EXHIBIT 4.4
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SECURITIES PURCHASE AGREEMENT
by and among
AOA HOLDING LLC
and
AOA CAPITAL CORP,
as Issuers
and
CIBC WORLD MARKETS CORP.,
as Initial Purchaser
Dated as of May 21, 1999
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TABLE OF CONTENTS
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Page
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ARTICLE I
DEFINITIONS
Section 1.1. Definitions.......................................................3
Section 1.2. Accounting Terms; Financial Statements............................7
ARTICLE II
ISSUE OF NOTES; PURCHASE AND SALE OF NOTES; RIGHTS OF HOLDERS
OF NOTES; OFFERING BY INITIAL PURCHASER
Section 2.1. Issue of Notes....................................................7
Section 2.2. Purchase, Sale and Delivery of Notes..............................8
Section 2.3. Registration Rights of Holders of Notes...........................8
Section 2.4. Offering by the Initial Purchaser.................................9
Section 2.5. Joint and Several Liability.......................................9
ARTICLE III
REPRESENTATIONS AND WARRANTIES; RESALE OF NOTES
Section 3.1. Representations and Warranties of the Issuers.....................9
Section 3.2. Resale of Notes..................................................20
ARTICLE IV
CONDITIONS PRECEDENT TO CLOSING
Section 4.1. Conditions Precedent to Obligations of the Initial Purchaser.....21
ARTICLE V
COVENANTS
Section 5.1. Covenants of the Issuers.........................................24
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ARTICLE VI
FEES
Section 6.1. Costs, Expenses and Taxes........................................26
ARTICLE VII
INDEMNITY
Section 7.1. Indemnity........................................................27
Section 7.2. Contribution.....................................................30
Section 7.3. Registration Rights Agreement....................................31
ARTICLE VIII
MISCELLANEOUS
Section 8.1. Survival of Provisions...........................................31
Section 8.2. Termination......................................................32
Section 8.3. No Waiver; Modifications in Writing..............................33
Section 8.4. Information Supplied by the Initial Purchaser....................33
Section 8.5. Communications...................................................34
Section 8.6. Execution in Counterparts........................................34
Section 8.7. Successors.......................................................34
Section 8.8. Governing Law....................................................35
Section 8.9. Severability of Provisions.......................................35
Section 8.10. Headings........................................................35
Section 8.11. Release from Liability..........................................35
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SECURITIES PURCHASE AGREEMENT, dated as of May 21, 1999 (the
"Agreement"), among AOA Holding LLC, a Minnesota limited liability company (the
"Company"), AOA Capital Corp, a Minnesota corporation and a wholly-owned
subsidiary of the Company ("Capital Corp." and, together with the Company, the
"Issuers"), and CIBC World Markets Corp. (the "Initial Purchaser").
In consideration of the mutual covenants and agreements set forth
herein and for good and valuable consideration, the receipt of which is hereby
acknowledged, the parties agree as follows:
ARTICLE I
DEFINITIONS
Section 1.1. Definitions. As used in this Agreement, and unless the
context requires a different meaning, the following terms have the meanings
indicated:
"Act" means the Securities Act of 1933, as amended, and the rules and
regulations of the Commission thereunder.
"Affiliate" means, with respect to any Person, any other Person which
directly or indirectly through one or more intermediaries controls, or is
controlled by, or is under common control with, the Person in question. For
purposes of this definition, "control" (including, with correlative meanings,
the terms "controlling", 'controlled by" and "under common control with"), as
used with respect to any Person, means the possession, directly or indirectly,
of the power to direct or cause the direction of the management and policies of
such Person, whether through the ownership of voting securities, by agreement or
otherwise; provided, however, that beneficial ownership of at least 10% of the
voting securities of a Person shall be deemed to be control.
"Agreement" means this Agreement, as the same may be amended,
supplemented or modified in accordance with the terms hereof and in effect.
"AOAI" means Xxxxx Outdoor Advertising, Inc., a Minnesota corporation,
which is a wholly-owned subsidiary of the Company and the general partner of
AOALP.
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"AOALP" means Xxxxx Outdoor Advertising Limited Partnership, a
Minnesota limited partnership, the partnership interests of which are owned 69%
by the Company and 1% by AOAI.
"Basic Documents" means, collectively, the Indenture, the Notes, the
Registration Rights Agreement, this Agreement and the Holding Company Documents.
"Business Day" means each Monday, Tuesday, Wednesday, Thursday and
Friday which is not a day on which banking institutions in the City of New York
are authorized or obligated by law to close.
"Closing" has the meaning provided therefor in Section 2.2 of this
Agreement.
"Closing Date" has the meaning provided therefor in Section 2.2 of this
Agreement.
"Code" means the Internal Revenue Code of 1986, as amended.
"Commission" means the Securities and Exchange Commission or any
similar agency then having jurisdiction to enforce the Act.
"Credit Facility Amendments" means, collectively, the amendments to the
AOALP secured credit facility (as described in the Memoranda) and the amendment
to the unsecured credit facility of AOALP (as described in the Memoranda), each
to be dated as of May 24, 1999.
"Default" means any event, act or condition which, with notice or lapse
of time or both, would constitute an Event of Default.
"Deficit Capital Contribution Agreement" means the Deficit Capital
Contribution Agreement dated as of May 21, 1999 by and between the Company and
Xxxxxxx Xxxxx.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended.
"Event of Default" means any event defined as an Event of Default in
the Indenture.
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"Exchange Act" means the Securities Exchange Act of 1934, as amended,
and the rules and regulations of the Commission thereunder.
"Final Memorandum" has the meaning provided therefor in Section 2.1 of
this Agreement.
"Holding Company Documents" means, collectively, the Credit Facility
Amendments, the Deficit Capital Contribution Agreement, the Indemnity Agreement
and the Partnership Agreement Amendment.
"Indemnified Party" has the meaning provided therefor in Section 7.1(c)
of this Agreement.
"Indemnity Agreement" means the Proceeds Allocation and Indemnity
Agreement dated as of May 21, 1999 by and between the Company and Capital Corp.
"Indemnifying Party" has the meaning provided therefor in Section
7.1(c) of this Agreement.
"Indenture" means the indenture to be dated as of May 26, 1999 among
the Issuers and United States Trust Company of New York, as Trustee, under which
the Notes will be issued.
"Initial Purchaser" has the meaning provided therefor in the
introductory paragraph of this Agreement.
"Lien" means, with respect to any property or assets of any Person, any
mortgage or deed of trust, pledge, hypothecation, assignment, deposit
arrangement, security interest, lien, charge, easement, encumbrance, preference,
priority or other security agreement or preferential arrangement of any kind or
nature whatsoever on or with respect to such property or assets (including
without limitation, any Capitalized Lease Obligation (as defined in the
Indenture)), conditional sales, or other title retention agreement having
substantially the same economic effect as any of the foregoing.
"Material Adverse Effect" means, with respect to the Issuers, a
material adverse effect on the business, financial condition or results of
operations of the Company or AOALP; provided, however, that, with respect to the
Issuers, "Material Adverse Effect" shall also mean a material adverse effect on
the ability of the Issuers to perform their respective obligations under this
Agreement or any of the Basic Documents.
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"Memoranda" has the meaning provided therefor in Section 2.1 of this
Agreement.
"Notes" means the 10 3/8% Senior Notes due 2006 of the Issuers.
"Offering Materials" has the meaning provided therefor in Section 7.1
of this Agreement.
"Organizational Document" has the meaning provided therefor in Section
3.1 of this Agreement.
"Other Issuer Obligations" has the meaning provided therefor in Section
2.5 of this Agreement.
"Partnership Agreement Amendment" means the amendment to the
partnership agreement of AOALP dated as of May 21, 1999.
"Person" means any individual, corporation, partnership, trust,
incorporated or unincorporated association, joint venture, joint-stock company,
government (including any agency or political subdivision thereof) or other
entity of any kind.
"PORTAL" means the Private Offerings Resales and Trading through
Automated Linkages Market.
"Preliminary Memorandum" has the meaning provided therefor in Section
2.1 of this Agreement.
"Private Exchange Notes" shall have the meaning provided therefor in
the Registration Rights Agreement.
"Proceeding" has the meaning provided therefor in Section 7.1(c) of
this Agreement.
"QIB" has the meaning provided therefor in Section 3.2 of this
Agreement.
"Registration Rights Agreement" means the registration rights agreement
between the Issuers and the Initial Purchaser relating to the Notes.
"State" means each of the states of the United States of America, the
District of Columbia and the Commonwealth of Puerto Rico.
"State Commission" means any agency of any State having jurisdiction to
enforce such State's securities laws.
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"Taxes" has the meaning provided therefor in Section 3.1 of this
Agreement.
"Time of Purchase" has the meaning provided therefor in Section 2.2 of
this Agreement.
"Trust Indenture Act" means the Trust Indenture Act of 1939, as
amended, and the rules and regulations of the Commission thereunder.
"Trustee" has the meaning provided therefor in the Indenture.
Section 1.2. Accounting Terms; Financial Statements. All accounting
terms used herein not expressly defined in this Agreement shall have the
respective meanings given to them in accordance with generally accepted
accounting principles set forth in the opinions and pronouncements of the
Accounting Principles Board of the American Institute of Certified Public
Accountants and statements and pronouncements of the Financial Accounting
Standard Board or in such other statements by such other entity as may be
approved by a significant segment of the accounting profession.
ARTICLE II
ISSUE OF NOTES; PURCHASE AND SALE
OF NOTES; RIGHTS OF HOLDERS OF NOTES;
OFFERING BY INITIAL PURCHASER
Section 2.1. Issue of Notes. The Issuers have authorized the issuance
of $50,000,000 aggregate principal amount of the Notes which are to be issued
pursuant to the Indenture. Each Note will be substantially in the form of the
Note set forth as Exhibit A to the Indenture.
The Notes will be offered and sold to the Initial Purchaser without
being registered under the Act, in reliance on exemptions therefrom.
In connection with the sale of the Notes, the Issuers have prepared a
preliminary offering memorandum dated May 13, 1999(the "Preliminary Memorandum")
and prepared a final offering memorandum dated May 21, 1999 (the "Final
Memorandum" and, together with the Preliminary Memorandum, the "Memoranda")
setting forth or including a description of the terms of the
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Notes, the terms of the offering, a description of the Issuers and any material
developments relating to the Issuers occurring after the date of the most recent
financial statements included therein.
Section 2.2. Purchase, Sale and Delivery of Notes. On the basis of the
representations, warranties, agreements and covenants herein contained and
subject to the terms and conditions herein set forth, the Issuers agree that
they will sell to the Initial Purchaser, and the Initial Purchaser agrees that
it will purchase from the Issuers at the Time of Purchase, the aggregate
principal amount of the Notes set forth opposite the name of the Initial
Purchaser on Schedule I attached hereto at a price equal to 97.375% of such
amount.
The purchase, sale and delivery of the Notes will take place at a
closing (the "Closing") at the offices of Xxxxxx Xxxxxx & Xxxxxxx, 00 Xxxx
Xxxxxx, Xxx Xxxx, Xxx Xxxx, at 10:00 A.M., New York time, on May 26, 1999, or
such later date and time, if any, as the Initial Purchaser and the Issuers shall
agree (the "Closing Date"). The time at which such Closing is concluded is
herein called the "Time of Purchase."
One or more certificates in definitive form for the Notes that the
Initial Purchaser has agreed to purchase hereunder, and in such denomination or
denominations and registered in such name or names as the Initial Purchaser
requests upon notice to the Issuers at least 24 hours prior to the Closing,
shall be delivered by or on behalf of the Issuers to the Initial Purchaser,
against payment by or on behalf of the Initial Purchaser of the purchase price
therefor by wire transfer of immediately available funds to the account of the
Company previously designated by it in writing. The Issuers will make such
certificate or certificates for the Notes available for checking and packaging
by the Initial Purchaser at the offices of CIBC World Markets Corp., or such
other place as the Initial Purchaser may designate, at least 24 hours prior to
the Closing.
Section 2.3. Registration Rights of Holders of Notes. The Initial
Purchaser and its direct and indirect transferees of the Notes will have such
rights with respect to the registration thereof under the Act and qualification
of the Indenture under the Trust Indenture Act as are set forth in the
Registration Rights Agreement.
Section 2.4. Offering by the Initial Purchaser. The Initial Purchaser
proposes to make an offering of the Notes
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at the price and upon the terms set forth in the Final Memorandum, as soon as
practicable after this Agreement is entered into and as in the judgment of the
Initial Purchaser is advisable.
Section 2.5. Joint and Several Liability. Each of the Issuers shall
have joint and several liability in respect of all obligations hereunder and
under each other Basic Document to which the Issuers are parties. Each of the
Issuers hereby acknowledges that this Agreement is the independent and several
obligation of each of the Issuers and may be enforced against either of the
Issuers separately, whether or not enforcement of any right or remedy hereunder
has been sought against any other Issuer. Each of the Issuers hereby expressly
waives, with respect to any of the amounts owing hereunder by the other Issuer
in respect of the obligations (collectively, the "Other Issuer Obligations"),
diligence, presentment, demand of payment, protest and all notices whatsoever,
and any requirement that the Initial Purchaser exhaust any right, power or
remedy or proceed against such other Issuer under this Agreement, any other
Basic Document or any other agreement or instrument referred to herein or
therein, or against any other person under any other guarantee of, or security
for, any of such Other Issuer Obligations.
ARTICLE III
REPRESENTATIONS AND WARRANTIES; RESALE OF NOTES
Section 3.1. Representations and Warranties of the Issuers. The
Issuers, jointly and severally, represent and warrant to and agree with the
Initial Purchaser as of the date hereof and as of the Time of Purchase as
follows:
(a) The Final Memorandum, as of its date and at all times
subsequent thereto up to and including the Time of Purchase, did not,
does not and will not contain any untrue statement of a material fact
or omit to state a material fact necessary to make the statements
therein, in the light of the circumstances under which they were made,
not misleading, except that the representations and warranties set
forth in this Section 3.1(a) do not apply to statements or omissions
made in reliance upon and in conformity with information relating to
the Initial Purchaser furnished to the Issuers in writing by the
Initial Purchaser
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expressly for use in the Final Memorandum or any amendment or
supplement thereto.
(b) The financial statements of AOALP and AOAI, together with
the related notes and schedules thereto, set forth in the Final
Memorandum fairly present the financial condition of AOALP and AOAI as
of the dates indicated and the results of operations and changes in
financial position for the periods therein specified in conformity with
generally accepted accounting principles consistently applied
throughout the periods involved (except as otherwise stated therein),
except that the unaudited interim financial statements are subject to
normal year-end adjustments. The pro forma financial data included in
the Final Memorandum has been prepared using reasonable assumptions and
in accordance with the applicable requirements of the Act and include
all adjustments necessary to present fairly the pro forma financial
information included within the Final Memorandum at the respective
dates and for the respective periods indicated. Each of Xxxxxx Xxxxxxxx
LLP and KPMG LLP, each of which is reporting upon certain of the
audited financial statements and schedules included in the Memoranda,
is an independent public accounting firm as required by the Act and the
rules and regulations thereunder.
(c) The Company and AOALP have been duly organized and are
validly existing and in good standing as a limited liability company
and a limited partnership, respectively, under the laws of the State of
Minnesota and have filed all reports with the Secretary of State of
Minnesota required to obtain a certificate of existence from that
office. Capital Corp. and AOAI have been duly incorporated and are
validly existing and in good standing as corporations under the laws of
the State of Minnesota and have filed all reports with the Secretary of
State of Minnesota required to obtain a certificate of existence from
that office. Each of the Issuers, AOALP and AOAI is duly qualified and
in good standing as a foreign limited liability company, limited
partnership or corporation, as the case may be, and is authorized to do
business, in each jurisdiction in which the ownership or leasing of any
property or the character of its operations makes such qualification
necessary and in which the failure so to qualify could have a Material
Adverse Effect.
(d) As of the date indicated in the Memoranda, the Company had
the authorized, issued and outstanding capi-
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talization as set forth under the caption "actual" under the heading
"Capitalization" in the Memoranda; neither Issuer owns, directly or
indirectly, any shares or any other equity or long-term debt securities
or has any equity interest in any firm, partnership, joint venture or
other entity, other than (i) the Company's interest in AOALP, AOAI and
Capital Corp. and (ii) AOAI's interest in AOALP and PA Outdoor, Inc.;
and the beneficial ownership of the equity interests in the Issuers,
AOALP and AOAI is as set forth in the Memoranda under the heading
"Principal Security Holders."
(e) This Agreement has been duly authorized by the Issuers and
the Issuers have all requisite power and authority to execute, issue
and deliver this Agreement and to incur and perform their respective
obligations provided for therein. This Agreement, when executed and
delivered by the Issuers (assuming the due authorization, execution and
delivery by the Initial Purchaser), will constitute a valid and legally
binding agreement of the Issuers, enforceable against each of them in
accordance with its terms except (i) that the enforcement hereof may be
subject to bankruptcy, insolvency, reorganization, fraudulent
conveyance, moratorium or other similar laws now or hereafter in effect
relating to creditors' rights generally, and to general principles of
equity and the discretion of the court before which any proceeding
therefor may be brought and (ii) as any rights to indemnity or
contribution hereunder may be limited by federal and state securities
laws and public policy considerations.
(f) The Indenture has been duly authorized by the Issuers and
the Issuers have all requisite power and authority to execute, issue
and deliver the Indenture and to incur and perform their respective
obligations provided for therein. The Indenture, when executed and
delivered by the Issuers (assuming the due authorization, execution and
delivery by the Trustee), will constitute a valid and legally binding
agreement of the Issuers, enforceable against each of them in
accordance with its terms except that the enforcement thereof may be
subject to (i) bankruptcy, insolvency, reorganization, fraudulent
conveyance, moratorium or other similar laws now or hereafter in effect
relating to creditors' rights generally, and (ii) general principles of
equity and the discretion of the court before which any proceeding
therefor may be brought.
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(g) The Registration Rights Agreement has been duly authorized
by the Issuers and the Issuers have all requisite power and authority
to execute, issue and deliver the Registration Rights Agreement and to
incur and perform their respective obligations provided for therein.
The Registration Rights Agreement, when executed and delivered by the
Issuers (assuming the due authorization, execution and delivery by the
Initial Purchaser), will constitute a valid and legally binding
agreement of the Issuers, enforceable against each of them in
accordance with its terms except (i) that the enforcement thereof may
be subject to bankruptcy, insolvency, reorganization, fraudulent
conveyance, moratorium or other similar laws now or hereafter in effect
relating to creditors' rights generally, and to general principles of
equity and the discretion of the court before which any proceeding
therefor may be brought and (ii) as any rights to indemnity or
contribution thereunder may be limited by federal and state securities
laws and public policy considerations.
(h) The Notes have each been duly authorized by the Issuers
and the Issuers have all requisite power and authority to execute,
issue and deliver the Notes and to incur and perform their respective
obligations provided for therein. The Notes, when executed and
delivered by the Issuers (assuming the due authorization, execution and
delivery by the Trustee) in accordance with the provisions of the
Indenture and delivered to and paid for by the Initial Purchaser in
accordance with the terms of this Agreement, will be entitled to the
benefits of the Indenture and will constitute valid and legally binding
obligations of the Issuers enforceable against each of them in
accordance with their terms, except that the enforcement thereof may be
subject to (i) bankruptcy, insolvency, reorganization, fraudulent
conveyance, moratorium or other similar laws now or hereafter in effect
relating to creditors' rights generally, and (ii) general principles of
equity and the discretion of the court before which any proceeding
therefor may be brought.
(i) Each of the Holding Company Documents has been duly
authorized by the Issuers party thereto and the Issuers have all
requisite power and authority to execute, issue and deliver each
Holding Company Document to which they are a party and to incur and
perform their respective obligations provided for therein. Each of the
Holding Company Documents, when executed and delivered by the Issuers
party thereto (assuming the due authorization, exe-
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cution and delivery by the other parties thereto), will constitute a
valid and legally binding agreement of the Issuers party thereto,
enforceable against each of them in accordance with its terms except
that the enforcement thereof may be subject to (i) bankruptcy,
insolvency, reorganization, fraudulent conveyance, moratorium or other
similar laws now or hereafter in effect relating to creditors' rights
generally, and (ii) general principles of equity and the discretion of
the court before which any proceeding therefor may be brought.
(j) Immediately after the consummation of the transactions
contemplated by this Agreement (including the use of proceeds from the
sale of Notes at the Time of Purchase), to the best of their knowledge,
the fair value and present fair saleable value of the assets of each of
the Issuers (on a consolidated basis) will exceed the sum of its stated
liabilities and identified contingent liabilities; neither Issuer (on a
consolidated basis) will be, after giving effect to the execution,
delivery and performance of this Agreement and the consummation of the
transactions contemplated hereby (including the use of proceeds from
the sale of Notes at the Time of Purchase), (i) left with unreasonably
small capital with which to carry on its business as it is proposed to
be conducted, (ii) unable to pay its debts (contingent or otherwise) as
they mature or (iii) otherwise insolvent.
(k) The Issuers have all requisite power and authority under
the laws of the State of Minnesota to execute, deliver and perform
their respective obligations under this Agreement. Each of the Issuers
has all requisite power and authority under the laws of the State of
Minnesota to (i) execute, deliver and perform its obligations under
this Agreement and each of the Basic Documents, (ii) execute, deliver
and perform its obligations under all other agreements and instruments
executed and delivered by the Issuers pursuant to or in connection with
this Agreement and each of the Basic Documents and (iii) issue the
Notes in the manner and for the purpose contemplated by this Agreement.
(l) Subsequent to the date as of which information is given in
the Final Memorandum to the Time of Purchase, there has not been (i)
any event or condition that has had or that could reasonably be
expected to have a Material Adverse Effect, (ii) any transaction
entered into by either of the Issuers, AOALP or AOAI, other than in the
or-
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dinary course of business, that is material to the Company or AOALP or
(iii) any dividend or distribution of any kind declared, paid or made
by either of the Issuers on any of its equity-interests.
(m) Except as set forth in the Final Memorandum, there is no
action, suit, investigation or proceeding, governmental or otherwise,
pending or, to the best knowledge of the Issuers, threatened to which
either of the Issuers, AOALP or AOAI is or would be a party or of which
the properties of either of the Issuers, AOALP or AOAI are or may be
subject, that (i) seeks to restrain, enjoin, prevent the consummation
of or otherwise challenge the issuance and sale of the Notes by the
Issuers, (ii) questions the legality or validity of the transfers into
the holding company structure described in the Memoranda or seeks to
recover damages or obtain other relief in connection therewith, (iii)
could have any effect on the power or ability of either Issuer to
perform its obligations under the Basic Documents or to consummate the
transactions contemplated hereby or thereby or (iv) could reasonably be
expected to have a Material Adverse Effect.
(n) The execution, delivery and performance by the Issuers of
this Agreement and the Basic Documents, the issuance and sale by the
Issuers of the Notes and the execution, delivery and performance by the
Issuers of all other agreements and instruments to be executed and
delivered by the Issuers, pursuant hereto or thereto or in connection
herewith or therewith, and compliance by the Issuers with the terms and
provisions hereof and thereof, do not and will not (i) violate any
provision of any law, rule or regulation (including, without
limitation, Regulation T, U or X of the Board of Governors of the
Federal Reserve System), order, writ, judgment, decree, determination
or award presently in effect or in effect at the Time of Purchase
having applicability to either of the Issuers, AOALP or AOAI (ii)
conflict with or result in a breach or violation of (A) any of the
terms or provisions of, or constitute a default (or an event which,
with notice or lapse of time or both, would constitute a default) by
either Issuer, AOALP or AOAI or give rise to any right to accelerate
the maturity or require the prepayment of any indebtedness under any
contract, indenture, mortgage, deed of trust, loan agreement, note,
lease, license, franchise agreement, authorization, permit, certificate
or other agreement or document to which either Issuer, AOALP or AOAI is
a party or by which any of them may be bound, or
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to which any of them or any of their respective assets or businesses is
subject or (B) the certificate of formation or limited liability
company agreement, the certificate of limited partnership or limited
partnership agreement or the articles of incorporation or bylaws, as
the case may be (each, an "Organizational Document"), of either Issuer,
AOALP or AOAI or (iii) except as contemplated by this Agreement and the
Basic Documents, result in, or require the creation or imposition of,
any Lien upon or with respect to any of the properties now owned or
hereafter acquired by either of the Issuers, AOALP or AOAI, except, in
each case, where such violation, conflict, breach, default or creation
or imposition of any Lien would not (individually or in the aggregate)
(1) have a Material Adverse Effect, (2) materially impair either
Issuer's ability to perform the obligations contemplated by the Basic
Documents and the Memoranda or (3) materially affect the consummation
of the transactions contemplated by the Basic Documents and the
Memoranda.
(o) Neither of the Issuers, AOALP or AOAI is currently or,
after giving effect to the consummation of the transactions
contemplated by this Agreement, will be, (i) in violation of its
certificate of formation, certificate of limited partnership or
articles of incorporation or limited liability company agreement,
partnership agreement or bylaws, as the case may be, (ii) in default
(nor will an event occur which with notice or passage of time or both
would constitute such a default) under or in violation of any indenture
or loan or credit agreement or any other material contract, agreement
or instrument to which it is a party or by which it or any of its
properties may be bound or affected (except as set forth in the Final
Memorandum), (iii) in violation of any order of any court, arbitrator
or governmental body or subject to or party to any order of any court
or governmental authority arising out of any action, suit or proceeding
under any statute or other law respecting antitrust, monopoly,
restraint of trade, unfair competition or similar matters, or (iv) in
violation of or will have violated any such statute, rule or regulation
of any governmental authority, which default or violation (individually
or in the aggregate) could reasonably be expected to (y) affect the
legality, validity or enforceability of this Agreement or any of the
Basic Documents or (z) have a Material Adverse Effect.
(p) Except as set forth in the Final Memorandum, no
authorization, consent, approval, license, qualification
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or formal exemption from, nor any filing, declaration or registration
with, any court, governmental agency or regulatory authority or any
securities exchange is required (i) in connection with the execution,
delivery or performance by the Issuers of this Agreement or any of the
Basic Documents, (ii) to permit the Issuers to effect payments of
principal of, premium and interest on the Notes or (iii) to own, lease,
license and use their respective businesses in the manner described in
the Final Memorandum except (A) as may be required under state
securities or "Blue Sky" laws or the laws of any foreign jurisdiction
in connection with the offer and sale of the Notes or (B) as would not
(individually or in the aggregate) have a Material Adverse Effect. All
such authorizations, consents, approvals, licenses, qualifications,
exemptions, filings, declarations and registrations set forth in the
Final Memorandum (other than as disclosed therein) which are required
to have been obtained by the date hereof have been obtained or made, as
the case may be, and are in full force and effect and not the subject
of any pending or, to the knowledge of either of the Issuers,
threatened attack by appeal or direct proceeding or otherwise.
(q) Neither Issuer is, nor immediately after the Time of
Purchase will be, an "investment company" or a company "controlled" by
an "investment company" within the meaning of the Investment Company
Act of 1940, as amended, and the rules and regulations of the
Commission thereunder.
(r) The execution and delivery of this Agreement and the other
Basic Documents and the sale of the Notes to the Initial Purchaser will
not involve any non-exempt prohibited transaction within the meaning of
Section 406 of ERISA, or Section 4975 of the Code on the part of the
Company. No Reportable Event (as defined in ERISA) has occurred during
the five-year period prior to the date on which this representation is
made or deemed made with respect to any Employee Benefit Plan (as
defined in ERISA), and each Employee Benefit Plan has complied in all
material respects with the applicable provisions of ERISA and the Code.
The present value of all benefits vested under each Employee Benefit
Plan maintained by the Issuers or any Commonly Controlled Entity (as
defined in ERISA) (based on the current liability, interest rate and
other assumptions used in preparation of the plan's Form 5500 Annual
Report) did not, as of the last annual valuation date prior to the date
on which this representation is
-17-
made or deemed made, exceed the value of the assets of such plan
allocable to such accrued benefits. Neither of the Issuers nor any
Commonly Controlled Entity has had a complete or partial withdrawal
from any Multiemployer Plan (as defined in ERISA), and neither of the
Issuers nor any Commonly Controlled Entity would become subject to any
liability under ERISA if such Issuer or any such Commonly Controlled
Entity were to withdraw completely from all Multiemployer Plans as of
the valuation date most closely preceding the date on which such
representation is made or deemed made. No such Multiemployer Plan is in
reorganization or insolvent. There are no material liabilities of
either of the Issuers or any Commonly Controlled Entity for
post-retirement benefits to be provided to their current and former
employees under Plans which are welfare benefit plans (as described in
Section 3(l) of ERISA).
(s) The Issuers, AOALP or AOAI have (i) good and valid title
to all tangible properties and assets identified in the Final
Memorandum as owned by each of them and (ii) valid and enforceable
leasehold interests in all properties and assets identified in the
Final Memorandum as leased by each of them, in each case, which are
material to the business of the Company and AOALP free and clear of all
Liens, except (A) such Liens as are described in the Final Memorandum,
(B) Liens created in the ordinary course of business which are
Permitted Liens (as defined in the Indenture) or (C) in the case of
leased properties and assets, Liens on such property which exist
pursuant to the terms of the agreement evidencing such leasehold
interest. All of the leases material to the business of the Company and
AOALP and under which the Company and AOALP holds properties described
in the Final Memorandum, are valid and binding as leased by them, with
such exceptions as are not material and do not interfere with the use
made and proposed to be made of such properties by the Company and
AOALP.
(t) No form of general solicitation or general advertising was
used by the Issuers or their representatives in connection with the
offer and sale of the Notes. Neither of the Issuers nor any Person
authorized to act for either of them has, either directly or
indirectly, sold or offered for sale any of the Notes or any other
similar security of either of the Issuers to, or solicited any offers
to buy any thereof from, or has otherwise approached or negotiated in
respect thereof with, any Person or Persons other than with or through
the Initial Purchaser; and
-18-
the Issuers agree that neither they nor any Person acting on its behalf
will sell or offer for sale any Notes to, or solicit any offers to buy
any Notes from, or otherwise approach or negotiate in respect thereof
with, any Person or Persons so as thereby to bring the issuance or sale
of any of the Notes within the provisions of Section 5 of the Act.
(u) All tax returns required to be filed by either of the
Issuers, AOALP or AOAI in any jurisdiction (including foreign
jurisdictions) have been so filed and all taxes, assessments, fees and
other charges including, without limitation, withholding taxes,
penalties, and interest ("Taxes") due or claimed to be due have been
paid, other than those Taxes being contested in good faith and those
Taxes for which adequate reserves or accruals have been established in
accordance with generally accepted accounting principles, except where
the failure to file such returns or to pay such Taxes could not
reasonably be expected to have, singly or in the aggregate, a Material
Adverse Effect. The Issuers know of no actual or proposed additional
tax assessments for any fiscal period against either of the Issuers,
AOALP or AOAI that, individually or in the aggregate, is reasonably
likely to have a Material Adverse Effect.
(v) The Issuers, AOALP and AOAI are the owners or licensees of
all trade names, unregistered trademarks and service marks, brand
names, patents, registered and unregistered copyrights, registered
trademarks and service marks, and all applications for any of the
foregoing, and all permits, grants and licenses or other rights with
respect thereto, the absence of which would have or could reasonably be
expected to have a Material Adverse Effect. Except as set forth in the
Final Memorandum neither of the Issuers, AOALP or AOAI has been charged
with any material infringement of any intangible property of the
character described above or been notified or advised of any material
claim of any other Person relating to any of the intangible property
which infringements or claims (individually or in the aggregate) would
have a Material Adverse Effect.
(w) Neither Issuer nor any of their Affiliates (as defined in
Rule 501(b) of Regulation D under the Act) has directly, or through any
agent, (i) sold, offered for sale, solicited offers to buy or otherwise
negotiated in respect of, any security (as defined in the Act) which is
-19-
or will be integrated with the sale of the Notes in a manner that would
require the registration under the Act of the Notes or (ii) engaged in
any form of general solicitation or general advertising in connection
with the offering of the Notes (as those terms are used in Regulation D
under the Act) or in any manner involving a public offering within the
meaning of Section 4(2) of the Act.
(x) Each Basic Document conforms in all material respects to
the descriptions thereof in the Final Memorandum.
(y) The statements set forth under the heading "Description of
the Notes" in the Final Memorandum, insofar as such statements purport
to summarize certain provisions of the Notes and the Indenture provide
a fair summary of such provisions and information with respect thereto.
(z) Assuming the accuracy of the Initial Purchaser's
representations and warranties set forth in Section 3.2 hereof and the
due performance by the Initial Purchaser of the covenants and
agreements set forth in Section 3.2 hereof, the offer and sale of the
Notes to the Initial Purchaser in the manner contemplated by this
Agreement and the Memoranda does not require registration under the Act
and the Indenture does not require qualification under the Trust
Indenture Act of 1939, as amended.
(aa) Neither Issuer, AOALP or AOAI conducts business with the
government of Cuba or any Person or affiliate located in Cuba. In the
event either Issuer, AOALP or AOAI commences engaging in business with
the government of Cuba or with any Person or affiliate located in Cuba,
the Issuers will provide the Florida Department of Banking and Finance
notice of such business in a form acceptable to such Department.
(bb) No labor problem, dispute or disturbance with respect to
the employees of either Issuer, AOALP or AOAI exists or, to the best
knowledge of the Issuers, is threatened which, individually or in the
aggregate, could reasonably be expected to have a Material Adverse
Effect.
(cc) No condition, omission, event or act has occurred with
respect to the Issuers, AOALP or AOAI which, had the Indenture already
been executed and delivered, would (or, with the giving of notice
and/or the lapse of time and/or the issue of a certificate, could)
constitute
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a Default or Event of Default (as defined in the Indenture).
(dd) The statistical and market-related data included or
incorporated by reference in the Final Memorandum are based on or
derived-from sources which the Issuers believe to be reliable and
accurate or represent the Issuers' good faith estimates that are made
on the basis of data derived from such sources.
Section 3.2. Resale of Notes. The Initial Purchaser represents and
warrants that it is a "qualified institutional buyer" as defined in Rule 144A of
the Act ("QIB"). The Initial Purchaser agrees with the Issuers that (a) it has
not and will not solicit offers for, or offer or sell, the Notes by any form of
general solicitation or general advertising (as those terms are used in
Regulation D under the Act) or in any manner involving a public offering within
the meaning of Section 4(2) of the Act; and (b) it has and will solicit offers
for the Notes only from, and will offer the Notes only to (A) in the case of
offers inside the United States, Persons whom the Initial Purchaser reasonably
believes to be QIBs or, if any such Person is buying for one or more
institutional accounts for which such Person is acting as fiduciary or agent,
only when such Person has represented to the Initial Purchaser that each such
account is a QIB, to whom notice has been given that such sale or delivery is
being made in reliance on Rule 144A, and, in each case, in transactions under
Rule 144A or (B) in the case of offers outside the United States, to Persons
other than U.S. Persons ('foreign purchasers,' which term shall include dealers
or other professional fiduciaries in the United States acting on a discretionary
basis for foreign beneficial owners (other than an estate or trust)); provided,
however, that, in the case of this clause (B), in purchasing such Notes such
Persons are deemed to have represented and agreed as provided under the caption
"Transfer Restrictions" contained in the Final Memorandum.
ARTICLE IV
CONDITIONS PRECEDENT TO CLOSING
Section 4.1. Conditions Precedent to Obligations of the Initial
Purchaser. The obligation of the Initial Purchaser to purchase the Notes to be
purchased by it hereunder is sub-
-21-
ject, at the Time of Purchase, to the satisfaction of the following conditions:
(a) The Initial Purchaser shall have received an opinion,
addressed to the Initial Purchaser in form and substance satisfactory
to counsel to the Initial Purchaser and dated the Time of Purchase,
from Xxxxxx, Xxxxxxxx & Xxxxxx, P.A., special counsel to the Issuers,
covering the matters set forth in Exhibit 1 attached hereto.
(b) The Initial Purchaser shall have received an opinion,
addressed to the Initial Purchaser in form and substance satisfactory
to the Initial Purchaser and dated the Time of Purchase, of Xxxxxx
Xxxxxx & Xxxxxxx, counsel to the Initial Purchaser, substantially in
the form of Exhibit 2 attached hereto.
In rendering such opinions in accordance with Sections 4.1(a)
and (b) above, each such counsel may rely as to factual matters upon
certificates or other documents furnished by officers and directors of
the Issuers and representations of the Initial Purchaser and by
government officials, and upon such other documents as such counsel
deem appropriate as a basis for their opinion. Each such counsel may
specify the jurisdictions in which it is admitted to practice and that
it is not admitted to practice in any other jurisdiction or an expert
in the law of any other jurisdiction. Any opinion relied upon by such
counsel as aforesaid shall be delivered to the Initial Purchaser
together with the opinion of such counsel, which opinion shall state
that such counsel believes that their and the Initial Purchaser's
reliance thereon is justified.
(c) The Initial Purchaser shall have received from Xxxxxx
Xxxxxxxx LLP a comfort letter or letters dated as of the date hereof
and as of the Closing Date in form and substance reasonably
satisfactory to counsel to the Initial Purchaser.
(d) The representations and warranties made by the Issuers
herein shall be true and correct in all material respects (except for
changes expressly provided for in this Agreement) on and as of the Time
of Purchase with the same effect as though such representations and
warranties had been made on and as of the Time of Purchase, each of the
Issuers shall have complied in all material respects with all
agreements as set forth in or contemplated hereunder and in the Basic
Documents required to be per-
-22-
formed by it at or prior to the Time of Purchase and the Issuers shall
have furnished to the Initial Purchaser a certificate, dated the Time
of Purchase, to such effect.
(e) Subsequent to the date of the Final Memorandum, to the
Closing Date, (i) there shall not have been any change, or any
development involving a prospective change, which has affected or is
reasonably expected to affect materially and adversely the businesses,
properties, the financial condition or the results of operations of the
Company or AOALP and (ii) the Company and AOALP shall have conducted
their business only in the ordinary course.
(f) At the Time of Purchase and after giving effect to the
consummation of the transactions contemplated by this Agreement and the
Basic Documents, there shall exist no Default or Event of Default.
(g) Subsequent to the date as of which information is given in
the Final Memorandum, neither of the Issuers, AOALP or AOAI has
incurred any liabilities or obligations, direct or contingent (other
than in the ordinary course of business) that are material to the
Issuers, AOALP or AOAI or entered into any transactions not in the
ordinary course of business that are material to the business,
condition (financial or other), assets, business prospects, results of
operations or properties of the Issuers, AOALP or AOAI and there has
not been any change in the capitalization of the Issuers, AOALP or AOAI
that is material to the business, financial condition, assets,
business, results of operations or properties of the Issuers, AOALP or
AOAI except in each case as described in the Final Memorandum.
(h) The sale of the Notes hereunder has not been enjoined
(temporarily or permanently).
(i) The purchase of and payment for the Notes by the Initial
Purchaser hereunder shall not be prohibited or enjoined (temporarily or
permanently) by any applicable law or governmental regulation
(including, without limitation, Regulation T, U or X of the Board of
Governors of the Federal Reserve System).
(j) At the Time of Purchase, the Initial Purchaser shall have
received a certificate, signed by the Chief Executive Officer or the
President or the principal financial or accounting officer of the
Company dated the Time
-23-
of Purchase, from the Issuers stating that the conditions specified in
Sections 4.1(d), (e), (f), (g) and (h) have been satisfied or duly
waived at the Time of Purchase.
(k) Each of the Basic Documents shall be satisfactory in form
and substance to the Initial Purchaser and shall have been executed and
delivered by all the respective parties thereto and shall be in full
force and effect.
(l) All proceedings taken in connection with the issuance of
the Notes and the transactions contemplated by this Agreement, the
Basic Documents and all documents and papers relating thereto shall be
reasonably satisfactory to the Initial Purchaser and counsel to the
Initial Purchaser. The Initial Purchaser and counsel to the Initial
Purchaser shall have received copies of such papers and documents as
they may reasonably request in connection therewith, all in form and
substance reasonably satisfactory to them.
(m) There shall not have been any announcement by any
"nationally recognized statistical rating organization", as defined for
purposes of Rule 436(g) under the Act, that (A) it is downgrading its
rating assigned to any debt securities of either of the Issuers, AOALP
or AOAI or (B) it is reviewing its rating assigned to any debt
securities of either of the Issuers, AOALP or AOAI with a view to
possible downgrading, or with negative implications, or direction not
determined.
(n) At the Time of Purchase, the Holding Company Documents
shall be in full force and effect on the terms described in the Final
Memorandum and the transfers to the holding company structure described
therein shall have been consummated.
(o) The Issuers shall have furnished to the Initial Purchaser,
as soon as they have been prepared, a copy of any unaudited interim
financial statements of the Issuers for any period subsequent to the
period covered by the most recent financial statements appearing in the
Final Memorandum.
(p) On or before the Closing, the Initial Purchaser and
counsel to the Initial Purchaser shall have received such further
documents, opinions, certificates and schedules or other instruments
relating to the business, corpo-
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rate, legal and financial affairs of the Issuers as they may reasonably
request.
ARTICLE V
COVENANTS
Section 5.1. Covenants of the Issuers. The Issuers covenant and agree
with the Initial Purchaser that:
(a) The Issuers will not amend or supplement the Final
Memorandum or any amendment or supplement thereto as to which the
Initial Purchaser shall not previously have been advised and furnished
a copy for a reasonable period of time prior to the proposed amendment
or supplement and as to which the Initial Purchaser shall not have
given its consent, which consent shall not be unreasonably withheld.
The Issuers will promptly, upon the reasonable request of the Initial
Purchaser or counsel to the Initial Purchaser, make any amendments or
supplements to the Preliminary Memorandum or the Final Memorandum that
may be deemed necessary or advisable by the Initial Purchaser or
counsel to the Initial Purchaser in connection with the resale of the
Notes by the Initial Purchaser.
(b) The Issuers will cooperate with the Initial Purchaser in
arranging for the qualification of the Notes for offering and sale
under the securities or "Blue Sky" laws of such jurisdictions as the
Initial Purchaser may designate and will continue such qualifications
in effect for as long as may be reasonably necessary to complete the
resale of the Notes; provided, however, that, in connection therewith,
neither Issuer shall be required to qualify as a foreign corporation or
foreign limited partnership, as the case may be, or to execute a
general consent to service of process in any jurisdiction or subject
itself to taxation in excess of a nominal dollar amount in any such
jurisdiction where it is not then so subject.
(c) If, at any time prior to the completion of the
distribution by the Initial Purchaser of the Notes or the Private
Exchange Notes, any event occurs or information becomes known as a
result of which the Final Memorandum as then amended or supplemented
would include any untrue statement of a material fact, or omit to state
a material fact necessary to make the statements therein, in the
-25-
light of the circumstances under which they were made, not misleading,
or if for any other reason it is necessary at any time to amend or
supplement the Final Memorandum to comply with applicable law, the
Issuers will promptly notify the Initial Purchaser thereof (who
thereafter will not use such Final Memorandum until appropriately
amended or supplemented) and will prepare, at the sole expense of the
Issuers, an amendment or supplement to the Final Memorandum that
corrects such statement or omission or effects such compliance.
(d) The Issuers will, without charge, provide to the Initial
Purchaser and to counsel to the Initial Purchaser as many copies of the
Preliminary Memorandum and the Final Memorandum or any amendment or
supplement thereto as the Initial Purchaser may reasonably request.
(e) The Issuers will apply the net proceeds from the sale of
the Notes as set forth under "Use of Proceeds" in the Final Memorandum.
(f) For and during the period ending on the date no Notes are
outstanding, the Issuers will furnish to the Initial Purchaser copies
of all reports and other communications (financial or otherwise)
furnished by the Issuers to the Trustee or the holders of the Notes.
(g) Neither of the Issuers nor any of their respective
Affiliates will sell, offer for sale or solicit offers to buy or
otherwise negotiate in respect of any "security" (as defined in the
Act) which could be integrated with the sale of the Notes in a manner
which would require the registration under the Act of the Notes.
(h) The Issuers will not solicit any offer to buy or offer to
sell the Notes by means of any form of general solicitation or general
advertising (as those terms are used in Regulation D under the Act) or
in any manner involving a public offering within the meaning of Section
4(2) of the Act.
(i) The Issuers will use their respective reasonable efforts
to (i) permit the Notes to be included for quotation on PORTAL and (ii)
permit the Notes to be eligible for clearance and settlement through
the facilities of The Depository Trust Company.
-26-
ARTICLE VI
FEES
Section 6.1. Costs, Expenses and Taxes. The Issuers, jointly and
severally, agree to pay all costs and expenses incident to the performance of
their obligations under this Agreement, whether or not the transactions
contemplated herein are consummated or this Agreement is terminated pursuant to
Section 8.2 hereof, including, but not limited to, all costs and expenses
incident to (i) the negotiation, preparation, printing, typing, reproduction,
execution and delivery of this Agreement and each of the Basic Documents, any
amendment or supplement to or modification of any of the foregoing and any and
all other documents furnished pursuant hereto or thereto or in connection
herewith or therewith, (ii) any costs of printing the Preliminary Memorandum and
the Final Memorandum and any amendment or supplement thereto, and any "Blue Sky"
memoranda (which shall include the reasonable disbursements of counsel to the
Initial Purchaser in respect thereof), (iii) all arrangements relating to the
delivery to the Initial Purchaser of copies of the foregoing documents, (iv) the
fees and disbursements of the counsel, the accountants and any other experts or
advisors retained by the Issuers, (v) preparation (including printing), issuance
and delivery to the Initial Purchaser of the Notes, (vi) the qualification of
the Notes under state securities and "Blue Sky" laws, including filing fees and
fees and disbursements of counsel to the Initial Purchaser relating thereto,
(vii) one-half of all local transportation, catering, room rental and similar
expenses in connection with any "roadshow" or other meetings with prospective
investors in the Notes (it being understood that the Initial Purchaser shall pay
the other one-half of such expenses and that each party shall pay its own air
transportation, lodging, individual meal and similar expenses, whether in
connection with such "roadshow" or otherwise related to this offering), (viii)
fees and expenses of the Trustee including fees and expenses of counsel to the
Trustee, (ix) all expenses and listing fees incurred in connection with the
application for quotation of the Notes on PORTAL, (x) any fees charged by
investment rating agencies for the rating of the Notes, and (xi) except as
limited by Article VII, all costs and expenses (including, without limitation,
reasonable attorneys' fees and expenses), if any, in connection with the
enforcement of this Agreement, the Notes or any other agreement furnished
pursuant hereto or thereto or in connection herewith or therewith. In addition,
the Issuers shall pay any and all stamp, transfer and other similar taxes
payable or de-
-27-
termined to be payable in connection with the execution and delivery of this
Agreement, any Basic Document or the issuance of the Notes, and shall save and
hold the Initial Purchaser harmless from and against any and all liabilities
with respect to or resulting from any delay in paying, or omission to pay, such
taxes.
ARTICLE VII
INDEMNITY
Section 7.1. Indemnity.
(a) Indemnification by the Issuers. The Issuers, jointly and severally,
agree and covenant to hold harmless and indemnify the Initial Purchaser and any
Affiliates thereof (including any director, officer, employee, agent or
controlling Person of any of the foregoing) from and against any losses, claims,
damages, liabilities and expenses (including expenses of investigation) to which
the Initial Purchaser and its Affiliates may become subject arising out of or
based upon any untrue statement or alleged untrue statement of any material fact
contained in the Memoranda and any amendments or supplements thereto, the Basic
Documents, any documents filed with the Commission or any State Commission
(collectively, the "Offering Materials") or arising out of or based upon the
omission or alleged omission to state in any of the Offering Materials a
material fact required to be stated therein or necessary to make the statements
therein not misleading; provided, however, that the Issuers shall not be liable
under this paragraph (a) to the extent that such losses, claims, damages or
liabilities arose out of or are based upon an untrue statement or omission made
in any of the documents referred to in this paragraph (a) in reliance upon and
in conformity with the information relating to the Initial Purchaser furnished
in writing by the Initial Purchaser for inclusion therein; provided, further,
that the Issuers shall not be liable under this paragraph (a) to the extent that
such losses, claims, damages or liabilities arose out of or are based upon an
untrue statement or omission made in any Preliminary Memorandum that is
corrected in the Final Memorandum (or any amendment or supplement thereto) if
the person asserting such loss, claim, damage or liability purchased Notes from
the Initial Purchaser in reliance on such Preliminary Memorandum but was not
given the Final Memorandum (or any amendment or supplement thereto) on or prior
to the confirmation of the sale of such Notes. The Issuers further agree to
-28-
reimburse the Initial Purchaser for any reasonable legal and other expenses as
they are incurred by it in connection with investigating, preparing to defend or
defending any lawsuits, claims or other proceedings or investigations arising in
any manner out of or in connection with such Person being an Initial Purchaser;
provided, however, that if the Issuers reimburse the Initial Purchaser hereunder
for any expenses incurred in connection with a lawsuit, claim or other
proceeding for which indemnification is sought, the Initial Purchaser hereby
agrees to refund such reimbursement of expenses to the extent that the losses,
claims, damages or liabilities arise out of or are based upon an untrue
statement or omission made in any of the documents referred to in this paragraph
(a) in reliance upon and in conformity with the information relating to the
Initial Purchaser furnished in writing by the Initial Purchaser for inclusion
therein. The Issuers further agree that the indemnification, contribution and
reimbursement commitments set forth in this Article VII shall apply whether or
not the Initial Purchaser is a formal party to any such lawsuits, claims or
other proceedings. The indemnity, contribution and expense reimbursement
obligations of the Issuers under this Article VII shall be in addition to any
liability the Issuers may otherwise have.
(b) Indemnification by the Initial Purchaser. The Initial Purchaser
agrees and covenants to hold harmless and indemnify the Issuers and any
Affiliates thereof (including any director, officer, employee, agent or
controlling Person of any of the foregoing) from and against any losses, claims,
damages, liabilities and expenses insofar as such losses, claims, damages,
liabilities or expenses arise out of or are based upon any untrue statement of
any material fact contained in the Offering Materials, or upon the omission to
state therein a material fact required to be stated therein or necessary to make
the statements therein not misleading, in each case to the extent, but only to
the extent, that such untrue statement or omission was made in reliance upon and
in conformity with the information relating to the Initial Purchaser furnished
in writing by the Initial Purchaser for inclusion therein. The indemnity,
contribution and expense reimbursement obligations of the Initial Purchaser
under this Article VII shall be in addition to any liability the Initial
Purchaser may otherwise have.
(c) Procedure. If any Person shall be entitled to indemnity hereunder
(each an "Indemnified Party"), such Indemnified Party shall give prompt written
notice to the party or parties from which such indemnity is sought (each an
"Indemni-
-29-
fying Party") of the commencement of any action, suit, investigation or
proceeding, governmental or otherwise (a "Proceeding"), with respect to which
such Indemnified Party seeks indemnification or contribution pursuant hereto;
provided, however, that the failure so to notify the Indemnifying Parties shall
not relieve the Indemnifying Parties from any obligation or liability except to
the extent that the Indemnifying Parties have been prejudiced materially by such
failure. The Indemnifying Parties shall have the right, exercisable by giving
written notice to an Indemnified Party promptly after the receipt of written
notice from such Indemnified Party of such Proceeding, to assume, at the
Indemnifying Parties' expense, the defense of any such Proceeding, with counsel
reasonably satisfactory to such Indemnified Party; provided, however, that an
Indemnified Party or parties (if more than one such Indemnified Party is named
in any Proceeding) shall have the right to employ separate counsel in any such
Proceeding and to participate in the defense thereof, but the fees and expenses
of such counsel shall be at the expense of such Indemnified Party or parties
unless: (1) the Indemnifying Parties agree to pay such fees and expenses; or (2)
the Indemnifying Parties fail promptly to assume the defense of such Proceeding
or fail to employ counsel reasonably satisfactory to such Indemnified Party or
parties; or (3) the named parties to any such Proceeding (including any
impleaded parties) include both such Indemnified Party or parties and the
Indemnifying Party or an Affiliate of the Indemnifying Party and such
Indemnified Parties, and the Indemnified Parties shall have been advised in
writing by counsel that there may be one or more legal defenses available to
such Indemnified Party or parties that are different from or additional to those
available to the Indemnifying Parties, in which case, if such Indemnified Party
or parties notifies the Indemnifying Parties in writing that it elects to employ
separate counsel at the expense of the Indemnifying Parties, the Indemnifying
Parties shall not have the right to assume the defense thereof and such counsel
shall be at the expense of the Indemnifying Parties, it being understood,
however, that, unless there exists a conflict among Indemnified Parties, the
Indemnifying Parties shall not, in connection with any one such Proceeding or
separate but substantially similar or related Proceedings in the same
jurisdiction, arising out of the same general allegations or circumstances, be
liable for the fees and expenses of more than one separate firm of attorneys
(together with appropriate local counsel) at any time for such Indemnified Party
or parties, or for fees and expenses that are not reasonable. No Indemnified
Party or parties will settle any Proceeding without the consent of the
Indemnifying Party or parties (but such consent shall not be unreasonably
-30-
withheld). No Indemnifying Party shall, without the prior written consent of the
Indemnified Party, effect any settlement of any pending or threatened Proceeding
in respect of which any Indemnified Party is or could have been or a party and
indemnity could have been sought hereunder by such Indemnified Party, unless
such settlement includes an unconditional release of such Indemnified Party from
all liability or claims that are the subject of such Proceeding.
Section 7.2. Contribution. If for any reason the indemnification
provided for in Section 7.1 of this Agreement is unavailable to an Indemnified
Party, or insufficient to hold it harmless, in respect of any losses, claims,
damages, liabilities or expenses referred to therein, then each applicable
Indemnifying Party, in lieu of indemnifying such Indemnified Party, shall
contribute to the amount paid or payable by such Indemnified Party as a result
of such losses, claims, damages or liabilities in such proportion as is
appropriate to reflect not only the relative benefits received by the
Indemnifying Party on the one hand and the Indemnified Party on the other, but
also the relative fault of the Indemnifying and Indemnified Parties in
connection with the statements or omissions which resulted in such losses,
claims, damages or liabilities, as well as any other relevant equitable
considerations. The relative benefits received by the Indemnifying and
Indemnified Parties shall be deemed to be in the same proportion as the total
proceeds from the offering of the Notes (before deducting expenses) received by
the Issuers bear to the total discounts and commissions received by the Initial
Purchaser. The relative fault of the Indemnifying and Indemnified Parties shall
be determined by reference to, among other things, whether the untrue or alleged
untrue statement of a material fact or the omission or alleged omission to state
a material fact relates to information supplied by the Indemnifying or
Indemnified Parties and the parties' relative intent, knowledge, access to
information and opportunity to correct or prevent such statement or omission.
The amount paid or payable by a party as a result of the losses, claims, damages
and liabilities referred to above shall be deemed to include any legal or other
fees or expenses incurred by such party in connection with investigating or
defending any such claim.
The Issuers and the Initial Purchaser agree that it would not be just
and equitable if contribution pursuant to the immediately preceding paragraph
were determined pro rata or per capita or by any other method of allocation
which does not take into account the equitable considerations referred to in
such paragraph. Notwithstanding any other provision of this Sec-
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tion 7.2, the Initial Purchaser shall not be obligated to make contributions
hereunder that in the aggregate exceed the total discounts, commissions and
other compensation received by the Initial Purchaser under this Agreement, less
the aggregate amount of any damages that the Initial Purchaser has otherwise
been required to pay by reason of the untrue or alleged untrue statements or the
omissions or alleged omissions to state a material fact. No Person guilty of
fraudulent misrepresentation (within the meaning of Section 11(f) of the Act)
shall be entitled to contribution from any Person who was not guilty of such
fraudulent misrepresentation.
Section 7.3. Registration Rights Agreement. Notwithstanding anything to
the contrary in this Article 7, the indemnification and contribution provisions
of the Registration Rights Agreement shall govern any claim with respect
thereto.
ARTICLE VIII
MISCELLANEOUS
Section 8.1. Survival of Provisions. Notwithstanding any other
provision of this Agreement, the representations, warranties and covenants of
the Issuers, their respective officers and the Initial Purchaser made herein,
the indemnity and contribution agreements contained herein and each of the
provisions of Articles V, VII and VIII shall remain operative and in full force
and effect regardless of (a) any investigation made by or on behalf of the
Issuers, the Initial Purchaser or any Indemnified Party, (b) acceptance of any
of the Notes and payment therefor, (c) any termination of this Agreement, or (d)
disposition of the Notes by the Initial Purchaser whether by redemption,
exchange, sale or otherwise.
Section 8.2. Termination. (a) This Agreement may be terminated in the
sole discretion of the Initial Purchaser by notice to the Issuers given prior to
the Time of Purchase in the event that the Issuers shall have failed, refused or
been unable to perform all obligations and satisfy all conditions on their part
to be performed or satisfied hereunder at or prior thereto or, if at or prior to
the Closing:
(i) the Issuers, AOALP or AOAI shall have sustained any loss
or interference with respect to its businesses or properties from fire,
flood, hurricane, accident or other calamity, whether or not covered by
insurance, or from any
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strike, labor dispute, slow down or work stoppage or any legal or
governmental proceeding, which loss or interference, in the sole
judgment of the Initial Purchaser, has had or has a Material Adverse
Effect, or there shall have been, in the sole judgment of the Initial
Purchaser, any event or development that, individually or in the
aggregate, has or could have a Material Adverse Effect (including,
without limitation, a change in control of either of the Issuers),
except in each case as described in the Final Memorandum (exclusive of
any amendment or supplement thereto);
(ii) trading in securities of the Issuers, AOALP or AOAI or in
securities generally on the New York Stock Exchange, American Stock
Exchange or the Nasdaq National Market shall have been suspended or
minimum or maximum prices shall have been established on any such
exchange or market;
(iii) a banking moratorium shall have been declared by New
York or United States authorities;
(iv) there shall have been (A) an outbreak or escalation of
hostilities between the United States and any foreign power, or (B) an
outbreak or escalation of any other insurrection or armed conflict
involving the United States or any other national or international
calamity or emergency, or (C) any material change in the financial
markets of the United States which, in the case of (A), (B) or (C)
above and in the sole judgment of the Initial Purchaser, makes it
impracticable or inadvisable to proceed with the purchase of the Notes
as contemplated by the Final Memorandum; or
(v) any securities of either of the Issuers, AOALP or AOAI
shall have been downgraded or placed on any "watch list" for possible
downgrading by any nationally recognized statistical rating
organization.
(b) Termination of this Agreement pursuant to this Section 8.2 shall be
without liability of any party to any other party except as provided in Section
8.1 hereof.
Section 8.3. No Waiver; Modifications in Writing. No failure or delay
on the part of the Issuers or the Initial Purchaser in exercising any right,
power or remedy hereunder shall operate as a waiver thereof, nor shall any
single or partial exercise of any such right, power or remedy preclude any
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other or further exercise thereof or the exercise of any other right, power or
remedy. The remedies provided for herein are cumulative and are not exclusive of
any remedies that may be available to the Issuers or the Initial Purchaser at
law or in equity or otherwise. No waiver of or consent to any departure by the
Issuers from any provision of this Agreement shall be effective unless signed in
writing by the party entitled to the benefit thereof, provided, however, that
notice of any such waiver shall be given to each party hereto as set forth
below. Except as otherwise provided herein, no amendment, modification or
termination of any provision of this Agreement shall be effective unless signed
in writing by or on behalf of each of the Issuers and the Initial Purchaser. Any
amendment, supplement or modification of or to any provision of this Agreement,
any waiver of any provision of this Agreement, and any consent to any departure
by the Issuers from the terms of any provision of this Agreement, shall be
effective only in the specific instance and for the specific purpose for which
made or given. Except where notice is specifically required by this Agreement,
no notice to or demand on the Issuers in any case shall entitle the Issuers to
any other or further notice or demand in similar or other circumstances.
Section 8.4. Information Supplied by the Initial Purchaser. The
statements set forth in the fifth and ninth paragraphs under the heading 'Plan
of Distribution' in the Final Memorandum (to the extent such statements relate
to the Initial Purchaser) constitute the only information furnished by the
Initial Purchaser to the Issuers for the purposes of Sections 3.1(a) and 7.1(a)
hereof.
Section 8.5. Communications. All notices, demands and other
communications provided for hereunder shall be in writing, and, (a) if to the
Initial Purchaser, shall be given by registered or certified mail, return
receipt requested, telex, telegram, telecopy, courier service or personal
delivery, addressed to CIBC World Markets Corp., 000 Xxxxxxxxx Xxxxxx, Xxx Xxxx,
Xxx Xxxx 00000, (b) if to the Issuers, shall be given by similar means to 1380
W. Paces Ferry Road, N.W., Suite 170, South Wing, Xxxxxxx, Xxxxxxx 00000, attn:
Chief Financial Officer, with copies to Xxxxxx, Xxxxxxxx & Xxxxxx, P.A., 5500
Norwest Center, 00 Xxxxx Xxxxxxx Xxxxxx, Xxxxxxxxxxx, Xxxxxxxxx 00000, attn:
Xxxxxx Xxxxxxx. In each case notices, demands and other communications shall be
deemed given when received.
Section 8.6. Execution in Counterparts. This Agreement may be executed
in any number of counterparts and by different parties hereto on separate
counterparts, each of
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which counterparts, when so executed and delivered, shall be deemed to be an
original and all of which counterparts, taken together, shall constitute but one
and the same Agreement.
Section 8.7. Successors. This Agreement shall inure to the benefit of
and be binding upon the Initial Purchaser, the Issuers and their respective
successors and legal representatives, and nothing expressed or mentioned in this
Agreement is intended or shall be construed to give any other Person any legal
or equitable right, remedy or claim under or in respect of this Agreement, or
any provisions herein contained; this Agreement and all conditions and
provisions hereof being intended to be and being for the sole and exclusive
benefit of such Persons and for the benefit of no other Person except that (i)
the indemnities of the Issuers contained in Section 7.1(a) of this Agreement
shall also be for the benefit of the directors, officers, employees and agents
of the Initial Purchaser and any Person or Persons who control the Initial
Purchaser within the meaning of Section 15 of the Act or Section 20 of the
Exchange Act and (ii) the indemnities of the Initial Purchaser contained in
Section 7.1(b) of this Agreement shall also be for the benefit of the directors
of the General Partner, the officers and any Person or Persons who control
either Issuer within the meaning of Section 15 of the Act or Section 20 of the
Exchange Act. No purchaser of Notes from the Initial Purchaser will be deemed a
successor because of such purchase.
Section 8.8. Governing Law. THIS AGREEMENT SHALL BE DEEMED TO BE A
CONTRACT MADE UNDER THE LAWS OF THE STATE OF NEW YORK, AND FOR ALL PURPOSES
SHALL BE CONSTRUED IN ACCORDANCE WITH THE LAWS OF SAID STATE, WITHOUT REGARD TO
PRINCIPLES OF CONFLICTS OF LAW.
Section 8.9. 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 8.10. Headings. The Article and Section headings and Table of
Contents used or contained in this Agreement are for convenience of reference
only and shall not affect the construction of this Agreement.
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Section 8.11. Release from Liability. No trustee, director, officer,
employee, stockholder (other than the Company), partner, affiliate or
beneficiary, as such, of the Issuers shall have any liability for any of the
obligations of the Issuers under this Agreement. It is understood that this
limitation on recourse is made expressly for the benefit of any such trustee,
director, officer, employee, stockholder, partner or beneficiary and may be
enforced by any one or all of them.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed as of the date first written above.
AOA HOLDING LLC
(a Minnesota limited liability company)
By: /s/ Xxx Xxxxxx
--------------------------
Name: Xxx Xxxxxx
Title: Vice President
AOA CAPITAL CORP
(a Minnesota corporation)
By: /s/ Xxx Xxxxxx
--------------------------
Name: Xxx Xxxxxx
Title: Vice President
CIBC WORLD MARKETS CORP.
By: /s/ Xxxxx Xxxxxxx
------------------------
Name: Xxxxx Xxxxxxx
Title:
SCHEDULE I
Principal Amount
Initial Purchaser of Notes________
CIBC World Markets Corp......................................... $50,000,000
Total................................................ $50,000,000
1. (a) (1) (i) (A) (b) (
(i) (A) (c) ( (i) (A) (d) (
(i) (A) (e) ( (i) (A) (f) (
(i) (A) (g) ( (i) (A) (h) (
(i) (A) (i) ( (i) (A) (j) (
(i) (A) (k) ( (i) (A) (l) (
(i) (A) (m) ( (i) (A) (n) (
(i) (A)
19956/1
