on a consolidated basis, will exceed the amount that will be
required to pay their probable liability on their existing debts and other
liabilities (including contingent liabilities) as they become absolute and
matured, and (ii) the assets of each of the Company, GLCC and its subsidiaries
will not constitute unreasonably small capital to carry out their businesses as
now or as anticipated to be conducted.
(kk) The Company, GLCC and its subsidiaries have good and
marketable title to all real property and good and marketable title to all
personal property owned by them which is material to the business of the
Company, GLCC and its subsidiaries, in each case free and clear of all Liens and
defects, except such as are described in the Preliminary Offering Memorandum and
the Offering Memorandum and such as would not have a Material Adverse Effect;
and any real property and buildings held under lease by the Company, GLCC and
its subsidiaries are held by them under valid, subsisting and enforceable leases
with such exceptions as would not have a Material Adverse Effect and except as
described in the Preliminary Offering Memorandum and the Offering Memorandum.
(ll) The Company, GLCC and each of its subsidiaries own or
possess, or can acquire on reasonable terms, all patents, patent rights,
licenses, inventions, copyrights, know-how (including trade secrets and other
unpatented and/or unpatentable proprietary or confidential information, systems
or procedures), trademarks, service marks and trade names ("INTELLECTUAL
PROPERTY") currently employed by them in connection with the business now
operated by them except where the failure to own or possess or otherwise be able
to acquire such intellectual property would not, singly or in the aggregate,
have a Material Adverse Effect; and neither the Company, GLCC nor any of its
subsidiaries has received any notice of infringement of or conflict with
asserted rights of others with respect to any of such intellectual property
which, singly or in the aggregate, if the subject of any unfavorable decision,
ruling or finding, would have a Material Adverse Effect.
(mm) GLCC is insured by insurers of recognized financial
responsibility against such losses and risks and in such amounts as are prudent
and customary in the businesses in
14
which it is engaged; and GLCC (i) has not received notice from any insurer or
agent of such insurer that substantial capital improvements or other material
expenditures will have to be made in order to continue such insurance or (ii)
has no reason to believe that it will not be able to renew its existing
insurance coverage as and when such coverage expires or to obtain similar
coverage from similar insurers at a cost that would not have a Material
Adverse Effect.
(nn) Except as described in the Offering Memorandum, no
relationship, direct or indirect, exists between or among the Company, GLCC or
any of its subsidiaries on the one hand, and the directors, officers,
stockholders, customers or suppliers of the Company, GLCC or any of its
subsidiaries on the other hand, which would be required by the Act to be
described in the Offering Memorandum if the Offering Memorandum were a
prospectus included in a registration statement on Form S-1 filed with the
Commission.
(oo) There is no (i) significant unfair labor practice
complaint, grievance or arbitration proceeding pending or, to the knowledge of
the Company, threatened against GLCC or any of its subsidiaries before the
National Labor Relations Board or any state or local labor relations board, (ii)
strike, labor dispute, slowdown or stoppage pending or, to the knowledge of the
Company, threatened against GLCC or any of its subsidiaries or (iii) union
representation question existing with respect to the employees of GLCC or any of
its subsidiaries who are not currently covered by a collective bargaining
agreement, except in the case of clauses (i), (ii) and (iii) for such actions
which, singly or in the aggregate, would not have a Material Adverse Effect.
(pp) GLCC and each of its subsidiaries maintains a system of
internal accounting controls sufficient to provide reasonable assurance that (i)
transactions are executed in accordance with management's general or specific
authorizations; (ii) transactions are recorded as necessary to permit
preparation of financial statements in conformity with generally accepted
accounting principles or any other criteria applicable to such statements and to
maintain asset accountability; (iii) access to assets is permitted only in
accordance with management's general or specific authorization; and (iv) the
recorded accountability for assets is compared with the existing assets at
reasonable intervals and appropriate action is taken with respect to any
differences.
(qq) All material tax returns required to be filed by GLCC and
each of its subsidiaries in any jurisdiction have been filed, taking into
account all applicable extensions, other than those filings being contested in
good faith, and all material taxes, including withholding taxes, penalties and
interest, assessments, fees and other charges due and payable pursuant to such
returns or pursuant to any assessment received by GLCC or any of its
subsidiaries have been paid, other than those being contested in good faith and
for which adequate reserves have been provided.
(rr) No action has been taken and no law, statute, rule or
regulation or order has been enacted, adopted or issued by any governmental
agency or body which prevents the execution, delivery and performance of any of
the Operative Documents or the issuance of the Series A Debentures, or suspends
the sale of the Series A Debentures in any jurisdiction referred to in
Section 5(e); and no injunction, restraining order or other order or relief of
any nature by a federal or state court or other tribunal of competent
jurisdiction has been issued with respect to the Company or any of its
subsidiaries which would prevent or suspend the issuance or sale of the Series A
Debentures in any jurisdiction referred to in Section 5(e).
15
(ss) Each certificate signed by any officer of the Company or
any of its subsidiaries and delivered to the Initial Purchaser or counsel for
the Initial Purchaser in connection with the transactions contemplated hereby
shall be deemed to be a representation and warranty by the Company or such
subsidiary to the Initial Purchaser as to the matters covered thereby.
The Company acknowledges that the Initial Purchaser and, for purposes
of the opinions to be delivered to the Initial Purchaser pursuant to Section 9
hereof, counsel to the Company and counsel to the Initial Purchaser will rely
upon the accuracy and truth of the foregoing representations and hereby consents
to such reliance.
7. INITIAL PURCHASER'S REPRESENTATIONS AND WARRANTIES. The Initial
Purchaser represents and warrants to the Company and agrees that:
(a) The Initial Purchaser is either a QIB or an institutional
"accredited investor", as defined in Rule 501(a)(1), (2), (3), or (7) under the
Act (an "ACCREDITED INSTITUTION"), in either case, with such knowledge and
experience in financial and business matters as is necessary in order to
evaluate the merits and risks of an investment in the Series A Debentures.
(b) The Initial Purchaser (A) is not acquiring the Series A
Debentures with a view to any distribution thereof or with any present intention
of offering or selling any of the Series A Debentures in a transaction that
would violate the Act or the securities laws of any state of the United States
or any other applicable jurisdiction and (B) will be reoffering and reselling
the Series A Debentures only to (x) QIBs in reliance on the exemption from the
registration requirements of the Act provided by Rule 144A and (y) in offshore
transactions in reliance upon Regulation S under the Act.
(c) The Initial Purchaser agrees that no form of general
solicitation or general advertising (each within the meaning of Regulation D
under the Act) has been or will be used by the Initial Purchaser or any of its
representatives in connection with the offer and sale of the Series A Debentures
pursuant hereto, including, but not limited to, articles, notices or other
communications published in any newspaper, magazine or similar medium or
broadcast over television or radio, or any seminar or meeting whose attendees
have been invited by any general solicitation or general advertising.
(d) The Initial Purchaser agrees that, in connection with
Exempt Resales, the Initial Purchaser will solicit offers to buy the Series A
Debentures only from, and will offer to sell the Series A Debentures only to,
Eligible Purchasers. The Initial Purchaser further agrees that it will offer to
sell the Series A Debentures only to, and will solicit offers to buy the Series
A Debentures only from (A) Eligible Purchasers that the Initial Purchaser
reasonably believes are QIBs and (B) Regulation S Purchasers, in each case, that
agree that (x) the Series A Debentures purchased by them may be resold, pledged
or otherwise transferred within the time period referred to under Rule 144(k)
(taking into account the provisions of Rule 144(d) under the Act, if applicable)
under the Act, as in effect on the date of the transfer of such Series A
Debentures, only (I) to the Company or any of its subsidiaries, (II) to a person
whom the seller reasonably believes is a QIB purchasing for its own account or
for the account of a QIB in a transaction meeting the requirements of Rule 144A
under the Act, (III) in an offshore transaction (as defined in Rule 902 under
the Act) meeting the requirements of Rule 904 of the Act, (IV) in a transaction
meeting the requirements of Rule 144 under the Act, (V) to an Accredited
Institution that, prior to such transfer, furnishes the Trustee a signed letter
containing certain representations and agreements relating to the registration
of transfer of such Series A Debenture (the form of which is available from the
Trustee)
16
and, if such transfer is in respect of an aggregate principal amount of
Series A Debentures less than $250,000, an opinion of counsel acceptable to
the Company that such transfer is in compliance with the Act, (VI) in
accordance with another exemption from the registration requirements of the
Act (and, if requested, based upon an opinion of counsel acceptable to the
Company) or (VII) pursuant to an effective registration statement and, in
each case, in accordance with the applicable securities laws of any state of
the United States or any other applicable jurisdiction and (y) they will
deliver to each person to whom such Series A Debentures or an interest
therein is transferred a notice substantially to the effect of the foregoing.
(e) The Initial Purchaser and its affiliates or any person
acting on its or their behalf have not engaged or will not engage in any
directed selling efforts within the meaning of Regulation S with respect to the
Series A Debentures.
(f) The Series A Debentures offered and sold by the Initial
Purchaser pursuant hereto in reliance on Regulation S have been and will be
offered and sold only in offshore transactions.
(g) The sale of the Series A Debentures offered and sold by
the Initial Purchaser pursuant hereto in reliance on Regulation S is not part of
a plan or scheme to evade the registration provisions of the Act.
(h) The Initial Purchaser agrees that it has not offered or
sold and will not offer or sell the Series A Debentures in the United States or
to, or for the benefit or account of, a U.S. Person (other than a distributor),
in each case, as defined in Rule 902 under the Act (i) as part of its
distribution at any time and (ii) otherwise until 40 days after the later of the
commencement of the offering of the Series A Debentures pursuant hereto and the
Closing Date, other than in accordance with Regulation S of the Act or another
exemption from the registration requirements of the Act. The Initial Purchaser
agrees that, during such 40-day restricted period, it will not cause any
advertisement with respect to the Series A Debentures (including any "tombstone"
advertisement) to be published in any newspaper or periodical or posted in any
public place and will not issue any circular relating to the Series A
Debentures, except such advertisements as are permitted by and include the
statements required by Regulation S.
(i) The Initial Purchaser agrees that, at or prior to
confirmation of a sale of Series A Debentures by it to any distributor, dealer
or person receiving a selling concession, fee or other remuneration during
40-day restricted period referred to in Rule 903(c)(2) under the Act, it will
send to such distributor, dealer or person receiving a selling concession, fee
or other remuneration a confirmation or notice to substantially the following
effect:
"The Series A Debentures covered hereby have not been registered under
the U.S. Securities Act of 1933, as amended (the "Securities Act"),
and may not be offered and sold within the United States or to, or for
the account or benefit of, U.S. persons (i) as part of your
distribution at any time or (ii) otherwise until 40 days after the
later of the commencement of the Offering and the Closing Date, except
in either case in accordance with Regulation S under the Securities
Act (or Rule 144A or to Accredited Institutions in transactions that
are exempt from the registration requirements of the Securities Act),
and in connection with any subsequent sale by you of the Series A
Debentures covered
17
hereby in reliance on Regulation S during the period referred to above to
any distributor, dealer or person receiving a selling concession fee or
other remuneration, you must deliver a notice to substantially the
foregoing effect. Terms used above have the meanings assigned to them in
Regulation S."
(j) Such Initial Purchaser agrees that the Series A
Debentures offered and sold in reliance on Regulation S will be represented upon
issuance by a global security that may not be exchanged for definitive
securities until the expiration of the 40-day restricted period referred to in
Rule 903(c)(3) of the Act and only upon certification of beneficial ownership of
such Series A Debentures by non-U.S. persons or U.S. persons who purchased such
Series A Debentures in transactions that were exempt from the registration
requirements of the Act.
The Initial Purchaser acknowledges that the Company and, for
purposes of the opinions to be delivered to the Initial Purchaser pursuant to
Section 9 hereof, counsel to the Company and counsel to the Initial Purchaser
will rely upon the accuracy and truth of the foregoing representations and the
Initial Purchaser hereby consents to such reliance.
8. INDEMNIFICATION.
(a) The Company agrees to indemnify and hold harmless the
Initial Purchaser, its directors, its officers and each person, if any, who
controls the Initial Purchaser within the meaning of Section 15 of the Act or
Section 20 of the Exchange Act, from and against any and all losses, claims,
damages, liabilities and judgments (including, without limitation, any legal or
other expenses incurred in connection with investigating or defending any
matter, including any action, that could give rise to any such losses, claims,
damages, liabilities or judgments) caused by any untrue statement or alleged
untrue statement of a material fact contained in the Offering Memorandum (or any
amendment or supplement thereto), the Preliminary Offering Memorandum or any
Rule 144A Information provided by the Company to any holder or prospective
purchaser of Series A Debentures pursuant to Section 5(h) or caused by any
omission or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein not misleading,
except insofar as such losses, claims, damages, liabilities or judgments are
caused by any such untrue statement or omission or alleged untrue statement or
omission based upon information that the Initial Purchaser provides in writing
to the Company relating to the Initial Purchaser; provided, however, that the
foregoing indemnity agreement with respect to any Preliminary Offering
Memorandum shall not inure to the benefit of the Initial Purchaser if the
Initial Purchaser failed to deliver a Final Offering Memorandum (as then amended
or supplemented, provided by the Company to the Initial Purchaser in the
requisite quantity and on a timely basis to permit proper delivery on or prior
to the Closing Date) to the person asserting any losses, claims, damages and
liabilities and judgments caused by any untrue statement or alleged untrue
statement of a material fact contained in any Preliminary Offering Memorandum,
or caused by any omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements therein not
misleading, if such material misstatement or omission or alleged material
misstatement or omission was cured in the Final Offering Memorandum.
(b) The Initial Purchaser agrees to indemnify and hold
harmless the Company, and its directors and officers and each person, if any,
who controls (within the meaning of Section 15 of the Act or Section 20 of the
Exchange Act) the Company, to the same extent as the foregoing indemnity from
the Company to the Initial Purchaser but only with reference to the information
18
that the Initial Purchaser provided to the Company in writing expressly relating
to the Initial Purchaser for use in the Preliminary Offering Memorandum or the
Offering Memorandum.
(c) In case any action shall be commenced involving any
person in respect of which indemnity may be sought pursuant to Section 8(a) or
8(b) (the "INDEMNIFIED PARTY"), the indemnified party shall promptly notify the
person against whom such indemnity may be sought (the "INDEMNIFYING PARTY") in
writing and the indemnifying party shall assume the defense of such action,
including the employment of counsel reasonably satisfactory to the indemnified
party and the payment of all fees and expenses of such counsel, as incurred
(except that in the case of any action in respect of which indemnity may be
sought pursuant to both Sections 8(a) and 8(b), the Initial Purchaser shall not
be required to assume the defense of such action pursuant to this Section 8(c),
but may employ separate counsel and participate in the defense thereof, but the
fees and expenses of such counsel, except as provided below, shall be at the
expense of the Initial Purchaser). Any indemnified party shall have the right
to employ separate counsel in any such action and participate in the defense
thereof, but the fees and expenses of such counsel shall be at the expense of
the indemnified party unless (i) the employment of such counsel shall have been
specifically authorized in writing by the indemnifying party, (ii) the
indemnifying party shall have failed to assume the defense of such action or
employ counsel reasonably satisfactory to the indemnified party or (iii) the
named parties to any such action (including any impleaded parties) include both
the indemnified party and the indemnifying party, and the indemnified party
shall have been advised by such counsel that there may be one or more legal
defenses available to it which are different from or additional to those
available to the indemnifying party (in which case the indemnifying party shall
not have the right to assume the defense of such action on behalf of the
indemnified party). In any such case, the indemnifying party shall not, in
connection with any one action or separate but substantially similar or related
actions in the same jurisdiction arising out of the same general allegations or
circumstances, be liable for the fees and expenses of more than one separate
firm of attorneys (in addition to any local counsel) for all indemnified parties
and all such fees and expenses shall be reimbursed as they are incurred. Such
firm shall be designated in writing by Xxxxxxxxx, Xxxxxx & Xxxxxxxx Securities
Corporation, in the case of the parties indemnified pursuant to Section 8(a),
and by the Company, in the case of parties indemnified pursuant to Section 8(b).
The indemnifying party shall indemnify and hold harmless the indemnified party
from and against any and all losses, claims, damages, liabilities and judgments
by reason of any settlement of any action (i) effected with its written consent
or (ii) effected without its written consent if the settlement is entered into
more than twenty business days after the indemnifying party shall have received
a request from the indemnified party for reimbursement for the fees and expenses
of counsel (in any case where such fees and expenses are at the expense of the
indemnifying party) and, prior to the date of such settlement, the indemnifying
party shall have failed to comply with such reimbursement request. No
indemnifying party shall, without the prior written consent of the indemnified
party, effect any settlement or compromise of, or consent to the entry of
judgment with respect to, any pending or threatened action in respect of which
the indemnified party is or could have been a party and indemnity or
contribution may be or could have been sought hereunder by the indemnified
party, unless such settlement, compromise or judgment (i) includes an
unconditional release of the indemnified party from all liability on claims that
are or could have been the subject matter of such action and (ii) does not
include a statement as to or an admission of fault, culpability or a failure to
act, by or on behalf of the indemnified party.
(d) To the extent the indemnification provided for in this
Section 8 is unavailable to an indemnified party or insufficient in respect of
any losses, claims, damages, liabilities or judgments referred to therein, then
each indemnifying party, in lieu of indemnifying such indemnified
19
party, shall contribute to the amount paid or payable by such indemnified
party as a result of such losses, claims, damages, liabilities and judgments
(i) in such proportion as is appropriate to reflect the relative benefits
received by the Company, on the one hand, and the Initial Purchaser, on the
other hand, from the offering of the Series A Debentures or (ii) if the
allocation provided by clause 8(d)(i) above is not permitted by applicable
law, in such proportion as is appropriate to reflect not only the relative
benefits referred to in clause 8(d)(i) above but also the relative fault of
the Company, on the one hand, and the Initial Purchaser, on the other hand,
in connection with the statements or omissions which resulted in such losses,
claims, damages, liabilities or judgments, as well as any other relevant
equitable considerations. The relative benefits received by the Company, on
the one hand, and the Initial Purchaser, on the other hand, shall be deemed
to be in the same proportion as the total net proceeds from the offering of
the Series A Debentures (after underwriting discounts and commissions, but
before deducting expenses) received by the Company, and the total discounts
and commissions received by the Initial Purchaser bear to the total price to
investors of the Series A Debentures, in each case as set forth in the table
on the cover page of the Offering Memorandum. The relative fault of the
Company, on the one hand, and the Initial Purchaser, on the other hand, shall
be determined by reference to, among other things, whether the untrue or
alleged untrue statement of a material fact or the omission or alleged
omission to state a material fact relates to information supplied by the
Company, on the one hand, or the Initial Purchaser, but only with reference
to the information that the Initial Purchaser furnished, on the other hand,
and the parties' relative intent, knowledge, access to information and
opportunity to correct or prevent such statement or omission.
The Company and the Initial Purchaser agree that it would not be
just and equitable if contribution pursuant to this Section 8(d) were determined
by pro rata allocation or by any other method of allocation which does not take
account of the equitable considerations referred to in the immediately preceding
paragraph. The amount paid or payable by an indemnified party as a result of
the losses, claims, damages, liabilities or judgments referred to in the
immediately preceding paragraph shall be deemed to include, subject to the
limitations set forth above, any legal or other expenses incurred by such
indemnified party in connection with investigating or defending any matter,
including any action, that could have given rise to such losses, claims,
damages, liabilities or judgments. Notwithstanding the provisions of this
Section 8, the Initial Purchaser shall not be required to contribute any amount
in excess of the amount by which the total discounts and commissions received by
the Initial Purchaser exceeds the amount of any damages which the Initial
Purchaser has otherwise been required to pay by reason of such untrue or alleged
untrue statement or omission or alleged omission. No person guilty of
fraudulent misrepresentation (within the meaning of Section 11(f) of the Act)
shall be entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation.
(e) The remedies provided for in this Section 8 are not
exclusive and shall not limit any rights or remedies which may otherwise be
available to any indemnified party at law or in equity.
9. CONDITIONS OF THE INITIAL PURCHASER'S OBLIGATIONS. The
obligations of the Initial Purchaser to purchase the Series A Debentures under
this Agreement are subject to the satisfaction of each of the following
conditions:
(a) All the representations and warranties of the Company
contained in this Agreement shall be true and correct on the Closing Date with
the same force and effect as if made on and as of the Closing Date.
20
(b) On or after the date hereof, (i) there shall not have
occurred any downgrading, suspension or withdrawal of, nor shall any notice have
been given of any potential or intended downgrading, suspension or withdrawal
of, or of any review (or of any potential or intended review) for a possible
change that does not indicate the direction of the possible change in, any
rating of the Company or any securities of the Company (including, without
limitation, the placing of any of the foregoing ratings on credit watch with
negative or developing implications or under review with an uncertain direction)
by any "nationally recognized statistical rating organization" as such term is
defined for purposes of Rule 436(g)(2) under the Act, (ii) there shall not have
occurred any change, nor shall any notice have been given of any potential or
intended change, in the outlook for any rating of the Company or any securities
of the Company by any such rating organization and (iii) no such rating
organization shall have given notice that it has assigned (or is considering
assigning) a lower rating to the Debentures than that on which the Debentures
were marketed.
(c) Since the respective dates as of which information is
given in the Offering Memorandum other than as set forth in the Offering
Memorandum (exclusive of any amendments or supplements thereto subsequent to the
date of this Agreement), (i) there shall not have occurred any change or any
development involving a prospective change in the condition, financial or
otherwise, or the earnings, business, management or operations of the Company
and its subsidiaries, taken as a whole, (ii) there shall not have been any
change or any development involving a prospective change in the capital stock or
in the long-term debt of the Company or any of its subsidiaries and (iii)
neither the Company nor any of its subsidiaries shall have incurred any
liability or obligation, direct or contingent, the effect of which, in any such
case described in clause 9(c)(i), 9(c)(ii) or 9(c)(iii), in your judgment, is
material and adverse and, in your judgment, makes it impracticable to market the
Series A Debentures on the terms and in the manner contemplated in the Offering
Memorandum.
(d) You shall have received on the Closing Date a certificate
dated the Closing Date, signed by the President or a Vice President of the
Company, confirming the matters set forth in Sections 6(y), 9(a) and 9(b) and
stating that the Company has complied with all the agreements and satisfied all
of the conditions herein contained and required to be complied with or satisfied
on or prior to the Closing Date.
(e) You shall have received on the Closing Date an opinion
(satisfactory to you and counsel for the Initial Purchaser), dated the Closing
Date, of Skadden, Arps, Slate, Xxxxxxx & Xxxx, LLP, counsel for the Company, to
the effect that:
(i) the Company has been duly incorporated, is validly
existing as a corporation in good standing under the laws of its
jurisdiction of incorporation and has the corporate power and corporate
authority to carry on its business and to own, lease and operate its
properties, in both cases as described in the Offering Memorandum;
(ii) all the outstanding shares of capital stock of the
Company have been duly authorized and validly issued and are fully paid,
non-assessable and not subject to any preemptive or similar rights;
(iii) the issuance and sale of the Series A Debentures
have been duly authorized by requisite corporate action on the part of the
Company, and when executed and authenticated in accordance with the terms
of the Indenture and delivered to and paid for the
21
Initial Purchasers in accordance with the terms of this Agreement, will
be valid and binding obligations of the Company enforceable against the
Company in accordance with their terms, except (a) to the extent
enforcement thereof may be limited by (x) bankruptcy, insolvency,
reorganization, moratorium or other similar laws now or hereafter in
effect relating to creditors' rights generally and (y) general principles
of equity (regardless of whether enforceability is considered in a
proceeding at law or in equity) and (b) the waiver contained in Section
4.06 of the Indenture may be deemed unenforceable;
(iv) the Indenture has been duly authorized, executed
and delivered by the Company and, assuming the due authorization, execution
and delivery by the Trustee, is a valid and binding obligation of the
Company enforceable against the Company in accordance with its terms,
except (a) to the extent enforcement thereof may be limited by (x)
bankruptcy, insolvency, reorganization, moratorium or other similar laws
now or hereafter in effect relating to creditors' rights generally and (y)
general principles of equity (regardless of whether enforceability is
considered in a proceeding at law or in equity) and (b) the waiver
contained in Section 4.06 of the Indenture may be deemed unenforceable;
(v) this Agreement has been duly authorized, executed
and delivered by the Company;
(vi) the Registration Rights Agreement has been duly
authorized, executed and delivered by the Company and, assuming the due
authorization, execution and delivery by the Initial Purchasers, is a valid
and binding obligation of the Company enforceable against the Company in
accordance with its terms except (a) to the extent enforcement thereof may
be limited by (x) bankruptcy, insolvency, reorganization, moratorium or
other similar laws now or hereafter in effect relating to creditors' rights
generally and (y) general principles of equity (regardless of whether
enforceability is considered in a proceeding at law or in equity); (b) any
rights to indemnity or contribution thereunder may be limited by federal
and state securities laws and public policy considerations; and (c) such
counsel need express no opinion with respect to Section 5 of the
Registration Rights Agreement;
(vii) the Series B Debentures have been duly authorized
by requisite corporate action on the part of the Company;
(viii) the statements under the captions
"Summary--Acquisition Transactions," "Acquisition Transactions,"
"Description of Holdings Capital Stock," "Description of Debentures,"
"Description of Other Indebtedness," and "Plan of Distribution" in the
Offering Memorandum, insofar as they purport to constitute a summary of the
provisions of the documents described therein, fairly summarize the
provisions of such documents purported to be described. The statements
under the caption "Certain United States Federal Income Tax Considerations"
fairly summarize the matters addressed therein in all material respects;
(ix) the execution and delivery of this Agreement and
the other Operative Documents by the Company and the Company's performance
of its obligations under each of the Operative Documents to which it is a
party in accordance with its terms do not (i) require any consent,
approval, authorization of, or filing, recordation or registration with,
any court or governmental body or agency (except such as may be required
under the securities or
22
Blue Sky laws of the various states or that has been obtained prior to the
Closing Date), (ii) conflict with the charter or by-laws of the Company or
constitute a violation of or a default under the agreements listed in a
schedule attached to such opinion, (iii) contravene any law of the State
of New York, which in the experience of such counsel, is normally
applicable to transactions of the type contemplated by this Agreement and
the other Operative Documents and are not the subject of a specific
opinion herein referring expressly to a particular law or laws or (iv)
cause the creation of any security interest or Lien (other than the
Liens contemplated by the Operative Documents) under any agreement or
instrument listed in a schedule to such opinion to which the Company or any
of its subsidiaries is a party or by which the Company or any of its
subsidiaries or their respective property is bound. Such counsel need
express no opinion, however, as to whether execution, delivery or
performance by the Company of its obligations under each of the Operative
Documents in accordance with its terms will constitute a violation of or a
default under any covenant, restriction or provision with respect to
financial ratios or tests or any aspect of the financial condition or
results of operations of the Company;
(x) to such counsel's knowledge, other than as set
forth in the Offering Memorandum, there are no legal or governmental
proceedings in the United States pending or threatened to which the Company
or any of its subsidiaries is a party or to which any of their respective
property is subject, which might result, singly or in the aggregate, in a
Material Adverse Effect;
(xi) the Company is not and, after giving effect to the
offering and sale of the Series A Debentures and the application of the net
proceeds thereof as described in the Offering Memorandum, will not be
required to be registered as, and is not registered as, an "investment
company" as such term is defined in the Investment Company Act of 1940, as
amended;
(xii) to the best of such counsel's knowledge, there are
no contracts, agreements or understandings between the Company and any
person granting such person the right to require the Company to file a
registration statement under the Act with respect to any securities of the
Company or to require the Company to include such securities with the Notes
registered pursuant to any Registration Statement;
(xiii) the Indenture is in such form that would not
preclude qualification under the TIA and the rules and regulations of the
Commission applicable to an indenture which is qualified thereunder.
Assuming (i) the accuracy of the representations and warranties of the
Company set forth in Sections 6(u), (aa), (bb), (dd), (ee), (ff), (gg) and
(hh) of this Agreement and of the Initial Purchasers in Section 7 of this
Agreement, and (ii) the due performance by the Company and the due
performance by the Initial Purchasers of the covenants and agreements set
forth in this Agreement, it is not necessary in connection with the offer,
sale and delivery of the Series A Debentures to the Initial Purchasers in
the manner contemplated by this Agreement or in connection with the Exempt
Resales to qualify the Indenture under the TIA; and
(xiv) assuming (i) the accuracy of the representations
and warranties of the Company set forth in Sections 6(u), (aa), (bb), (dd),
(ee), (ff), (gg) and (hh) of this Agreement and of the Initial Purchasers
in Section 7 of this Agreement, (ii) the due performance
23
by the Company and the due performance by the Initial Purchasers of the
covenants and agreements set forth in this Agreement, (iii) compliance by
the Initial Purchasers with the offering and transfer procedures and
restrictions described in the Offering Memorandum, (iv) the accuracy of
the representations and warranties made in accordance with this Agreement
and the Offering Memorandum by purchasers to whom the Initial Purchasers
initially resell Series A Debentures and (v) that purchasers to whom the
Initial Purchasers initially resell Series A Debentures receive a copy of
the Offering Memorandum prior to such sale, the offer, sale and delivery of
the Series A Debentures to the Initial Purchasers in the manner
contemplated by this Agreement and the Offering Memorandum and the initial
resale of the Series A Debentures by the Initial Purchasers in the manner
contemplated in the Offering Memorandum and this Agreement, do not require
registration under the Securities Act of 1933, as amended, it being
understood that such counsel need express no opinion as to any subsequent
resale of any Series A Debenture.
In addition, such counsel shall state that it has participated in
conferences with officers and other representatives of the Company,
representatives of the independent accountants of the Company, and the Initial
Purchasers and the Initial Purchasers' counsel at which the contents of the
Offering Memorandum and related matters were discussed and, although such
counsel need not pass upon, and shall not assume any responsibility for, the
accuracy, completeness or fairness of the statements contained in the Offering
Memorandum and need make no independent check or verification thereof, on the
basis of the foregoing, no facts have come to such counsel's attention that have
led such counsel to believe that the Offering Memorandum, as of its date and as
of the Closing Date, contained or contains an untrue statement of a material
fact or omitted or omits to state a material fact necessary in order to make the
statements therein, in light of the circumstances under which they were made,
not misleading, except that such counsel need express no opinion or belief with
respect to the financial statements, and other financial and statistical data
included therein or excluded therefrom.
The opinion of counsel for the Company described in Section 9(e)
above shall be rendered to you at the request of the Company and shall so state
therein.
(f) The Initial Purchaser shall have received on the Closing
Date an opinion, dated the Closing Date, of Xxxxxx & Xxxxxxx, counsel for the
Initial Purchaser, in form and substance reasonably satisfactory to the Initial
Purchaser.
(g) The Initial Purchaser shall have received, at the time
this Agreement is executed and at the Closing Date, letters dated the date
hereof or the Closing Date, as the case may be, in form and substance
satisfactory to the Initial Purchaser from Ernst & Young LLP, independent public
accountants, containing the information and statements of the type ordinarily
included in accountants' "comfort letters" to the Initial Purchaser with respect
to the financial statements and certain financial information contained in the
Offering Memorandum.
(h) The Series A Debentures shall have been approved by the
NASD for trading and duly listed in PORTAL.
(i) The Company and the Trustee shall have executed the
Indenture and the Initial Purchaser shall have received an original copy
thereof, duly executed by the Company and the Trustee.
24
(j) The Company shall have executed the Registration Rights
Agreement and the Initial Purchaser shall have received an original copy
thereof, duly executed by the Company.
(k) On the Closing Date, the certificate of merger relating
to the Merger shall have been filed with the Secretary of State of the State of
Delaware, and Merger Sub shall have merged with and into the Company, with the
Company as the surviving corporation.
(l) The New Credit Agreement shall have been executed by the
parties thereto and, on the Closing Date, the closing under the New Credit
Agreement (including, without limitation, the borrowing of all term loans
thereunder) shall have been consummated, and the Initial Purchasers shall have
received counterparts, conformed as executed, of the New Credit Agreement and
any and all other ancillary documents related thereto.
(m) The Notes Offering shall have been consummated.
(n) The Tender Offer and Solicitation shall have been
consummated and the Supplemental Indenture shall be in full force and effect.
(o) The Initial Purchaser shall have received on the Closing
Date an opinion addressed to it, dated the Closing Date, of Valuation Research,
with respect to the solvency of the Company.
(p) The Company shall not have failed on or prior to the
Closing Date to perform or comply with any of the agreements herein contained
and required to be performed or complied with by it on or prior to the Closing
Date.
10. EFFECTIVENESS OF AGREEMENT AND TERMINATION. This Agreement shall
become effective upon the execution and delivery of this Agreement by the
parties hereto.
This Agreement may be terminated at any time on or prior to the
Closing Date by the Initial Purchaser by written notice to the Company if any of
the following has occurred: (i) any outbreak or escalation of hostilities or
other national or international calamity or crisis or change in economic
conditions or in the financial markets of the United States or elsewhere that,
in the Initial Purchaser's judgment, is material and adverse and, in the Initial
Purchaser's judgment, makes it impracticable to market the Series A Debentures
on the terms and in the manner contemplated in the Offering Memorandum, (ii) the
suspension or material limitation of trading in securities or other instruments
on the New York Stock Exchange, the American Stock Exchange, the Chicago Board
of Options Exchange, the Chicago Mercantile Exchange, the Chicago Board of Trade
or the Nasdaq National Market or limitation on prices for securities or other
instruments on any such exchange or the Nasdaq National Market, (iii) the
suspension of trading of any securities of the Company or any Guarantor on any
exchange or in the over-the-counter market, (iv) the enactment, publication,
decree or other promulgation of any federal or state statute, regulation, rule
or order of any court or other governmental authority which in your opinion
materially and adversely affects, or will materially and adversely affect, the
business, prospects, financial condition or results of operations of the Company
and its subsidiaries, taken as a whole, (v) the declaration of a banking
moratorium by either federal or New York State authorities or (vi) the taking of
any action by any federal, state or local government or agency in respect of its
monetary or
25
fiscal affairs which in your opinion has a material adverse effect on the
financial markets in the United States.
11. MISCELLANEOUS. Notices given pursuant to any provision of this
Agreement shall be addressed as follows: (i) if to the Company, to Great Lakes
Acquisition Corp., c/o American Industrial Partners, Xxx Xxxxxxxx Xxxxx, Xxxxx
0000, Xxx Xxxxxxxxx, Xxxxxxxxxx, 00000, Attention: Xxxxxxxx X. Xxxx, and (ii) if
to the Initial Purchaser, to Xxxxxxxxx, Xxxxxx & Xxxxxxxx Securities
Corporation, 000 Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Syndicate
Department, or in any case to such other address as the person to be notified
may have requested in writing.
The respective indemnities, contribution agreements, representations,
warranties and other statements of the Company and the Initial Purchaser set
forth in or made pursuant to this Agreement shall remain operative and in full
force and effect, and will survive delivery of and payment for the Series A
Debentures, regardless of (i) any investigation, or statement as to the results
thereof, made by or on behalf of the Initial Purchaser, the officers or
directors of the Initial Purchaser, any person controlling the Initial
Purchaser, the Company, the officers or directors of the Company, or any person
controlling the Company, (ii) acceptance of the Series A Debentures and payment
for them hereunder and (iii) termination of this Agreement.
If for any reason the Series A Debentures are not delivered by or on
behalf of the Company as provided herein (other than as a result of any
termination of this Agreement pursuant to Section 10), the Company agrees to
reimburse the Initial Purchaser for all out-of-pocket expenses (including the
fees and disbursements of counsel) incurred by them. Notwithstanding any
termination of this Agreement, the Company shall be liable for all expenses
which it has agreed to pay pursuant to Section 5(i) hereof. The Company also
agrees to reimburse the Initial Purchaser and its officers, directors and each
person, if any, who controls the Initial Purchaser within the meaning of Section
15 of the Act or Section 20 of the Exchange Act for any and all fees and
expenses (including without limitation the fees and expenses of counsel)
incurred by them in connection with enforcing their rights under this Agreement
(including without limitation its rights under Section 8).
Except as otherwise provided, this Agreement has been and is made
solely for the benefit of and shall be binding upon the Company, the Initial
Purchaser, the Initial Purchaser's directors and officers, any controlling
persons referred to herein, the directors of the Company and their respective
successors and assigns, all as and to the extent provided in this Agreement, and
no other person shall acquire or have any right under or by virtue of this
Agreement. The term "successors and assigns" shall not include a purchaser of
any of the Series A Debentures from the Initial Purchaser merely because of such
purchase.
This Agreement shall be governed and construed in accordance with the
laws of the State of New York (including, without limitation, Section 5-1401 of
the New York General Obligations Law).
This Agreement may be signed in various counterparts which together
shall constitute one and the same instrument.
26
Please confirm that the foregoing correctly sets forth
the agreement among Great Lakes Acquisition Corp. and the Initial Purchaser.
Very truly yours,
GREAT LAKES ACQUISITION CORP.
By: /s/ XXXXXXXX XXXX
------------------------------------
Name: Xxxxxxxx Xxxx
Title: President
XXXXXXXXX, XXXXXX & XXXXXXXX
SECURITIES CORPORATION
By: /s/ XXXXXXX XXXXX
-------------------------------------
Name: Xxxxxxx Xxxxx
Title: Managing Director
S-1
SCHEDULE A
SUBSIDIARIES
Subsidiaries of the Company:
Great Lakes Merger Sub Corp., a Delaware corporation
Subsidiaries of GLCC:
Copetro, S.A., an Argentine corporation
Great Lakes International Sales Corp., a Barbados corporation
A-1
EXHIBIT A
FORM OF REGISTRATION RIGHTS AGREEMENT
Filed herewith as Exhibit 4.3.
