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EXHIBIT 10.23
[EXECUTION COPY]
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NOTE AGREEMENT
Between
THE TRAVELERS INSURANCE COMPANY,
THE TRAVELERS LIFE AND ANNUITY COMPANY,
PRIMERICA LIFE INSURANCE COMPANY,
NATIONWIDE LIFE INSURANCE COMPANY,
EMPLOYERS LIFE INSURANCE COMPANY OF WAUSAU,
OHIO NATIONAL LIFE ASSURANCE CORPORATION
AND
THE MINNESOTA MUTUAL LIFE INSURANCE COMPANY
("Purchasers")
and
CASH AMERICA INTERNATIONAL, INC.
("Company")
Dated as of December 1, 1997
RE: $30,000,000 7.10% SENIOR NOTES DUE 2008
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TABLE OF CONTENTS
SECTION HEADING PAGE
ARTICLE I PURCHASE AND SALE OF NOTES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Section 1.01. Authorization of Notes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Section 1.02. Sale and Purchase of Notes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Section 1.03. The Closing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
ARTICLE II DEFINITIONS AND INTERPRETATIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Section 2.01. Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Section 2.02. Interpretation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
ARTICLE III CONDITIONS OF CLOSING . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
Section 3.01. Representations and Warranties . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
Section 3.02. Performance; No Default . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
Section 3.03. Compliance Certificate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
Section 3.04. Opinions of Counsel . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
Section 3.05. Resolutions, Etc . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
Section 3.06. Purchase Permitted by Applicable Laws, Etc . . . . . . . . . . . . . . . . . . . . . . 18
Section 3.07. Payment of Closing Fees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
Section 3.08. Private Placement Number . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
Section 3.09. Notes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
Section 3.10. Guaranty; Subrogation and Contribution Agreement . . . . . . . . . . . . . . . . . . . 19
Section 3.11. Other Loan Documents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
Section 3.12. Proceedings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
ARTICLE IV USE OF PROCEEDS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
Section 4.01. Use of Proceeds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
Section 4.02. Margin Regulations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
ARTICLE V PREPAYMENTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
Section 5.01. Required Prepayments of the Notes . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
Section 5.02. Optional Prepayments of the Notes . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
Section 5.03. Notice of Optional Prepayments; Officers' Certificate . . . . . . . . . . . . . . . . . 20
Section 5.04. Allocation of Partial Prepayments . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
Section 5.05. Maturity; Surrender, Etc . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
Section 5.06. Retirement of Notes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
ARTICLE VI REPRESENTATIONS AND WARRANTIES OF THE COMPANY . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
Section 6.01. Subsidiaries . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
Section 6.02. Organization, Qualification, Authorization, Etc . . . . . . . . . . . . . . . . . . . . 22
Section 6.03. Disclosure Documents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
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Section 6.04. Changes, Etc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
Section 6.05. Tax Returns and Payments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
Section 6.06. Indebtedness; Solvency . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
Section 6.07. Permits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
Section 6.08. Material Contracts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
Section 6.09. Title to Property, Etc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
Section 6.10. Condition of Property . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
Section 6.11. Compliance with Applicable Laws, Permits and Contracts . . . . . . . . . . . . . . . . 25
Section 6.12. Litigation, Etc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
Section 6.13. ERISA . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
Section 6.14. No Governmental Consents Required for Overall Transaction . . . . . . . . . . . . . . . 26
Section 6.15. Offering of Notes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
Section 6.16. Use of Proceeds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
Section 6.17. Foreign Assets Control Regulations, Etc. . . . . . . . . . . . . . . . . . . . . . . . 27
Section 6.18. Status Under Certain Federal Statutes . . . . . . . . . . . . . . . . . . . . . . . . . 27
Section 6.19. Environmental Matters . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
Section 6.20. Books and Records . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
Section 6.21. Fiscal Year . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
Section 6.22. Brokerage . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
Section 6.23. Labor Matters . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
Section 6.24. Patents, Trademarks, Etc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
Section 6.25. Chief Executive Office . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
Section 6.26. Permitted Investments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
Section 6.27. Liens . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
Section 6.28. Full Disclosure . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
ARTICLE VII PURCHASE FOR INVESTMENT; SOURCE OF FUNDS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
Section 7.01. Representations of the Purchasers . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
ARTICLE VIII AFFIRMATIVE COVENANTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
Section 8.01. Financial Statements, Reports and Documents . . . . . . . . . . . . . . . . . . . . . . 33
Section 8.02. Payment of Principal, Interest and Premium . . . . . . . . . . . . . . . . . . . . . . 35
Section 8.03. Payment of Taxes, Claims and Indebtedness . . . . . . . . . . . . . . . . . . . . . . . 36
Section 8.04. Maintenance of Existence and Rights; Conduct of Business . . . . . . . . . . . . . . . 36
Section 8.05. Compliance with Loan Documents . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
Section 8.06. Compliance with Contracts and Permits . . . . . . . . . . . . . . . . . . . . . . . . . 36
Section 8.07. Inspection . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
Section 8.08. Books and Records . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
Section 8.09. Compliance with Legal Requirements . . . . . . . . . . . . . . . . . . . . . . . . . . 37
Section 8.10. Insurance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
Section 8.11. Authorizations and Approvals . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38
Section 8.12. Maintenance of Properties . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38
Section 8.13. Ownership of Subsidiaries . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38
Section 8.14. Further Assurances . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38
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ARTICLE IX NEGATIVE COVENANTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38
Section 9.01. Consolidated Indebtedness for Money Borrowed . . . . . . . . . . . . . . . . . . . . . 38
Section 9.02. Consolidated Tangible Net Worth . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
Section 9.03. Current Assets to Current Liabilities Ratio . . . . . . . . . . . . . . . . . . . . . . 39
Section 9.04. Current Assets to Total Indebtedness Ratio . . . . . . . . . . . . . . . . . . . . . . 39
Section 9.05. Inventory Turnover . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
Section 9.06. Fixed Charge Coverage . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
Section 9.07. Restricted Payments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
Section 9.08. Limitation on Indebtedness . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40
Section 9.09. Assurances . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
Section 9.10. Negative Pledge . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43
Section 9.11. Limitation on Investments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43
Section 9.12. Alteration of Contracts, Etc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44
Section 9.13. Transactions with Affiliates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44
Section 9.14. Limitation on Sale or Issuance of Subsidiary Stock . . . . . . . . . . . . . . . . . . 44
Section 9.15. Limitation on Sale of Properties . . . . . . . . . . . . . . . . . . . . . . . . . . . 45
Section 9.16. Dissolution; Liquidation; Merger; Consolidation . . . . . . . . . . . . . . . . . . . . 45
Section 9.17. Change of Name, Fiscal Year and Method of Accounting . . . . . . . . . . . . . . . . . 46
Section 9.18. Lines of Business . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46
Section 9.19. Amendment of Organizational Documents . . . . . . . . . . . . . . . . . . . . . . . . . 46
Section 9.20. Limitation on Acquisition of New Subsidiaries . . . . . . . . . . . . . . . . . . . . . 46
Section 9.21. ERISA . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48
Section 9.22. No Inconsistent Agreements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
Section 9.23. Incorporation of More Restrictive Covenants . . . . . . . . . . . . . . . . . . . . . . 49
ARTICLE X EVENTS OF DEFAULT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
Section 10.01. Events of Default . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
Section 10.02. Other Remedies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 52
ARTICLE XI MISCELLANEOUS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 53
Section 11.01. Note Payments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 53
Section 11.02. Expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 53
Section 11.03. Consent to Waivers and Amendments . . . . . . . . . . . . . . . . . . . . . . . . . . . 54
Section 11.04. Solicitation of Holders . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55
Section 11.05. Form, Registration, Transfer and Exchange of Notes; Lost Notes . . . . . . . . . . . . 55
Section 11.06. Persons Deemed Owners . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 56
Section 11.07. Reliance on and Survival of Representations and Warranties . . . . . . . . . . . . . . 56
Section 11.08. Successors and Assigns . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 57
Section 11.09. Notices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 57
Section 11.10. Substitution of Purchasers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 57
Section 11.11. Satisfaction Requirement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 57
Section 11.12. Independence of Covenants . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 58
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Section 11.13. Remedies Cumulative . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 58
Section 11.14. Reproduction of Documents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 58
Section 11.15. Notes as Securities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 58
Section 11.16. Severability of Provisions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 58
Section 11.17. Interest . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 58
Section 11.18. Representations, Etc. Cumulative . . . . . . . . . . . . . . . . . . . . . . . . . . . 59
Section 11.19. Submission to Jurisdiction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 59
Section 11.20. Governing Law . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 60
Section 11.21. Indemnification . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 60
Section 11.22. Survival of Indemnities, Etc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 61
Section 11.23. Judgment Currency . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 61
Section 11.24. Liabilities of Holders . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 62
Section 11.25. Taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 62
Section 11.26. Counterparts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 62
Section 11.27. Entire Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 62
Signature Page . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 63
EXHIBIT A -- Form of Note
EXHIBIT B -- Form of Company Counsel Opinion
EXHIBIT C -- Form of General Counsel Opinion
EXHIBIT D -- Form of Purchasers Counsel Opinion
EXHIBIT E -- Form of Guaranty
EXHIBIT F -- Form of Subrogation and Contribution Agreement
SCHEDULE I -- Purchasers Information
SCHEDULE II -- List of Subsidiaries
SCHEDULE III -- List of Jurisdictions Where Company is Qualified to Do Business as Foreign Corporation
SCHEDULE IV -- Permitted Liens
SCHEDULE V -- Material Contracts
SCHEDULE VI -- Description of Company Financials
SCHEDULE VII -- Description of Projections
SCHEDULE VIII -- Indebtedness
SCHEDULE IX -- Labor Contracts
SCHEDULE X -- Tradenames
SCHEDULE XI -- Investments
SCHEDULE XII -- Transferee Representations
SCHEDULE XIII -- Outstanding Indebtedness for Money Borrowed
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NOTE AGREEMENT
CASH AMERICA INTERNATIONAL, INC.
As of December 1, 1997
To Each of the Purchasers Listed in
the Attached Schedule I
Ladies and Gentlemen:
Cash America International, Inc. (the "Company"), a Texas corporation,
hereby agrees with you as follows:
ARTICLE I
PURCHASE AND SALE OF NOTES
Section 1.01. Authorization of Notes. The Company will duly
authorize the issue and sale of a series of its senior notes designated "7.10%
Senior Notes Due January 2, 2008" and limited in aggregate original principal
amount to $30,000,000 (the "Notes"). The Notes will (a) be issuable as
registered notes, without coupons, in denominations permitted by Section 11.05,
(b) be dated the date of issue thereof, (c) mature January 2, 2008, (d) bear
interest on the unpaid balance thereof from the date thereof to, but excluding,
the date the principal thereof shall have become due and payable at the rate of
7.10% per annum, (e) bear interest on overdue principal, premium and (to the
extent permitted by law) interest at the Default Rate, (f) be entitled to the
benefits of the Guaranty and (g) be in the form of Exhibit A.
Section 1.02. Sale and Purchase of Notes. Subject to the terms
and conditions of this Agreement, the Company agrees to sell to the Purchasers,
and the Purchasers agree to purchase from the Company, the Notes at 100% of the
principal amount thereof. Such sale and purchase is sometimes herein referred
to as the "Private Placement."
Section 1.03. The Closing. The closing of the Private Placement
(the "Closing") shall take place at the offices of the Xxxxxxx and Xxxxxx, at
10:00 a.m., Chicago, Illinois time, on December 17, 1997 or on such other
Business Day as may be agreed upon by the Company and the Purchasers (the
"Closing Date"). At the Closing, the Company will deliver the Notes in the
form of a single Note (or such greater number of Notes as the Purchasers may
request in denominations permitted by Section 11.05) payable to the Purchasers
or their registered assigns against payment of the purchase price therefor by
electronic funds transfer to NationsBank of Texas, N.A. for credit to such
account as the Company may designate in writing delivered to the Purchasers at
least three Business Days prior to the Closing Date for use in accordance with
Section 4.01. By delivering payment on the Closing Date for the Notes, the
Purchasers shall be deemed to have confirmed as of the Closing Date that the
representations and warranties made by the Purchasers in Article VII remain
accurate as of
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the Closing Date. If, at the Closing, the Company shall fail to tender the
Notes to the Purchasers as provided above, or any of the conditions specified
in Article III shall not have been fulfilled to the satisfaction of the
Purchasers, the Purchasers shall, at their election, be relieved of all further
obligations under this Agreement, without thereby waiving any other rights it
may have by reason of such failure or such nonfulfillment.
ARTICLE II
DEFINITIONS AND INTERPRETATIONS
Section 2.01. Definitions. For purposes of this Agreement,
except as otherwise expressly provided or unless the context otherwise
requires, the following terms shall have the following respective meanings:
"Affiliate" means (a) when used with reference to any
corporation, any Person that, directly or indirectly, owns or controls
5% or more of any class of Voting Stock of such corporation or is a
director or officer of such corporation or is a Person in which such
corporation has a 5% or greater direct or indirect equity interest,
(b) when used with reference to any partnership, any Person that,
directly or indirectly, owns or controls 5% or more of either the
capital or profit interests of such partnership or is a partner or
employee of such partnership or is Person in which such partnership
has 5% or greater direct or indirect equity interest, (c) when used
with reference to any individual, any Person that is related to such
individual by blood or marriage or is a present or former xxxx,
guardian, employer or employee of such individual or is a trust or
estate in which such individual owns a 5% or greater beneficial
interest or of which such individual serves as trustee, executor or in
any similar capacity and (d) when used with reference to a trust or an
estate, any Person that is a trustee, executor, administrator or
beneficiary thereof. Moreover, the term "Affiliate", when used with
reference to any Person, shall also mean any other Person that,
directly or indirectly, controls or is controlled by or is under
common control with such Person. As used in the preceding sentence,
the term "control" means the possession, directly or indirectly, of
the power to direct or to cause the direction of the management and
policies of the entity referred to, whether through ownership of
voting securities, by contract or otherwise, and the terms
"controlling" and "controls" shall have meanings correlative to the
foregoing.
"Agreement" means this Note Agreement, as amended,
supplemented or modified from time to time.
"Applicable Contract" means any contract or agreement to which
the Company or any Subsidiary is a party or by which it or any of its
Properties is bound or under or pursuant to which it owns, maintains
or operates any of its Properties or conducts business.
"Applicable Permit" means any Permit to which the Company or
any Subsidiary is a party or by which it or any of its Properties is
bound or under or pursuant to which it owns, maintains or operates any
of its Properties or conducts business.
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"Assurance" means, as to any Person, any contract, agreement
or understanding to guarantee, or in effect guarantee, any
indebtedness (the "Primary Obligation") of any other Person (the
"Primary Obligor") in any manner, whether directly or indirectly,
including agreements:
(a) to purchase the Primary Obligation or any
Property constituting security therefor;
(b) to advance or supply funds (i) for the
purchase or payment of the Primary Obligation or (ii) to
maintain working capital or other balance sheet conditions, or
otherwise to advance or make available funds for the purchase
or payment of the Primary Obligation; or
(c) to purchase Property, securities or services
primarily for the purpose of assuring the holder of the
Primary Obligation of the ability of the Primary Obligor to
make payment of the Primary Obligation;
provided, however, that "Assurance" shall not include the endorsement
by any Person, in the ordinary course of business, of negotiable
instruments or documents for deposit or collection. The amount of any
Assurance shall be deemed to be an amount equal to the stated or
determinable amount of the Primary Obligation in respect of which such
Assurance is made or, if not stated or determinable, the maximum
reasonably anticipated liability in respect thereof (assuming the
Person giving such Assurance is required to perform in respect
thereof) as determined by such Person in good faith.
"Bank Loan Agreement" means the Amended and Restated Senior
Revolving Credit Facility Agreement dated as of June 19, 1996, among
the Company, the banks party thereto and NationsBank of Texas, N.A.,
as Agent.
"Bankruptcy Law" has the meaning specified in Section
10.01(j).
"Benefit Arrangement" means an employee benefit plan (within
the meaning of Section 3(3) of ERISA) which is not a Plan and with
respect to which the Company or a member of the ERISA Group has an
obligation or liability, whether or not current or contingent, to make
contributions or pay benefits.
"Business Day" means any day other than a Saturday, Sunday or
other day on which commercial banking institutions in New York, New
York or Fort Worth, Texas are authorized or required by law,
regulation or executive order to be closed.
"Called Principal" means, with respect to any Note, the
principal of such Note that is to be prepaid pursuant to Section 5.02
(any partial prepayment being applied in satisfaction of required
payments of principal in inverse order of their scheduled due dates)
or is declared to be or becomes immediately due and payable pursuant
to Section 10.01, as the context requires.
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"CERCLA" means the Federal Comprehensive Environmental
Response, Compensation and Liability Act, as amended from time to
time, together with all regulations and rulings thereunder and all
interpretations thereof by the Environmental Protection Agency.
"Closing" has the meaning specified in Section 1.03.
"Closing Date" has the meaning specified in Section 1.03.
"Code" means the Internal Revenue Code of 1986, as amended
from time to time, together with all regulations and rulings
thereunder and all interpretations thereof by the Internal Revenue
Service.
"Company" has the meaning specified in the opening paragraph
of this Agreement.
"Company Financials" has the meaning specified in Section
6.03(a)(8).
"Consolidated Adjusted Net Income" means, with respect to any
period, consolidated net earnings (after income taxes) of the Company
and the Consolidated Subsidiaries for such period, determined in
accordance with GAAP, but excluding (a) any gain or loss in excess of
$1,000,000 (before income taxes) arising from the sale of capital
assets and (b) any other items which would be considered extraordinary
items in accordance with GAAP.
"Consolidated Current Assets" means, as of any date, the
current assets which would be reflected on a consolidated balance
sheet of the Company and the Consolidated Subsidiaries prepared as of
such date in accordance with GAAP.
"Consolidated Current Liabilities" means, as of any date, the
current liabilities which would be reflected on a consolidated balance
sheet of the Company and the Consolidated Subsidiaries prepared as of
such date in accordance with GAAP.
"Consolidated Indebtedness for Money Borrowed" means, at any
date, the Indebtedness for Money Borrowed of the Company and the
Consolidated Subsidiaries consolidated as of such date in accordance
with GAAP.
"Consolidated Subsidiary" means, at any date, any Subsidiary
the accounts of which would, in accordance with GAAP, be consolidated
with those of the Company in its consolidated financial statements as
of such date.
"Consolidated Tangible Net Worth" means, as of any date, the
total shareholders' equity which would appear on a consolidated
balance sheet of the Company and the Consolidated Subsidiaries
prepared as of such date in accordance with GAAP less the sum of (i)
the aggregate amount of all currency translation adjustments (gains
and losses) shown on such balance sheet and (ii) the net book value
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of all Intangible Assets shown on such balance sheet. As used in this
definition, "Intangible Assets" means those assets (including
licenses, patents, copyrights, trademarks, tradenames, franchises,
goodwill, experimental expenses and other similar assets) which would
be classified as intangible assets for purposes of a balance sheet
prepared in accordance with GAAP.
"Default" means, with respect to any Loan Document, any event
or condition that constitutes, or with the giving of notice or the
lapse of time or both would constitute, a default thereunder or breach
thereof. Without limitation of the foregoing, "Default" shall include
any Event of Default as well as any event, act or condition which with
notice or lapse of time, or both, would constitute an Event of
Default.
"Default Rate" means, at any time, a rate of interest per
annum equal to the lesser of (a) 2% above the interest rate then
payable on the Notes and (b) the Highest Lawful Rate.
"Discounted Value" means, with respect to the Called Principal
of any Note, the amount obtained by discounting all Remaining
Scheduled Payments with respect to such Called Principal from their
respective scheduled due dates to the Settlement Date with respect to
such Called Principal, in accordance with accepted financial practice
and at a discount factor (applied on a semiannual basis) equal to the
Reinvestment Yield with respect to such Called Principal.
"Dollars" and the sign "$" means lawful currency of the United
States of America.
"Environmental Claim" shall mean any investigation, notice,
violation, demand, allegation, action, suit, injunction, judgment,
order, consent decree, penalty, fine, lien, proceeding or claim
(whether administrative, judicial or private in nature) arising (a)
pursuant to, or in connection with an actual or alleged violation of,
any Environmental Law, (b) in connection with any Hazardous Material,
(c) from any abatement, removal, remedial, corrective or other
response action in connection with a Hazardous Material, Environmental
Law or other order of a Governmental Authority or (d) from any actual
or alleged damage, injury, threat or harm to health, safety, natural
resources or the environment.
"Environmental Laws" means applicable laws (including the
common law), regulations or rules, and any applicable judicial or
administrative interpretations thereof, as well as any applicable
judicial or administrative orders, decrees or judgments, relating to
pollution, environmental, health, safety, industrial hygiene or
similar matters.
"Environmental Permit" means any Permit required under
applicable Environmental Laws.
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"ERISA" means the Employee Retirement Income Security Act of
1974, as amended from time to time, and all rules, regulations,
rulings and interpretations adopted by the Internal Revenue Service or
the Department of Labor thereunder.
"ERISA Group" means all corporations, trades or businesses
(whether or not incorporated) and other persons or entities which,
together with the Company, are treated as a single employer under
Section 414(b), (c), (m) or (o) of the Code.
"Event of Default" has the meaning specified in Section 10.01.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended.
"Executive Officer" means (a) the chairman of the board, the
chief executive officer, the chief operating officer, the chief
financial officer, the chief accounting officer or the chief legal
officer of the Company or (b) any other officer of the Company who has
been elected by the Board of Directors of the Company and designated
as an executive officer in any Form 10-K or successor Form filed by
the Company with the SEC.
"Fiscal Quarter" means a fiscal quarter of the Company.
"Fiscal Year" means the fiscal year of the Company.
"GAAP" means generally accepted accounting principles as in
effect from time to time as set forth in the opinions, statements and
pronouncements of the Accounting Principles Board of the American
Institute of Certified Public Accountants, the Financial Accounting
Standards Board and such other Persons who shall be approved by a
significant segment of the accounting profession and concurred in by
the Independent Accountants.
"Governmental Authority" means any foreign governmental
authority, the United States of America, any State of the United
States or any political subdivision, agency or instrumentality of any
of the foregoing, and any agency, department, commission, board,
bureau, court or other tribunal having jurisdiction over any Loan
Party, the Purchasers or any other Holder or their respective
Property, including the Texas Consumer Credit Commissioner, the United
States Department of the Treasury, Bureau of Alcohol, Tobacco and
Firearms and the Office of Fair Trading of the United Kingdom and any
other governmental authority charged with the enforcement of the
Regulatory Acts or otherwise having authority with respect to the
regulation, supervision and licensing of pawnshop activities in any
jurisdiction in which the Company or any of the Subsidiaries conducts
business.
"Guarantors" means the Subsidiaries listed in Schedule II
(other than Xxxxxx & Xxxxxxxx Limited, Pantbelaning, Murtrum and the
Murtrum Affiliate) and each other Person that becomes bound by the
Guaranty as contemplated by Section 9.20(a).
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"Guaranty" has the meaning specified in Section 3.10.
"Xxxxxx & Xxxxxxxx Indebtedness" means the indebtedness of
Xxxxxx & Xxxxxxxx Limited for borrowed money in an aggregate amount
not to exceed 5,000,000 pounds sterling incurred under and pursuant to
that certain Loan Agreement, dated August 26, 1993 between Xxxxxx &
Xxxxxxxx Limited and Barclays Bank PLC as extended by the respective
renewal agreements dated February 10, 1995, February 26, 1996 and
April 12, 1997.
"Hazardous Materials" means any hazardous substance, hazardous
or toxic waste, pollutant, contaminant, oil, petroleum product or
other substance (a) which is listed, regulated or designated as toxic
or hazardous (or words of similar meaning and regulatory effect), or
with respect to which remedial obligations may be imposed, under any
Environmental Laws or (b) exposure to which may pose a health or
safety hazard.
"Highest Lawful Rate" means the maximum nonusurious rate of
interest permitted to be charged by applicable federal or state law
(whichever shall permit the higher lawful rate) from time to time in
effect. The parties agree that, insofar as the provisions of Chapter
One of the Texas Credit Code are at any time applicable to the
determination of the Highest Lawful Rate, the Highest Lawful Rate
shall be the "interest rate ceiling" (as defined in such Chapter One)
from time to time in effect, provided that, to the extent permitted by
such Chapter One, each Holder may from time to time by notice to the
Company revise the election of such interest rate ceiling as such
ceiling affects the then current or future amounts outstanding under
the Notes held by such Holder.
"Holder" means (a) the Purchasers so long as any such
Purchaser is obligated to purchase the Notes hereunder or holds any
outstanding Note and (b) any other holder from time to time of any
outstanding Note.
"Indebtedness for Money Borrowed" means, with respect to any
Person and without duplication:
(a) the principal amount of all indebtedness of
such Person, current or funded, secured or unsecured, incurred
in connection with borrowings (including the sale of debt
securities),
(b) all indebtedness of such Person created or
arising under any conditional sale or other title retention
agreement with respect to any Property acquired by such
Person,
(c) all indebtedness of such Person issued,
incurred or assumed in respect of the purchase price of
Property or services except for accounts payable incurred in
the ordinary course of business,
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(d) all obligations of such Person evidenced by a
note, bond, debenture or similar instrument,
(e) the present value (determined in accordance
with GAAP) of all obligations of such Person under leases
which shall have been or should be recorded as capitalized
leases in accordance with GAAP,
(f) all Assurances of such Person in respect of
indebtedness of any other Person of any of the types described
in the preceding clauses (a) through (e), provided that, when
calculating the amount of any Person's Indebtedness for Money
Borrowed, no Assurance of such Person of the type described in
this clause (f) shall be included in such calculation unless,
and then only to the extent that, the indebtedness relating to
such Assurance, when aggregated with the total indebtedness
relating to all other outstanding Assurances of the Loan
Parties of the type described in this clause (f), exceeds
$500,000,
(g) the amount of all sinking fund payments or
other mandatory redemption or payments on any class of capital
stock of such Person,
(h) the maximum stated amount from time to time
available for drawing under any letters of credit issued at
the request of such Person, and
(i) the amount of any reimbursed drawings under
letters of credit issued at the request of such Person.
"Indemnitees" means, collectively, the Purchasers, each
Transferee and each Holder and their respective successors and
assigns, and the officers, trustees, directors and employees of each
of the foregoing.
"Independent Accountants" means Coopers & Xxxxxxx L.L.P. or
another firm of independent public accountants of recognized national
standing selected by the Company.
"Investment" means, as applied to any Person, (i) any direct
or indirect purchase or other acquisition by such Person of stocks,
bonds, notes, debentures or other securities of any other Person, (ii)
any direct or indirect loan, advance, extension of credit or capital
contribution by such Person to any other Person, (iii) any Assurance
by such Person of any indebtedness of any other Person, (iv) the
subordination by such Person of any claim against any other Person to
other indebtedness of such other Person and (v) any other item which
would be classified as an "investment" on a balance sheet of such
Person prepared in accordance with GAAP, including any direct or
indirect contribution by such Person of Property to a joint venture,
partnership or other business entity in which such Person retains an
interest.
"Legal Requirements" means any and all (a) applicable
constitutional provisions, laws (statutory, administrative, judicial
or otherwise, including those established
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pursuant to common law or equity), ordinances, treaties, rules, codes,
standards and regulations (or any interpretation of any of the
foregoing), whether foreign or domestic, (b) judgments, orders,
injunctions and decrees, (c) Permits and (d) contracts with
Governmental Authorities relating to compliance with the items
described in (a), (b) or (c) above.
"Lien" means any mortgage, pledge, charge, encumbrance,
security interest, collateral assignment, conditional sale or title
retention arrangement or other lien or restriction of any kind,
whether based on common law, constitutional provision, statute or
contract.
"Loan Documents" means, collectively, this Agreement, the
Notes, the Guaranty, the Subrogation and Contribution Agreement and
all other instruments and documents executed and delivered to the
Purchasers by the Loan Parties, or any of them, pursuant to this
Agreement.
"Loan Parties" means, collectively, the Company and the
Guarantors.
"Make-Whole Premium" means, with respect to the Called
Principal of any Note, a premium equal to the excess, if any, of the
Discounted Value of such Called Principal over the sum of (a) such
Called Principal plus (b) interest accrued thereon to the Settlement
Date with respect to such Called Principal. The Make-Whole Premium
shall in no event be less than zero.
"Material Adverse Effect" means any circumstance or event of
whatever nature (including any adverse determination in any
litigation, arbitration or governmental investigation or proceeding)
which (a) could reasonably be expected to have a material adverse
effect on the financial condition, business, operations or Properties
of the Company and the Subsidiaries, taken as a whole, (b) could
reasonably be expected to diminish or impair in any material respect
the ability of the Company to perform any of its obligations under the
Loan Documents to which it is a party, (c) could reasonably be
expected to diminish or impair in any material respect the ability of
the Purchasers or any other Holder to enforce any of the Obligations
or to exercise or enforce any of their rights and remedies under the
Loan Documents, (d) causes an Event of Default, (e) causes a Default
which could reasonably be expected to become an Event of Default or
(f) could reasonably be expected to subject the Purchasers or any
other Holder to civil or criminal liability.
"Material Contract" means any contract, agreement or
instrument to which the Company or any Subsidiary is a party (a) which
calls for payments to or from the Company or such Subsidiary of more
than $1,000,000 during any 12-month period or (b) pursuant to which
the Company or such Subsidiary acquires any right to an interest in
Property or a right to obtain services if the Company's or such
Subsidiary's inability to obtain such interest or services, as the
case may be, could be reasonably be expected to have a Material
Adverse Effect, provided that "Material Contract" shall not include
any Loan Document.
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"Murtrum" means Murtrum AB, formerly known as Xxxxxx Xxxxx AB,
a corporation organized under the laws of Sweden and a Wholly-Owned
Subsidiary.
"Murtrum Affiliate" means the following corporation which (i)
is organized under the laws of Sweden and (ii) is a Wholly-Owned
Subsidiary: AB Svensk Pantbelaning.
"1993 Guaranty" means that certain Joint and Several Guaranty
dated as of May 6, 1993 delivered by the Company and certain of its
Subsidiaries in connection with the issuance and sale of the 1993
Notes.
"1993 Loan Documents" means the "Loan Documents" as defined in
the 1993 Note Agreement.
"1993 Note Agreement" means that certain Note Agreement dated
as of May 6, 1993 between the Company and Teachers Insurance and
Annuity Association of America, as amended.
"1993 Notes" means those certain 8.33% Senior Notes due May 1,
2003 issued by the Company under and pursuant to the 1993 Note
Agreement.
"1995 Guaranty" means that certain Joint and Several Guaranty
dated as of July 7, 1995 delivered by the Company and certain of its
Subsidiaries in connection with the issuance and sale of the 1995
Notes.
"1995 Loan Documents" means the "Loan Documents" as defined in
the 1995 Note Agreement.
"1995" Note Agreement" means that certain Note Agreement dated
as of July 7, 1995 between the Company and Teachers Insurance and
Annuity Association of America, as amended.
"1995 Notes" means those certain 8.14% Senior Notes due July
7, 2007 issued by the Company under and pursuant to the 1995 Note
Agreement.
"Notes" has the meaning specified in Section 1.01.
"Obligations" means all obligations, liabilities and
indebtedness of every nature of the Loan Parties from time to time
owing to the Purchasers and the other Holders under the Loan
Documents, including, without limitation, (a) all obligations of the
Company under the Loan Documents to pay principal, premium and
interest in respect of the Notes, (b) all obligations of the
Guarantors in respect of the Guaranty, (c) all obligations of the Loan
Parties under the Loan Documents to reimburse or indemnify the
Purchasers or any other Indemnitee and (d) all obligations of the Loan
Parties to pay fees and expenses pursuant to Section 11.02 and similar
sections of the other Loan Documents.
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"Officers' Certificate" means a certificate executed on behalf
of the Company by at least two of its Responsible Officers (in their
representative capacities and not in their individual capacities).
"Organizational Documents" means (i) with reference to any
Person that is a corporation, its articles or certificate of
incorporation and its bylaws and (ii) with reference to any Person
that is a partnership, its partnership agreement and all other
instruments relating to its formation, existence or governance.
"Overall Transaction" means the Private Placement and the
guarantees and other transactions and activities contemplated by the
Loan Documents.
"Pantbelaning" means CAII Pantbelaning AB, a corporation
organized under the laws of Sweden and a Wholly-Owned Subsidiary.
"Pantbelaning Indebtedness" means indebtedness of Pantbelaning
for borrowed money in the approximate amount of SEK 185,000,000
pursuant to that certain Amended and Restated Loan Agreement, dated as
of October 29, 1997, between Pantbelaning and Skandinaviska Enskilda
Xxxxxx XX (Publ.), New York Branch.
"Permits" means any and all permits, authorizations,
certificates, approvals, registrations, variances, licenses,
franchises, exemptions or orders (a) under any Legal Requirement or
(b) granted by any Governmental Authority.
"Permitted Liens" means:
(a) Liens (if any) granted to the Holders to
secure the Obligations;
(b) Liens in existence on the date hereof and
described in Schedule IV;
(c) pledges or deposits made to secure payment of
worker's compensation (or to participate in any fund in
connection with worker's compensation), unemployment
insurance, pensions or social security programs;
(d) Liens imposed by mandatory provisions of law
such as for materialmen's, mechanics, warehousemen's and other
like Liens arising in the ordinary course of business,
securing indebtedness whose payment is not yet due, and
landlords liens, whether arising through contract or by
operation by law, but only if the same are not yet due and
payable or if the same are being contested in good faith and
the payment of which is not at the time required by Section
8.03,
(e) Liens for taxes, assessments and governmental
charges or levies imposed upon a Person or upon such Person's
income or profits or property, but only if the same are not
yet due and payable or if the same are being
-11-
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contested in good faith and the payment of which is not at the
time required by Section 8.03;
(f) good faith deposits in connection with
tenders, leases, real estate bids or contracts (other than
contracts involving the borrowing of money), pledges or
deposits to secure public or statutory obligations, deposits
to secure (or in lieu of) surety, stay, appeal or customs
bonds and deposits to secure the payment of taxes,
assessments, customs duties or other similar charges;
(g) encumbrances consisting of zoning
restrictions, easements, or other restrictions on the use of
real property, provided that such do not materially impair the
use of such property for the uses intended, and none of which
is violated by existing or proposed structures or land use;
(h) Liens on Property of any Consolidated
Subsidiary securing obligations of such Consolidated
Subsidiary owing to the Company or to any Wholly-Owned
Subsidiary;
(i) Liens created to secure (A) purchase money
indebtedness incurred to finance the purchase price of the
Property acquired in the ordinary course of business, but only
if each such Lien shall secure only the purchase money
indebtedness incurred to purchase the Property so acquired and
shall be confined solely to such Property and (B) the
indebtedness permitted by Section 9.08(b)(11); provided,
however, that the aggregate amount of all indebtedness at any
time secured by all Liens referred to in this clause (i) shall
not exceed $10,000,000; and
(j) Liens on Temporary Cash Investments, but only
if (A) such Liens secure short-term indebtedness owed by the
Company or a Consolidated Subsidiary to the broker or
investment banking firm which is holding such Temporary Cash
Investments for the account of the Company or a Consolidated
Subsidiary and (B) such indebtedness is to be repaid, in the
ordinary course of business, by the collection or liquidation
of such Temporary Cash Investments at the maturity of such
Temporary Cash Investments.
"Person" means and includes an individual, a partnership, a
joint venture, a corporation, a trust, an unincorporated organization
and a Governmental Authority.
"Plan" means an employee pension benefit plan (within the
meaning of Section 3(3) of ERISA) which is or has been established or
maintained, or to which contributions are or have been made, by the
Company, any Subsidiary or any Related Person or as to which the
Company, any Subsidiary or any Related Person would be treated as a
contributing sponsor under Section 4069 of ERISA if such plan were to
be terminated.
"Private Placement" has the meaning specified in Section 1.02.
-12-
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"Projections" has the meaning specified in Section 6.03(a)(9).
"Property" means any interest in any kind of property or
asset, whether real, personal or mixed, tangible or intangible.
"Purchasers" has the meaning specified in the opening
paragraph of this Agreement.
"Regulatory Acts" means (a) the Texas Pawnshop Act, (b) the
Consumer Credit Xxx 0000 enacted in the United Kingdom and (c) all
other foreign, Federal or state laws (statutory, administrative,
judicial or other otherwise) relating to pawn shops and activities
incidental thereto.
"Reinvestment Yield" means with respect to the Called
Principal of any Note, the sum of 50 basis points plus the yield to
maturity implied by (a) the yields reported, as of 10:00 A.M. (New
York City time) two Business Days next preceding the Settlement Date
with respect to such Called Principal, on the display designated as
"Page USD" on the Bloomberg Financial Markets Service (or such other
display as may replace Page USD on the Bloomberg Financial Markets
Service) for actively traded U.S. Treasury securities having a
maturity equal to the Remaining Average Life of such Called Principal
as of such Settlement Date, or, if such yields shall not be reported
as of such time or the yields reported as of such time shall not be
ascertainable, (b) the Treasury Constant Maturity Series yields
reported, for the latest day for which such yields shall have been so
reported as of the Business Day next preceding the Settlement Date
with respect to such Called Principal, in Federal Reserve Statistical
Release H.15 (519) (or any comparable successor publication) for
actively traded U.S. Treasury securities having a constant maturity
equal to the Remaining Average Life of such Called Principal as of
such Settlement Date. Such implied yield shall be determined, if
necessary, by (i) converting U.S. Treasury xxxx quotations to bond
equivalent yields in accordance with accepted financial practice and
(ii) interpolating linearly between reported yields.
"Related Person" means any trade or business, whether or not
incorporated, which, together with the Company, would be treated as a
single employer under Section 414 of the Code.
"Release" has the meaning specified in CERCLA Sections
101(22) (42 U.S.A. Sections 9601(22)).
"Remaining Average Life" means, with respect to the Called
Principal of any Note, the number of years (calculated to the nearest
one-twelfth year) obtained by dividing (a) such Called Principal into
(b) the sum of the products obtained by multiplying (i) each Remaining
Scheduled Payment of such Called Principal (but not of interest
thereon) by (ii) the number of years (calculated to the nearest
one-twelfth year) which will elapse between the Settlement Date with
respect to such Called Principal and the scheduled due date of such
Remaining Scheduled Payment.
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"Remaining Scheduled Payments" means, with respect to the
Called Principal of any Note, all payments of such Called Principal
and interest thereon that would be due on or after the Settlement Date
with respect to such Called Principal if no payment of such Called
Principal were made prior to its scheduled due date.
"Required Holders" means, at any time, the Holder or Holders
of at least 51% of the aggregate principal amount of the Notes then
outstanding.
"Responsible Officer" means, as to any Loan Party, the
chairman of the board, the chief executive officer, the president, the
chief financial officer, the principal accounting officer, the chief
legal officer or the treasurer of such Loan Party.
"Restricted Payment" means as specified in Section 9.07(a).
"SEC" means the Securities and Exchange Commission.
"SEK" means the legal currency of Sweden.
"Securities Act" means the Securities Act of 1933, as amended.
"Settlement Date" means, with respect to the Called Principal
of any Note, the date on which such Called Principal is to be prepaid
pursuant to Section 5.02 or is declared to be or becomes immediately
due and payable pursuant to Article X, as the context requires.
"Stock" means (i) in the case of any corporation, capital
stock of any class of such corporation (however designated) and
warrants or options to purchase such capital stock, (ii) in the case
of any partnership, partnership interests of such partnership (however
designated) and warrants or options to purchase such partnership
interests and (iii) in the case of any other entity, equity interests
of such entity (however designated) and warrants or options to
purchase such equity interests.
"Subrogation and Contribution Agreement" means the Subrogation
and Contribution Agreement dated as of December 1, 1997 among the
Company and the Guarantors substantially in the form of Exhibit F.
"Subsidiary" means, at any time, (a) any corporation 50% or
more of the outstanding Voting Stock of which is owned, directly or
indirectly, by the Company at such time and (b) any partnership,
association, joint venture or other entity in which the Company owns,
directly or indirectly, a 50% or greater equity interest (however
designated) at such time.
"Temporary Cash Investment" mean any of the following
investments: (a) Investments in open market commercial paper maturing
within 180 days after acquisition thereof and rated at least A-1 (or
the equivalent thereof) by Standard & Poor's Ratings Group (or any
successor thereto which is a nationally recognized rating
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agency) or at least P-1 (or the equivalent thereof) by Xxxxx'x
Investors Service, Inc. (or any successor thereto which is a
nationally recognized rating agency), (b) Investments in marketable
obligations, maturing within 180 days after acquisition thereof,
issued or unconditionally guaranteed by the United States of America
or an instrumentality or agency thereof and entitled to the full faith
and credit of the United States of America, (c) Investments in money
market funds that invest solely in the types of Investments permitted
under clauses (a) and (b) above, (d) Investments in repurchase
agreements of any financial institution or brokerage firm acceptable
to the Required Holders which are fully secured by securities
described in clause (b) above, (e) certificates of deposit and time
deposits (including Eurodollar deposits), maturing within 180 days
from the date of deposit thereof, with a domestic office of (i) any
national or state bank or trust company organized under the laws of
the United States of America or any state therein and having capital,
surplus and undivided profits of at least $100,000,000 or (ii) any
other national or state bank so long as all such deposits are
federally insured, (f) in the case of Xxxxxx & Xxxxxxxx Limited,
certificates of deposit and other instruments substantially equivalent
to a certificate of deposit maturing within 180 days from the date of
acquisition and issued by a bank or trust company organized and
located in the United Kingdom having capital, surplus and undivided
profits of at least 65,000,000 pounds sterling and (g) in the case of
Pantbelaning, Murtrum and Murtrum Affiliate, certificates of deposit
and other instruments substantially equivalent to a certificate of
deposit maturing within 180 days from the date of acquisition and
issued by a bank or trust company organized and located in Sweden
having capital, surplus and undivided profits of at least SEK
750,000,000.
"Transferee" means any direct or indirect transferee of all or
any part of any Note purchased by the Purchasers under this Agreement.
"Voting Stock" means, when used with respect to any Person,
any Stock of such Person having general voting power under ordinary
circumstances to elect a majority of the board of directors (or other
governing body) of such Person (irrespective of whether at the time
any Stock of such Person shall have or might have voting power by
reason of the happening of any contingency).
"Wholly-Owned Subsidiary" means a Consolidated Subsidiary, all
of the outstanding Stock (other than directors' qualifying shares, if
required by law) of which are at the time owned directly by the
Company or by one or more Wholly-Owned Subsidiaries or by the Company
and one or more Wholly-Owned Subsidiaries.
Section 2.02. Interpretation. (a) In this Agreement, unless a
clear contrary intention appears:
(1) the singular number includes the plural number and
vice versa;
(2) reference to any gender includes each other gender;
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(3) the words "herein," "hereof" and "hereunder" and
other words of similar import refer to this Agreement as a whole and
not to any particular Article, Section or other subdivision;
(4) reference to any Person includes such Person's
successors and assigns but, if applicable, only if such successors and
assigns are permitted by this Agreement, and reference to a Person in
a particular capacity excludes such Person in any other capacity or
individually, provided that nothing in this clause (4) is intended to
authorize any assignment not otherwise permitted by this Agreement;
(5) reference to any agreement, document, instrument or
report means, unless the context otherwise requires, such agreement,
document, instrument or report as in effect when delivered to the
Purchasers pursuant to this Agreement and as the same may thereafter
be amended, supplemented or modified in accordance with the terms
thereof and hereof, and reference to any Note includes any note issued
pursuant hereto in renewal, rearrangement, reinstatement, enlargement,
amendment, modification, extension, substitution or replacement
therefor;
(6) reference to any Article, Section, Schedule or
Exhibit means such Article or Section hereof or such Schedule or
Exhibit hereto;
(7) the words "including" (and with correlative meaning
"include") means including, without limiting the generality of any
description preceding such term;
(8) with respect to the determination of any period of
time, the word "from" means "from and including" and the word "to"
means "to but excluding";
(9) reference to any Legal Requirement means such Legal
Requirement as amended, modified, codified or reenacted, in whole or
in part, and in effect from time to time;
(10) accounting terms used but not defined herein shall be
construed in accordance with GAAP, and whenever the character or
amount of any asset or liability or item of income or expense is
required to be determined, or any consolidation or accounting
computation is required to be made, for purposes hereof, such
determination or computation shall be made in accordance with GAAP;
(11) the word "knowledge", when used in any representation
or warranty of the Company contained herein, means the actual
knowledge of any Executive Officer or director of the Company;
(12) where any provision of this Agreement refers to
action to be taken by any Person, or which such Person is prohibited
from taking, such provision shall be applicable whether such action is
taken directly or indirectly by such Person; and
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(13) if any action or failure to act by the Company
violates any covenant or obligation of the Company contained herein,
such violation shall not be excused by the fact that such action or
failure to act is required or permitted by any other covenant or
obligation of the Company contained herein.
(b) Should there be a change in GAAP following the date of this
Agreement and should either (i) the Company determine (in good faith) that the
requirements of one or more of the covenants contained in Article IX are
materially increased or made more severe as a result thereof or (ii) the
Required Holders determine (in good faith) that the requirements of one or more
of the covenants contained in Article IX are materially reduced or relaxed as a
result thereof, then the Company and such Required Holders shall enter into
good faith negotiations with the desired result being that such covenant(s)
shall be amended in such a way that the criteria therein set forth for
evaluating the financial condition of the Company and/or the Subsidiaries shall
be the same after such amendment as if such change in GAAP had not been made.
(c) The Article and Section headings herein and the Table of
Contents are for convenience only and shall not affect the construction hereof.
(d) No provision of this Agreement shall be interpreted or
construed against any Person solely because that Person or its legal
representative drafted such provision.
ARTICLE III
CONDITIONS OF CLOSING
The obligation of the Purchasers to purchase and pay for the Notes
hereunder is subject to the satisfaction of the following conditions:
Section 3.01. Representations and Warranties. The
representations and warranties of the Loan Parties contained in the following
instruments shall be true and correct at the time of Closing: (i) this
Agreement, (ii) the other Loan Documents and (iii) the instruments delivered by
one or more of the Loan Parties pursuant to this Article III.
Section 3.02. Performance; No Default. The Loan Parties shall
have performed and complied with all agreements and conditions contained in
this Agreement or in the other Loan Documents required to be performed or
complied with by them prior to or at the Closing. At the time of Closing, no
Default shall have occurred and be continuing or would result from the
consummation of the Overall Transaction.
Section 3.03. Compliance Certificate. The Purchasers shall have
received an Officers' Certificate, dated the Closing Date and satisfactory in
form and substance to the Purchasers, certifying that the conditions specified
in Sections 3.01 and 3.02 have been fulfilled. If required by the Purchasers,
such Officers' Certificate will also certify as to such matters of fact as the
Purchasers may reasonably request to enable the Purchasers to determine
compliance with such conditions.
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Section 3.04. Opinions of Counsel. The Purchasers shall have
received (a) a favorable opinion from Jenkens & Xxxxxxxxx, a Professional
Corporation, counsel for the Company and the Guarantors, in the form of Exhibit
B, (b) a favorable opinion of Xxxx X. Xxxxxxx, General Counsel to the Company
and the Guarantors, in the form of Exhibit C and (c) a favorable opinion from
Xxxxxxx and Xxxxxx, special counsel for the Purchasers, in the form of Exhibit
D. Each such opinion shall (i) be addressed to the Purchasers, (ii) be dated
the Closing Date and (iii) state that all Transferees are entitled to rely
thereon as though it were addressed to them.
Section 3.05. Resolutions, Etc. The Purchasers shall have
received (a) copies of resolutions of the Board of Directors of each Loan
Party, certified as of the Closing Date by the Secretary or an Assistant
Secretary of such Loan Party, duly authorizing the Overall Transaction, (b) a
certificate as to the incumbency and authority of the Person or Persons
executing and delivering Loan Documents on behalf of such Loan Party and (c)
such other documents and evidence as the Purchasers or its special counsel may
request with respect to any Loan Party or the Overall Transaction, including
the taking of all corporate proceedings in connection therewith and compliance
with the conditions set forth herein, in each case in form and substance
satisfactory to the Purchasers.
Section 3.06. Purchase Permitted by Applicable Laws, Etc. The
consummation of the Private Placement on the terms and conditions herein
provided (including the use of the proceeds of such Notes by the Company) shall
(i) not violate any Legal Requirement (including, without limitation, section 5
of the Securities Act or Regulation G, T or X of the Board of Governors of the
Federal Reserve System), (ii) not subject the Purchasers to any tax (other than
routine income taxes), penalty, liability or other onerous condition under or
pursuant to any Legal Requirement and (iii) constitute a legal investment under
the laws and regulations of each jurisdiction to which the Purchasers are
subject, but without resort to provisions (such as Section 1405(a)(8) of the
New York Insurance Law) which permit the making of an investment without
restriction as to the character of the particular investment being made. If
required by the Purchasers, the Purchasers shall have received an Officers'
Certificate, dated the Closing Date, certifying as to such matters of fact as
the Purchasers may reasonably specify to enable the Purchasers to determine
compliance with the conditions set forth in the preceding sentence.
Section 3.07. Payment of Closing Fees. The Company shall have
paid the fees and disbursements which it is obligated to pay pursuant to
Section 11.02 and which have been invoiced to the Company prior to the time of
Closing.
Section 3.08. Private Placement Number. The CUSIP Service Bureau
of Standard & Poor's Information Group shall have issued to the Purchasers a
private placement number with respect to the Notes.
Section 3.09. Notes. The Purchasers shall have received the
Notes complying with the requirements of Section 1.03.
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Section 3.10. Guaranty; Subrogation and Contribution Agreement.
Each Guarantor and the Company shall have duly authorized, executed and
delivered to the Purchasers a Joint and Several Guaranty, dated the Closing
Date, in the form of Exhibit E (the "Guaranty") and a Subrogation and
Contribution Agreement.
Section 3.11. Other Loan Documents. Each of the other Loan
Documents shall (a) have been duly authorized, executed, acknowledged (if
appropriate) and delivered by the respective Loan Parties thereto, (b) be dated
as of the Closing Date, (c) be in form and substance satisfactory to the
Purchasers and (d) be in full force and effect on the Closing Date without any
default existing thereunder. A counterpart of each Loan Document executed by
the Loan Parties thereto shall have been delivered to the Purchasers or its
special counsel. Each Loan Document shall constitute the valid and binding
obligation of each Loan Party thereto, enforceable against such Loan Party in
accordance with the terms thereof.
Section 3.12. Proceedings. All proceedings taken or to be taken
in connection with the Overall Transaction prior to or on the Closing Date (and
all documents incident thereto) shall be satisfactory in substance and form to
the Purchasers, and the Purchasers and its special counsel shall have received
all such counterpart originals or certified or other copies of such documents
as the Purchasers may reasonably request.
ARTICLE IV
USE OF PROCEEDS
Section 4.01. Use of Proceeds. The Company will apply the
proceeds of the Private Placement solely to pay the costs and expenses
described in Section 11.02 and to repay indebtedness of the Company outstanding
under the Bank Loan Agreement and for no other purpose. Nothing in this
Section 4.01 is intended to prohibit the Company from effecting re-borrowings
under the Bank Loan Agreement.
Section 4.02. Margin Regulations. The Company will not, directly
or indirectly, use any of the proceeds of the Private Placement for the
purpose, whether immediate, incidental or ultimate, of buying a "margin stock"
or of maintaining, reducing or retiring any indebtedness originally incurred to
purchase a stock that is currently a "margin stock", or for any other purpose
which might constitute the private placement of a "purpose credit," in each
case within the meaning of Regulation G (12 C.F.R. 207, as amended) or
Regulation T (12 C.F.R. 220, as amended) of the Board of Governors of the
Federal Reserve System, or otherwise take or permit to be taken any action
which would involve a violation of such Regulation G or T or of Regulation X
(12 C.F.R. 224, as amended) of the Board of Governors of the Federal Reserve
System or any other regulation of such Board.
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ARTICLE V
PREPAYMENTS
Section 5.01. Required Prepayments of the Notes. (a) Unless the
aggregate principal amount of the then outstanding Notes shall have become due
and payable pursuant to Section 10.01, the Company shall apply to the
prepayment of the Notes, without premium, and there shall become due and
payable, the sum of $4,285,714.28 on January 2 in each of the years 2002
through 2007 (or, in the case of any such prepayment, such lesser principal
amount of the Notes as shall then be outstanding), leaving $4,285,714.32
principal amount (or such other principal amount thereof as then remains
unpaid) of the Notes for payment at their stated maturity on January 2, 2008.
Each such prepayment shall be at 100% of the principal amount of the Notes so
prepaid, together with all accrued and unpaid interest thereon to the date of
prepayment. No partial prepayment of the Notes pursuant to Section 5.02 shall
relieve the Company from its obligation to make the required prepayments
provided for in this Section 5.01.
(b) Whenever any prepayment to be made under this Section 5.01
shall be stated to be due on a day which is not a Business Day, the due date
thereof shall be extended to the next succeeding Business Day and the amount of
such prepayment shall bear interest at the applicable rate during such
extension.
Section 5.02. Optional Prepayments of the Notes. The Company
may, at its option, upon notice as provided in Section 5.03, at any time or
from time to time, prepay any part (in a principal amount of at least
$1,000,000 or an integral multiple of $100,000 in excess thereof) or all of the
Notes at 100% of the principal amount so prepaid, together with all accrued and
unpaid interest thereon to the date of prepayment, plus a premium equal to the
Make-Whole Premium, if any, on the amount so prepaid, determined as of two
Business Days prior to the date of such prepayment pursuant to this Section
5.02.
Section 5.03. Notice of Optional Prepayments; Officers'
Certificate. The Company shall give each Holder irrevocable written notice of
each optional prepayment of Notes made under Section 5.02 not less than 30 nor
more than 60 days prior to the date fixed for such prepayment (which shall be a
Business Day), in each case specifying (a) such prepayment date, (b) the
aggregate principal amount of the Notes to be prepaid, (c) the aggregate
principal amount of the Notes held by such Holder to be prepaid, (d) that a
Make-Whole Premium may be payable, (e) the date when such Make- Whole Premium
will be calculated, (f) the estimated Make-Whole Premium together with a
reasonably detailed calculation of such Make-Whole Premium and (g) the accrued
interest applicable to the prepayment. The Company will give each Holder, one
Business Day prior to the date scheduled for any such prepayment, an Officers'
Certificate certifying that the conditions of Section 5.02 have been fulfilled
and specifying the particulars of such fulfillment, and, whether or not a
Make-Whole Premium is payable in connection with such prepayment, setting forth
the calculations used in computing such Make-Whole Premium.
Section 5.04. Allocation of Partial Prepayments. Any partial
prepayment of the Notes shall be allocated among all Notes at the time
outstanding in proportion, as nearly as
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practicable, to the respective unpaid principal amounts of the Notes so
outstanding, with adjustments, to the extent practicable, to compensate for any
prior payments not made exactly in such proportion. All partial prepayments
shall be applied to the Notes in anticipation and satisfaction of the
prepayments required to be made by the provisions of Section 5.01, in inverse
order of the maturity thereof.
Section 5.05. Maturity; Surrender, Etc. In the case of any
prepayment of the Notes pursuant to this Article V, the principal amount of
each Note to be prepaid shall mature and become due and payable on the date
fixed for such prepayment, together with interest on such principal amount
accrued to such date and the applicable Make-Whole Premium, if any. From and
after such date, unless the Company shall fail to pay such principal amount
when so due and payable, together with the interest and Make-Whole Premium, if
any, as aforesaid, interest on such principal amount shall cease to accrue.
Any Note paid or prepaid in full shall, after such payment or prepayment in
full, be surrendered to the Company and be cancelled and shall not be reissued,
and no Note shall be issued in lieu of any prepaid principal amount of any
Note.
Section 5.06. Retirement of Notes. The Company shall not, and
shall not permit any of its Affiliates to, prepay or otherwise retire, in whole
or in part, prior to their stated final maturity (other than by prepayment
pursuant to this Article V or upon acceleration of such final maturity pursuant
to Section 10.01), or purchase or otherwise acquire, directly or indirectly,
Notes held by any Holder unless the Company or such Affiliate shall have
offered to prepay or otherwise retire or purchase or otherwise acquire, as the
case may be, the same proportion of the aggregate principal amount of Notes
held by each other Holder at the time outstanding upon the same terms and
conditions. Any Notes prepaid pursuant to this Article V or Section 10.01 or
otherwise retired or purchased or otherwise acquired by the Company or any of
its Affiliates shall not be deemed to be outstanding for any purpose under this
Agreement, provided that, with respect to each prepayment pursuant to this
Article V, all Notes then held by the Company and its Affiliates shall
nonetheless be entitled to participate in such prepayment the same as if such
Notes were deemed outstanding.
ARTICLE VI
REPRESENTATIONS AND WARRANTIES
OF THE COMPANY
The Company represents and warrants that:
Section 6.01. Subsidiaries. (a) The Company has no Subsidiaries
on the date hereof except those listed in Schedule II, each of which is a
Consolidated Subsidiary and a Wholly-Owned Subsidiary.
(b) Schedule II sets forth, with respect to each of the
Subsidiaries listed therein, (i) whether such Subsidiary is a corporation or
partnership, (ii) the jurisdiction of its incorporation or formation (as the
case may be) and (iii) each jurisdiction in which it is qualified to do
business as a foreign Person.
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(c) All of the issued and outstanding Stock of each Subsidiary is
validly issued, fully-paid and is nonassessable and, except for directors'
qualifying shares (if any), is owned (beneficially and of record) by the
Company, free and clear of any Lien.
(d) No Subsidiary owns any Stock of the Company.
Section 6.02. Organization, Qualification, Authorization, Etc.
(a) The Company and each Subsidiary (i) is a corporation or partnership (as the
case may be) duly organized or formed (as the case may be) and existing in good
standing under the laws of the jurisdiction of its organization or formation
(as the case may be), (ii) is duly qualified or registered and in good standing
as a foreign Person in each jurisdiction in which the nature of such
qualification or registration is necessary and in which the failure to so
qualify or register could have a Material Adverse Effect and (iii) has the
corporate or partnership (as the case may be) power (A) to own its Properties,
(B) to carry on its business as now being conducted and (C) to consummate the
Overall Transaction. Schedule III sets forth each jurisdiction in which the
Company is qualified or registered to do business as a foreign corporation.
(b) The execution, delivery and performance by each Loan Party of
the Loan Documents to which it is a party have been duly authorized by all
necessary corporate or partnership (as the case may be) action on the part of
such Loan Party. This Agreement constitutes, and the Notes and such other Loan
Documents (when executed and delivered as contemplated hereby) will each
constitute, a legal, valid and binding obligation of each Loan Party thereto,
enforceable in accordance with its terms, except as the enforceability thereof
may be limited by bankruptcy, insolvency or other laws of general application
relating to the enforcement of creditors' rights.
Section 6.03. Disclosure Documents. (a) The Company has
heretofore furnished the Purchasers with true, correct and complete copies of
the following documents:
(1) the Organizational Documents of the Company and each
Subsidiary as in effect on the date hereof;
(2) the Bank Loan Agreement;
(3) each Material Contract described in Schedule V;
(4) the Company's Annual Reports to Stockholders for the
Fiscal Years ended December 31, 1994 through 1996 (inclusive);
(5) the Company's Annual Reports on Form 10-K for the
Fiscal Years ended December 31, 1994 through 1996 (inclusive), as
filed with the SEC;
(6) the Company's Quarterly Reports on Form 10-Q for the
Fiscal Quarters ended June 30, 1995 September 30, 1995, March 31,
1996, June 30, 1996,
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September 30, 1996, March 31, 1997, June 30, 1997 and September 30,
1997 as filed with the SEC;
(7) all proxy statements relating to all meetings of the
Company's stockholders (whether annual or special) since December 31,
1994;
(8) the consolidated financial statements of the Company
and the Consolidated Subsidiaries described in Schedule VI (the
"Company Financials"); and
(9) the projections described in Schedule VII (the
"Projections").
(b) The Company Financials (including any related schedules and/or
notes) (i) were true and correct in all material respects as at the dates
thereof, (ii) were prepared in accordance with GAAP consistently followed
throughout the periods involved and (iii) show all liabilities, direct and
contingent, of the Company and the Consolidated Subsidiaries required to be
shown in accordance with GAAP. The balance sheets included in the Company
Financials fairly present the consolidated financial condition of the Company
and the Consolidated Subsidiaries as at the dates thereof, and the statements
of operations and statements of cash flows included in the Company Financials
fairly present the consolidated results of operations and cash flows of the
Company and the Consolidated Subsidiaries for the periods indicated.
(c) The Projections are based on good faith estimates and
assumptions believed by the Company to be reasonable at the time made, it being
recognized by the Purchasers that the Projections, insofar as they relate to
future events, are not to be viewed as facts and that actual results during the
period or periods covered by the Projections may differ materially from the
projected results. Since the preparation of the Projections, nothing has
occurred to cause the Company to believe that the estimates and assumptions on
which the Projections are based are no longer reasonable.
Section 6.04. Changes, Etc. (a) Since December 31, 1996, (i)
neither the Company nor any Subsidiary has entered into any materially adverse
transactions not in the ordinary course of business, nor incurred any material
liabilities or obligations, direct or contingent, except for the Loan Documents
and (ii) no events have occurred which, individually or in the aggregate, have
had, or in the future could reasonably be expected to have, a Material Adverse
Effect.
(b) Neither the business nor the Properties of the Company or any
of the Subsidiaries are presently affected by any fire, explosion, accident,
labor controversy, strike, lockout or other labor dispute, drought, storm,
hail, earthquake, embargo, act of God or of the public enemy or other casualty
which could reasonably be expected to have a Material Adverse Effect.
Section 6.05. Tax Returns and Payments. (a) The Company and each
Subsidiary has filed all tax returns required by law to be filed by it (or
obtained extensions with respect thereto) and has paid all taxes, assessments
and other governmental charges levied upon it or
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any of its Properties, income or franchises which are shown to be due and
payable on such returns and all other taxes and assessments payable by it,
other than (i) those which are not past due, (ii) those which are presently
being contested in good faith by appropriate proceedings diligently conducted
for which such reserves or other appropriate provisions, if any, as shall be
required by GAAP have been made and (iii) those not reflected on such returns
the non- payment of which could not reasonably be expected to have a Material
Adverse Effect. No contest referred to in the foregoing clause (ii) could
reasonably be expected to have a Material Adverse Effect.
(b) After due inquiry, the Company knows of no proposed tax
assessment against the Company or any Subsidiary which could reasonably be
expected to have a Material Adverse Effect. In the opinion of the Company, all
tax liabilities of the Company and the Subsidiaries are adequately provided for
on their respective books. The Federal income tax returns of the Company and
the Subsidiaries have been audited by the Internal Revenue Service for all
Fiscal Years up to and including the Fiscal Year ended December 31, 1992.
Section 6.06. Indebtedness; Solvency. (a) The Company and the
Subsidiaries have no outstanding Indebtedness for Money Borrowed other than (i)
the indebtedness evidenced by the Notes and the Guaranty, (ii) the indebtedness
evidenced by the 1993 Notes and the 1993 Guaranty, (iii) the indebtedness
evidenced by the 1995 Notes and the 1995 Guaranty, (iv) the indebtedness
outstanding under the Bank Loan Agreement, (v) the indebtedness described in
Schedule XIII and (vi) other indebtedness permitted under Section 9.08 which
indebtedness does not exceed $500,000 in the aggregate.
(b) Each of the Loan Parties (i) has, and after giving effect to
the Overall Transaction will have, capital sufficient to carry on its business
and transactions and all the business and transactions in which it is about to
engage, (ii) is, and after giving effect to the Overall Transaction will be,
solvent and able to pay its debts as they mature and (iii) owns, and after
giving effect to the Overall Transaction will own, Property having a value,
both at fair valuation and present fair salable value, greater than the amount
required to pay the probable liability on its debts.
Section 6.07. Permits. The Company and each Subsidiary possess
all Permits that are necessary or desirable in connection with the ownership,
use or operation by it of its Properties and the conduct by it, in the ordinary
course, of its business as now conducted and as currently proposed to be
conducted, except those Permits the absence of which would not have a Material
Adverse Effect. None of such Permits impose any material burden or restriction
on the Company or any Subsidiary. The Company and the Subsidiaries are in
compliance with all terms of such Permits. All such Permits are valid and in
full force and effect and, to the Company's knowledge (after due inquiry), none
are threatened to be revoked, cancelled, suspended or modified for any reason.
Section 6.08. Material Contracts. Schedule V describes all
Material Contracts existing on the date hereof. Each of such Material
Contracts (a) has been duly executed and delivered by, and constitutes the
legal, valid and binding obligation of, each Loan Party thereto, enforceable
against each such Loan Party in accordance with its terms, (b) is in full
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force and effect and (c) except as reflected in Schedule V, has not been
amended or modified, nor any provision thereof waived, in any respect. The
Company and each Subsidiary has, and, to the Company's knowledge, all other
parties to such Material Contracts have, performed and complied in all material
respects with all of the terms and conditions set forth therein. No default by
the Company any Subsidiary or, to the Company's knowledge, any such other party
exists under any such Material Contract.
Section 6.09. Title to Property, Etc. (a) The Company and each
Subsidiary has good and indefeasible fee simple title to its real property and
good and defensible title to all of its other Property, including the Property
reflected in the balance sheets included in the Company Financials (other than
Properties disposed of in the ordinary course of business), subject to no Lien
of any kind except Permitted Liens which do not, individually or in the
aggregate, materially affect or interfere with, or if used or availed of will
not materially affect or interfere with, the occupancy, use or operation of
such item of Property for its intended purpose or the peaceful and quiet use
and enjoyment thereof by the Company or such Subsidiary, as the case may be.
(b) No lease under which the Company or any Subsidiary is the
lessee or is operating contains any provision which individually or in the
aggregate interferes with the ordinary conduct of the business of the Company
or such Subsidiary or otherwise could reasonably be expected to have a Material
Adverse Effect. The Company and each Subsidiary enjoys peaceful and
undisturbed possession under all leases under which it is the lessee or is
operating, except where the absence of such possession would not have a
Material Adverse Effect. All of such leases are valid and subsisting and no
default by the Company, such Subsidiary or, to the Company's knowledge, any
such other party exists thereunder.
Section 6.10. Condition of Property. The facilities of the
Company and the Subsidiaries, taken as a whole, are in a condition and state of
repair which are sufficient and adequate to operate their respective businesses
in a proper and efficient manner.
Section 6.11. Compliance with Applicable Laws, Permits and
Contracts. (a) Neither the Company nor any Subsidiary is in violation of (i)
any provision of its Organizational Documents, (ii) any Applicable Permit or
Applicable Contract (including the Bank Loan Agreement and the 1993 Note
Agreement and the 1995 Note Agreement) or (iii) any instrument evidencing or
otherwise relating to Indebtedness for Money Borrowed (other than, in the case
of the foregoing clauses (ii) and (iii), violations which, individually or
collectively, could not reasonably be expected to have a Material Adverse
Effect), and the execution, delivery and performance of the Loan Documents and
the consummation of the Overall Transaction will not result in any violation of
or constitute a default under any of the foregoing or result in the creation of
(or impose any obligation on the Company or any Subsidiary to create) any Lien
upon any Property of the Company or any Subsidiary.
(b) Neither the Company nor any Subsidiary is in violation of any
Legal Requirement other than violations which, individually or collectively,
will not have a Material Adverse Effect, and the execution, delivery and
performance of the Loan
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Documents and the consummation of the Overall Transaction will not result in a
violation of any Legal Requirement.
(c) Except for this Agreement, the Bank Loan Agreement, the 1993
Note Agreement, the 1995 Note Agreement, the agreement evidencing the
Pantbelaning Indebtedness and the agreement evidencing the Xxxxxx & Xxxxxxxx
Indebtedness, neither the Company nor any Subsidiary is a party to or bound by
any Permit, agreement or instrument (including its Organizational Documents)
which contains any restrictions or limitations on the incurrence by the Company
or such Subsidiary of any Indebtedness for Money Borrowed.
(d) Neither the Company nor any Subsidiary is in default and no
waiver of default is currently in effect, in the payment of any principal or
interest on any Indebtedness for Money Borrowed of the Company or such
Subsidiary.
Section 6.12. Litigation, Etc. No action, suit, investigation or
proceeding is pending or, to the knowledge of the Company (after due inquiry),
threatened against or affecting the Company or any Subsidiary or any Property
of the Company or any Subsidiary which (a) individually or collectively, could
reasonably be expected to have a Material Adverse Effect or (b) questions the
validity of any Loan Document or any action taken or to be taken pursuant
thereto.
Section 6.13. ERISA. Neither the Company nor any member of its
ERISA Group has ever maintained or contributed to, or had an obligation or
liability to contribute to, any Plan. Each Benefit Arrangement is (and has
been) maintained and operated in compliance in all material respects with the
applicable provisions of ERISA, the Code and other Legal Requirements. Neither
the Company nor any member of the ERISA Group has failed to timely make any
required contribution or payment to or in respect of any Benefit Arrangement.
No Benefit Arrangement provides post employment health benefits except as
required by Part 6 of Subtitle B of ERISA. No litigation, investigation or
claim (other than a routine, undisputed claim for benefits) is pending or, to
the knowledge of the Company (after due inquiry), threatened or anticipated
concerning any Benefit Arrangement. The Company and/or the members of its
ERISA Group may at any time unilaterally, without the consent of any Person,
terminate any and/or all Benefit Arrangement(s) without incurring any material
liability. The execution and delivery of this Agreement and the other Loan
Documents and the issue and sale of the Notes will not involve any transaction
which is subject to the prohibitions of section 406 of ERISA or in connection
with which a tax could be imposed pursuant to section 4975 of the Code. The
representation by the Company in the next preceding sentence is made in
reliance upon and subject to the accuracy of the representation of the
Purchasers in Article VII as to the source of the funds to be used to pay the
purchase price of the Notes.
Section 6.14. No Governmental Consents Required for Overall
Transaction. Neither the nature of the Company nor any Subsidiary, nor the
business or Properties of the Company or any Subsidiary, nor any relationship
between the Company or any Subsidiary and any other Person, nor any
circumstance in connection with the offering, issuance, sale or
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delivery of the Notes is such as to require any authorization, consent,
approval, exemption or other action by or notice to or filing with any
Governmental Authority in connection with the execution and delivery of this
Agreement, the other Loan Documents or the consummation of the Overall
Transaction other than routine SEC filings by the Company under the Exchange
Act.
Section 6.15. Offering of Notes. Neither the Company nor its
Affiliates nor anyone acting on its or their behalf has, directly or
indirectly, (a) offered the Notes or any similar security of the Company for
sale to, or solicited any offers to buy the Notes or any similar security of
the Company from, or otherwise approached or negotiated with respect thereto
with, any Person other than the Purchasers and not more than 45 other
institutional investors, each of which has been offered the Notes at a private
sale for investment or (b) taken or will take any action which would require
the issuance or sale of the Notes to be registered pursuant to the provisions
of section 5 of the Securities Act or pursuant to the provisions of any
securities or Blue Sky law of any jurisdiction.
Section 6.16. Use of Proceeds. The Company will apply the
proceeds of the sale of the Notes in accordance with Article IV. No
indebtedness being reduced or retired, directly or indirectly, out of the
proceeds of the sale of the Notes was incurred for the purpose of purchasing or
carrying any stock which is currently a "margin stock" (as defined in Section
4.02), and the Company neither owns nor has any present intention of acquiring
any amount of "margin stock." None of the proceeds of the sale of the Notes
will be used to acquire any security in any transaction which is subject to
section 13 or 14 of the Exchange Act, including particularly sections 13(d) and
14(d) thereof.
Section 6.17. Foreign Assets Control Regulations, Etc. Neither
the issue and sale of the Notes by the Company nor its use of the proceeds
thereof as contemplated by this Agreement will violate the Trading with the
Enemy Act, as amended, or any of the foreign assets control regulations of the
United States Treasury Department (31 CFR, Subtitle B, Chapter V, as amended)
or any enabling legislation or executive order relating thereto.
Section 6.18. Status Under Certain Federal Statutes. No Loan
Party is (a) an "investment company" or a Person "controlled" by or acting on
behalf of an "investment company," in each case within the meaning of the
Investment Company Act of 1940, as amended, (b) a "holding company" or a
"subsidiary company" of a "holding company" or an "affiliate" of a "holding
company" or of a "subsidiary company" of a "holding company," as such terms are
defined in the Public Utility Holding Company Act of 1935, as amended, (c) a
"public utility" as such term is defined in the Federal Power Act, as amended,
(d) a "rail carrier or a person controlled by or affiliated with a rail
carrier", within the meaning of Title 49, U.S.C., or (e) a "carrier" to which
49 U.S.C. Section 11301(b)(1) is applicable.
Section 6.19. Environmental Matters. (a) The Company and each
Subsidiary has all Environmental Permits necessary for the conduct of its
business and for the ownership, use, maintenance and operation of its assets,
and is in compliance with all material terms thereof. All such Environmental
Permits are valid and in full force and effect and, to the Company's knowledge,
none are threatened to be revoked, cancelled, suspended or modified adversely
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for any reason. As to any such Environmental Permit that is about to expire or
is needed for the proposed conduct of its business, the Company or such
Subsidiary, as the case may be, has timely and properly applied for renewal or
receipt of the same or, if such Permit is not reasonably expected to be
renewed, such nonrenewal will not have a Material Adverse Effect.
(b) Without in any manner limiting any other representations and
warranties set forth in this Agreement:
(i) neither the Company nor any Subsidiary, nor any real
property or facility presently owned, used, maintained or operated by
the Company or any Subsidiary, nor any of the other assets of the
Company or any Subsidiary is in violation of or is in noncompliance
with, any Environmental Laws, except for violations or noncompliances
which, individually or in the aggregate, could not reasonably be
expected to have a Material Adverse Effect; and
(ii) without in any manner limiting the generality of
clause (i) above:
(A) no Hazardous Materials have been used,
generated, manufactured, transported, stored or treated, or
disposed of, landfilled or in any other way Released by or on
behalf of the Company or any Subsidiary, except for those of
the foregoing activities which, individually or in the
aggregate, could not have a Material Adverse Effect, and
(B) to the Company's knowledge, no Hazardous
Materials have been used, generated, manufactured, stored or
treated, or disposed of, landfilled or in any other way
Released (and no Release is threatened), by any Person other
than the Company or any Subsidiary on, under, about or from
any Property now or previously owned, used, maintained or
operated by the Company or any Subsidiary or any Property
adjacent to any such Property except for those of the
foregoing activities (including Releases and threatened
Releases) which, individually or in the aggregate, could not
have a Material Adverse Effect;
(C) neither the Company nor any Subsidiary is
subject, as a result of the operation or condition of its
business or assets prior to or at Closing, to any (1)
contingent liability in connection with any Release or
threatened Release of any Hazardous Materials into the
environment whether on or off any Property owned, used,
maintained or operated by the Company or such Subsidiary or
(2) reclamation or remediation requirements under
Environmental Laws, or any reporting requirements related
thereto, except for liabilities or requirements which,
individually or in the aggregate, could not have a Material
Adverse Effect;
(D) neither the Company nor any Subsidiary has
been named as a potentially responsible party under, and none
of its Property has been nominated or identified as a facility
which is subject to an existing or potential
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claim under, CERCLA or comparable Environmental Laws, and no
such Property is subject to any Lien arising under
Environmental Laws;
(E) the Company and each Subsidiary has all
environmental and pollution control equipment necessary for
(1) compliance in all material respects with all Environmental
Laws (including all applicable Permits) and (2) operation of
the business of the Company or such Subsidiary as it is
presently conducted;
(F) no Hazardous Materials have been incorporated
into or contained in any of the personal property or
improvements to real property owned, used, maintained or
operated by the Company or any Subsidiary such that such
Hazardous Materials could reasonably be expected to have a
Material Adverse Effect;
(G) none of the locations where Hazardous
Materials have been used, generated, manufactured, stored,
treated, recycled, disposed of or Released by or on behalf of
the Company or any Subsidiary has been nominated or identified
as a facility which may be subject to an existing or potential
claim under CERCLA or comparable Environmental Laws;
(H) to the knowledge of the Company, none of the
offsite locations where Hazardous Materials from any of the
assets of the Company or any Subsidiary have been stored,
treated, recycled, disposed of or Released has been nominated
or identified as a facility which may be subject to an
existing or potential claim under CERCLA or comparable
Environmental Laws;
(I) neither the Company nor any Subsidiary has
received any written notices of (1) any violation of,
noncompliance with or remedial obligation under Environmental
Laws relating to the ownership, use, maintenance, operation
of, or conduct of business related to, any Property of the
Company or such Subsidiary or (2) any Release or threatened
Release of Hazardous Materials, except for violations,
noncompliances, obligations, Releases or threatened Releases
which, individually or in the aggregate, could not have a
Material Adverse Effect;
(J) there are no writs, injunctions, decrees,
orders or judgments outstanding, or lawsuits, claims,
proceedings or investigations pending or, to the knowledge of
the Company, threatened relating to the ownership, use,
maintenance, operation of, or conduct of business related to,
any Property of the Company or any Subsidiary arising out of
or relating to Environmental Laws, nor does the Company or any
Subsidiary have knowledge (after due inquiry) of any basis for
any of the foregoing, except for writs, injunctions, decrees,
orders, judgments, lawsuits, claims, proceedings or
investigations which, individually or in the aggregate, could
not have a Material Adverse Effect;
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(K) no underground or aboveground storage tanks
or surface impoundments are located at any Property owned,
used, maintained or operated by the Company or any Subsidiary
other than those which, individually or in the aggregate,
could not reasonably be expected to have a Material Adverse
Effect; and
(L) there are no material obligations,
undertakings or liabilities arising out of or relating to
Environmental Laws which the Company or any Subsidiary has
agreed to, assumed or retained, by contract or otherwise.
Section 6.20. Books and Records. The Company maintains books,
records and accounts with respect to itself and the Subsidiaries which, in
reasonable detail, accurately and fairly reflect their transactions and
dispositions of their assets, and maintains a system of internal accounting
controls sufficient to provide reasonable assurances that (a) transactions are
executed in accordance with management's general or specific authorization, (b)
transactions are recorded as necessary (i) to permit preparation of financial
statements in accordance with GAAP, and (ii) to maintain accountability for
assets, (c) access to assets is permitted only in accordance with management's
general or specific authorization and (d) the recorded accountability for
assets is compared with the existing assets at reasonable intervals and
appropriate action is taken with respect to any differences.
Section 6.21. Fiscal Year. The fiscal year of the Company and
each Subsidiary coincides with the calendar year.
Section 6.22. Brokerage. All negotiations relative to this
Agreement, the other Loan Documents and the transactions contemplated hereby
have been carried on by the Company and the other Loan Parties without the
intervention of any Person which might give rise to a valid claim against the
Purchasers for a brokerage commission or other like payment.
Section 6.23. Labor Matters. Schedule IX lists each employment,
consultant or similar agreement and all labor contracts and collective
bargaining agreements to which the Company or any Subsidiary is a party or by
which it is bound. Except as otherwise listed on Schedule IX, no strikes or
other labor disputes are pending or threatened against the Company or any
Subsidiary. All payments due from the Company or any Subsidiary on account of
employee health and welfare insurance have been paid or, if not due, have been
accrued as liabilities on the books of the Company or such Subsidiary.
Section 6.24. Patents, Trademarks, Etc. The Company and each
Subsidiary owns, or is licensed or otherwise has the lawful right to use, all
patents, trademarks, tradenames, copyrights, technology, know-how and processes
necessary for the conduct of its business as now conducted and as proposed to
be conducted. All tradenames used by the Company or any Subsidiary are listed
on Schedule X. Assumed name certificates have been duly filed of record with
appropriate Governmental Authorities for each of such tradenames.
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Section 6.25. Chief Executive Office. The chief executive office
of the Company and the office where it maintains its records is located at 0000
Xxxx 0xx Xxxxxx, Xxxx Xxxxx, Xxxxx 00000-0000.
Section 6.26. Permitted Investments. Schedule XI specifies the
aggregate amount of each investment held by the Company and any of its
Subsidiaries on the date hereof other than those permitted by clauses (a)
through (j) of Section 9.11.
Section 6.27. Liens. None of the Properties of the Company or
any Subsidiary is subject to any Lien other than Permitted Liens.
Section 6.28. Full Disclosure. (a) Neither this Agreement
(including the Schedules and Exhibits hereto), the other Loan Documents, the
Company Financials, the instruments described in Section 6.03(a) nor any
document delivered by the Company or any of its Affiliates pursuant to Article
III contains any untrue statement of a material fact or omits to state a
material fact necessary in order to make the statements contained herein or
therein not misleading in light of the circumstances under which the same were
made.
(b) There is no fact (excluding general economic conditions not
peculiar to the Company or any Subsidiary) which (i) has had a Material Adverse
Effect or, in the opinion of any Responsible Officer of the Company, could
reasonably be expected in the future to have a Material Adverse Effect and (ii)
has not been set forth in this Agreement (including the Schedules and Exhibits
hereto) or in the Company Financials.
ARTICLE VII
PURCHASE FOR INVESTMENT; SOURCE OF FUNDS
Section 7.01. Representations of the Purchasers. (a) Each of the
Purchasers hereby represent to the Company that it (i) is purchasing the Notes
for its own account for investment and not with a view to, or for sale in
connection with, the distribution thereof or with any present intention of
distributing or selling any of the Notes, provided that the disposition of the
Purchaser's property shall at all times be within its control, (ii) is an
"accredited investor", as defined in Regulation D under the Securities Act, and
(iii) (x) has knowledge and experience in financial and business matters such
that it is capable of evaluating the merits and risks of the investment in the
Notes and (y) is able to bear the economic risk of such investment. Each of the
Purchasers understands that the Notes have not been registered under the
Securities Act and may not be sold or otherwise transferred by the Purchasers
except pursuant to an effective registration statement under such Act or
pursuant to an available exemption therefrom under such Act.
(b) Each of the Purchasers further represents to the
Company that at least one of the following statements is an accurate
representation as to each source of funds (a "Source") to be used by it to pay
the purchase price of the Notes to be purchased by it hereunder:
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(i) the Source is an "insurance company general account"
within the meaning of Department of Labor Prohibited Transaction
Exemption ("PTE") 95-60 (issued July 12, 1995) and there is no
employee benefit plan, treating as a single plan, all plans maintained
by the same employer or employee organization, with respect to which
the amount of the general account reserves and liabilities for all
contracts held by or on behalf of such plan, exceeds ten percent (10%)
of the total reserves and liabilities of such general account
(exclusive of separate account liabilities) plus surplus, as set forth
in the NAIC Annual Statement filed with your state of domicile; or
(ii) the Source is either (1) an insurance company pooled
separate account, within the meaning of PTE 90-1 (issued January 29,
1990), or (2) a bank collective investment fund, within the meaning of
the PTE 91-38 (issued July 12, 1991) and, except as you have disclosed
to the Company in writing pursuant to this paragraph (ii), no employee
benefit plan or group of plans maintained by the same employer or
employee organization beneficially owns more than 10% of all assets
allocated to such pooled separate account or collective investment
fund; or
(iii) (1) the Source constitutes assets of an "investment
fund" (within the meaning of Part V of the QPAM Exemption) managed by
a "qualified professional asset manager" or "QPAM" (within the meaning
of Part V of the QPAM Exemption), (2) no employee benefit plan's
assets that are included in such investment fund, when combined with
the assets of all other employee benefit plans established or
maintained by the same employer or by an affiliate (within the meaning
of Section V(c)(1) of the QPAM Exemption) of such employer or by the
same employee organization and managed by such QPAM, exceed 20% of the
total client assets managed by such QPAM, (3) the conditions of Part
1((c)and (g) of the QPAM Exemption are satisfied, (4) neither the QPAM
nor a person controlling or controlled by the QPAM (applying the
definition of "control" in Section V(e) of the QPAM Exemption) owns a
5% or more interest in the Company and (5) the identity of such QPAM
and the names of all employee benefit plans whose assets are included
in such investment fund have been disclosed to the Company in writing
pursuant to this paragraph (iii); or
(iv) the Source is a governmental plan; or
(v) the Source is one or more employee benefit plans, or
a separate account or trust fund comprised of one or more employee
benefit plans, each of which has been identified to the Company in
writing pursuant to this paragraph (v); or
(vi) the Source does not include assets of any employee
benefit plan, other than a plan exempt from the coverage of ERISA.
If you or any prospective transferee of a Note identifies a plan
pursuant to paragraphs (ii), (iii) or (v) above, the Company shall deliver a
certificate on the appropriate date of Closing, with respect to you and on or
prior to the date of any transfer of any Note, with respect to any prospective
transferee, which certificate shall state (x) whether it is a
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party in interest or a "disqualified, person" (as defined in Section 4975(e)(2)
of the Code), with respect to any plan identified pursuant to paragraphs (ii)
or (v) above, or (y) with respect to any plan, identified pursuant to paragraph
(iii) above, whether it or any "affiliate" (as defined in Section V(c) of the
QPAM Exemption) has, at such time or during the immediately preceding one year,
exercised the authority to appoint or terminate said QPAM as manager of the
assets of any plan identified in writing pursuant to paragraph (c) above or to
negotiate the terms of said QPAM's management agreement on behalf of any such
identified plans.
As used in this Section 7.01(b), the terms "employee benefit plan",
"governmental plan", "party in interest" and "separate account" shall have the
respective meanings assigned to such terms in Section 3 of ERISA.
ARTICLE VIII
AFFIRMATIVE COVENANTS
Section 8.01. Financial Statements, Reports and Documents. The
Company shall deliver to each Holder (in duplicate):
(a) as soon as available, and in any event within 45
days, after the end of each Fiscal Quarter (other than the last Fiscal
Quarter in any Fiscal Year), a consolidated balance sheet of the
Company and the Consolidated Subsidiaries (in reasonable detail) as of
the end of such Fiscal Quarter and the related consolidated statements
of income, stockholders' equity and cash flows of the Company and the
Consolidated Subsidiaries (in reasonable detail) for such Fiscal
Quarter and for the portion of the current Fiscal Year ending on the
last day of such Fiscal Quarter, in each case (i) prepared in
accordance with GAAP and (ii) setting forth in comparative form the
figures for the corresponding period of the preceding Fiscal Year,
which financial statements shall be certified (subject to normal
year-end audit adjustments) as to fairness of presentation, compliance
with GAAP and consistency with prior periods by a Responsible Officer
of the Company, it being understood that no such statement need be
accompanied by complete footnotes;
(b) as soon as available, and in any event within 90
days, after the end of each Fiscal Year, a consolidated balance sheet
of the Company and the Consolidated Subsidiaries (in reasonable
detail) as of the end of such Fiscal Year and the related consolidated
statements of income, stockholders' equity and cash flows of the
Company and the Consolidated Subsidiaries (in reasonable detail) for
such Fiscal Year, in each case (i) prepared in conformity with GAAP
and (ii) setting forth in comparative form the figures for the
preceding Fiscal Year, which financial statements shall be accompanied
by an opinion thereon (which shall not be qualified by reason of any
limitation imposed by the Company) of the Independent Accountants
stating that such financial statements, in the opinion of the
Independent Accountants, present fairly the consolidated financial
position of the Company and the Consolidated Subsidiaries as of the
date thereof and the consolidated results of their operations and cash
flows for the period covered thereby in conformity with GAAP
consistently
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applied (except for noted changes in which the Independent Accountants
concur) and that the examination of the Independent Accountants in
connection with such financial statements has been made in accordance
with generally accepted auditing standards and, accordingly, includes
such tests of the accounting records and such other auditing
procedures as were considered necessary in the circumstances;
(c) simultaneously with the delivery of each set of
financial statements referred to in clauses (a) and (b) above, an
Officers' Certificate (i) setting forth in reasonable detail the
calculations required to establish whether the Company was in
compliance with the requirements of Sections 9.01, 9.02, 9.03, 9.04,
9.05, 9.06 and 9.07 on the date of such financial statements, (ii)
stating that the signers have reviewed this Agreement and the other
Loan Documents and have made, or caused to be made under their
supervision, a review of the transactions and condition of the Company
during the accounting period covered by such financial statements and
(iii) stating that such review did not disclose the existence during
or at the end of such accounting period of any Default or, if any
Default exists, specifying the nature and period of existence thereof
and what action the Company has taken, is taking or proposes to take
with respect thereto;
(d) simultaneously with the delivery of each set of
financial statements referred to in clause (b) above, a written
statement by the Independent Accountants giving the opinion thereon
stating (i) that their audit has included a review of the terms of
this Agreement and that such review is sufficient to enable them to
make the statement referred to in clause (iv) of this paragraph (d)
(it being understood that such Independent Accountants shall not be
required to conduct or make any special or additional audit procedures
or examinations for purposes of such written statement, other than
those required by generally accepted auditing standards, and that
their audit will not have been directed primarily toward obtaining
knowledge of any Default), (ii) whether, in the course of their audit,
they obtained knowledge (and whether, as of the date of such written
statement, they have knowledge) of the existence and continuance of
any Default and, if so, specifying the nature and period of existence
thereof, (iii) that they have examined the Officers' Certificate
delivered in connection therewith pursuant to clause (c) above and
(iv) that the matters set forth in such Officers' Certificate pursuant
to subclause (i) of clause (c) above have been properly stated in
accordance with this Agreement;
(e) promptly upon receipt thereof, a copy of each
management letter submitted to the Company by the Independent
Accountants (and each response of the Company thereto), it being
understood and agreed that all material items which are furnished to
the Holders pursuant to this clause (e) shall be treated as
confidential if such items are not previously known to any Holder and
if, and so long as, such items are not generally available to the
public, but nothing herein contained shall limit or impair the right
of any Holder to (i) disclose such items to any other Holder, any
prospective Transferee, the National Association of Insurance
Commissioners or any Governmental Authority, (ii) disclose such items
in connection with any litigation, investigation or similar
proceeding, (iii) use such information to the extent pertinent
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to an evaluation of the Obligations or to enforce compliance with the
terms and conditions of this Agreement, (iv) take any action required
by law or (v) take any lawful action which such Holder deems necessary
to protect its interests under this Agreement or any other Loan
Document;
(f) promptly upon becoming available, a copy of each
consolidating balance sheet and income statement of the Company and
the Consolidated Subsidiaries prepared by or on behalf of the Company
after the date hereof, including those prepared in connection with any
federal income tax return for the Company or any Subsidiary;
(g) promptly upon transmission thereof, a copy of each
(i) financial statement, proxy statement, notice and report sent or
made available by the Company to its security holders in compliance
with the Exchange Act or any comparable federal or state laws relating
to the disclosure by any Person of information to its security
holders, (ii) regular and periodic report, registration statement
(excluding exhibits) and prospectus filed by the Company with any
securities exchange or with the SEC or any Governmental Authority
succeeding to any of its functions and (iii) press release or other
statement made available by the Company to the public concerning
material developments in the business of the Company;
(h) as soon as practicable, and in any event within two
Business Days, after the Company obtains knowledge of any Default, an
Officers' Certificate specifying the nature and period of existence
thereof and what action the Company has taken, is taking or proposes
to take with respect thereto;
(i) as soon as practicable, and in any event within ten
Business Days, after the Company obtains knowledge of any condition
(excluding general economic conditions not peculiar to the Company or
any Subsidiary), happening or event which, in the opinion of the Board
of Directors or any Responsible Officer of the Company, could
reasonably be expected to have a Material Adverse Effect, an Officers'
Certificate specifying the nature and period of existence thereof and
what action the Company has taken, is taking or proposes to take with
respect thereto;
(j) promptly, a copy of each Material Contract entered
into or assumed by the Company after the date hereof and each
amendment, supplement or modification entered into after the date
hereof in respect of any Material Contract; and
(k) such other information concerning the business,
financial condition, results of operation, prospects or Properties of
the Company or any of any Subsidiary as any Holder shall reasonably
request.
Section 8.02. Payment of Principal, Interest and Premium. The
Company will duly and punctually pay the principal of, and interest and premium
(if any) on, the Notes in accordance with the terms of the Notes and this
Agreement.
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Section 8.03. Payment of Taxes, Claims and Indebtedness. The
Company will, and will cause each Subsidiary to, pay and discharge, as and when
due and payable, (a) all taxes, assessments and governmental charges or levies
imposed upon it or any of its Properties or in respect of any of its
franchises, business, income or profits, (b) all claims (including claims for
labor, services, materials and supplies) for sums which, if unpaid, might
become a Lien upon any of its Property and (c) all of its other indebtedness in
excess of $500,000; provided, however, that no such tax, assessment, charge or
levy, claim or indebtedness (other than the Obligations) need be paid if and so
long as (i) no Default shall be in existence, (ii) the amount, applicability or
validity thereof is being contested in good faith by appropriate proceedings
promptly initiated and diligently conducted and (iii) such reserves or other
appropriate provision (if any) as shall be required by GAAP shall have been
made therefor.
Section 8.04. Maintenance of Existence and Rights; Conduct of
Business. The Company will, and will cause each Subsidiary to, (a) preserve
and keep in full force and effect (except as permitted by Section 9.16) its
corporate or partnership, as the case may be, existence and all of its rights,
privileges and franchises necessary or desirable in the normal conduct of its
business, (b) qualify and remain qualified as a foreign Person authorized to do
business in each jurisdiction in which such qualification is required and (c)
carry on and conduct its business (i) in the ordinary course, (ii) in an
orderly and efficient manner consistent with good business practices and (iii)
in accordance, in all material respects, with all Legal Requirements.
Section 8.05. Compliance with Loan Documents. The Company will,
and will cause each Subsidiary to, promptly comply with any and all covenants
and provisions of each Loan Document to which it is a party.
Section 8.06. Compliance with Contracts and Permits. The Company
will, and will cause each Subsidiary to, comply with all of its Applicable
Contracts and Applicable Permits except for noncompliances which, individually
or in the aggregate, could not reasonably be expected to have a Material
Adverse Effect.
Section 8.07. Inspection. (a) The Company will, and will cause
each Subsidiary to, permit any Person designated by any Holder, at all
reasonable times, to (i) visit and inspect any of its Properties, (ii) examine,
copy or make excerpts from, any and all books, records, software, documents and
other information in the possession of the Company or such Subsidiary and
relating to its affairs and (iii) discuss its affairs, finances and accounts
with its directors, officers and independent public accountants; and, by this
provision, the Company (on behalf of itself and each Subsidiary) irrevocably
authorizes such accountants to discuss with such Person the affairs, finances
and accounts of the Company and such Subsidiary. All such visits and
inspections shall be at the expense of such Holder unless a Default shall
exist, in which event the reasonable costs and expenses associated with all
such events and inspections shall be at the expense of the Company.
(b) The Company will keep at its principal executive office a true
copy of this Agreement and each other Loan Document and cause the same to be
available for inspection
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at said office during normal business hours by any Holder or any Transferee or
prospective Transferee designated by any Holder.
Section 8.08. Books and Records. The Company will, and will
cause each Subsidiary to, (a) maintain (in accordance with good accounting
practices and all Legal Requirements) complete and accurate books, records and
accounts accurately and fairly reflecting its transactions in reasonable detail
and (b) maintain a system of internal accounting controls sufficient to provide
reasonable assurances that:
(i) its transactions are executed in accordance with
management's general or specific authorization;
(ii) its transactions are recorded as necessary (A) to
permit preparation of financial statements in accordance with GAAP and
(B) to maintain accountability for its assets;
(iii) access to its assets is permitted only in accordance
with management's general or specific authorization; and
(iv) the recorded accountability for its assets is
compared with the existing assets at reasonable intervals and
appropriate action is taken with respect to any differences.
Section 8.09. Compliance with Legal Requirements. (a) The
Company will, and will cause each Subsidiary to, will comply with all Legal
Requirements applicable to it or any of its Properties, business, operations or
transactions except for noncompliances which, individually or in the aggregate,
could not reasonably be expected to have a Material Adverse Effect.
(b) Without limiting the foregoing, the Company will, and will
cause each Subsidiary to, (i) comply in a timely fashion with, or operate
pursuant to valid waiver of the provisions of, all Environmental Laws,
including any such Laws relating to contamination from any Hazardous Materials
except for noncompliances which, individually or in the aggregate, could not
reasonably be expected to have a Material Adverse Effect, (ii) notify each
Holder promptly in the event of any material violation of any Environmental Law
and (iii) promptly forward to each Holder a copy of any Permit, order, notice,
application or other communication or report in connection with any material
matter relating to the Environmental Laws as they may affect it or any of its
Properties.
Section 8.10. Insurance. The Company will, and will cause each
Subsidiary to, maintain in full force and effect, with sound and reputable
insurers, such insurance on its Properties and business against such
casualties, risks, liabilities and contingencies, and in such types and
amounts, as are consistent with customary practices and standards of companies
engaged in similar businesses; provided, however, except as may be required by
any Legal Requirement, neither the Company nor any Subsidiary shall be required
to maintain (i) business interruption insurance or (ii) insurance on its
inventories.
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Section 8.11. Authorizations and Approvals. The Company will,
and will cause each Subsidiary to, promptly obtain, from time to time at its
own expense, all such Permits as may be required to enable it to comply with
its obligations hereunder and under the other Loan Documents.
Section 8.12. Maintenance of Properties. (a) The Company will,
and will cause each Subsidiary to, protect and maintain (or cause to be
protected or maintained), in good repair, working order and condition (ordinary
wear and tear excepted), all Properties used or intended for use in its
business.
(b) From time to time, the Company will, and will cause each
Subsidiary to, make (or cause to be made) all appropriate repairs, renewals and
replacements thereof so that, at all times, it may conduct its business
properly and efficiently and in accordance with all Legal Requirements;
provided that failure to perform this paragraph (b) in accordance with its
terms will not constitute an Event of Default unless such failure could have a
Material Adverse Effect.
(c) The Company will, and will cause each Subsidiary to, comply at
all times with the provisions of all leases to which it is a party as lessee or
under which it occupies Property; provided that nothing in this paragraph (c)
shall require the Company or any Subsidiary to comply with any such provision
unless the noncompliance with such provision could reasonably be expected to
have a Material Adverse Effect.
Section 8.13. Ownership of Subsidiaries. The Company will, at
all times, directly or indirectly own and hold the entire legal title to and
beneficial interest in all outstanding Stock (other than directors' qualifying
shares, if any, to the extent required by applicable law) of each Subsidiary,
in each case free and clear of all Liens.
Section 8.14. Further Assurances. The Company will, and will
cause each Subsidiary to, promptly take all such actions as the Required
Holders may, at any time or from time to time, reasonably request in order to
(i) further carry out and consummate the Overall Transaction or (ii) comply
with or accomplish the covenants and agreements of the Loan Parties in any of
the Loan Documents.
ARTICLE IX
NEGATIVE COVENANTS
Until payment in full of the Notes and all other Obligations,
the Company covenants and agrees as follows:
Section 9.01. Consolidated Indebtedness for Money Borrowed. The
Company will not permit Consolidated Indebtedness for Money Borrowed, as of the
last day of any Fiscal Quarter commencing on or after September 30, 1996, to be
greater than the amount determined by multiplying the Applicable Percentage
times the sum of (a) Consolidated Indebtedness for Money Borrowed as of such
date and (b) Consolidated Tangible Net Worth as of such date. As used in this
Section 9.01, "Applicable Percentage" means 75%.
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Section 9.02. Consolidated Tangible Net Worth. The Company will
not permit Consolidated Tangible Net Worth at any time to be less than the sum
of (a) $30,625,000 plus (b) 50% of Consolidated Adjusted Net Income (but only
if positive) for each Fiscal Quarter ending after December 31, 1992.
Section 9.03. Current Assets to Current Liabilities Ratio. The
Company will not permit the ratio of (a) Consolidated Current Assets to (b)
Consolidated Current Liabilities to be less than 3.5 to 1 as of the last day of
any Fiscal Quarter commencing on or after January 1, 1995.
Section 9.04. Current Assets to Total Indebtedness Ratio. The
Company will not permit the ratio of (a) Consolidated Current Assets to (b)
Consolidated Current Liabilities plus Consolidated Funded Debt to be less than
.8 to 1 as of the last day of any Fiscal Quarter commencing on or after
September 30, 1996. As used in this Section 9.04, "Consolidated Funded Debt"
means, at any time, Consolidated Indebtedness for Money Borrowed at such time,
provided that in no event shall Consolidated Funded Debt include any obligation
included in Consolidated Current Liabilities.
Section 9.05. Inventory Turnover. The Company will not at any
time permit the ratio of (a) cost of goods sold by the Company and the
Consolidated Subsidiaries for the Computation Period (as shown on the
consolidated statements of income delivered by the Company pursuant to clause
(a) or (b) of Section 8.01 with respect to the Computation Period) to (b) the
Average Monthly Inventory for the Computation Period to be less than 1.65 to 1.
As used in this Section 9.05, (i) "Computation Period" means, at any time, the
12-month period ended on the date of the most recent balance sheet delivered
(or required to be delivered) by the Company pursuant to clause (a) or (b) of
Section 8.01 and (ii) "Average Monthly Inventory" means, when used with
reference to any Computation Period, the amount determined by dividing (A) the
aggregate amounts of inventory appearing on the books of the Company and the
Consolidated Subsidiaries as of the last day of each calendar month within such
Computation Period by (B) twelve.
Section 9.06. Fixed Charge Coverage. The Company will not at any
time permit the ratio of (a) the sum of Consolidated Adjusted Net Income for
the Computation Period plus the aggregate amount of all taxes, rents, leases
and interest expenses deducted from gross income to obtain such Consolidated
Adjusted Net Income to (b) the aggregate amount of all such rents, leases and
interest expenses so deducted to be less than 1.5 to 1. As used in this
Section 9.06, "Computation Period" means, at any time, the period of four
consecutive Fiscal Quarters ended on the date of the most recent balance sheet
delivered (or required to be delivered) by the Company pursuant to clause (a)
or (b) of Section 8.01.
Section 9.07. Restricted Payments. (a) The Company will not, and
will not permit any Subsidiary to, (i) declare or make any dividends or
distributions on any of its Stock (other than dividends payable in shares of
its Stock), (ii) purchase, redeem or acquire for value any of the Company's or
any Subsidiary's Stock, (iii) make any principal payment on (or make any
payment, transfer or deposit for the purpose of canceling, extinguishing,
satisfying or defeasing) any indebtedness of the Company which is subordinate
in right of
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payment to the Notes or any other Obligation, (iv) set aside funds for any such
purposes or (v) become liable to do any of the foregoing (in each case, a
"Restricted Payment") unless, immediately after giving effect thereto, (A) no
Default shall exist and (B) the aggregate amount of all Restricted Payments
made by the Company and all Subsidiaries on or after January 1, 1996 does not
exceed the sum of $15,000,000 plus 50% of Consolidated Adjusted Net Income from
and after January 1, 1996. For purposes of this Section 9.07, the Company's
repurchase of shares of its common stock in the aggregate amount of $38,250,000
under its issuer tender offer commenced November 18, 1996 in accordance with
Rule 13E-4 promulgated by the SEC shall not be considered a Restricted Payment.
(b) Notwithstanding the foregoing provisions of this Section 9.07,
the Company may, so long as no Default shall be in existence or shall result
therefrom, purchase, redeem or acquire shares of the Company's capital stock
with the net cash proceeds received by the Company during the immediately
preceding 18-month period from the sale of other shares of the Company's
capital stock, in which event both the receipt and expenditure of such proceeds
shall be excluded from any calculation under paragraph (a) above.
(c) Nothing in this Section 9.07 shall prohibit any Subsidiary
from making any Restricted Payment to the Company or any Wholly-Owned
Subsidiary, and no such Restricted Payment shall be taken into account in any
calculation under paragraph (a) above.
Section 9.08. Limitation on Indebtedness. (a) The Company will
not incur, create, assume or have outstanding any indebtedness, except:
(1) (A) indebtedness of the Company arising out of this
Agreement and the other Loan Documents, (B) indebtedness of the
Company arising out of the 1993 Note Agreement and the other 1993 Loan
Documents and (C) indebtedness of the Company arising out of the 1995
Note Agreement and the other 1995 Loan Documents;
(2) indebtedness of the Company arising out of the Bank
Loan Agreement;
(3) purchase money indebtedness (not to exceed
$10,000,000 in the aggregate for the Company and all Subsidiaries at
any time outstanding);
(4) current liabilities for taxes and assessments
incurred in the ordinary course of business and not yet due, and other
liabilities for unpaid taxes being contested in good faith by the
obligor the payment of which is not at the time required by Section
8.03;
(5) current indebtedness (other than indebtedness for
borrowed money or purchase money indebtedness) for accounts payable or
other claims (including claims for labor, services, materials and
supplies) incurred in the ordinary course of business, provided that
all such accounts and claims shall be promptly paid and discharged
when due or in conformity with customary trade terms, except for those
being contested in good faith by the obligor and the payment of which
is not at the time required by Section 8.03;
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(6) contingent liabilities resulting from the endorsement
of negotiable instruments in the ordinary course of business;
(7) indebtedness constituting Assurances of the Company
permitted by Section 9.09;
(8) indebtedness for borrowed money of the Company owing
to any Subsidiary, but only if permitted by Section 9.11;
(9) indebtedness secured by Liens described in clause (j)
of the definition of "Permitted Liens" in Section 2.01; and
(10) indebtedness for borrowed money of the Company not
otherwise permitted by the foregoing provisions of this Section
9.08(a) if (A) immediately after giving effect the incurrence or
assumption thereof by the Company, the Company is in compliance with
Sections 9.01, 9.02, 9.03, 9.04, 9.05 and 9.06 and (B) at the time of
the incurrence or assumption thereof by the Company and immediately
thereafter, no Default shall exist.
(b) The Company will not permit any Subsidiary to incur, create,
assume or have outstanding any indebtedness, except:
(1) (A) indebtedness of Subsidiaries arising out of this
Agreement and the other Loan Documents, (B) indebtedness of
Subsidiaries arising out of the 1993 Guaranty and (C) indebtedness of
Subsidiaries arising out of the 0000 Xxxxxxxx;
(2) purchase money indebtedness (not to exceed
$10,000,000 in the aggregate for the Company and all Subsidiaries at
any time outstanding);
(3) current liabilities for taxes and assessments
incurred in the ordinary course of business and not yet due, and other
liabilities for unpaid taxes being contested in good faith by the
obligor the payment of which is not at the time required by Section
8.03;
(4) current indebtedness (other than indebtedness for
borrowed money or purchase money indebtedness) for accounts payable or
other claims (including claims for labor, services, materials and
supplies) incurred in the ordinary course of business, provided that
all such accounts and claims shall be promptly paid and discharged
when due or in conformity with customary trade terms, except for those
being contested in good faith by the obligor and the payment of which
is not at the time required by Section 8.03;
(5) contingent liabilities resulting from the endorsement
of negotiable instruments in the ordinary course of business;
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(6) indebtedness constituting Assurances of Subsidiaries
permitted by Section 9.09;
(7) indebtedness for borrowed money of any Subsidiary
owing to the Company or to any other Subsidiary, but only if permitted
by Section 9.11;
(8) indebtedness secured by Liens described in clause (j)
of the definition of "Permitted Liens" in Section 2.01;
(9) other indebtedness of any Subsidiary not otherwise
permitted by the foregoing provisions of this Section 9.08(b), but (A)
only if such indebtedness is outstanding on the date hereof and
described in Schedule VIII and (B) excluding any extensions, renewals
and rearrangements of such indebtedness;
(10) (A) in the case of Pantbelaning, the Pantbelaning
Indebtedness, (B) in the case of Pantbelaning, Murtrum, and the
Murtrum Affiliate, Indebtedness for Money Borrowed (not to exceed SEK
55,000,000 in the aggregate at any time outstanding) incurred after
the date hereof pursuant to a credit facility to be extended by one or
more banks, but only if no Default shall be in existence at the time
of the incurrence of such indebtedness, and (C) in the case of Xxxxxx
& Xxxxxxxx Limited, the Xxxxxx & Xxxxxxxx Indebtedness and, to the
extent permitted under the 1993 Note Agreement and the 1995 Note
Agreement, additional Indebtedness for Money Borrowed in an amount not
to exceed 5,000,000 pounds sterling in the aggregate at any time
outstanding incurred after the date hereof pursuant to a credit
facility to be extended by one or more banks, but only if no Default
or Event of Default shall be in existence at the time of the
incurrence of such Indebtedness for Money Borrowed; provided that the
Indebtedness for Money Borrowed described in clauses (A), (B) and (C)
described above may be extended, renewed or refinanced so long as
there is no increase in principal amount of such Indebtedness for
Money Borrowed and so long as no Default shall be in existence or
shall occur upon such extension, renewal or refinancing; and
(11) in the case of any Wholly-Owned Subsidiary acquired
by the Company after the date hereof in accordance with Section
9.20(a)(1), all indebtedness of such Subsidiary outstanding on the
date of its acquisition by the Company, but (i) only if the amount of
such indebtedness, when aggregated with the total amount of all other
indebtedness of all Persons (including such Wholly-Owned Subsidiary)
outstanding pursuant to this clause (11), does not exceed $750,000,
(ii) only if such indebtedness was incurred, created or assumed by
such Subsidiary prior to its acquisition by the Company and not in
anticipation of, or in connection with, such acquisition and (iii)
excluding any extensions, renewals and rearrangements of such
indebtedness.
Section 9.09. Assurances. The Company will not, and will not
permit any Subsidiary to, enter into, assume or become or be liable in respect
of any Assurance, except for (i) Assurances by the Company of indebtedness of
Subsidiaries permitted by Section 9.08(b), (ii) Assurances by one or more
Guarantors of indebtedness (other than the Obligations) of
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the Company permitted by Section 9.08(a) but only if and so long as the
Guaranty is in full force and effect, (iii) Assurances of the Guarantors
evidenced by the Guaranty, (iv) Assurances by the Company and the Guarantors of
the Pantbelaning Indebtedness, and (v) other Assurances not otherwise permitted
by this Section 9.09 but only to the extent that the aggregate amount of all
indebtedness relating to such Assurances does not exceed $500,000.
Section 9.10. Negative Pledge. The Company will not, and will
not permit any Subsidiary to, assume, create or suffer to exist any Lien upon
any of its Properties (whether now owned hereafter acquired) except Permitted
Liens.
Section 9.11. Limitation on Investments. The Company will not,
and will not permit any Subsidiary to, make or have outstanding any Investments
in any Person, except for:
(a) pawn transactions and pawn loans made in the ordinary
course of business;
(b) travel advances and other similar advances made to
employees in the ordinary course of business;
(c) advances and extensions of credit (in the form of
accounts receivable) made to customers in the ordinary course of
business;
(d) advances and deposits made by the Company or any
Subsidiary in the ordinary course of business to contractors
performing services for the Company or such Subsidiary, as the case
may be;
(e) in the case of the Company, Investments in
Wholly-Owned Subsidiaries (including Wholly-Owned Subsidiaries
acquired after the date hereof in accordance with Section 9.20(a)(1))
resulting from its acquisition or ownership of Stock of, or capital
contributions to, such Subsidiaries but, in each case, only to the
extent not prohibited by Section 9.20;
(f) in the case of any Subsidiary, Investments in the
Company;
(g) in the case of any Subsidiary, Investments in
Wholly-Owned Subsidiaries (including Wholly-Owned Subsidiaries
acquired after the date hereof in accordance with Section 9.20(a)(1))
resulting from its acquisition or ownership of Stock of, or capital
contributions to, such Wholly-Owned Subsidiaries but, in each case,
only to the extent not prohibited by Section 9.20;
(h) loans and advances by the Company to any Wholly-Owned
Subsidiary, provided that, in the case of any such loan or advance
made after the date hereof, no Default shall exist either immediately
before or after giving effect thereto;
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(i) loans and advances made by any Subsidiary to the
Company or to any Wholly-Owned Subsidiary;
(j) Temporary Cash Investments;
(k) other Investments not otherwise permitted by this
Section 9.11, but only if owned by the Company and/or any Subsidiary
on the date hereof and described in Schedule XI; and
(l) other Investments made after the date hereof and not
otherwise permitted by this Section 9.11, provided that neither the
Company nor any Subsidiary shall make any Investment under this clause
(l) if a Default shall be in existence immediately before or after
such Investment or if the amount of such Investment, when aggregated
with the total amount of all other Investments then outstanding under
this clause (l), exceeds 7.5% of Consolidated Tangible Net Worth as of
the date of such Investment.
Section 9.12. Alteration of Contracts, Etc. The Company will
not, and will not permit any Subsidiary to, (a) cancel, terminate, surrender,
release, alter, amend, modify or supplement any Applicable Contract or
Applicable Permit, (b) waive timely performance of any of the provisions of any
Applicable Contract or Applicable Permit or (c) consent or agree to, or permit,
any of the foregoing, provided that any such action may be taken if the Company
shall determine in good faith that such action could not reasonably be expected
to have a Material Adverse Effect.
Section 9.13. Transactions with Affiliates. The Company will
not, and will not permit any Subsidiary to, enter into any transaction with, or
pay any management fees to, any of its Affiliates except in the ordinary course
of business and then only upon terms that are no less favorable to Company or
such Subsidiary, as the case may be, than would be obtainable at the time in
arms'-length transactions with Persons which are not Affiliates of the Company
or such Subsidiary, as the case may be, provided that this Section 9.13 shall
not apply to transactions between the Company and any Wholly-Owned Subsidiary
or to any management fees payable by any Subsidiary to the Company or any
Wholly-Owned Subsidiary.
Section 9.14. Limitation on Sale or Issuance of Subsidiary Stock.
(a) The Company will not permit any Subsidiary to issue or sell any shares of
Stock (or any securities convertible into or exchangeable for or carrying
rights to subscribe for shares of Stock) of such Subsidiary to any Person other
than the Company or a Wholly-Owned Subsidiary.
(b) The Company will not (i) sell, transfer or otherwise dispose
of any shares of Stock (or any securities convertible into or exchangeable for
or carrying rights to subscribe for shares of Stock) of any Subsidiary or (ii)
permit any Subsidiary to sell, transfer or otherwise dispose of any shares of
Stock (or any securities, convertible into or exchangeable for or carrying
rights to subscribe for shares of Stock) of any other Subsidiary.
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Section 9.15. Limitation on Sale of Properties. (a) The Company
will not, and will not permit any Subsidiary to, sell, assign, convey,
exchange, lease or otherwise dispose of any of its Properties (including
accounts receivable and pawn loans), whether now owned or hereafter acquired,
except in the ordinary course of its business; provided, however, that the
Company and the Subsidiaries may sell Properties having an aggregate net book
value (at the time of the disposition thereof) not in excess of $5,000,000
during any Fiscal Year and, provided further, that this Section 9.15 shall not
operate to prevent the transactions permitted by Section 9.14 or Section 9.16
or any sale, transfer or lease of Property by a Wholly-Owned Subsidiary to the
Company or to another Wholly-Owned Subsidiary and, provided further, that the
Company will not, and will not permit any Subsidiary to, sell, assign, discount
or otherwise dispose of any accounts receivable, except in the ordinary course
of business consistent with the Company's collection practices as in effect
from time to time and not a part of a financing.
(b) Nothing in this Section 9.15 shall prohibit the Company, so
long as no Default shall have occurred and be continuing, from selling the real
estate (including improvements thereon) currently owned by the Company at 000
Xxxxxxxx Xxxxxx, 000 Xxxxx Xxxxx Street and 000 Xxxxx Xxxxx Xxxxxx, Xxxx,
Xxxxx, and in no event shall the net book value of such Property be taken into
account in any computation under this Section 9.15.
Section 9.16. Dissolution; Liquidation; Merger; Consolidation.
The Company will not, and will not permit any Subsidiary to, dissolve or
liquidate or consolidate or merge with, or sell, assign, convey, exchange,
lease or otherwise dispose of its Properties as an entirety or substantially as
an entirety to, any other Person except that:
(a) any corporation may consolidate with or merge into
the Company if (i) the Company shall be the surviving corporation,
(ii) immediately after giving effect to such transaction, (A) no
Default or Event of Default shall have occurred and be continuing, (B)
the Company is solvent and no less creditworthy than immediately prior
to the consummation of such transaction and (C) the consummation of
such transaction did not have, and could not reasonably be expected to
have, a Material Adverse Effect and (iii) each Holder shall have
received an Officers' Certificate, dated not more than 10 days prior
to the effective date of such transaction, describing such transaction
and stating that such transaction is permitted by this Section 9.16;
(b) the Company may consolidate with or merge into, or
sell, assign, convey, exchange, lease or otherwise dispose of its
Properties as an entirety or substantially as an entirety to, any
Person if (i) such Person shall be a solvent corporation organized
under the laws of any state of the United States of America, (ii) such
Person shall, by written instrument in form and substance acceptable
to the Required Holders, expressly and unconditionally assume, agree
to pay and perform all the Obligations and to be bound by this
Agreement and the other Loan Documents the same as if such Person had
originally executed this Agreement in place of the Company and had
been the original maker of the Notes, (iii) immediately after giving
effect to such transaction, (A) no Default or Event of Default shall
have occurred and be continuing, (B) such Person is no less
creditworthy than was the Company
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immediately prior to the consummation of such transaction and (C) the
consummation of such transaction did not have, and could not be
reasonably expected to have, a Material Adverse Effect and (iv) each
Holder shall have received an Officers' Certificate, dated not more
than ten days prior to the effective date of such transaction,
describing such transaction and stating that such transaction is
permitted by this Section 9.16;
(c) any Wholly-Owned Subsidiary may consolidate with or
merge into, or sell, assign, convey, exchange, lease or otherwise
dispose of its Properties as an entirety or substantially as an
entirety to, the Company or any other Wholly-Owned Subsidiary; and
(d) any Wholly-Owned Subsidiary may consolidate or merge
with any Person solely for the purpose of the Company's acquisition of
such Person in accordance with Section 9.20(a)(1).
Section 9.17. Change of Name, Fiscal Year and Method of
Accounting. The Company will not, and will not permit any Subsidiary to, (i)
change its name, (ii) change its fiscal year, (iii) change its principal
accounting firm to an accounting firm other than the Independent Accountants or
(iv) change its method of accounting unless required under GAAP.
Section 9.18. Lines of Business. The Company will not, and will
not permit any Subsidiary to, engage in any business other than (i) the
pawnshop business, (ii) the business of cashing checks and conducting related
cash dispensing transactions, (iii) the business of offering tires and wheels
on a rent-to-own or comparable basis and performing ancillary
automobile-related services, and (iv) activities related to the above.
Section 9.19. Amendment of Organizational Documents. The Company
will not, and will not permit any Subsidiary to, amend its Organizational
Documents if such action could reasonably be expected to have a Material
Adverse Effect.
Section 9.20. Limitation on Acquisition of New Subsidiaries. (a)
The Company will not, and will not permit any Subsidiary to, (i) acquire any
Stock of any Person, (ii) enter into any partnership or joint venture or (iii)
take any action which would result in the Company having any Subsidiary other
than those listed in Schedule II except that, from time to time, the Company
may:
(1) acquire (whether by purchase, merger or other similar
transaction) any Person, but only if:
(A) immediately after giving effect to such acquisition,
such Person shall constitute a Wholly- Owned
Subsidiary;
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(B) immediately after giving effect to such acquisition,
no Default shall be in existence, and the
consummation of such acquisition did not have, and
could not be reasonably expected to have, a Material
Adverse Effect;
(C) each Holder shall have received an Officers'
Certificate, dated not more than ten days prior to
the effective date of such acquisition, describing
such acquisition (including the name of such Person
and the business conducted by it) and stating that
such acquisition is permitted by this Section 9.20,
which Officers' Certificate shall be accompanied by
complete and accurate copies of the Organizational
Documents of such Person; and
(D) promptly (and in any event within 15 days) after the
consummation of such acquisition, such Person shall
duly authorize, execute and deliver to each Holder an
instrument in writing pursuant to which such Person
agrees to become a Guarantor under, and to be bound
as a Guarantor by the terms of, the Guaranty and the
Subrogation and Contribution Agreement; and
(2) create or form a new corporation or limited
partnership (the "New Entity") and thereupon cause the New Entity to
become a Wholly-Owned Subsidiary, but only if:
(A) no Default shall exist immediately after the New
Entity becomes a Subsidiary;
(B) subject to paragraph (b) below, promptly (and in any
event within 15 days) after its creation or
formation, the New Entity shall duly authorize,
execute and deliver to each Holder an instrument in
writing pursuant to which the New Entity agrees to
become a Guarantor under, and to be bound as a
Guarantor by the terms of, the Guaranty and the
Subrogation and Contribution Agreement;
(C) except as required by clause (B) above, the New
Entity shall not conduct any business prior to
becoming a Subsidiary; and
(D) subject to paragraph (b) below, promptly (and in any
event within 15 days) after the creation or formation
of the New Entity, the Company shall deliver to each
Holder an Officers' Certificate notifying the Holders
of the formation or creation of the New Entity, which
Officers' Certificate shall (i) specify the name of
the New Entity and the jurisdiction of its
incorporation or formation, (ii) describe, in
reasonable detail, the business proposed to be
conducted by the New Entity, (iii) state that the
Company is authorized to form or create the New
Entity and to cause it to become a Subsidiary in
accordance with this Section 9.20 and (iv) be
accompanied by complete and accurate copies of the
Organizational Documents of the New Entity.
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(b) In no event shall any New Entity created or formed pursuant to
paragraph (a)(2) above be required to execute and deliver a written instrument
with respect to the Guaranty as contemplated by clause (B) thereof nor shall
the Company be required to deliver the documents described with respect to such
New Entity in clause (D) thereof until the earlier of (i) the date on which the
Company makes an Investment in such New Entity (other than the incurrence of
routine organizational expenses and other than capital contributions totalling
less than $5,000) and (ii) the date on which such New Entity first conducts
business.
(c) Nothing in this Section 9.20 shall operate to prevent any
transaction permitted by Section 9.11 or Section 9.16.
(d) If any Person becomes a Subsidiary at any time after the date
hereof, such Person shall be deemed to have incurred or made, as the case may
be, at the time it becomes a Subsidiary (i) all Assurances, indebtedness,
loans, advances and Investments of such Person which are outstanding at such
time and (ii) all Liens then in effect with respect to any of its Properties.
Section 9.21. ERISA. The Company will not, and will not permit
any Subsidiary or Related Person to,
(a) engage in any transaction in connection with which
the Company or any Subsidiary could be subject to either a civil
penalty assessed pursuant to section 502(i) of ERISA or a tax imposed
by section 4975 of the Code, terminate any Plan (other than a
multiemployer plan) in a manner, or take any other action with respect
to any such Plan, which could result in any liability of the Company
or any Subsidiary to the Pension Benefit Guaranty Corporation, fail to
make full payment when due of all amounts which, under the provisions
of applicable law, or the terms of any Plan or collective bargaining
agreement, the Company or any Subsidiary is required to pay as
contributions thereto, or permit to exist any accumulated funding
deficiency, whether or not waived, with respect to any Plan (other
than a multiemployer plan), if, in any such case, such penalty or tax
or such liability, or the failure to make such payment, or the
existence of such deficiency, as the case may be, could reasonably be
expected to have a Material Adverse Effect;
(b) permit the aggregate present value of all benefit
liabilities under all Plans maintained at such time by the Company,
any Subsidiary and any Related Persons (other than multiemployer
plans) that are subject to Title IV of ERISA to exceed the aggregate
current value of the assets of such Plans allocable to such benefit
liabilities by more than $500,000; or
(c) permit the aggregate complete or partial withdrawal
liability under Title IV of ERISA with respect to multiemployer plans
incurred by the Company, the Subsidiaries and Related Persons to
exceed $250,000.
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As used in this Section 9.21, (i) the term "accumulated funding deficiency" has
the meaning specified in section 302 of ERISA and section 412 of the Code, (ii)
the terms "present value," "benefit liabilities" and "current value" have the
respective meanings specified in sections 3 and 4001 of ERISA and (iii)
"multiemployer plan" means a Plan which is a "multiemployer plan" as defined in
section 4001(a)(3) of ERISA.
Section 9.22. No Inconsistent Agreements. The Company will not
enter into, assume or otherwise become obligated under any agreement or
instrument which restricts the ability of the Company to consummate the Private
Placement or perform its obligations under any Loan Document.
Section 9.23. Incorporation of More Restrictive Covenants. In
the event the Bank Loan Agreement or any renewal, modification, or replacement
thereof at any time includes a financial covenant or restriction similar to the
covenants and restrictions set forth in Section 9.01, 9.05 or 9.06 that is more
restrictive than the levels set forth in said Section 9.01, 9.05 and 9.06 (the
"More Restrictive Covenant"), the Company shall, immediately upon such
inclusion of the More Restrictive Covenant, notify the Purchasers and furnish a
verbatim statement of the More Restrictive Covenant. Such notification shall
also inform the Purchasers of the Required Holders' right to elect in writing
to substitute such More Restrictive Covenant as described below and shall state
the date by which such election must be made in accordance with this Section
9.23. The Required Holders may elect to substitute the More Restrictive
Covenant for the corresponding Section 9.01, 9.05 or 9.06 by notifying the
Company in writing within sixty (60) days after receipt of the notice referred
to in the preceding sentence.
ARTICLE X
EVENTS OF DEFAULT
Section 10.01. Events of Default. If any of the following events
(each such event being an "Event of Default") shall occur and be continuing for
any reason whatsoever (and whether such occurrence shall be voluntary or
involuntary or come about or be effected by operation of law or otherwise):
(a) the Company shall fail to pay when due under this
Agreement any principal of or premium, if any, on any Note;
(b) any Loan Party shall fail to pay any interest,
premium or other Obligation when due under any Loan Document, and such
failure shall have continued for five days; or
(c) any representation or warranty made by or on behalf
of any Loan Party in any Loan Document shall prove to be untrue or
inaccurate as of the date hereof or as of the Closing Date; or
(d) any representation or warranty made by or on behalf
of any Loan Party in any certificate, statement or other writing
furnished to any Holder after the date
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hereof in connection with or pursuant to any Loan Document shall prove
to be untrue or inaccurate in any material respect as of the date on
which such representation or warranty is made; or
(e) the Company shall fail to perform or observe any
covenant or agreement contained in Section 8.01(h), Sections 9.01
through 9.07 or Section 9.14; or
(f) the Company shall fail to perform or observe any
other covenant, agreement, term or condition contained in any Loan
Document and such failure shall not be remedied within 30 consecutive
days after the earlier of (i) the date on which such failure became
known to any Responsible Officer of the Company and (ii) the date on
which written notice thereof shall have been received by the Company
from any Holder; or
(g) any Guarantor shall fail to perform or observe any
agreement contained in its Guaranty; or
(h) any Loan Party, Xxxxxx & Xxxxxxxx Limited,
Pantbelaning, Murtrum or any Murtrum Affiliate shall (i) default in
any payment of principal of or interest on any other indebtedness in
excess of $500,000 beyond any period of grace provided with respect
thereto or (ii) fail to perform or observe any other covenant or
agreement contained in any agreement under which any such indebtedness
is created or outstanding within any applicable grace period provided
therein (or if any other event thereunder or under any such agreement
shall occur and be continuing) and the effect of such failure or other
event is (A) to cause such indebtedness to become due prior to its
stated maturity or (B) to permit the holder or holders of such
indebtedness (or any Person acting on behalf of such holder or
holders) to cause such indebtedness to become due prior to its stated
maturity; or
(i) the Company or any Subsidiary shall make an
assignment for the benefit of creditors or shall fail to generally pay
its debts as such debts become due; or
(j) any decree or order for relief in respect of the
Company or any Subsidiary shall be entered under any bankruptcy,
reorganization, compromise, arrangement, insolvency, readjustment of
debt, dissolution or liquidation or similar law, whether now or
hereafter in effect, of any jurisdiction (herein called the
"Bankruptcy Law") and such decree or order remains unstayed and in
effect for more than 60 days; or
(k) the Company or any Subsidiary petitions or applies to
any tribunal for, or consents to, the appointment of, or taking
possession by, a trustee, receiver, custodian, liquidator or similar
official of such Person, or of any substantial part of the assets of
such Person, or commences a voluntary case under the federal
Bankruptcy Law or any proceedings relating to such Person under the
Bankruptcy Law of any other jurisdiction; or
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(l) any such petition or application is filed, or any
such proceedings as described in clause (k) above are commenced,
against the Company or any Subsidiary and such Person by any act
indicates its approval thereof, consent thereto or acquiescence
therein; or
(m) an order, judgment or decree is entered appointing
any such trustee, receiver, custodian, liquidator or similar official,
or approving the petition in any such proceedings, and such order,
judgment or decree remains unstayed and in effect for more than 60
consecutive days; or
(n) any order, judgment or decree is entered in any
proceedings against the Company or any Subsidiary decreeing the
dissolution, winding-up or liquidation of such Person and such order,
judgment or decree remains unstayed and in effect for more than 60
consecutive days; or
(o) any order, judgment or decree is entered in any
proceedings against the Company or any Subsidiary decreeing a split-up
of such Person which requires the divestiture of assets and such
order, judgment or decree remains unstayed and in effect for more than
60 consecutive days; or
(p) any final judgment or final judgments for the payment
of money in excess of the sum of $500,000 in the aggregate shall be
rendered against the Company or any Subsidiary and such judgment or
judgments shall not be satisfied, discharged or stayed (with
sufficient reserves having been set aside by the Company or such
Subsidiary to pay such judgment or judgments) at least ten days prior
to the date on which any of its assets could be lawfully sold to
satisfy such judgment; or
(q) this Agreement or any other Loan Document shall at
any time, for any reason, cease to be in full force and effect or
shall be declared to be null and void in whole or in any material part
by the final judgment of any court or other Governmental Authority
having jurisdiction in respect thereof, or the validity or the
enforceability of this Agreement or any other Loan Document shall be
contested by or on behalf of any Loan Party, or any Loan Party shall
renounce this Agreement or any other Loan Document, or deny that it is
bound by the terms hereof or thereof or has any further liability
hereunder or thereunder; or
(r) the Company or any Subsidiary shall have (i)
concealed or removed, or permitted to be concealed or removed, any
part of its Property with the intent to hinder, delay or defraud its
creditors or any of them or (ii) made or suffered a transfer under any
bankruptcy, fraudulent conveyance or similar law;
then (i) if such event is an Event of Default specified in clauses (i), (j),
(k) (1) or (m) of this Section 10.01, all of the Notes shall thereupon be and
become automatically due and payable together with interest accrued thereon and
together with the Make-Whole Premium, if any, with respect to each Note,
without presentment, demand, protest, notice of intent to accelerate, notice of
acceleration or other notice of any kind, all of which are hereby waived
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by the Company, (ii) if such event is an Event of Default specified in clause
(a) or clause (b) (but only with respect to the failure of any Loan Party to
pay interest) of this Section 10.01, any Holder may at its option, by notice in
writing to the Company, declare all of the Notes held by such Holder to be, and
all of such Notes shall thereupon be and become, immediately due and payable
together with interest accrued thereon and together with the Make-Whole
Premium, if any, with respect to each such Note, without presentment, demand,
protest, notice of intent to accelerate or other notice of any kind, all of
which are hereby waived by the Company, and (iii) if such event is any other
continuing Event of Default, the Holders of at least 66-2/3% of the aggregate
principal amount of the Notes at the time outstanding may at their option, by
notice in writing to the Company, declare all of the Notes to be, and all of
the Notes shall thereupon be and become, immediately due and payable together
with interest accrued thereon and together with the Make- Whole Premium, if
any, with respect to each Note, without presentment, demand, protest, notice of
intent to accelerate or other notice of any kind, all of which are hereby
waived by the Company; provided that in the case of each acceleration of the
Notes solely on account of any Default (other than a payment default) described
in clause (c), (d), (e), (f), (g), (h) or (p) of this Section 10.01, the
Make-Whole Premium, if any, with respect to each Note shall be due and payable
upon such acceleration only if such Default is the result of an intentional or
willful act of the Company or any Affiliate of the Company.
At any time after the principal of, and interest accrued on, any or
all of the Notes are declared due and payable, the Holders of at least 66-2/3%
of the aggregate principal amount of the Notes at the time outstanding may at
their option, by written notice to the Company, rescind and annul any such
declaration and its consequences if (a) the Company has paid all overdue
interest on the Notes, the principal of and premium, if any, on any Notes which
have become due otherwise than by reason of such declaration, and interest on
such overdue principal and premium and (to the extent permitted by applicable
law) any overdue interest in respect of such Notes at a rate per annum from
time to time equal to the Default Rate, (b) the Company has paid all sums paid
or advanced by any Holder under any Loan Document (other than the loans
evidenced by the Notes), (c) all Defaults, other than nonpayment of amounts
which have become due solely by reason of such declaration, have been cured or
waived pursuant to Section 11.03, and (d) no judgment or decree has been
entered for the payment of any monies due pursuant to the Notes or any other
Loan Document; but no such rescission and annulment shall extend to or affect
any subsequent Default or impair any right consequent thereon.
Section 10.02. Other Remedies. If any Event of Default shall
occur and be continuing, any Holder may proceed to protect and enforce its
rights under this Agreement and the other Loan Documents by exercising such
remedies as are available to such Holder in respect thereof under applicable
law, either by suit in equity or by action at law, or both, whether for
specific performance of any covenant or other agreement contained in this
Agreement or any other Loan Document or in aid of the exercise of any power
granted in this Agreement or in any other Loan Document, or such Holder may
proceed to enforce the payment of all Obligations or to enforce any other legal
or equitable right of such Holder.
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ARTICLE XI
MISCELLANEOUS
Section 11.01. Note Payments. (a) The Company agrees that, so
long as the Purchasers or their respective nominees shall hold any Note, it
will make payments of principal thereof (and premium if any, and interest
thereon) which comply with the terms of this Agreement, by electronic funds
transfer to the account or accounts of the Purchasers as specified in Schedule
I or such other account or accounts in the United States of America as the
Purchasers may designate in writing, notwithstanding any contrary provision
herein or in any Note with respect to the place of payment.
(b) The Purchasers agree that, before disposing of any Note, they
will make a notation thereon (or on a schedule attached thereto) of all
principal payments previously made thereon and of the date to which interest
thereon has been paid, provided that the failure to so endorse or any error in
so endorsing any such amount on such schedule (or on a continuation thereof)
shall not limit or otherwise affect the obligation of the Company or any other
Loan Party to pay the Obligations.
(c) The Company agrees to afford the benefits of paragraph (a) of
this Section 11.01 to any Transferee which shall have made the same agreement
as the Purchasers have made in paragraph (b) of this Section 11.01.
Section 11.02. Expenses. (a) Whether or not the transactions
contemplated by this Agreement shall be consummated, the Company will pay and
will indemnify and hold harmless the Purchasers and each other Indemnitee in
respect of all reasonable expenses in connection with such transactions and in
connection with any amendments or waivers (whether or not the same become
effective) under or in respect of this Agreement, the Notes or any other Loan
Document, including: (i) the reasonable costs and expenses of preparing and
reproducing this Agreement, the Notes and the other Loan Documents, of
furnishing all opinions of counsel referred to herein and all certificates on
behalf of the Company and the Subsidiaries, and of the performance of and
compliance with all agreements and conditions contained herein and in the other
Loan Documents on the part of the Company and the Subsidiaries to be performed
or complied with, (ii) the cost of delivering to the principal office of the
Purchasers, insured to the satisfaction of the Purchasers, the Notes originally
issued to the Purchasers hereunder and any Notes delivered to the Purchasers
upon any substitution of such Notes and of the Purchasers delivering any Notes,
insured to the satisfaction of the Purchasers, upon any such substitution,
(iii) the reasonable fees, expenses and disbursements of special counsel to the
Purchasers in connection with such transactions (including the costs and
expenses incurred in connection with obtaining a private placement number) and
any such amendments or waivers (whether or not such amendments or waivers
become effective) and (iv) the reasonable costs and expenses, including
attorneys' fees, incurred by the Purchasers or any Transferee in enforcing any
rights under this Agreement or the other Loan Documents or in responding to any
subpoena or any other legal process issued in connection with this Agreement,
the other Loan Documents or the Overall Transaction or by reason of the
Purchasers' or any Transferee's having acquired any Note, including reasonable
costs and expenses incurred in any bankruptcy case.
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(b) The Company also will pay, and will indemnify, and hold the
Purchasers and each other Indemnitee harmless from, all claims in respect of
the fees, if any, of brokers and finders engaged by or on behalf of the
Company.
(c) In furtherance of the foregoing, at the Closing the Company
will pay the reasonable fees and disbursements of Xxxxxxx and Xxxxxx, special
counsel to the Purchasers, which are reflected as unpaid in the statement of
special counsel to the Purchasers delivered to the Company at or prior to the
time of Closing.
(d) The obligations of the Company under this Section 11.02 shall
survive the transfer of any Note or portion thereof or interest therein by the
Purchasers or any Transferee and the payment of the Notes.
(e) In the event any Holder or Holders propose to engage special
counsel in connection with any amendments or waivers requested by the Company
under or in respect of this Agreement or any other Loan Document, such Holder
or Holders agree to engage only one special counsel for each such matter and to
use reasonable efforts to cause such special counsel to furnish the Company
with an estimate of the total fees, expenses and disbursements to be incurred
by such special counsel in connection with such engagement, provided that the
failure (for any reason) of such special counsel to provide such an estimate
(nor any error therein or deviation therefrom) shall not relieve the Company of
any of its obligations under this Section 11.02.
Section 11.03. Consent to Waivers and Amendments. (a) This
Agreement and the other Loan Documents may be amended, and the Company may take
any action herein or therein prohibited, or omit to perform any act herein or
therein required to be performed by it, if the Company shall obtain the written
consent to such amendment, action or omission to act, of the Required Holders
except that, without the written consent of the holder or holders of all Notes
at the time outstanding, no amendment to this Agreement or any other Loan
Document shall change the maturity of any Note, or change the principal of, or
the rate or time of payment of interest or any premium payable with respect to
any Note, or affect the time, amount or allocation of any required prepayments,
or alter or amend the right of any Holder to declare all of the Notes held by
such Holder to be due and payable in accordance with the provisions of Section
10.01 or change or modify any of the provisions of this Section 11.03. Each
Holder of any Note at the time or thereafter outstanding shall be bound by any
consent authorized by this Section 11.03, whether or not such Note shall have
been marked to indicate such consent, but any Notes issued thereafter may bear
a notation referring to any such consent.
(b) Executed or true and correct copies of any consent, waiver and
amendment effected pursuant to the provisions of this Section 11.03 shall be
delivered by the Company to each Holder forthwith following the date on which
the same shall have been executed and delivered by the Required Holders.
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(c) No course of dealing between the Company and the Holder of any
Note nor any delay in exercising any rights hereunder or under any Note shall
operate as a waiver of any rights of any Holder of such Note.
Section 11.04. Solicitation of Holders. The Company will not
solicit, request or negotiate for or with respect to any proposed consent,
waiver or amendment of any of the provisions of this Agreement or any other
Loan Document unless each Holder shall concurrently be informed thereof in
writing by the Company and shall be afforded the opportunity to consider the
same and shall be supplied by the Company with sufficient information to enable
it to make an informed decision with respect thereto. The Company will not pay
or cause to be paid any remuneration, whether by way of supplemental or
additional interest, fee or otherwise, to any Holder as consideration for or as
an inducement to the entering into by any such Holder of any waiver or
amendment of any of the terms and provisions of this Agreement or any other
Loan Document unless such remuneration is concurrently paid, on the same terms,
ratably to each Holder.
Section 11.05. Form, Registration, Transfer and Exchange of Notes;
Lost Notes. (a) The Notes are issuable as registered notes without coupons in
minimum denominations equal to $1,000,000 (except as may be necessary to
reflect any principal amount not evenly divisible by $1,000,000). The Company
shall keep at its principal executive office a register in which the Company
shall provide for the registration of Notes and of transfers of Notes. Subject
to paragraph (d) below, upon surrender for registration of transfer of any Note
at the principal executive office of the Company, the Company shall, at its
expense, execute and deliver one or more new Notes of like tenor and of a like
aggregate principal amount, registered in the name of the designated Transferee
or Transferees. Every Note surrendered for registration of transfer shall be
duly endorsed, or be accompanied by a written instrument of transfer duly
executed, by the Holder of such Note, or such Holder's attorney, duly
authorized in writing.
(b) At the option of any Holder, any Note held by such Holder may
be exchanged for other Notes of like tenor and of any authorized denominations,
of a like aggregate principal amount, upon surrender of the Note to be
exchanged at the principal office of the Company. Whenever any Notes are so
surrendered for exchange, the Company shall, at its expense, execute and
deliver the Notes which the Holder making the exchange is entitled to receive.
(c) Any Note or Notes issued in exchange for any Note or upon
transfer thereof shall carry the rights to unpaid interest and interest to
accrue which were called by the Note so exchanged or transferred, so that
neither gain nor loss of interest shall result from any such transfer or
exchange. Upon receipt of written notice from the Holder of any Note of the
loss, theft, destruction or mutilation of such Note and, in the case of any
such loss, theft or destruction, upon receipt of such Holder's unsecured
indemnity agreement, or in the case of any such mutilation upon surrender and
cancellation of such Note, the Company will make and deliver a new Note, of
like tenor, in lieu of the lost, stolen, destroyed or mutilated Note.
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(d) Each Purchaser agrees, to the extent permitted by applicable
law, that it will not transfer any Notes except as follows:
(i) it may transfer some (but not all) of the Notes to
not more than two Transferees,
(ii) it may at any time transfer all of the Notes then
held by it to any single Transferee, and
(iii) it may at any time transfer all or a part of the
Notes then held by it to one or more Affiliates of the Purchasers;
provided, however, that it shall be a condition to any transfer pursuant to
clause (i) or (ii) above, as well as any subsequent transfer of a Note by a
Transferee, that each Transferee executes and delivers to the Company an
instrument in writing whereby such Transferee agrees that it will not transfer
to any Person (other than an Affiliate of such Transferee) less than all of the
Notes held by such Transferee and, provided further, that it shall be a
condition to any transfer to an Affiliate of the Purchasers pursuant to clause
(iii) above that such Affiliate executes and delivers to the Company an
instrument in writing whereby such Affiliate agrees that the transfer
restrictions contained in this paragraph (d) shall be applicable to such
Affiliate the same as if such Affiliate were the Purchasers.
Section 11.06. Persons Deemed Owners. Prior to due presentment
for registration of transfer, the Company may treat the Person in whose name
any Note is registered in accordance with Section 11.05 as the owner and Holder
of such Note for the purpose of receiving payment of principal of and premium,
if any, and interest on such Note and for all other purposes whatsoever,
whether or not such Note shall be overdue, and the Company shall not be
affected by notice to the contrary.
Section 11.07. Reliance on and Survival of Representations and
Warranties. (a) All of the representations and warranties of the Loan Parties
contained in the Loan Documents or in any certificates or other instruments
delivered by any Loan Party at or after the Closing pursuant to any Loan
Document shall (i) survive the execution and delivery of this Agreement, the
Notes and the other Loan Documents, the transfer by the Purchasers of any Note
or portion thereof or interest therein and the payment of any Note, and may be
relied upon by the Purchasers or any Transferee, regardless of any
investigation made at any time by or on behalf of the Purchasers, any
Transferee or any other Person and (ii) be deemed to be material and to have
been relied upon by each Holder, notwithstanding any investigation heretofore
or hereafter made by or on behalf of any Holder.
(b) All representations, warranties and covenants contained herein
made by the Purchasers or any Holder shall survive the execution and delivery
of this Agreement, the Notes and the other Loan Documents, and may be relied
upon by the Company and its successors and assigns. No Holder (including the
Purchasers) shall be responsible for the truth, correctness or performance of
the representations or warranties of the Company, the Guarantors or any other
Holder (including any Transferee).
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Section 11.08. Successors and Assigns. All covenants and other
agreements in this Agreement contained by or on behalf of either of the parties
hereto shall bind and inure to the benefit of the respective successors and
assigns of the parties hereto (including, without limitation, any Transferee)
whether so expressed or not. Each Transferee, by taking any Note, shall be
deemed to have made the representation contained in Part 1 of Schedule XII and
at least one of the representations contained in Part 2 of Schedule XII and to
have agreed to be bound by the terms and conditions of this Agreement.
Section 11.09. Notices. All written communications provided for
hereunder shall be sent by first class mail or nationwide overnight delivery
service (with charges prepaid) and (a) if to the Purchasers, addressed to it at
the address specified for such communications in Schedule I, or at such other
address as the Purchasers shall have specified to the Company in writing, (b)
if to any other Holder, addressed to such other Holder at such address as such
other Holder shall have specified to the Company in writing or, if any such
other Holder shall not have so specified an address to the Company, then
addressed to such other Holder in care of the last holder of such Note which
shall have so specified an address to the Company and (c) if to the Company,
addressed to it at 0000 Xxxx 0xx Xxxxxx, Xxxx Xxxxx, Xxxxx 00000-0000,
Attention: President, or at such other address as the Company shall have
specified to each Holder in writing.
Section 11.10. Substitution of Purchasers. The Purchasers shall
have the right, by written notice to the Company, to substitute any one of its
Affiliates as the purchaser of the Notes, which notice shall be signed by both
the Purchasers and such Affiliate and shall contain such Affiliate's agreement
to be bound by this Agreement and shall contain a confirmation by such
Affiliate of the accuracy with respect to it of the representation contained in
Part 1 of Schedule XII and of at least one of the representations set forth in
Part 2 of Schedule XII. Upon receipt of such notice, wherever the word
"Purchaser" is used in this Agreement (other than in this Section 11.10) or any
other Loan Document or certificate, opinion or other instrument delivered or to
be delivered pursuant hereto or thereto, such word shall be deemed to refer to
such Affiliate in lieu of the Purchaser. In the event such Affiliate is so
substituted as a purchaser hereunder and such Affiliate thereafter transfers to
the Purchaser all of the Notes then held by such Affiliate, upon receipt by the
Company of notice of such transfer, wherever the word "Purchaser" is used in
this Agreement or any other Loan Document or certificate, opinion or other
instrument delivered or to be delivered pursuant hereto or thereto, such word
shall no longer be deemed to refer to such Affiliate, but shall refer to the
Purchaser, and the Purchaser shall have all the rights of an original Holder of
the Notes under this Agreement.
Section 11.11. Satisfaction Requirement. If any agreement,
certificate or other writing, or any action taken or to be taken, is by the
terms of this Agreement required to be satisfactory to the Purchasers or to the
Required Holders, the determination of such satisfaction shall be made by the
Purchasers or the Required Holders, as the case may be, in the sole and
exclusive judgment of the Person or Persons making such determination unless,
by the terms of this Agreement, such matter is required to be reasonably
satisfactory to the Purchasers or to the Required Holders, as the case may be,
in which event the determination
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of such satisfaction shall be made by the Purchasers or the Required Holders,
as the case may be, in the reasonable judgment of the Person or Persons making
such determination.
Section 11.12. Independence of Covenants. All covenants contained
in this Agreement shall be given independent effect so that if a particular
action or condition is not permitted by any of such covenants, the fact that
such action or condition would be permitted by an exception to, or otherwise be
within the limitations of, another covenant shall not avoid the occurrence of a
Default or an Event of Default if such action is taken or condition exists.
Section 11.13. Remedies Cumulative. No right, power or remedy
granted under any Loan Document is intended to be exclusive, but each shall be
cumulative and in addition to any other rights, powers or remedies referred to
in such Loan Document or otherwise available at law or in equity and the
exercise or beginning of exercise by any party hereto of any one or more of
such rights, powers or remedies shall not preclude the simultaneous or later
exercise by such party of any or all such other rights, powers or remedies.
Section 11.14. Reproduction of Documents. This Agreement, the
Notes, the other Loan Documents and all documents relating hereto and thereto,
including (a) consents, waivers and notifications which may hereafter be
executed, (b) documents received by the Purchasers at the Closing and (c)
financial statements, certificates and other information previously or
hereafter furnished to any Holder of a Note, may be reproduced by such Holder
or the Company by any photographic, photostatic, microfilm, microcard,
miniature photographic or other similar process and any original document so
reproduced may be destroyed. The Company and the Purchasers agree and
stipulate that, to the extent permitted by applicable law, any such
reproduction shall be admissible in evidence as the original itself in any
judicial or administrative proceeding (whether or not the original is in
existence and whether or not such reproduction was made in the regular course
of business) and any enlargement, facsimile or further reproduction of such
reproduction shall likewise be admissible in evidence.
Section 11.15. Notes as Securities. The Company and the
Purchasers agree that the Notes are securities as defined in each of the
Securities Act and the Exchange Act.
Section 11.16. Severability of Provisions. Any provision of this
Agreement which is prohibited or unenforceable in any jurisdiction shall, as to
such jurisdiction, be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining provisions hereof or
affecting the validity or enforceability of such provision in any other
jurisdiction.
Section 11.17. Interest. (a) Each provision in this Agreement,
the Notes and the other Loan Documents is expressly limited so that in no event
whatsoever shall the amount paid, or otherwise agreed to be paid, to any Holder
for the use, forbearance or detention of the indebtedness evidenced by the
Notes or any other Loan Document or otherwise (including any sums paid as
required by any covenant or obligation contained herein or in any other Loan
Document which is for the use, forbearance or detention of such money), exceed
that amount of money which would cause the effective rate of interest to exceed
the Highest
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Lawful Rate, and all amounts owed under this Agreement, the Notes and each
other Loan Document shall be held to be subject to reduction to the effect that
such amounts so paid or agreed to be paid which are for the use, forbearance or
detention of money under this Agreement, the Notes or any other Loan Documents
shall in no event exceed that amount of money which would cause the effective
rate of interest to exceed the Highest Lawful Rate.
(b) Anything in this Agreement, any Note or any other Loan
Document to the contrary notwithstanding, the Company shall never be required
to pay unearned interest on any Note or ever be required to pay interest on
such Note at a rate in excess of the Highest Lawful Rate, and if the effective
rate of interest which would otherwise be payable under this Agreement, such
Note or any other Loan Document would exceed the Highest Lawful Rate, or if the
Holder of such Note shall receive any unearned interest or shall receive monies
that are deemed to constitute interest which would increase the effective rate
of interest payable by the Company under this Agreement, such Note and the
other Loan Documents to a rate in excess of the Highest Lawful Rate, then (i)
the amount of interest which would otherwise be payable by the Company under
this Agreement, such Note and the other Loan Documents shall be reduced to the
amount allowed under applicable law and (ii) any unearned interest paid by the
Company or any interest paid by the Company in excess of the Highest Lawful
Rate shall be in the first instance credited on the principal of such Note with
the excess thereof, if any, refunded to the Company.
(c) It is further agreed that, without limitation of the
foregoing, all calculations of the rate of interest contracted for, charged or
received by any Holder under the Notes held by it, or under this Agreement or
the other Loan Documents, which are made for the purpose of determining whether
such rate exceeds the Highest Lawful Rate shall be made, to the extent
permitted by usury laws applicable to such Notes (now or hereafter enacted), by
amortizing, prorating and spreading in equal parts during the period of the
full stated term of the loans evidenced by said Notes all interest at any time
contracted for, charged or received by such Holder in connection therewith.
(d) If, at any time and from time to time, (i) the amount of
interest payable to any Holder on any date shall be computed at the Highest
Lawful Rate and (ii) in respect of any subsequent interest computation period
the amount of interest otherwise payable to such holder would be less than the
Highest Lawful Rate, then the amount of interest payable to such Holder in
respect of such subsequent interest computation period shall continue to be
computed at the Highest Lawful Rate until the total amount of interest payable
to such Holder shall equal the total amount of interest which would have been
payable to such Holder if the total amount of interest had been computed
without giving effect to this Section 11.17.
Section 11.18. Representations, Etc. Cumulative. All
representations, covenants, agreements and indemnities contained in this
Agreement shall be in addition to and cumulative of the representations,
covenants, agreements and indemnities contained in the other Loan Documents.
Section 11.19. Submission to Jurisdiction. THE COMPANY HEREBY
IRREVOCABLY SUBMITS TO THE NON-EXCLUSIVE JURISDICTION OF ANY STATE OR FEDERAL
COURT
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LOCATED IN NEW YORK, NEW YORK OVER ANY ACTION OR PROCEEDING (A) TO ENFORCE OR
DEFEND ANY RIGHT UNDER THIS AGREEMENT OR UNDER ANY OTHER LOAN DOCUMENT OR (B)
ARISING FROM OR RELATING TO ANY FINANCING RELATIONSHIP EXISTING IN CONNECTION
WITH THIS AGREEMENT AND THE LOAN DOCUMENTS, AND THE COMPANY HEREBY IRREVOCABLY
AGREES THAT ALL CLAIMS IN RESPECT OF ANY SUCH ACTION OR PROCEEDING MAY BE HEARD
AND DETERMINED IN SUCH STATE OR FEDERAL COURT. THE COMPANY HEREBY IRREVOCABLY
CONSENTS TO THE SERVICE OF PROCESS OUT OF ANY OF THE AFOREMENTIONED COURTS IN
ANY SUCH ACTION OR PROCEEDING BY THE MAILING OF COPIES THEREOF BY REGISTERED OR
CERTIFIED MAIL POSTAGE PREPAID, TO THE COMPANY AT ITS ADDRESS FOR NOTICES
PURSUANT TO SECTION 11.09, SUCH SERVICE TO BECOME EFFECTIVE 10 DAYS AFTER SUCH
MAILING. EACH SUCH SERVICE IS HEREBY ACKNOWLEDGED BY THE COMPANY TO BE
SUFFICIENT, EFFECTIVE AND BINDING SERVICE IN EVERY RESPECT. IF ANY AGENT
APPOINTED BY THE COMPANY REFUSES TO ACCEPT SERVICE, THE COMPANY HEREBY AGREES
THAT SERVICE UPON IT BY MAIL SHALL CONSTITUTE SUFFICIENT NOTICE. THE COMPANY
HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT THAT IT MAY EFFECTIVELY DO SO,
THE DEFENSE OF AN INCONVENIENT FORUM OR VENUE TO THE MAINTENANCE OF ANY SUCH
ACTION OR PROCEEDING. THE COMPANY HEREBY AGREES THAT A FINAL JUDGMENT IN ANY
SUCH ACTION OR PROCEEDING SHALL BE CONCLUSIVE AND MAY BE ENFORCED IN OTHER
JURISDICTIONS BY SUIT ON THE JUDGMENT OR IN ANY OTHER MANNER PROVIDED BY LAW.
NOTHING IN THIS SECTION 11.19 SHALL AFFECT THE RIGHT OF ANY HOLDER OR ANY OTHER
PERSON TO SERVE LEGAL PROCESS IN ANY OTHER MANNER PERMITTED BY APPLICABLE LAW
OR TO BRING ANY ACTION OR PROCEEDING AGAINST THE COMPANY OR THE PROPERTY OF THE
COMPANY IN THE COURTS OF ANY OTHER JURISDICTION.
Section 11.20. Governing Law. This Agreement shall be construed
and enforced in accordance with, and the rights of the parties shall be
governed by, the Internal Laws of the State of New York, without reference to
principles of conflicts of law.
Section 11.21. Indemnification. The Company hereby waives any
claim for contribution against any Indemnitee and agrees to indemnify,
exonerate and hold each Indemnitee free and harmless from and against any and
all actions, causes of action, suits, citations, directives, demands,
assessments, losses, liabilities, damages and expenses, including (without
limitation) reasonable attorneys' fees and disbursements and, in the case of
clause (e) below, fees and disbursements of environmental consultants
(collectively, the "Indemnified Liabilities"), incurred, suffered, sustained or
required to be paid by the Indemnitees or any of them as a result of, or
arising out of, or relating to (a) any transaction financed in whole or in part
directly or indirectly with the proceeds of any of the Notes, (b) the exercise,
protection or enforcement of any Holder's rights, remedies, powers or
privileges under this Agreement or any other Loan Document, (c) the breach of
any representation or warranty of any Loan Party contained herein or in any
other Loan Document, (d) the nonfulfillment by any Loan Party of, or its
failure to perform, any of its covenants or agreements contained in this
Agreement or any of the other Loan Documents or (e) the presence of Hazardous
Materials on, or the escape, seepage, leakage, spillage, discharge, emission or
release of Hazardous Materials from, any of the real Properties of the
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Company or any Subsidiary or any site, facility or location to which any
material, products, waste or other substances from or attributable to the
business or operations of the Company or any Subsidiary have been transported
for treatment, disposal, storage or deposit, the operation or violation of any
Environmental Law at any such Property, site, facility or location, any
Environmental Claim in connection with the Company or any Property of the
Company, except, in each case, for any of such Indemnified Liabilities arising
on account of such Indemnitee's gross negligence or willful misconduct, and if
and to the extent that the foregoing undertaking may be unenforceable for any
reason, the Company hereby agrees to make the maximum contribution to the
payment and satisfaction of the Indemnified Liabilities that is permissible
under applicable law. The obligations of the Company under this Section 11.21
shall survive the transfer and payment of the Notes.
Section 11.22. Survival of Indemnities, Etc. (a) The indemnities
contained in this Agreement are cumulative and in addition to the indemnities
contained in the other Loan Documents and shall survive the termination of this
Agreement and the transfer and payment of the Notes.
(b) THE INDEMNITIES CONTAINED IN THIS AGREEMENT SHALL COVER AND
INCLUDE LOSSES, COSTS, EXPENSES, CLAIMS, DAMAGES, PENALTIES AND OBLIGATIONS
ARISING OUT OF OR RESULTING FROM THE NEGLIGENCE OF ANY INDEMNITEE, REGARDLESS
OF WHETHER SUCH NEGLIGENCE BE ORDINARY OR SOLE.
Section 11.23. Judgment Currency. (a) The obligation of the
Company hereunder and under the other Loan Documents to make payments in
Dollars shall not be discharged or satisfied by any tender or recovery pursuant
to any judgment expressed in or converted into any currency other than Dollars,
except to the extent that such tender or recovery results in the effective
receipt by each Holder of the full amount of Dollars expressed to be payable to
such Holder under this Agreement or any other Loan Documents. If for the
purpose of obtaining or enforcing judgment against the Company in any court or
in any jurisdiction, it becomes necessary to convert into or from any currency
other than Dollars (such other currency being referred to in this Section 11.23
as the "Judgment Currency") an amount due in Dollars, the conversion shall be
made, at the Dollar Equivalent, as of the Business Day immediately preceding
the day on which the judgment is given (such Business Day being referred to in
this Section 11.23 as the "Judgment Currency Conversion Date"). For purposes
of this Section 11.23, the term "Dollar Equivalent" shall mean, with respect to
any monetary amount in a currency other than Dollars, at any time for the
determination thereof, the amount of Dollars obtained by converting such
foreign currency involved in such computation into Dollars at the spot rate for
the purchase of Dollars with the applicable foreign currency as quoted to such
Holder at approximately 10:00 A.M. (New York City time) on the date of
determination thereof specified herein.
(b) If there is a change in the rate of exchange prevailing
between the Judgment Currency Conversion Date and the date of actual payment of
the amount due, the Company covenants and agrees to pay, or cause to be paid,
such additional amounts, if any (but in any event not a lesser amount), as may
be necessary to ensure that the amount paid in the Judgment Currency, when
converted at the rate of exchange prevailing on the date of
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payment, will produce the amount of Dollars which could have been purchased
with the amount of Judgment Currency stipulated in the judgment or judicial
award at the rate of exchange prevailing on the Judgment Currency Conversion
Date.
(c) For purposes of determining the Dollar Equivalent for this
Section 11.23, such amounts shall include any premium and costs payable in
connection with the purchase of the Dollars.
Section 11.24. Liabilities of Holders. Neither this Agreement nor
any other Loan Documents nor any disposition of the Notes shall be deemed to
create any liability or obligation of any Holder to enforce any provision
hereof or of any other Loan Document for the benefit or on behalf of any other
Person who may be the holder of any Note.
Section 11.25. Taxes. The Company will (a) pay all taxes
(including interest and penalties) that may be payable in connection with the
execution and delivery of this Agreement or any other Loan Document or any
amendment of, or waiver or consent under or with respect to, this Agreement or
any other Loan Document and (b) indemnify and hold the Purchasers and each
other Holder harmless from and against any loss or liability resulting from
nonpayment or delay in payment of any such tax. The obligations of the Company
under this Section 11.25 shall survive the transfer and payment of the Notes.
Section 11.26. Counterparts. This Agreement may be executed
simultaneously in two or more counterparts, each of which shall be deemed an
original, and it shall not be necessary in making proof of this Agreement to
produce or account for more than one such counterpart.
Section 11.27. Entire Agreement. This Agreement and the other
Loan Documents to which the Company is a party constitute the entire contract
between the parties relative to the subject matter hereof. Any previous
agreement among the parties with respect to the subject matter hereof is
superseded by this Agreement and the other Loan Documents. Subject to Section
11.08, nothing in this Agreement or in the other Loan Documents, expressed or
implied, is intended to confer upon any Person other than the parties hereto
and thereto any rights, remedies, obligations or liabilities under or by reason
of this Agreement or the other Loan Documents.
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The Purchasers should indicate its agreement with the foregoing by
signing the form of acceptance on the enclosed counterpart of this letter and
return the same to the Company, whereupon this letter shall become a binding
agreement between the Purchasers and the Company.
Very truly yours,
CASH AMERICA INTERNATIONAL, INC.
By /s/ XXXXXX X. XXXXXXX, XX.
--------------------------------
Xxxxxx X. Xxxxxxx, Xx.,
Senior Vice President and
Chief Financial Officer
69
The foregoing Agreement is
hereby accepted as of the date
first above written.
THE TRAVELERS INSURANCE COMPANY
By /s/ A. XXXXXXX XXXXXXXX
--------------------------------
2nd Vice President
THE TRAVELERS LIFE AND ANNUITY COMPANY
By /s/ A. XXXXXXX XXXXXXXX
--------------------------------
2nd Vice President
PRIMERICA LIFE INSURANCE COMPANY
By /s/ A. XXXXXXX XXXXXXXX
--------------------------------
2nd Vice President
NATIONWIDE LIFE INSURANCE COMPANY
By /s/ XXXXX X. XXXXXXXXXX, XX.
--------------------------------
Vice President
Fixed-Income Securities
EMPLOYERS LIFE INSURANCE COMPANY OF WAUSAU
By /s/ XXXXX X. XXXXXXXXXX, XX.
--------------------------------
Vice President
Fixed-Income Securities
70
OHIO NATIONAL LIFE ASSURANCE CORPORATION
By /s/ XXXXXXX X. XXXXXXXX
--------------------------------
Xxxxxxx X. Xxxxxxxx
Vice President, Fixed-Income Securities
THE MINNESOTA MUTUAL LIFE
INSURANCE COMPANY
By: MIMLIC Asset Management Company
By /s/ XXXX X. XXXXXXX
--------------------------------
Vice President
