EXHIBIT 10(3)
EXECUTION COPY
AMSCAN HOLDINGS, INC.
8.75% SENIOR SUBORDINATED NOTES DUE 2014
PURCHASE AGREEMENT
April 27, 2004
Xxxxxxx, Xxxxx & Co.
Credit Suisse First Boston LLC,
As representatives of the several Purchasers
named in Schedule I hereto,
c/o Goldman, Sachs & Co.,
00 Xxxxx Xxxxxx,
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
Amscan Holdings, Inc., a Delaware corporation (the "Company"), proposes,
subject to the terms and conditions stated herein, to issue and sell to the
Purchasers named in Schedule I hereto (the "Purchasers"), in the respective
amounts set forth in Schedule I hereto, an aggregate of $175,000,000 principal
amount of the 8.75% Senior Subordinated Notes due 2014, specified above (the
"Securities"). The Securities will be unconditionally guaranteed as to the
payment of principal, premium and interest (including special interest), if any,
(the "Guarantees") by each of the Company's existing domestic subsidiaries (each
a "Guarantor" and collectively, the "Guarantors"). Capitalized terms used but
not defined herein shall have the meanings assigned to them in the Offering
Circular (as defined below) under the heading "Description of Notes."
The Securities are being issued and sold in connection with the
acquisition of the Company (the "Acquisition") by AAH Holdings Corporation ("AAH
Holdings"), pursuant to the Agreement and Plan of Merger by and among AAH
Holdings, AAH Acquisition Corporation ("AAH Acquisition") and the Company, dated
March 26, 2004 (the "Acquisition Agreement"). The Acquisition is structured as a
merger of AAH Acquisition with and into the Company, with the Company surviving
as a wholly-owned subsidiary of AAH Holdings, all as provided in "The
Transactions" sections of the Offering Circular. The gross proceeds from the
sale of the Securities pursuant to this Agreement, together with the proceeds of
other financings described in the Offering Circular, will be used to consummate
the Acquisition, consummate a debt tender offer to acquire at least a majority
of the Company's existing 9.875% Senior Subordinated Notes due 2007 (the "Tender
Offer") and pay related fees and expenses. The Acquisition, together with (A) a
cash common equity investment by certain investors (the "Equity Investment"),
(B) the borrowing by the Company under a new senior secured credit facility to
be dated as of or before April 30, 2004, by and among the Company, AAH Holdings
and certain of the Company's subsidiaries, as guarantors, Xxxxxxx Xxxxx Credit
Partners L.P., X.X. Xxxxxx Securities Inc., General Electric Capital Corporation
and certain other lenders (the "Credit Agreement"), (C) the sale of $175,000,000
of the Securities pursuant to this Agreement, and (D) the
consummation of the Tender Offer shall collectively be referred to as the
"Transactions." The sale of the Securities hereby is conditioned on the
contemporaneous consummation of the Acquisition, the Tender Offer and the
provision of funds pursuant to the Equity Investment and the Credit Agreement.
1. As of the date hereof, AAH Holdings (excluding the representations
and warranties set forth in subsections (f), (g) and (n) (with respect to the
Company and the Guarantors) and (e), (h), (i), (j), (k), (l), and (m); provided
that the representations and warranties made in subsections (o), (r), (w), (x)
and (z) are made only to the best of AAH Holdings' knowledge) and, at the Time
of Delivery (as defined below), each of the Company and the Guarantors, jointly
and severally, represents and warrants to, and agrees with, each of the
Purchasers that:
(a) A preliminary offering circular, dated April 16, 2004 (the
"Preliminary Offering Circular"), and an offering circular, dated April
27, 2004 (the "Offering Circular"), have been prepared in connection with
the offering of the Securities. Any reference to the Preliminary Offering
Circular or the Offering Circular, as the case may be, as amended or
supplemented, as of any specified date, shall be deemed to include (i) any
documents filed with the United States Securities and Exchange Commission
(the "Commission") pursuant to Section 13(a), 13(c) or 15(d) of the United
States Securities Exchange Act of 1934, as amended (the "Exchange Act")
after the date of the Preliminary Offering Circular or the Offering
Circular, as the case may be, and prior to such specified date and (ii)
any Additional Issuer Information (as defined in Section 5(f) hereof)
furnished by the Company prior to the completion of the distribution of
the Securities; and all documents filed under the Exchange Act and so
deemed to be included in the Preliminary Offering Circular or the Offering
Circular, as the case may be, or any amendment or supplement thereto are
hereinafter called the "Exchange Act Reports." The Exchange Act Reports,
when they were or are filed with the Commission, conformed or will conform
in all material respects to the applicable requirements of the Exchange
Act and the applicable rules and regulations of the Commission thereunder.
The Preliminary Offering Circular or the Offering Circular and any
amendments or supplements thereto and the Exchange Act Reports, if any,
did not and will not, as of their respective dates, contain an untrue
statement of a material fact or omit to state a material fact necessary in
order to make the statements therein, in the light of the circumstances
under which they were made, not misleading; provided, however, that this
representation and warranty shall not apply to any statements or omissions
made in reliance upon and in conformity with information furnished in
writing to the Company by a Purchaser through Xxxxxxx, Xxxxx & Co.
expressly for use therein;
(b) Neither the Company, the Guarantors nor any of their
respective subsidiaries has sustained since the date of the latest audited
financial statements included in the Offering Circular any material loss
or interference with its business from fire, explosion, flood or other
calamity, whether or not covered by insurance, or from any labor dispute
or court or governmental action, order or decree, otherwise than as set
forth or contemplated in the Offering Circular; and, since the respective
dates as of which information is given in the Offering Circular, there has
not been any change in the capital stock or increase in the long-term debt
of the Company, the Guarantors or any of their respective subsidiaries or
any material adverse change, or any development involving a prospective
material adverse change, in or affecting the general affairs, management,
financial position, stockholders' equity or results of operations of the
Company and its subsidiaries, otherwise than as set forth or contemplated
in the Offering Circular;
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(c) The Company, the Guarantors and their respective subsidiaries
have good and marketable title in fee simple to all real property and good
and marketable title to all personal property owned by them, in each case
free and clear of all liens, encumbrances and defects except such as are
described in the Offering Circular or such as do not materially adversely
affect the value of such property and do not materially interfere with the
use made and proposed in the Offering Circular to be made of such property
by the Company, the Guarantors and their respective subsidiaries; and any
real property and buildings held under lease by the Company, the
Guarantors and their respective subsidiaries are held by them under valid,
subsisting and enforceable leases with such exceptions as are not material
and do not materially interfere with the use made and proposed in the
Offering Circular to be made of such property and buildings by the
Company, the Guarantors and their respective subsidiaries;
(d) The Company and the Guarantors have each been duly
incorporated and are validly existing as corporations, or other entities,
in good standing under the laws of their respective jurisdictions of
incorporation or organization, with corporate power and authority or power
and authority under its organizational documents and the applicable
limited liability company statute, as applicable, to own or lease their
properties and conduct their business as described in the Offering
Circular, and have been duly qualified as foreign corporations for the
transaction of business and are in good standing under the laws of each
other jurisdiction in which they own or lease properties or conduct any
business so as to require such qualification, or are subject to no
material liability or disability by reason of the failure to be so
qualified in any such jurisdiction; and each subsidiary of the Company and
the Guarantors that is not a Guarantor has been duly incorporated and is
validly existing as a corporation, or other entity, in good standing under
the laws of its jurisdiction of incorporation or organization, except as
would not, individually or in the aggregate, result in a material adverse
effect on the current or future business, management, financial position,
stockholders' equity or results of operations of the Company, the
Guarantors and their respective subsidiaries, taken as a whole (a
"Material Adverse Effect");
(e) At the Time of Delivery, the Company will have a
capitalization as set forth in the Offering Circular under the caption
"Capitalization." All of the issued shares of capital stock of the Company
have been duly and validly authorized and issued and are fully paid and
non-assessable; and all of the issued shares of capital stock of each
subsidiary of the Company and the Guarantors have been duly and validly
authorized and issued, are fully paid and non-assessable and (except for
directors' qualifying shares and except as otherwise set forth in the
Offering Circular) are owned directly or indirectly by the Company or the
Guarantors, free and clear of all liens, encumbrances, equities or claims;
(f) The offering of the Securities has been duly authorized by AAH
Holdings. At the Time of Delivery, the Securities will have been duly
authorized by the Company and, when issued and delivered pursuant to this
Agreement and the Indenture (as defined below), will have been duly
executed, authenticated, issued and delivered and will constitute valid
and legally binding obligations of the Company entitled to the benefits
provided by the indenture to be dated as of April 30, 2004 (the
"Indenture") among the Company, the Guarantors and The Bank of New York,
as Trustee (the "Trustee"), under which they are to be issued, enforceable
against the Company in accordance with their terms, subject, as to
enforcement, to bankruptcy, insolvency, reorganization and other laws of
general applicability relating to or
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affecting creditors' rights and to general equity principles; and the
Securities will be in substantially the form previously delivered to you;
(g) This Agreement has been duly authorized by AAH Holdings, the
Company and each of the Guarantors;
(h) The Indenture has been duly authorized by the Company and each
of the Guarantors and, when duly executed and delivered by the Company and
each of the Guarantors (assuming due authorization, execution and delivery
by each of the other parties thereto), the Indenture will constitute a
valid and legally binding obligation of the Company and each of the
Guarantors, enforceable against the Company and each of the Guarantors in
accordance with its terms, subject, as to enforcement, to bankruptcy,
insolvency, reorganization and other laws of general applicability
relating to or affecting creditors' rights and to general equity
principles;
(i) The Guarantees have been duly authorized by each of the
Guarantors and, when issued and delivered pursuant to this Agreement and
the Indenture, will have been duly executed, issued and delivered and will
constitute valid and legally binding obligations of each of the
Guarantors, entitled to the benefits provided by the Indenture and
enforceable against each of the Guarantors in accordance with their terms,
subject, as to enforcement, to bankruptcy, insolvency, reorganization and
other laws of general applicability relating to or affecting creditors'
rights and to general equity principles;
(j) The exchange and registration rights agreement to be dated as
of April 30, 2004, among the Company, the Guarantors and the Purchasers
(the "Registration Rights Agreement") has been duly authorized by the
Company and each of the Guarantors and, when duly executed and delivered
by the Company and each of the Guarantors (assuming due authorization,
execution and delivery by each of the other parties thereto), will
constitute a valid and legally binding obligation of the Company and each
of the Guarantors, enforceable against the Company and each of the
Guarantors in accordance with its terms, subject, as to enforcement, to
bankruptcy, insolvency, reorganization and other laws of general
applicability relating to or affecting creditors' rights and to general
equity principles; provided that no representation is made as to the
enforceability of the indemnification and contribution provisions thereof;
(k) The series of debt securities of the Company, with terms
identical to the Securities, that are registered on a registration
statement on Form S-4 (the "Exchange Securities") have been duly
authorized for issuance by the Company and, when issued and delivered
pursuant to the Indenture, will have been duly executed, authenticated,
issued and delivered and will constitute valid and legally binding
obligations of the Company, entitled to the benefits provided by the
Indenture and enforceable against the Company in accordance with their
terms, subject, as to enforcement, to bankruptcy, insolvency,
reorganization and other laws of general applicability relating to or
affecting creditors' rights and to general equity principles;
(l) The guarantees of the Company's obligations under the Exchange
Securities (the "Exchange Guarantees") to be offered in exchange for the
Guarantees in the Exchange Offer have been duly authorized by each of the
Guarantors and, when issued and delivered pursuant to the Indenture, will
have been duly executed, issued and delivered and will constitute valid
and legally binding obligations of each of the Guarantors, entitled to the
benefits provided by the Indenture and enforceable against each of the
Guarantors in accordance with their terms, subject, as to enforcement, to
bankruptcy, insolvency,
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reorganization and other laws of general applicability relating to or
affecting creditors' rights and to general equity principles;
(m) The Credit Agreement has been duly authorized by the Company
and each of the Guarantors and, when duly executed and delivered by the
Company and each of the Guarantors (assuming due authorization, execution
and delivery by each of the other parties thereto), will constitute a
valid and legally binding obligation of the Company and each of the
Guarantors, enforceable against the Company and each of the Guarantors in
accordance with its terms, subject, as to enforcement, to bankruptcy,
insolvency, reorganization and other laws of general applicability
relating to or affecting creditors' rights and to general equity
principles;
(n) The Acquisition Agreement has been duly authorized, executed
and delivered by the Company, AAH Holdings and AAH Acquisition and
constitutes a valid and legally binding obligation of the Company, AAH
Holdings and AAH Acquisition, enforceable against the Company, AAH
Holdings and AAH Acquisition in accordance with its terms, subject, as to
enforcement, to bankruptcy, insolvency, reorganization and other laws of
general applicability relating to or affecting creditors' rights and to
general equity principles;
(o) None of the transactions contemplated by this Agreement
(including, without limitation, the use of the proceeds from the sale of
the Securities) will violate or result in a violation of Section 7 of the
Exchange Act, or any regulation promulgated thereunder, including, without
limitation, Regulations G, T, U and X of the Board of Governors of the
Federal Reserve System;
(p) Prior to the date hereof, neither the Company, the Guarantors
nor any of the affiliates of AAH Holdings has taken any action which is
designed to or which has constituted or which might have been expected to
cause or result in stabilization or manipulation of the price of any
security of the Company or any Guarantor in connection with the offering
of the Securities and the Guarantees;
(q) The issue and sale of the Securities and the Guarantees,
compliance by the Company and the Guarantors with all of the provisions of
the Securities, the Guarantees, the Indenture, the Registration Rights
Agreement, the Credit Agreement, the equity subscription agreement, to be
dated as of or before April 30, 2004 (the "Equity Subscription
Agreement"), the Acquisition Agreement and this Agreement and the
consummation of the transactions herein and therein contemplated will not
(i) conflict with or result in a breach or violation of any of the terms
or provisions of, or constitute a default under, any indenture, mortgage,
deed of trust, loan agreement or other agreement or instrument to which
the Company or any of its subsidiaries is a party or by which the Company
or any of its subsidiaries is bound or to which any of the property or
assets of the Company or any of its subsidiaries is subject, (ii) result
in any violation of the provisions of the Certificate of Incorporation or
By-laws of the Company or any of its subsidiaries, (iii) assuming the
accuracy of the representations made by the Purchasers in Section 3
hereof, result in any violation of the provisions of any law or statute or
any order, rule or regulation, judgment or decree of any court or
governmental agency or body having jurisdiction over the Company or any of
its subsidiaries or any of their respective properties or assets, except
in the case of (i) and (iii) above, for such conflicts, breaches,
violations and defaults as would not reasonably be expected to have a
Material Adverse Effect; no consent, approval, authorization, order,
registration or qualification of or with any such court or governmental
agency or body is required for the issue and sale of the Securities and
the Guarantees or the consummation by the Company and the Guarantors of
the transactions contemplated by this Agreement, the Securities, the
Guarantees, the Indenture or
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the Registration Rights Agreement, except for (i) the filing of a
registration statement by the Company with the Commission pursuant to the
United States Securities Act of 1933, as amended (the "Act") and (ii) such
consents, approvals, authorizations, registrations or qualifications as
may be required under state securities or Blue Sky laws in connection with
the purchase and distribution of the Securities by the Purchasers;
(r) Neither the Company, the Guarantors nor any of their
respective subsidiaries is (i) in violation of its Certificate of
Incorporation, By-laws, Certificate of Formation or Limited Liability
Company Agreement, as applicable, or (ii) in default in the performance or
observance of any obligation, covenant or condition contained in any
indenture, mortgage, deed of trust, loan agreement, lease or other
agreement or instrument to which it is a party or by which it or any of
its properties may be bound, except in the case of (ii) above, for such
defaults as would not reasonably be expected to have a Material Adverse
Effect ;
(s) The statements set forth in the Offering Circular under the
caption "Description of Notes," insofar as they purport to constitute a
summary of the terms of the Securities, the Guarantees and the Indenture,
and under the captions "Material Federal Income Tax Consequences" and
"Underwriting," insofar as they purport to describe the provisions of the
laws and documents referred to therein, are accurate, complete and fair in
all material respects;
(t) Other than as set forth in the Offering Circular, there are no
legal or governmental proceedings pending to which the Company or any of
its subsidiaries is a party or of which any property or assets of the
Company or any of its subsidiaries is the subject which, if determined
adversely to the Company or any of its subsidiaries, would individually or
in the aggregate be reasonably expected to have a Material Adverse Effect;
and, to the best of the Company's and each Guarantor's knowledge, no such
proceedings are threatened or contemplated by governmental authorities or
threatened by others;
(u) When the Securities and the Guarantees are issued and
delivered pursuant to this Agreement, neither the Securities nor the
Guarantees will be of the same class (within the meaning of Rule 144A
under the Act) as securities which are listed on a national securities
exchange registered under Section 6 of the Exchange Act or quoted in a
U.S. automated inter-dealer quotation system;
(v) Neither the Company, the Guarantors nor any of their
respective subsidiaries is or after giving effect to the offering and sale
of the Securities, will be an "investment company," or an entity
"controlled by an investment company," as such terms are defined in the
United States Investment Company Act of 1940, as amended, and the rules
and regulations thereunder (the "Investment Company Act");
(w) Neither the Company, the Guarantors nor any person acting on
its or their behalf (provided that no representation or warranty is made
as to actions of the Purchasers) has offered or sold the Securities by
means of any general solicitation or general advertising within the
meaning of Rule 502(c) under the Act or, with respect to Securities sold
outside the United States to non-U.S. persons (as defined in Rule 902
under the Act), by means of any directed selling efforts within the
meaning of Rule 902 under the Securities Act and the Company, any
affiliate of AAH Holdings and any person acting on its or their behalf has
complied with and will implement the "offering restriction" within the
meaning of such Rule 902;
(x) Within the preceding six months, neither the Company, the
Guarantors nor any other person acting on behalf of the Company or any
Guarantor has offered or sold to any
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person any Securities or Guarantees, or any securities of the same or a
similar class as the Securities or Guarantees, other than Securities
offered or sold to the Purchasers hereunder. The Company will take
reasonable precautions designed to insure that any offer or sale, direct
or indirect, in the United States or to any U.S. person (as defined in
Rule 902 under the Act) of any Securities or any substantially similar
security issued by the Company, within six months subsequent to the date
on which the distribution of the Securities and the Guarantees has been
completed (as notified to the Company by Xxxxxxx, Sachs & Co.), is made
under restrictions and other circumstances reasonably designed not to
affect the status of the offer and sale of the Securities and the
Guarantees in the United States and to U.S. persons contemplated by this
Agreement as transactions exempt from the registration provisions of the
Securities Act;
(y) Neither the Company, the Guarantors nor any of their
respective affiliates does business with the government of Cuba or with
any person or affiliate located in Cuba within the meaning of Section
517.075, Florida Statutes;
(z) Ernst & Young LLP who have audited certain financial
statements of the Company and its subsidiaries, are independent public
accountants as required by the Act and the rules and regulations of the
Commission thereunder;
(aa) The Company maintains and will maintain disclosure controls
and procedures (as defined in Rule 13a-14 of the Exchange Act) designed to
ensure that information required to be disclosed by the Company in the
reports that it files or submits under the Exchange Act is recorded,
processed, summarized and reported in accordance with the Exchange Act and
the rules and regulations thereunder; and the Company has carried out and
will carry out evaluations, under the supervision and with the
participation of the Company's management, of the effectiveness of the
design and operation of the Company's disclosure controls and procedures
in accordance with Rule 13a-15 of the Exchange Act;
(bb) Except as described in the Offering Circular, (i) neither the
Company, the Guarantors nor any of their respective subsidiaries is in
violation of any federal, state, local or foreign statute, law, rule,
regulation, ordinance, code, policy or rule of common law or any judicial
or administrative order, consent, decree or judgment thereof, including
any judicial or administrative order, consent, decree or judgment relating
to pollution or protection of human health, the environment (including,
without limitation, ambient air, surface water, groundwater, land surface
or subsurface strata) or wildlife, including, without limitation, laws and
regulations relating to the release or threatened release of chemicals,
pollutants, contaminants, wastes, toxic substances, hazardous substances,
petroleum or petroleum products (collectively, "Hazardous Materials") or
to the manufacture, processing, distribution, use, treatment, storage,
disposal, transport or handling of Hazardous Materials (collectively,
"Environmental Laws"), (ii) the Company, the Guarantors and each of their
respective subsidiaries have all permits, authorizations and approvals
required under any applicable Environmental Laws and are each in
compliance with their requirements, (iii) there are no pending or, to the
knowledge of the Company, the Guarantors or any of their respective
subsidiaries, threatened administrative, regulatory or judicial actions,
suits, demands, demand letters, claims, liens, notices of noncompliance or
violation, investigation or proceedings relating to any Environmental Law
against the Company, the Guarantors or any of their respective
subsidiaries and (iv) there are no events or circumstances that might
reasonably be expected to form the basis of an order for clean-up or
remediation, or an action, suit or proceeding by any private party or
governmental body or agency, against or affecting the Company, the
Guarantors or any of
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their respective subsidiaries relating to Hazardous Materials or
Environmental Laws, except, in each case, as would not individually or in
the aggregate reasonably be expected to have a Material Adverse Effect;
(cc) The Company, the Guarantors and each of their respective
subsidiaries own or possess adequate rights to use all patents, patent
applications, trademarks, service marks, trade names, trademark
registrations, service xxxx registrations, copyrights and licenses
necessary for the conduct of their respective businesses, and have no
reason to believe that the conduct of their respective businesses will
conflict with, and, except as disclosed in the Preliminary Offering
Circular and the Offering Circular, have not received any notice of any
claim of conflict with, any such rights of others, except, in each case,
as would not individually or in the aggregate reasonably be expected to
have a Material Adverse Effect;;
(dd) The financial statements, including the notes thereto,
included in the Offering Circular comply as to form in all material
respects with the applicable accounting requirements of the Act, the
Exchange Act, and the rules and regulations of the Commission thereunder,
and present fairly in all material respects the financial position of the
Company and its consolidated subsidiaries for which financial statements
are included in the Offering Circular as of the dates indicated and
condition and results of operations for the periods specified; said
financial statements have been prepared in conformity with generally
accepted accounting principles applied on a consistent basis throughout
the periods involved except as noted therein; and the other financial and
statistical information and data included in the Offering Circular present
fairly in all material respects the information included therein and have
been prepared on a basis consistent with that of the financial statements
included in the Offering Circular and the books and records of the
respective entities presented therein except as otherwise provided in the
Offering Circular;
(ee) No labor disturbance by the employees of the Company, the
Guarantors or any of their respective subsidiaries exists or, to the best
of AAH Holdings', the Company's or the Guarantors' knowledge, is imminent;
except as disclosed in the Offering Circular, neither the Company, the
Guarantors, nor any of their respective subsidiaries is party to a
collective bargaining agreement; and there are no unfair labor practice
complaints pending against the Company, the Guarantors or any of their
respective subsidiaries or, to the best of AAH Holdings', the Company's or
the Guarantors' knowledge, threatened against any of them, except, in each
case, as would not individually or in the aggregate reasonably be expected
to have a Material Adverse Effect;
(ff) No "prohibited transaction" (as defined in Section 406 of the
Employee Retirement Income Security Act of 1974, as amended, including the
regulations and published interpretations thereunder ("ERISA"), or Section
4975 of the Internal Revenue Code of 1986, as amended from time to time
(the "Code")), or "accumulated funding deficiency" (as defined in Section
302 of ERISA) or any of the events set forth in Section 4043(b) of ERISA
(other than events with respect to which the 30-day notice requirement
under Section 4043 of ERISA has been waived) has occurred with respect to
any "employee benefit plan," (as defined in Section 3(3) of ERISA), or any
"employee benefit plan" of any entity which is considered one employer
with the Company under Section 4001 of ERISA or Section 414 of the Code
(an "ERISA Affiliate"); each such "employee benefit plan" is in compliance
in all material respects with its terms and applicable law, including
ERISA and the Code; and the Company or any ERISA Affiliate has not
participated in any multiemployer plan (as defined in Section 3(37) of
ERISA); the Company or any ERISA Affiliate has not incurred and does not
expect to incur any material
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liability under Title IV of ERISA with respect to the termination of, or
withdrawal from any "pension plan" (as defined in Section 3(2) of ERISA)
and each "pension plan" for which the Company would have any material
liability that is intended to be qualified under Section 401(a) of the
Code is so qualified in all material respects and nothing has occurred,
whether by action or by failure to act, which could cause the loss of such
qualification; and
(gg) The Securities, the Guarantees, the Indenture, the
Registration Rights Agreement, the Equity Subscription Agreement, the
Credit Agreement and the Acquisition Agreement will conform in all
material respects to the descriptions thereof in the Offering Circular.
2. Subject to the terms and conditions herein set forth, the Company
and the Guarantors agree to issue and the Company agrees to sell to each of the
Purchasers, and each of the Purchasers agrees, severally and not jointly, to
purchase from the Company, at a purchase price of 97.25% of the principal amount
thereof, plus accrued interest, if any, from April 27, 2004 to the Time of
Delivery hereunder, the principal amount of Securities (and the Guarantees
thereof) set forth opposite the name of such Purchaser in Schedule I hereto.
3. Upon the authorization by you of the release of the Securities and
the Guarantees, the several Purchasers propose to offer the Securities and the
Guarantees for sale upon the terms and conditions set forth in this Agreement
and the Offering Circular and each Purchaser hereby represents and warrants to,
and agrees with the Company that:
(a) It will offer and sell the Securities only to: (i) persons who
it reasonably believes are "qualified institutional buyers" ("QIBs")
within the meaning of Rule 144A under the Act in transactions meeting the
requirements of Rule 144A or (ii) through its selling agents, outside the
United States, to non-U.S. persons in reliance on Regulation S under the
Act;
(b) It is an Institutional Accredited Investor within the meaning
of Rule 501 under the Act; and
(c) It will not offer or sell the Securities by any form of
general solicitation or general advertising, including but not limited to
the methods described in Rule 502(c) under the Act.
4. (a) The Securities to be purchased by each Purchaser hereunder will
be represented by one or more definitive global Securities in book-entry form
that will be deposited by or on behalf of the Company with The Depository Trust
Company ("DTC") or its designated custodian. The Company will deliver the
Securities and the Guarantees to Xxxxxxx, Xxxxx & Co., for the account of each
Purchaser, against payment by or on behalf of such Purchaser of the purchase
price therefor by wire transfer, payable to the order of the Company in Federal
(same day) funds, by causing DTC to credit the Securities and the Guarantees to
the account of Xxxxxxx, Sachs & Co. at DTC. The Company will cause the
certificates representing the Securities and the Guarantees to be made available
to Xxxxxxx, Xxxxx & Co. for checking at least twenty-four hours prior to the
Time of Delivery (as defined below) at the office of DTC or its designated
custodian (the "Designated Office"). The time and date of such delivery and
payment shall be 9:30 a.m., New York City time, on April 30, 2004 or such other
time and date as Xxxxxxx, Sachs & Co. and the Company may agree upon in writing.
Such time and date are herein called the "Time of Delivery."
(b) The documents to be delivered at the Time of Delivery by or on
behalf of the parties hereto pursuant to Section 7 hereof, including the
cross-receipt for the Securities and any additional documents requested by the
Purchasers pursuant to Section 7(h) hereof, will be delivered at such time and
date at the offices of Ropes & Xxxx LLP, 00 Xxxxxxxxxxx Xxxxx, Xxx Xxxx, Xxx
Xxxx 00000-0000 (the "Closing Location"), and the Securities will be delivered
at the Designated Office, all at the
9
Time of Delivery. A meeting will be held at the Closing Location at 3:00 p.m.,
New York City time, on the New York Business Day next preceding the Time of
Delivery, at which meeting the final drafts of the documents to be delivered
pursuant to the preceding sentence will be available for review by the parties
hereto. For the purposes of this Section 4, "New York Business Day" shall mean
each Monday, Tuesday, Wednesday, Thursday and Friday which is not a day on which
banking institutions in New York are generally authorized or obligated by law or
executive order to close.
5. As of the date hereof, AAH Holdings and, at the Time of Delivery,
each of the Company and the Guarantors, jointly and severally, agrees with each
of the Purchasers:
(a) To prepare the Offering Circular in a form approved by you; to
make no amendment or any supplement to the Offering Circular which shall
be disapproved by you promptly after reasonable notice thereof; and to
furnish you with copies thereof;
(b) Promptly from time to time to take such action as you may
reasonably request to qualify the Securities and the Guarantees for
offering and sale under the securities laws of such jurisdictions as you
may request and to comply with such laws so as to permit the continuance
of sales and dealings therein in such jurisdictions for as long as may be
necessary to complete the distribution of the Securities and the
Guarantees, provided that in connection therewith neither the Company nor
any of the Guarantors shall be required to qualify as a foreign
corporation or to file a general consent to service of process in any
jurisdiction;
(c) To furnish the Purchasers with three copies of the Offering
Circular and each amendment or supplement thereto with the independent
accountants' report(s) in the Offering Circular, and any amendment or
supplement containing amendments to the financial statements covered by
such report(s), signed by the accountants, and additional written and
electronic copies thereof in such quantities as you may from time to time
reasonably request, and if, at any time prior to the earlier to occur of
(i) the completion of the distribution of the Securities by the Purchasers
and (ii) the expiration of nine months after the date of the Offering
Circular, any event shall have occurred as a result of which the Offering
Circular as then amended or supplemented would include an untrue statement
of a material fact or omit to state any material fact necessary in order
to make the statements therein, in the light of the circumstances under
which they were made when such Offering Circular is delivered, not
misleading, or, if for any other reason it shall be necessary or desirable
during such same period to amend or supplement the Offering Circular, to
notify you and upon your request to prepare and furnish without charge to
each Purchaser and to any dealer in securities as many written and
electronic copies as you may from time to time reasonably request of an
amended Offering Circular or a supplement to the Offering Circular which
will correct such statement or omission or effect such compliance;
(d) For a period of 90 days from the date of the Offering
Circular, not to offer, sell, contract to sell, grant any option to
purchase, issue any instrument convertible into or exchangeable for, or
otherwise transfer or dispose of (or enter into any transaction or device
which is designed to, or could be expected to, result in the disposition
in the future of), any securities of the Company or any of its
subsidiaries that are substantially similar to the Securities or the
Guarantees, except (i) in exchange for the Exchange Securities in
connection with the Exchange Offer or (ii) with the prior consent of
Xxxxxxx, Xxxxx & Co.;
(e) Not to be or become, at any time prior to the expiration of
two years after the Time of Delivery, an open-end investment company, unit
investment trust, closed-end investment
10
company or face-amount certificate company that is or is required to be
registered under Section 8 of the Investment Company Act;
(f) For so long as any Securities are outstanding, at any time
when the Company is not subject to Section 13 or 15(d) of the Exchange
Act, for the benefit of holders from time to time of Securities, to
furnish at its expense, upon request, to holders of Securities and
prospective purchasers of securities information (the "Additional Issuer
Information") satisfying the requirements of subsection (d)(4)(i) of Rule
144A under the Act;
(g) If requested by you, to use commercially reasonable efforts to
cause such Designated Securities to be eligible for the PORTAL trading
system of the National Association of Securities Dealers, Inc.;
(h) During a period of three years from the date of the Offering
Circular, to furnish to you copies of all reports or other communications
(financial or other) furnished to holders of the Securities;
(i) During the period of two years after the Time of Delivery, the
Company will not, and will not permit any of its "affiliates" (as defined
in Rule 144 under the Securities Act) to, resell any of the Securities
which constitute "restricted securities" under Rule 144 that have been
reacquired by any of them;
(j) To do and perform all things required to be done and performed
under this Agreement, the Securities, the Guarantees, the Indenture and
the Registration Rights Agreement prior to and after the Time of Delivery;
(k) To comply with all agreements set forth in the representation
letters of the Company to DTC relating to the approval of the Securities
by DTC for "book entry" transfer; and
(l) To use the net proceeds received by it from the sale of the
Securities pursuant to this Agreement in the manner specified in the
Offering Circular under the caption "Use of Proceeds."
6. Each of the Company and the Guarantors, jointly and severally,
covenants and agrees with the several Purchasers that the Company and the
Guarantors will pay or cause to be paid the following: (i) the fees,
disbursements and expenses of the Company's counsel and accountants in
connection with the issue of the Securities and the Guarantees and all other
expenses in connection with the preparation, printing and filing of the
Preliminary Offering Circular and the Offering Circular and any amendments and
supplements thereto and the mailing and delivering of copies thereof to the
Purchasers and dealers; (ii) the cost of printing or producing any Agreement
among Purchasers, this Agreement, the Indenture, the Registration Rights
Agreement, the Blue Sky and legal investment surveys, closing documents
(including any compilations thereof) and any other documents in connection with
the offering, purchase, sale and delivery of the Securities; (iii) all expenses
in connection with the qualification of the Securities, the Exchange Securities,
the Guarantees and the Exchange Guarantees for offering and sale under state
securities laws as provided in Section 5(b) hereof, including the reasonable
fees and disbursements of counsel for the Purchasers in connection with such
qualification and in connection with the Blue Sky and legal investment surveys;
(iv) any fees charged by securities rating services for rating the Securities
and the Exchange Securities; (v) the cost of preparing the Securities and the
Guarantees; (vi) the fees and expenses of the Trustee and any agent of the
Trustee and the fees and disbursements of counsel for the Trustee in connection
with the Indenture and the Securities; (vii) any cost incurred in connection
with the designation of the
11
Securities for trading in PORTAL; and (viii) all other costs and expenses
incident to the performance of its obligations hereunder which are not otherwise
specifically provided for in this Section. It is understood, however, that,
except as provided in this Section, and Sections 8 and 11 hereof, the Purchasers
will pay all of their own costs and expenses, including the fees of their
counsel, transfer taxes on resale of any of the Securities by them, and any
advertising expenses connected with any offers they may make.
7. The obligations of the Purchasers hereunder shall be subject, in
their discretion, to the condition that all representations and warranties and
other statements of AAH Holdings, the Company and the Guarantors herein are, on
the date hereof and at the Time of Delivery, true and correct, the condition
that AAH Holdings, the Company and the Guarantors shall have performed all of
their respective obligations hereunder theretofore to be performed, and the
following additional conditions:
(a) Xxxxxx & Xxxxxxx LLP, counsel for the Purchasers, shall have
furnished to you such opinion or opinions, dated the Time of Delivery, with
respect to such matters as you may reasonably request, and such counsel shall
have received such papers and information as they may reasonably request to
enable them to pass upon such matters;
(b) Ropes & Xxxx LLP, counsel for the Company, shall have furnished to
you their written opinion, dated the Time of Delivery, in the form set forth on
Annex I hereto and Xxxx, Plant, Xxxxx, Xxxxx & Xxxxxxx, P.A., counsel for the
Company, shall have furnished to you their written opinion, dated the Time of
Delivery, in the form set forth on Annex II hereto
(c) On the date of the Offering Circular prior to the execution of this
Agreement and also at the Time of Delivery, Ernst & Young LLP shall have
furnished to you a letter or letters, dated the respective dates of delivery
thereof, in form and substance satisfactory to you, to the effect set forth in
Annex III hereto;
(d) (i) Neither the Company, the Guarantors nor any of their respective
subsidiaries shall have sustained since the date of the latest audited financial
statements included in the Offering Circular any loss or interference with its
business from fire, explosion, flood or other calamity, whether or not covered
by insurance, or from any labor dispute or court or governmental action, order
or decree, otherwise than as set forth or contemplated in the Offering Circular,
and (ii) since the respective dates as of which information is given in the
Offering Circular there shall not have been any change in the capital stock or
an increase in the long-term debt of the Company, the Guarantors or any of their
respective subsidiaries or any change, or any development involving a
prospective change, in or affecting the general affairs, management, financial
position, stockholders' equity or results of operations of the Company, the
Guarantors and their respective subsidiaries, otherwise than as set forth or
contemplated in the Offering Circular, the effect of which, in any such case
described in clause (i) or (ii), is in the judgment of the Representatives so
material and adverse as to make it impracticable or inadvisable to proceed with
the offering or the delivery of the Securities on the terms and in the manner
contemplated in this Agreement and in the Offering Circular;
(e) On or after the date hereof (i) no downgrading shall have occurred
in the rating accorded the Company's or the Guarantors' debt securities by any
"nationally recognized statistical rating organization," as that term is defined
by the Commission for purposes of Rule 436(g)(2) under the Act, and (ii) no such
organization shall have publicly announced that it has under surveillance or
review, with possible negative implications, its rating of any of the Company's
or the Guarantors' debt securities;
(f) On or after the date hereof there shall not have occurred any of the
following: (i) a suspension or material limitation in trading in securities
generally on the New York Stock Exchange or
12
the Nasdaq National Market; (ii) a general moratorium on commercial banking
activities declared by either Federal or New York State authorities or a
material disruption in commercial banking or securities settlement or clearance
services in the United States; (iii) the outbreak or escalation of hostilities
involving the United States or the declaration by the United States of a
national emergency or war or (iv) the occurrence of any other calamity or crisis
or any change in financial, political or economic conditions in the United
States or elsewhere, if the effect of any such event specified in clause (iii)
or (iv) in the judgment of the Representatives makes it impracticable or
inadvisable to proceed with the offering or the delivery of the Securities on
the terms and in the manner contemplated in the Offering Circular;
(g) The Securities have been designated for trading on PORTAL;
(h) The Company shall have furnished or caused to be furnished to you at
the Time of Delivery certificates of officers of the Company and the Guarantors
satisfactory to you as to the accuracy of the representations and warranties of
the Company and the Guarantors herein at and as of such Time of Delivery, as to
the performance by the Company of all of its obligations hereunder to be
performed at or prior to such Time of Delivery, as to the matters set forth in
subsection (d) of this Section and as to such other matters as you may
reasonably request;
(i) The Company and the Guarantors shall have entered into this
Agreement;
(j) The Company and the Guarantors shall have executed the Registration
Rights Agreement, and the Purchasers shall have received counterparts, conformed
as executed, thereof;
(k) The Company, the Guarantors and the Trustee shall have executed the
Indenture, and the Purchasers shall have received counterparts, conformed as
executed, thereof; and
(l) The Company and the Guarantors shall have consummated the
Transactions on substantially the terms described in the Offering Circular and
the Purchasers shall have received a certificate, dated the Time of Delivery,
signed on behalf of the Company, in form and substance satisfactory to the
Purchasers, confirming that the Transactions were so consummated.
8. (a) As of the date hereof, AAH Holdings and, at the Time of
Delivery, each of the Company and the Guarantors, jointly and severally,
indemnify and hold harmless each Purchaser against any losses, claims, damages
or liabilities, joint or several, to which such Purchaser may become subject,
under the Act or otherwise, insofar as such losses, claims, damages or
liabilities (or actions in respect thereof) arise out of or are based upon an
untrue statement or alleged untrue statement of a material fact contained in any
Preliminary Offering Circular or the Offering Circular, or any amendment or
supplement thereto, or arise out of or are based upon the omission or alleged
omission to state therein a material fact necessary to make the statements
therein not misleading, and will reimburse each Purchaser for any legal or other
expenses reasonably incurred by such Purchaser in connection with investigating
or defending any such action or claim as such expenses are incurred; provided,
however, that neither the Company nor any of the Guarantors shall be liable in
any such case to the extent that any such loss, claim, damage or liability
arises out of or is based upon an untrue statement or alleged untrue statement
or omission or alleged omission made in any Preliminary Offering Circular or the
Offering Circular or any such amendment or supplement in reliance upon and in
conformity with written information furnished to the Company by any Purchaser
through Xxxxxxx, Xxxxx & Co. expressly for use therein.
(b) Each Purchaser will indemnify and hold harmless the Company and the
Guarantors against any losses, claims, damages or liabilities to which the
Company and the Guarantors may become subject, under the Act or otherwise,
insofar as such losses, claims, damages or liabilities (or
13
actions in respect thereof) arise out of or are based upon an untrue statement
or alleged untrue statement of a material fact contained in any Preliminary
Offering Circular or the Offering Circular, or any amendment or supplement
thereto, or arise out of or are based upon the omission or alleged omission to
state therein a material fact 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 alleged untrue statement or omission or alleged omission was made
in any Preliminary Offering Circular or the Offering Circular or any such
amendment or supplement in reliance upon and in conformity with written
information furnished to the Company by such Purchaser through Xxxxxxx, Sachs &
Co. expressly for use therein; and will reimburse the Company and the Guarantors
for any legal or other expenses reasonably incurred by the Company and such
Guarantors in connection with investigating or defending any such action or
claim as such expenses are incurred.
(c) Promptly after receipt by an indemnified party under subsection (a)
or (b) above of notice of the commencement of any action, such indemnified party
shall, if a claim in respect thereof is to be made against the indemnifying
party under such subsection, notify the indemnifying party in writing of the
commencement thereof; but the omission so to notify the indemnifying party shall
not relieve it from any liability which it may have to any indemnified party
otherwise than under such subsection. In case any such action shall be brought
against any indemnified party and it shall notify the indemnifying party of the
commencement thereof, the indemnifying party shall be entitled to participate
therein and, to the extent that it shall wish, jointly with any other
indemnifying party similarly notified, to assume the defense thereof, with
counsel reasonably satisfactory to such indemnified party (who shall not, except
with the consent of the indemnified party, be counsel to the indemnifying
party), and, after notice from the indemnifying party to such indemnified party
of its election so to assume the defense thereof, the indemnifying party shall
not be liable to such indemnified party under such subsection for any legal
expenses of other counsel or any other expenses, in each case subsequently
incurred by such indemnified party, in connection with the defense thereof other
than reasonable costs of investigation. No indemnifying party shall, without the
written consent of the indemnified party, effect the settlement or compromise
of, or consent to the entry of any judgment with respect to, any pending or
threatened action or claim in respect of which indemnification or contribution
may be sought hereunder (whether or not the indemnified party is an actual or
potential party to such action or claim) unless such settlement, compromise or
judgment (i) includes an unconditional release of the indemnified party from all
liability arising out of such action or claim and (ii) does not include a
statement as to, or an admission of, fault, culpability or a failure to act, by
or on behalf of any indemnified party.
(d) If the indemnification provided for in this Section 8 is unavailable
to or insufficient to hold harmless an indemnified party under subsection (a) or
(b) above in respect of any losses, claims, damages or liabilities (or actions
in respect thereof) referred to therein, then each indemnifying party shall
contribute to the amount paid or payable by such indemnified party as a result
of such losses, claims, damages or liabilities (or actions in respect thereof)
in such proportion as is appropriate to reflect the relative benefits received
by AAH Holdings, the Company and the Guarantors on the one hand and the
Purchasers on the other from the offering of the Securities. If, however, the
allocation provided by the immediately preceding sentence is not permitted by
applicable law or if the indemnified party failed to give the notice required
under subsection (c) above, then each indemnifying party shall contribute to
such amount paid or payable by such indemnified party in such proportion as is
appropriate to reflect not only such relative benefits but also the relative
fault of AAH Holdings, the Company and the Guarantors on the one hand and the
Purchasers on the other in connection with the statements or omissions which
resulted in such losses, claims, damages or liabilities (or actions in respect
thereof), as well as any other relevant equitable considerations. The
14
relative benefits received by AAH Holdings, the Company and the Guarantors on
the one hand and the Purchasers on the other shall be deemed to be in the same
proportion as the total net proceeds from the offering (before deducting
expenses) received by AAH Holdings, the Company and the Guarantors bear to the
total underwriting discounts and commissions received by the Purchasers, in each
case as set forth in the Offering Circular. The relative fault 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 AAH Holdings, the Company and
the Guarantors on the one hand or the Purchasers on the other and the parties'
relative intent, knowledge, access to information and opportunity to correct or
prevent such statement or omission. AAH Holdings, the Company, the Guarantors
and the Purchasers agree that it would not be just and equitable if contribution
pursuant to this subsection (d) were determined by pro rata allocation (even if
the Purchasers were treated as one entity for such purpose) or by any other
method of allocation which does not take account of the equitable considerations
referred to above in this subsection (d). The amount paid or payable by an
indemnified party as a result of the losses, claims, damages or liabilities (or
actions in respect thereof) referred to above in this subsection (d) shall be
deemed to include any legal or other expenses reasonably incurred by such
indemnified party in connection with investigating or defending any such action
or claim. Notwithstanding the provisions of this subsection (d), no Purchaser
shall be required to contribute any amount in excess of the amount by which the
total discounts and commissions received by such Purchaser with respect to the
offering of the Securities underwritten by it exceeds the amount of any damages
which such Purchaser has otherwise been required to pay by reason of such untrue
or alleged untrue statement or omission or alleged omission. The Purchasers'
obligations in this subsection (d) to contribute are several in proportion to
their respective underwriting obligations and not joint.
(e) The obligations of AAH Holdings, the Company and the Guarantors
under this Section 8 shall be in addition to any liability which AAH Holdings,
the Company and the Guarantors may otherwise have and shall extend, upon the
same terms and conditions, to each person, if any, who controls any Purchaser
within the meaning of the Act; and the obligations of the Purchasers under this
Section 8 shall be in addition to any liability which the respective Purchasers
may otherwise have and shall extend, upon the same terms and conditions, to each
officer and director of AAH Holdings, the Company or any Guarantor and to each
person, if any, who controls AAH Holdings, the Company or any Guarantor within
the meaning of the Act.
9. (a) If any Purchaser shall default in its obligation to purchase the
Securities which it has agreed to purchase hereunder, you may in your discretion
arrange for you or another party or other parties to purchase such Securities on
the terms contained herein. If within thirty-six hours after such default by any
Purchaser you do not arrange for the purchase of such Securities, then the
Company shall be entitled to a further period of thirty-six hours within which
to procure another party or other parties satisfactory to you to purchase such
Securities on such terms. In the event that, within the respective prescribed
periods, you notify the Company that you have so arranged for the purchase of
such Securities, or the Company notifies you that it has so arranged for the
purchase of such Securities, you or the Company shall have the right to postpone
the Time of Delivery for a period of not more than seven days, in order to
effect whatever changes may thereby be made necessary in the Offering Circular,
or in any other documents or arrangements, and the Company agrees to prepare
promptly any amendments to the Offering Circular which in your opinion may
thereby be made necessary. The term "Purchaser" as used in this Agreement shall
include any person substituted under this Section with like effect as if such
person had originally been a party to this Agreement with respect to such
Securities.
15
(b) If, after giving effect to any arrangements for the purchase of the
Securities of a defaulting Purchaser or Purchasers by you and the Company as
provided in subsection (a) above, the aggregate principal amount of such
Securities which remains unpurchased does not exceed one-eleventh of the
aggregate principal amount of all the Securities, then the Company shall have
the right to require each non-defaulting Purchaser to purchase the principal
amount of Securities which such Purchaser agreed to purchase hereunder and, in
addition, to require each non-defaulting Purchaser to purchase its pro rata
share (based on the principal amount of Securities which such Purchaser agreed
to purchase hereunder) of the Securities of such defaulting Purchaser or
Purchasers for which such arrangements have not been made; but nothing herein
shall relieve a defaulting Purchaser from liability for its default.
(c) If, after giving effect to any arrangements for the purchase of the
Securities of a defaulting Purchaser or Purchasers by you and the Company as
provided in subsection (a) above, the aggregate principal amount of Securities
which remains unpurchased exceeds one-eleventh of the aggregate principal amount
of all the Securities, or if the Company shall not exercise the right described
in subsection (b) above to require non-defaulting Purchasers to purchase
Securities of a defaulting Purchaser or Purchasers, then this Agreement shall
thereupon terminate, without liability on the part of any non-defaulting
Purchaser or the Company, except for the expenses to be borne by the Company and
the Purchasers as provided in Section 6 hereof and the indemnity and
contribution agreements in Section 8 hereof; but nothing herein shall relieve a
defaulting Purchaser from liability for its default.
10. The respective indemnities, agreements, representations, warranties
and other statements of the Company, the Guarantors and the several Purchasers,
as set forth in this Agreement or made by or on behalf of them, respectively,
pursuant to this Agreement, shall remain in full force and effect, regardless of
any investigation (or any statement as to the results thereof) made by or on
behalf of any Purchaser or any controlling person of any Purchaser, the Company
or any Guarantor, or any officer or director or controlling person of the
Company or a Guarantor, and shall survive delivery of and payment for the
Securities.
11. If this Agreement shall be terminated pursuant to Section 9 hereof,
none of AAH Holdings, the Company or any Guarantor shall then be under any
liability to any Purchaser except as provided in Sections 6 and 8 hereof; but,
if for any other reason, the Securities and the Guarantees are not delivered by
or on behalf of the Company as provided herein, the Company and the Guarantors,
jointly and severally, will reimburse the Purchasers through you for all
out-of-pocket expenses approved in writing by you, including fees and
disbursements of counsel, reasonably incurred by the Purchasers in making
preparations for the purchase, sale and delivery of the Securities and the
Guarantees, but none of AAH Holdings, the Company or the Guarantors shall then
be under any further liability to any Purchaser except as provided in Sections 6
and 8 hereof.
12. In all dealings hereunder, you shall act on behalf of each of the
Purchasers, and the parties hereto shall be entitled to act and rely upon any
statement, request, notice or agreement on behalf of any Purchaser made or given
by you jointly or by Xxxxxxx, Xxxxx & Co. on behalf of you as the
Representatives.
All statements, requests, notices and agreements hereunder shall be in
writing, and if to the Purchasers shall be delivered or sent by mail, telex or
facsimile transmission to you as the Representatives in care of Xxxxxxx, Sachs &
Co., 00 Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Registration
Department; and if to the Company or any Guarantor shall be delivered or sent by
mail, telex or facsimile transmission to the address of the Company set forth in
the Offering Circular, Attention: Secretary; provided, however, that any notice
to a Purchaser pursuant to Section
16
8(c) hereof shall be delivered or sent by mail, telex or facsimile transmission
to such Purchaser at its address set forth in its Purchasers' Questionnaire, or
telex constituting such Questionnaire, which address will be supplied to the
Company by you upon request. Any such statements, requests, notices or
agreements shall take effect upon receipt thereof.
13. This Agreement shall be binding upon, and inure solely to the
benefit of, the Purchasers, AAH Holdings, the Company, the Guarantors and, to
the extent provided in Sections 8 and 10 hereof, the officers and directors of
AAH Holdings, the Company and the Guarantors and each person who controls AAH
Holdings, the Company, any Guarantor or any Purchaser, and their respective
heirs, executors, administrators, successors and assigns, and no other person
shall acquire or have any right under or by virtue of this Agreement. No
purchaser of any of the Securities from any Purchaser shall be deemed a
successor or assign by reason merely of such purchase.
14. Time shall be of the essence of this Agreement.
15. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH
THE LAWS OF THE STATE OF NEW YORK.
16. This Agreement may be executed by any one or more of the parties
hereto in any number of counterparts, each of which shall be deemed to be an
original, but all such respective counterparts shall together constitute one and
the same instrument.
17. The Company and the Guarantors are authorized, subject to applicable
law, to disclose any and all aspects of this potential transaction that are
necessary to support any U.S. federal income tax benefits expected to be claimed
with respect to such transaction, and all materials of any kind (including tax
opinions and other tax analyses) related to those benefits, without the
Purchasers imposing any limitation of any kind.
18. AAH Holdings agrees to cause each of the Company and the Guarantors
to become a party to this Agreement at the time of the consummation of the
Acquisition. All obligations and liabilities of AAH Holdings under this
Agreement shall terminate when each of the Company and the Guarantors become
party to this Agreement.
17
If the foregoing is in accordance with your understanding, please sign and
return to us six counterparts hereof, and upon the acceptance hereof by you, on
behalf of each of the Purchasers, this letter and such acceptance hereof shall
constitute a binding agreement between each of the Purchasers, AAH Holdings, the
Company and the Guarantors. It is understood that your acceptance of this letter
on behalf of each of the Purchasers is pursuant to the authority set forth in a
form of Agreement among Purchasers, the form of which shall be submitted to the
Company for examination upon request, but without warranty on your part as to
the authority of the signers thereof.
Very truly yours,
AAH Holdings Corporation
By: /s/ Xxxxxx X. Small
-------------------------------------
Name: Xxxxxx X. Small
Title: President
The foregoing Agreement is hereby agreed to and accepted as of the Time of
Delivery.
Amscan Holdings, Inc.
By: /s/ Xxxxxxx X. Xxxxxxxx
-------------------------------------
Name: Xxxxxxx X. Xxxxxxxx
Title: Chief Financial Officer,
Secretary and Vice President
Amscan Inc.
By: /s/ Xxxxxxx X. Xxxxxxxx
-------------------------------------
Name: Xxxxxxx X. Xxxxxxxx
Title: Vice President and Treasurer
SSY Realty Corp.
By: /s/ Xxxxxxx X. Xxxxxxxx
-------------------------------------
Name: Xxxxxxx X. Xxxxxxxx
Title: Assistant Treasurer
18
JCS Realty Corp.
By: /s/ Xxxxxxx X. Xxxxxxxx
-------------------------------------
Name: Xxxxxxx X. Xxxxxxxx
Title: Assistant Treasurer
Am-Source, LLC
By: /s/ Xxxxxxx X. Xxxxxxxx
-------------------------------------
Name: Xxxxxxx X. Xxxxxxxx
Title: Assistant Treasurer
Trisar, Inc.
By: /s/ Xxxxxxx X. Xxxxxxxx
-------------------------------------
Name: Xxxxxxx X. Xxxxxxxx
Title: Assistant Treasurer
Anagram International, Inc.
By: /s/ Xxxxxxx X. Xxxxxxxx
-------------------------------------
Name: Xxxxxxx X. Xxxxxxxx
Title: Vice President, Assistant
Treasurer and Secretary
Anagram International Holdings, Inc.
By: /s/ Xxxxxxx X. Xxxxxxxx
-------------------------------------
Name: Xxxxxxx X. Xxxxxxxx
Title: Vice President, Assistant
Treasurer and Secretary
Anagram Eden Prairie Property
Holdings LLC
By: Amscan Holdings, Inc., its Sole
Member
By: /s/ Xxxxxxx X. Xxxxxxxx
-------------------------------------
Name: Xxxxxxx X. Xxxxxxxx
Title: Chief Financial Officer,
Secretary and Vice President
19
M&D Industries, Inc.
By: /s/ Xxxxxxx X. Xxxxxxxx
-------------------------------------
Name: Xxxxxxx X. Xxxxxxxx
Title: Senior Vice President,
Treasurer and Chief Financial
Officer
Accepted as of the date hereof:
Xxxxxxx, Xxxxx & Co.
Credit Suisse First Boston LLC
By: /s/ Xxxxxxx, Sachs & Co.
-------------------------------------------
(Xxxxxxx, Xxxxx & Co.)
On behalf of each of the Purchasers
20
SCHEDULE I
PRINCIPAL
AMOUNT OF
SECURITIES
TO BE
PURCHASER PURCHASED
--------- ---------
Xxxxxxx, Sachs & Co. ....................................................................... $ 87,500,000
Credit Suisse First Boston LLC.............................................................. 87,500,000
Total..................................................................... $175,000,000
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