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Exhibit 10(a)
EXECUTION COPY
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INSILCO CORPORATION
AND
INSILCO HOLDING CO.
as Issuers
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120,000 UNITS CONSISTING OF
$120,000,000 12% SENIOR SUBORDINATED NOTES DUE 2007 AND
WARRANTS TO PURCHASE 62,400 SHARES OF COMMON STOCK
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PURCHASE AGREEMENT
Dated as of November 2, 1998
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XXXXXXXXX, XXXXXX & XXXXXXXX
Securities Corporation
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120,000 Units Consisting of
$120,000,000 12% Senior Subordinated Notes due 2007
of Insilco Corporation and
Warrants to Purchase 62,400 Shares of Common Stock
of Insilco Holding Co.
PURCHASE AGREEMENT
November 2, 1998
XXXXXXXXX, LUFKIN & XXXXXXXX
SECURITIES CORPORATION
000 Xxxx Xxxxxx Xxx Xxxx,
Xxx Xxxx 00000
Dear Sirs:
Insilco Corporation, a Delaware corporation ("Insilco") and Insilco
Holding Co., a Delaware corporation ("Holdings" and together with Insilco, the
"Issuers"), propose to issue and sell to Xxxxxxxxx, Lufkin & Xxxxxxxx
Securities Corporation (the "Initial Purchaser") 120,000 units (the
"Units"), each consisting of $1,000 principal amount of 12% Senior
Subordinated Notes due 2007 (the "Series A Notes") of Insilco and one warrant
(collectively, the "Warrants") to purchase 0.520 of a share of common stock of
Holdings, par value $0.001 per share (the "Common Stock"), subject to the
terms and conditions set forth herein. The Series A Notes are to be issued
pursuant to the provisions of an indenture (the "Indenture"), to be dated as
of the Closing Date (as defined below), between Insilco and Star Bank, N.A., as
trustee (the "Trustee"). The Series A Notes and the Series B Notes (as defined
below) issuable in exchange therefor are collectively referred to herein as the
"Notes." The Warrants will be issued pursuant to a warrant agreement to be
dated as of the Closing Date (the "Warrant Agreement") between Holdings and
National City Bank, as warrant agent (the "Warrant Agent"). Shares of Common
Stock of Holdings issuable upon exercise of the Warrants are collectively
referred to herein as the "Warrant Shares." The Units, the Notes, the Warrants
and the Warrant Shares are collectively referred to herein as the
"Securities." The Series A Notes and the Warrants will not be detachable or
separable until the first to occur of certain events specified in the Offering
Memorandum. Capitalized terms used but not defined herein shall have the
meanings given to such terms in the Indenture or the Warrant Agreement, as
applicable.
All agreements, representations and warranties of the Issuers set forth
in this Agreement are made as of the date of this Agreement. This Agreement, the
Indenture, the Series A Notes, the Warrants, the Warrant Agreement, the A/B
Registration Rights Agreement (as defined), and the Warrant Registration Rights
Agreement (as defined) are collectively referred herein as the "Operative
Documents."
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1. OFFERING MEMORANDUM.
The Units will be offered and sold to the Initial Purchaser pursuant to
one or more exemptions from the registration requirements under the Securities
Act of 1933, as amended (the "Securities Act"). The Issuer has prepared a
preliminary offering memorandum, dated October 30, 1998 (the "Preliminary
Offering Memorandum"), and a final offering memorandum, dated November 2, 1998
(the "Offering Memorandum"), relating to the Units.
Upon original issuance thereof, and until such time as the same is no
longer required pursuant to the Indenture, the Series A Notes (and all
securities issued in exchange therefor, in substitution thereof or upon
conversion thereof) shall bear the following legend:
"THIS SECURITY (OR ITS PREDECESSOR) HAS NOT BEEN REGISTERED UNDER THE
U.S. SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT") AND,
ACCORDINGLY, MAY NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED
WITHIN THE UNITED STATES OR TO, OR FOR THE ACCOUNT OR BENEFIT OF, U.S.
PERSONS, EXCEPT AS SET FORTH IN THE NEXT SENTENCE. BY ITS ACQUISITION
HEREOF OR OF A BENEFICIAL INTEREST HEREIN, THE HOLDER:
(1) REPRESENTS THAT (A) IT IS A "QUALIFIED INSTITUTIONAL BUYER" (AS
DEFINED IN RULE 144A UNDER THE SECURITIES ACT) (A "QIB") OR (B) IT IS
AN INSTITUTIONAL "ACCREDITED INVESTOR" (AS DEFINED IN RULE 501(A)
(1), (2), (3) OR (7) OF REGULATION D UNDER THE SECURITIES ACT) (AN
"IAI"),
(2) AGREES THAT IT WILL NOT RESELL OR OTHERWISE TRANSFER THIS SECURITY
EXCEPT (A) TO THE ISSUER OR ANY OF ITS SUBSIDIARIES, (B) TO A PERSON
WHOM THE SELLER REASONABLY BELIEVES IS A QIB PURCHASING FOR ITS OWN
ACCOUNT OR FOR THE ACCOUNT OF A QIB IN A TRANSACTION MEETING THE
REQUIREMENTS OF RULE 144A, (C) IN A TRANSACTION MEETING THE
REQUIREMENTS OF RULE 144 UNDER THE SECURITIES ACT, (D) TO AN IAI THAT,
PRIOR TO SUCH TRANSFER, FURNISHES THE TRUSTEE A SIGNED LETTER
CONTAINING CERTAIN REPRESENTATIONS AND AGREEMENTS RELATING TO THE
TRANSFER OF THIS SECURITY (THE FORM OF WHICH CAN BE OBTAINED FROM THE
TRUSTEE) AND, IF SUCH TRANSFER IS IN RESPECT OF AN AGGREGATE PRINCIPAL
AMOUNT OF SECURITIES LESS THAN $250,000, AN OPINION OF COUNSEL
ACCEPTABLE TO THE ISSUER THAT SUCH TRANSFER IS IN COMPLIANCE WITH THE
SECURITIES ACT, (E) IN ACCORDANCE WITH ANOTHER EXEMPTION FROM THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT (AND BASED UPON AN
OPINION OF COUNSEL ACCEPTABLE TO THE ISSUER) OR (F) PURSUANT TO AN
EFFECTIVE REGISTRATION STATEMENT AND, IN EACH CASE, IN ACCORDANCE WITH
THE APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES OR ANY
OTHER APPLICABLE JURISDICTION, AND
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(3) AGREES THAT IT WILL DELIVER TO EACH PERSON TO WHOM THIS SECURITY OR
AN INTEREST HEREIN IS TRANSFERRED A NOTICE SUBSTANTIALLY TO THE EFFECT
OF THIS LEGEND.
THE INDENTURE CONTAINS A PROVISION REQUIRING THE TRUSTEE TO REFUSE TO
REGISTER ANY TRANSFER OF THIS SECURITY IN VIOLATION OF THE FOREGOING."
Upon original issuance thereof, and until such time as the same is no
longer required pursuant to the Warrant Agreement, the Warrants (and all
securities issued in exchange therefor, in substitution thereof or upon
conversion thereof) shall bear the following legend:
"THIS WARRANT (OR ITS PREDECESSOR) AND THE SHARES OF COMMON STOCK
ISSUABLE UPON THE EXERCISE HEREOF HAVE NOT BEEN REGISTERED UNDER THE
U.S. SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT") AND,
ACCORDINGLY, MAY NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED
WITHIN THE UNITED STATES OR TO, OR FOR THE ACCOUNT OR BENEFIT OF, U.S.
PERSONS, EXCEPT AS SET FORTH IN THE NEXT SENTENCE. BY ITS ACQUISITION
HEREOF OR OF A BENEFICIAL INTEREST HEREIN, THE HOLDER:
(1) REPRESENTS THAT (A) IT IS A "QUALIFIED INSTITUTIONAL BUYER" (AS
DEFINED IN RULE 144A UNDER THE SECURITIES ACT) (A "QIB") OR (B) IT IS
AN INSTITUTIONAL "ACCREDITED INVESTOR" (AS DEFINED IN RULE 501(A)
(1), (2), (3) OR (7) OF REGULATION D UNDER THE SECURITIES ACT) (AN
"IAI"),
(2) AGREES THAT IT WILL NOT RESELL OR OTHERWISE TRANSFER THIS WARRANT
OR THE WARRANT SHARES EXCEPT (A) TO THE ISSUER OR ANY OF ITS
SUBSIDIARIES, (B) TO A PERSON WHOM THE SELLER REASONABLY BELIEVES IS A
QIB PURCHASING FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QIB IN A
TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A, (C) IN A TRANSACTION
MEETING THE REQUIREMENTS OF RULE 144 UNDER THE SECURITIES ACT, (D) TO
AN IAI THAT, PRIOR TO SUCH TRANSFER, FURNISHES THE WARRANT AGENT A
SIGNED LETTER CONTAINING CERTAIN REPRESENTATIONS AND AGREEMENTS
RELATING TO THE TRANSFER OF THIS WARRANT OR THE WARRANT SHARES (THE
FORM OF WHICH CAN BE OBTAINED FROM THE WARRANT AGENT) AND AN OPINION OF
COUNSEL ACCEPTABLE TO THE ISSUER THAT SUCH TRANSFER IS IN COMPLIANCE
WITH THE SECURITIES ACT, (E) IN ACCORDANCE WITH ANOTHER EXEMPTION FROM
THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT (AND BASED UPON AN
OPINION OF COUNSEL ACCEPTABLE TO THE ISSUER) OR (F) PURSUANT TO AN
EFFECTIVE REGISTRATION STATEMENT AND, IN EACH CASE, IN ACCORDANCE WITH
THE APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES OR ANY
OTHER APPLICABLE JURISDICTION, AND
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(3) AGREES THAT IT WILL DELIVER TO EACH PERSON TO WHOM THIS WARRANT OR
THE WARRANT SHARES OR AN INTEREST HEREIN OR THEREIN IS TRANSFERRED A
NOTICE SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND.
THE WARRANT AGREEMENT CONTAINS A PROVISION REQUIRING THE WARRANT AGENT
TO REFUSE TO REGISTER ANY TRANSFER OF THIS SECURITY IN VIOLATION OF THE
FOREGOING."
2. AGREEMENTS TO SELL AND PURCHASE. On the basis of the
representations, warranties and covenants contained in this Agreement, and
subject to the terms and conditions contained herein, the Issuers agree to issue
and Insilco agrees to sell to the Initial Purchaser, and the Initial Purchaser
agrees to purchase from Insilco, all of the Units at a price equal to $970 per
Unit (the "Purchase Price").
3. TERMS OF OFFERING. The Initial Purchaser has advised the Issuers
that the Initial Purchaser will make offers (the "Exempt Resales") of the
Units purchased hereunder on the terms set forth in the Offering Memorandum, as
amended or supplemented, solely to persons whom the Initial Purchaser reasonably
believes to be "qualified institutional buyers" ("QIBs") as defined in Rule
144A under the Securities Act (the "Eligible Purchasers"). The Initial
Purchaser will offer the Units to Eligible Purchasers initially at a price equal
to $1,000 per Unit. Such price may be changed at any time without notice.
Holders (including subsequent transferees) of the Series A Notes will
have the registration rights set forth in the registration rights agreement with
respect to the Series A Notes (the "A/B Registration Rights Agreement"), to be
dated the Closing Date, in substantially the form of Exhibit A hereto, for so
long as such Series A Notes constitute "Transfer Restricted Securities" (as
defined in the A/B Registration Rights Agreement). Pursuant to the A/B
Registration Rights Agreement, Insilco will agree to file with the Securities
and Exchange Commission (the "Commission") under the circumstances set forth
therein, (i) a registration statement under the Securities Act (the "Exchange
Offer Registration Statement") relating to Insilco's 12% Senior Subordinated
Notes due 2007 (the "Series B Notes"), to be offered in exchange for the
Series A Notes (such offer to exchange being referred to as the "Exchange
Offer") and (ii) a shelf registration statement pursuant to Rule 415 under the
Securities Act (the "Note Shelf Registration Statement" and, together with the
Exchange Offer Registration Statement, the "Note Registration Statements")
relating to the resale by certain holders of the Series A Notes and to use its
reasonable best efforts to cause such Note Registration Statements to be
declared and remain effective and usable for the periods specified in the A/B
Registration Rights Agreement and to consummate the Exchange Offer.
Holders (including subsequent transferees) of the Warrants will have
the registration rights with respect to the Warrants set forth in the warrant
registration rights agreement (the "Warrant Registration Rights Agreement,"
and together with the A/B Registration Rights Agreement, the "Registration
Rights Agreements"), to be dated the Closing Date, in substantially the form of
Exhibit B hereto, for so long as the Warrants or Warrant Shares constitute
"Transfer Restricted Securities" (as defined in the Warrant Registration
Rights Agreement). Pursuant to the Warrant Registration Rights Agreement,
Holdings will agree to file with the Commission under the circumstances set
forth therein, a shelf registration
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statement pursuant to Rule 415 under the Securities Act (the "Warrant
Registration Statement") relating to the resale by certain holders of Warrants
and Warrant Shares and to use its reasonable best efforts to cause such Warrant
Registration Statement to be declared and remain effective and usable for the
periods specified in the Warrant Registration Rights Agreement.
4. DELIVERY AND PAYMENT.
(a) Delivery of, and payment of the Purchase Price for, the Units shall
be made at the offices of Xxxxx Xxxx & Xxxxxxxx or such other location as may be
mutually acceptable. Such delivery and payment shall be made at 9:00 a.m. New
York City time, on November 9, 1998, or at such other time on the same date or
such other date as shall be agreed upon by the Initial Purchaser and the Issuers
in writing. The time and date of such delivery and the payment for the Units are
herein called the "Closing Date."
(b) One or more of the Units containing Series A Notes and Warrants in
definitive global form (collectively, the "Global Securities"), registered in
the name of Cede & Co., as nominee of The Depository Trust Company ("DTC"),
shall be delivered by the Issuers to the Initial Purchaser (or as the Initial
Purchaser directs), in each case, with any transfer taxes thereon duly paid by
the Issuers against payment by the Initial Purchaser of the portion of the
Purchase Price relating to the Units by wire transfer in immediately available
funds to the order of Insilco. The Global Securities shall be made available to
the Initial Purchaser for inspection not later than 9:30 a.m., New York City
time, on the business day immediately preceding the Closing Date.
5. AGREEMENTS OF THE ISSUERS. Each Issuer hereby agrees with the
Initial Purchaser as follows:
(a) To advise the Initial Purchaser promptly and, if requested by the
Initial Purchaser, confirm such advice in writing, (i) of the issuance by any
state securities commission of any stop order suspending the qualification or
exemption from qualification of any Units for offering or sale in any
jurisdiction designated by the Initial Purchaser pursuant to Section 5(e)
hereof, or the initiation of any proceeding by any state securities commission
or any other federal or state regulatory authority for such purpose, and (ii) of
the happening of any event during the period referred to in Section 5(c) below
that makes any statement of a material fact made in the Preliminary Offering
Memorandum or the Offering Memorandum untrue or that requires any additions to
or changes in the Preliminary Offering Memorandum or the Offering Memorandum in
order to make the statements therein not misleading. Each Issuer shall use its
reasonable best efforts to prevent the issuance of any stop order or order
suspending the qualification or exemption of any Securities under any state
securities or Blue Sky laws, and, if at any time any state securities commission
or other federal or state regulatory authority shall issue an order suspending
the qualification or exemption of any Securities under any state securities or
Blue Sky laws, each Issuer shall use its reasonable best efforts to obtain the
withdrawal or lifting of such order at the earliest possible time; provided,
however, that neither Issuer shall be required in connection therewith to
qualify as a foreign corporation in any jurisdiction in which it is not now so
qualified or to take any action that would subject it to general consent to
service of process or taxation, other than as to matters and transactions
relating to the Preliminary Offering Memorandum, the Offering Memorandum or
Exempt Resales, in any jurisdiction in which it is not now so subject.
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(b) To furnish the Initial Purchaser and those persons identified by
the Initial Purchaser to the Issuers as many copies of the Preliminary Offering
Memorandum and the Offering Memorandum, and any amendments or supplements
thereto, as the Initial Purchaser may reasonably request for the time period
specified in Section 5(c). Subject to the Initial Purchaser's compliance with
its representations and warranties and agreements set forth in Section 7 hereof,
each Issuer consents to the use of the Preliminary Offering Memorandum and the
Offering Memorandum, and any amendments and supplements thereto required
pursuant hereto, by the Initial Purchaser in connection with Exempt Resales and
market-making activities.
(c) During such period as, in the opinion of counsel for the Initial
Purchaser, an Offering Memorandum is required by law to be delivered in
connection with Exempt Resales by the Initial Purchaser and in connection with
market-making activities of the Initial Purchaser for so long as any Securities
are outstanding, (i) not to make any amendment or supplement to the Offering
Memorandum of which the Initial Purchaser shall not previously have been advised
or to which the Initial Purchaser shall reasonably object after being so advised
and (ii) to prepare promptly, upon the Initial Purchaser's reasonable request,
any amendment or supplement to the Offering Memorandum which may be necessary or
advisable in connection with such Exempt Resales or such market-making
activities.
(d) If, during the period referred to in Section 5(c) above, any event
shall occur or condition shall exist as a result of which, in the opinion of
counsel to the Initial Purchaser, it becomes necessary to amend or supplement
the Offering Memorandum in order to make the statements therein, in the light of
the circumstances when such Offering Memorandum is delivered by the Initial
Purchaser, not misleading, or if, in the opinion of counsel to the Initial
Purchaser, it is necessary to amend or supplement the Offering Memorandum to
comply with any applicable law, forthwith to prepare an appropriate amendment or
supplement to such Offering Memorandum so that the statements therein, as so
amended or supplemented, will not, in the light of the circumstances when it is
so delivered, be misleading, or so that such Offering Memorandum will comply
with applicable law, and to furnish to the Initial Purchaser and such other
persons as the Initial Purchaser may designate such number of copies thereof as
the Initial Purchaser may reasonably request.
(e) Prior to the sale of all Units pursuant to Exempt Resales as
contemplated hereby, to cooperate with the Initial Purchaser and counsel to the
Initial Purchaser in connection with the registration or qualification of the
Units for offer and sale to the Initial Purchaser and pursuant to Exempt Resales
under the securities or Blue Sky laws of such jurisdictions as the Initial
Purchaser may request and to continue such registration or qualification in
effect so long as required for Exempt Resales and to file such consents to
service of process or other documents as may be necessary in order to effect
such registration or qualification; provided, however, that neither Issuer shall
be required in connection therewith to qualify as a foreign entity in any
jurisdiction in which it is now so qualified or to take any action that would
subject it to general consent to service of process or taxation, other than as
to matters and transactions relating to the Preliminary Offering Memorandum, the
Offering Memorandum or Exempt Resales, in any jurisdiction in which it is now so
subject.
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(f) So long as any of the Securities are outstanding and the Indenture
or Warrant Agreement so requires, (i) to mail and make generally available as
soon as practicable after the end of each fiscal year to the record holders of
the Securities a financial report of the Issuers and their subsidiaries on a
consolidated basis, all such financial reports to include a consolidated balance
sheet, a consolidated statement of operations, a consolidated statement of cash
flows and a consolidated statement of shareholders' equity as of the end of and
for such fiscal year, together with comparable information as of the end of and
for the preceding year, certified by the Issuer's independent public accountants
and (ii) to mail and make generally available as soon as practicable after the
end of each quarterly period (except for the last quarterly period of each
fiscal year) to such holders, a consolidated balance sheet, a consolidated
statement of operations and a consolidated statement of cash flows as of the end
of and for such period, and for the period from the beginning of such year to
the close of such quarterly period, together with comparable information for the
corresponding periods of the preceding year.
(g) So long as any of the Securities are outstanding, to furnish to the
Initial Purchaser as soon as available copies of all reports or other
communications furnished by either Issuer to its security holders or furnished
to or filed with the Commission or any national securities exchange on which any
class of securities of either Issuer is listed and such other publicly available
information concerning either Issuer and/or their subsidiaries as the Initial
Purchaser may reasonably request.
(h) So long as any of the Series A Notes or Warrants remain outstanding
and during any period in which either Issuer is not subject to Section 13 or
15(d) of the Securities Exchange Act of 1934, as amended (the "Exchange Act"),
to make available to any holder of Series A Notes or Warrants in connection with
any sale thereof and any prospective purchaser of such Series A Notes or
Warrants from such holder, the information ("Rule 144A Information") required
by Rule 144A(d)(4) under the Securities Act.
(i) Whether or not the transactions contemplated in this Agreement are
consummated or this Agreement is terminated, to pay or cause to be paid all
expenses incident to the performance of the obligations of each Issuer under
this Agreement, including: (i) the fees, disbursements and expenses of counsel
to the Issuers and accountants of the Issuers in connection with the sale and
delivery of the Units to the Initial Purchaser and pursuant to Exempt Resales,
and all other fees and expenses in connection with the preparation, printing,
filing and distribution of the Preliminary Offering Memorandum, the Offering
Memorandum and all amendments and supplements to any of the foregoing (including
financial statements), including the mailing and delivering of copies thereof to
the Initial Purchaser and persons designated by it in the quantities specified
herein, (ii) all costs and expenses related to the transfer and delivery of the
Units to the Initial Purchaser and pursuant to Exempt Resales, including any
transfer or other taxes payable thereon, (iii) all costs of printing or
producing this Agreement, the other Operative Documents and any other agreements
or documents in connection with the offering, purchase, sale or delivery of the
Units, (iv) all expenses in connection with the registration or qualification of
the Units for offer and sale under the securities or Blue Sky laws of the
several states and all costs of printing or producing any preliminary and
supplemental Blue Sky memoranda in connection therewith (including the filing
fees and fees and disbursements of counsel for the Initial Purchaser in
connection with such registration or qualification and memoranda relating
thereto), (v) the cost of printing
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certificates representing the Securities, (vi) all expenses and listing fees in
connection with the application for quotation of the Units in the National
Association of Securities Dealers, Inc. ("NASD") Automated Quotation System -
PORTAL ("PORTAL"), (vii) the fees and expenses of the Trustee and the Warrant
Agent and their respective counsel in connection with the Indenture, the Notes,
the Warrant Agreement and the Warrants, (viii) the costs and charges of any
transfer agent, registrar and/or depositary (including the DTC), (ix) any fees
charged by rating agencies for the rating of the Notes, (x) all costs and
expenses of the Exchange Offer and any Registration Statement, as set forth in
the Registration Rights Agreements, and (xi) and all other costs and expenses
incident to the performance of the obligations of the Issuers hereunder and
under the Registration Rights Agreements for which provision is not otherwise
made in this Section.
(j) To use its best efforts to effect the inclusion of the Units,
Series A Notes and Warrants in PORTAL and to maintain the listing of the Units,
Series A Notes and Warrants on PORTAL for so long as any Units, Series A Notes
or Warrants are outstanding.
(k) To obtain the approval of DTC for "book-entry" transfer of the
Securities, and to comply with all agreements set forth in the representation
letters of the Issuers to DTC relating to the approval of the Securities by DTC
for "book-entry" transfer.
(l) During the period beginning on the date hereof and continuing to
and including the Closing Date, not to offer, sell, contract to sell or
otherwise transfer or dispose of any securities of either Issuer or any
warrants, rights or options to purchase or otherwise acquire securities of
either Issuer substantially similar to the Units, Notes, Warrants or Common
Stock (other than (i) the Units, Notes, Warrants or Warrant Shares and (ii)
commercial paper issued in the ordinary course of business), without the prior
written consent of the Initial Purchaser.
(m) Not to sell, offer for sale or solicit offers to buy or otherwise
negotiate in respect of any security (as defined in the Securities Act) that
would be integrated with the sale of the Units, the Series A Notes or the
Warrants to the Initial Purchaser or pursuant to Exempt Resales in a manner that
would require the registration of any such sale of the Units, the Series A Notes
or the Warrants under the Securities Act.
(n) Not to voluntarily claim, and to actively resist any attempts to
claim, the benefit of any usury laws against the holders of any Notes.
(o) To cause the Exchange Offer to be made in the appropriate form to
permit Series B Notes registered pursuant to the Securities Act to be offered in
exchange for the Series A Notes, subject to the limitations contemplated by the
A/B Registration Rights Agreement, and to comply with all applicable federal and
state securities laws in connection with the Exchange Offer.
(p) To comply with all of its agreements set forth in the Registration
Rights Agreements.
(q) To cause the Offer to Purchase (as defined in Offering Memorandum)
to be consummated no later than November 20, 1998.
(r) To enter into the New Credit Facility (as defined in Offering
Memorandum) no later than November 20, 1998.
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(s) To use its best efforts to do and perform all things required or
necessary to be done and performed under this Agreement by it prior to the
Closing Date and to satisfy all conditions precedent to the delivery of the
Units.
(t) For so long as any of the Securities are outstanding and during
such period after the Closing Date as, in the opinion of counsel for the Initial
Purchaser, an Offering Memorandum is required by law to be delivered in
connection with market-making activities of the Initial Purchaser, to (i)
periodically amend the Offering Memorandum so that the Offering Memorandum would
comply with the requirements of Section 10(a) of the Securities Act if the
Series A Notes or the Warrants were being offered and sold pursuant to a
registration statement under the Securities Act, (ii) amend or supplement the
Offering Memorandum when necessary to reflect any material changes in the
information provided therein, and (iii) provide the Initial Purchaser with
copies of each such amendment or supplement and such other documents, including
opinions of counsel and "comfort" letters, as the Initial Purchaser may
reasonably request.
6. REPRESENTATIONS, WARRANTIES AND AGREEMENTS OF THE ISSUERS. As of the
date hereof, each Issuer represents and warrants to, and agrees with, the
Initial Purchaser that:
(a) The Preliminary Offering Memorandum as of its date did not, and the
Offering Memorandum does not, and any supplement or amendment to them will not,
contain any untrue statement of a material fact or omit to state any material
fact required to be stated therein or necessary to make the statements therein,
in the light of the circumstances under which they were made, not misleading,
except that the representations and warranties contained in this paragraph (a)
shall not apply to statements in or omissions from the Preliminary Offering
Memorandum or the Offering Memorandum (or any supplement or amendment thereto)
based upon information relating to the Initial Purchaser furnished to either
Issuer in writing by the Initial Purchaser expressly for use therein. No stop
order preventing the use of the Preliminary Offering Memorandum or the Offering
Memorandum, or any amendment or supplement thereto, or any order asserting that
any of the transactions contemplated by this Agreement are subject to the
registration requirements of the Securities Act, has been issued.
(b) Each of the Issuers and their subsidiaries listed on Schedule B
hereto (each, a "Significant Subsidiary") has been duly organized, is validly
existing and in good standing under the laws of its jurisdiction of organization
and has the requisite power and authority to carry on its business as described
in the Preliminary Offering Memorandum and the Offering Memorandum and to own,
lease and operate its properties, and is duly qualified and is in good standing
as a foreign entity authorized to do business in each jurisdiction in which the
nature of its business or its ownership or leasing of property requires such
qualification, except where the failure to be so qualified would not (i) have a
material adverse effect on the business, prospects, financial condition or
results of operations of Holdings and its subsidiaries, taken as a whole or (ii)
in any manner draw into question the validity of any of the Operative Documents
(the events referred to in clauses (i) and (ii), a "Material Adverse Effect").
(c) All equity interests of each Issuer have been duly authorized and
validly issued and are fully paid, non-assessable and not subject to any
preemptive or similar rights.
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(d) The entities listed on Schedule A hereto are the only subsidiaries,
direct or indirect, of Holdings. Except as otherwise set forth in the Offering
Memorandum, all of the outstanding equity interests of each of Holdings'
subsidiaries have been duly authorized and validly issued and are fully paid and
non-assessable and are owned by Holdings, directly or indirectly through one or
more subsidiaries, free and clear of any security interest, claim, lien,
encumbrance or adverse interest of any nature (each, a "Lien") except for
Liens under the Credit Facility.
(e) This Agreement has been duly authorized, executed and delivered by
each Issuer.
(f) The Issuers have duly and validly authorized the issuance of the
Series A Notes and the Warrants as a Unit.
(g) The Indenture has been duly authorized by Insilco, and on the
Closing Date, will have been validly executed and delivered by Insilco. When the
Indenture has been duly executed and delivered by Insilco, the Indenture will be
a valid and binding agreement of Insilco, enforceable against Insilco in
accordance with its terms, except as (i) the enforceability thereof may be
limited by bankruptcy, insolvency or similar laws affecting creditors' rights
generally and (ii) rights of acceleration and the availability of equitable
remedies may be limited by equitable principles of general applicability. On the
Closing Date, the Indenture will conform in all material respects to the
requirements of the Trust Indenture Act of 1939, as amended (the "TIA" or
"Trust Indenture Act"), and the rules and regulations of the Commission
applicable to an indenture which is qualified thereunder.
(h) The Series A Notes have been duly authorized and, on the Closing
Date, will have been validly executed and delivered by Insilco. When the Series
A Notes have been issued, executed and authenticated in accordance with the
provisions of the Indenture and delivered to and paid for by the Initial
Purchaser in accordance with the terms of this Agreement, the Series A Notes
will be entitled to the benefits of the Indenture and will be valid and binding
obligations of Insilco, enforceable in accordance with their terms, except as
(i) the enforceability thereof may be limited by bankruptcy, insolvency or
similar laws affecting creditors' rights generally and (ii) rights of
acceleration and the availability of equitable remedies may be limited by
equitable principles of general applicability. On the Closing Date, the Series A
Notes will conform as to legal matters to the description thereof contained in
the Offering Memorandum.
(i) The Series B Notes have been duly authorized by Insilco. When the
Series B Notes are issued, executed and authenticated in accordance with the
terms of the Exchange Offer and the Indenture, the Series B Notes will be
entitled to the benefits of the Indenture and will be the valid and binding
obligations of Insilco, enforceable against Insilco in accordance with their
terms, except as (i) the enforceability thereof may be limited by bankruptcy,
insolvency or similar laws affecting creditors' rights generally and (ii) rights
of acceleration and the availability of equitable remedies may be limited by
equitable principles of general applicability.
(j) The Warrant Agreement has been duly authorized by Holdings and, on
the Closing Date, will have been validly executed and delivered by Holdings.
When the Warrant Agreement has been validly executed and delivered, the Warrant
Agreement will constitute the
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valid and binding agreement of Holdings, enforceable against Holdings in
accordance with its terms, except as (i) the enforceability thereof may be
limited by bankruptcy, insolvency or similar laws affecting creditors' rights
generally and (ii) rights of acceleration and the availability of equitable
remedies may be limited by equitable principles of general applicability.
(k) The Warrants have been duly authorized by Holdings and, on the
Closing Date, will have been validly delivered by Holdings. When the Warrants
have been validly issued and countersigned and upon delivery to the Initial
Purchaser against payment therefor in accordance with the terms hereof, the
Warrants will be entitled to the benefits of the Warrant Agreement and will be
valid and binding obligations of Holdings, enforceable against Holdings in
accordance with their terms except as (i) the enforceability thereof may be
limited by bankruptcy, insolvency or similar laws affecting creditors' rights
generally and (ii) rights of acceleration and the availability of equitable
remedies may be limited by equitable principles of general applicability.
(l) Holdings has duly authorized and reserved for issuance the Warrant
Shares to be issued upon the exercise of the Warrants and, when issued and
delivered upon the exercise of the Warrants against payment of the exercise
price as provided in the Warrant Agreement, the Warrant Shares will have been
validly issued and will be fully paid and non assessable, and the issuance of
the Warrant Shares will not be subject to any preemptive or similar rights.
(m) The Registration Rights Agreements have been duly authorized by the
Issuer party thereto and, on the Closing Date, will have been duly executed and
delivered by such Issuer. When each Registration Rights Agreement has been duly
executed and delivered, such Registration Rights Agreement will be a valid and
binding agreement of such Issuer, enforceable against such Issuer in accordance
with its terms, except as (i) the enforceability thereof may be limited by
bankruptcy, insolvency or similar laws affecting creditors' rights generally,
(ii) rights of acceleration and the availability of equitable remedies may be
limited by equitable principles of general applicability and (iii) rights to
indemnity and contribution thereunder may be limited by applicable law. On the
Closing Date, the Registration Rights Agreements will conform as to legal
matters to the descriptions thereof in the Offering Memorandum.
(n) (1) All of the indebtedness represented by the Series A Notes is
being incurred for proper purposes and in good faith. (2) As of the date hereof
(a) the fair value and present fair saleable value of the assets of Holdings and
its subsidiaries exceeds and would exceed their stated liabilities and
identified contingent liabilities, (b) Holdings and its subsidiaries should be
able to pay their debts as they become absolute and matured and (c) the capital
of Holdings and its subsidiaries is not and would not be unreasonably small for
the business in which it each of them is engaged.
(o) Neither of the Issuers nor any of their subsidiaries is in
violation of their respective organizational documents or, except as otherwise
set forth in the Offering Memorandum, in default in the performance of any
obligation, agreement, covenant or condition contained in any indenture, loan
agreement, mortgage, lease or other agreement or instrument to which either
Issuer or any of their subsidiaries is a party or by which either Issuer
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or any of their subsidiaries or their respective property is bound, except for
such defaults which, singly or in the aggregate, would not have a Material
Adverse Effect.
(p) The execution, delivery and performance by each Issuer of each of
the Operative Documents to which it is a party, the compliance by each Issuer
with all provisions thereof and the consummation of the transactions
contemplated thereby, and the consummation of the Offer to Purchase (as defined
in the Offering Memorandum) will not (i) require any consent, approval,
authorization or other order of, or qualification with, any court or
governmental body or agency (except such as may be required under the federal
securities or Blue Sky laws of the various states or have been or will be
obtained prior to the Closing Date), (ii) conflict with or constitute a breach
of any of the terms or provisions of, or a default under, (A) the organizational
documents of the Issuers or any of their subsidiaries or (B), except as
otherwise set forth in the Offering Memorandum, any indenture, loan agreement,
mortgage, lease or other agreement or instrument that is material to Holdings
and its subsidiaries, taken as a whole, to which either Issuer or any of their
subsidiaries is a party or by which either Issuer or any of their subsidiaries
or their respective property is bound, (iii) violate or conflict with any
applicable law or any rule, regulation, judgment, order or decree of any court
or any governmental body or agency having jurisdiction over either Issuer or any
of their subsidiaries or their respective property, (iv) except as otherwise set
forth in the Offering Memorandum, result in the imposition or creation of (or
the obligation to create or impose) a Lien under any agreement or instrument to
which either Issuer or any of their subsidiaries is a party or by which either
Issuer or any of their subsidiaries or their respective property is bound, or
(v) result in the termination, suspension or revocation of any Authorization (as
defined below) of either Issuer or any of their subsidiaries or result in any
other impairment of the rights of the holder of any such Authorization, except,
in the case of clauses (i), (ii)(B), (iv) and (v), as would not, singly or in
the aggregate, have a Material Adverse Effect.
(q) To the best knowledge of each Issuer, no action has been taken and
no law, statute, rule or regulation or order has been enacted, adopted or issued
by any governmental agency or body which prevents the execution, delivery and
performance of any of this Agreement, the Indenture, the Notes, the Warrants,
the Warrant Agreement or any of the other Operative Documents or the issuance of
the Securities, or suspends the sale of the Securities in any jurisdiction
referred to in Section 5(e) and no injunction, restraining order or other order
or relief of any nature by a federal or state court or other tribunal of
competent jurisdiction has been issued with respect to either Issuer which would
prevent or suspend the issuance or sale of the Units in any jurisdiction
referred to in Section 5(e).
(r) There are no legal or governmental proceedings pending or
threatened to which either Issuer or any of their subsidiaries is or could be a
party or to which any of their respective property is or could be subject, which
might result, singly or in the aggregate, in a Material Adverse Effect.
(s) To the best knowledge of each Issuer, neither Issuer nor any of
their subsidiaries has violated any foreign, federal, state or local law or
regulation relating to the protection of human health and safety, the
environment or hazardous or toxic substances or wastes, pollutants or
contaminants ("Environmental Laws"), any provisions of the Employee Retirement
Income Security Act of 1974, as amended ("ERISA"), or any provisions of the
Foreign Corrupt Practices
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Act or the rules and regulations promulgated thereunder, except for such
violations which, singly or in the aggregate, would not have a Material Adverse
Effect.
(t) There are no known costs or liabilities associated with
Environmental Laws (including, without limitation, any capital or operating
expenditures required for clean-up, closure of properties or compliance with
Environmental Laws or any Authorization, any related constraints on operating
activities and any potential liabilities to third parties) which would, singly
or in the aggregate, have a material adverse effect on the business, financial
condition or results of operations of Holdings and its subsidiaries, taken as a
whole.
(u) Each of the Issuers and their subsidiaries has such permits,
licenses, consents, exemptions, franchises, authorizations and other approvals
(each, an "Authorization") of, and has made all filings with and notices to,
all governmental or regulatory authorities and self-regulatory organizations and
all courts and other tribunals, including without limitation, under any
applicable Environmental Laws, as are necessary to own, lease, license and
operate its respective properties and to conduct its business, except where the
failure to have any such Authorization or to make any such filing or notice
would not, singly or in the aggregate, have a Material Adverse Effect. Each such
Authorization is valid and in full force and effect and each of the Issuers and
their subsidiaries is in compliance with all the terms and conditions thereof
and with the rules and regulations of the authorities and governing bodies
having jurisdiction with respect thereto; and no event has occurred (including,
without limitation, the receipt of any notice from any authority or governing
body) which allows or, after notice or lapse of time or both, would allow,
revocation, suspension or termination of any such Authorization or results or,
after notice or lapse of time or both, would result in any other impairment of
the rights of the holder of any such Authorization; and such Authorizations
contain no restrictions that are burdensome to either Issuer or any of their
subsidiaries; except, in each case, where such failure to be valid and in full
force and effect or to be in compliance, the occurrence of any such event or the
presence of any such restriction, would not, singly or in the aggregate, have a
Material Adverse Effect.
(v) The accountants, KPMG Peat Marwick LLP, that have certified the
financial statements included in the Preliminary Offering Memorandum and the
Offering Memorandum are independent public accountants with respect to each
Issuer, as required by the Securities Act and the Exchange Act.
(w) The historical financial statements, together with related notes,
forming part of the Preliminary Offering Memorandum and the Offering Memorandum
(and any amendment or supplement thereto), present fairly the consolidated
financial position, results of operations and changes in financial position of
Insilco and its subsidiaries (and for the third quarter of 1998 Holdings and its
subsidiaries as set forth in Annex A to the Offering Memorandum) on the basis
stated in the Preliminary Offering Memorandum and the Offering Memorandum at the
respective dates or for the respective periods to which they apply; such
statements and related schedules and notes have been prepared in accordance with
generally accepted accounting principles consistently applied throughout the
periods involved, except as disclosed therein; and the other financial and
statistical information and data set forth in the Preliminary Offering
Memorandum and the Offering Memorandum (and any amendment or supplement thereto)
are, in all material respects, accurately presented and prepared on a basis
consistent with such
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financial statements and the books and records of Insilco and its subsidiaries
or Holdings and its subsidiaries, as the case may be.
(x) To the best knowledge of each Issuer, each Issuer has complied with
all provisions of Section 517.075, Florida Statues (Chapter 92-198, Laws of
Florida).
(y) The pro forma financial statements included in the Preliminary
Offering Memorandum and the Offering Memorandum have been prepared on a basis
consistent with the historical financial statements of Insilco and its
subsidiaries and give effect to assumptions used in the preparation thereof on a
reasonable basis and in good faith and present fairly the historical and
proposed transactions contemplated by the Preliminary Offering Memorandum and
the Offering Memorandum; and such pro forma financial statements comply as to
form in all material respects with the requirements applicable to pro forma
financial statements included in registration statements on Form S-1 under the
Securities Act. The other pro forma financial and statistical information and
data included in the Preliminary Offering Memorandum and the Offering Memorandum
are, in all material respects, accurately presented and prepared on a basis
consistent with the pro forma financial statements.
(z) Neither Issuer is, and after giving effect to the offering and sale
of the Units and the application of the net proceeds thereof as described in the
Offering Memorandum, neither Issuer will be, an "investment company," as such
term is defined in the Investment Company Act of 1940, as amended.
(aa) Except as otherwise set forth in the Offering Memorandum, there
are no contracts, agreements or understandings between either Issuer and any
person granting such person the right to require such Issuer to file a
registration statement under the Securities Act with respect to any securities
of the Issuer or to require such Issuer to include such securities with the
Securities registered pursuant to any Registration Statements.
(bb) Neither Issuer nor any agent thereof acting on its behalf has
taken, and none of them will take, any action that might cause this Agreement or
the issuance or sale of the Series A Notes to violate Regulation G (12 C.F.R.
Part 207), Regulation T (12 C.F.R. Part 220), Regulation U (12 C.F.R. Part 221)
or Regulation X (12 C.F.R. Part 224) of the Board of Governors of the Federal
Reserve System.
(cc) No "nationally recognized statistical rating organization" (as
such term is defined for purposes of Rule 436(g)(2) under the Securities Act)
(i) has imposed (or has informed either Issuer that it is considering imposing)
any condition (financial or otherwise) on such Issuer's retaining any rating
assigned to such Issuer or any securities of such Issuer or (ii) has indicated
to such Issuer that it is considering (A) the downgrading, suspension, or
withdrawal of, or any review for a possible change that does not indicate the
direction of the possible change in, any rating so assigned or (B) any change in
the outlook for any rating of such Issuer, or any securities of such Issuer.
(dd) Since the respective dates as of which information is given in the
Offering Memorandum other than as set forth in the Offering Memorandum
(exclusive of any amendments or supplements thereto subsequent to the date of
this Agreement), (i) there has not occurred any material adverse change or any
development involving a prospective material adverse change in the condition,
financial or otherwise, or the earnings, business, management
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or operations of Holdings and its subsidiaries, taken as a whole, (ii) there has
not been any material adverse change or any development involving a prospective
material adverse change in the capital stock or in the long-term debt of
Holdings or any of its subsidiaries and (iii) neither Holdings nor any of its
subsidiaries has incurred any material liability or obligation, direct or
contingent.
(ee) Each of the Preliminary Offering Memorandum and the Offering
Memorandum, as of its date, contains all the information specified in, and
meeting the requirements of, Rule 144A(d)(4) under the Securities Act.
(ff) When the Series A Notes and Warrants are issued and delivered
pursuant to this Agreement, neither the Series A Notes nor the Warrants will be
of the same class (within the meaning of Rule 144A under the Securities Act) as
any security of Holdings or Insilco that is listed on a national securities
exchange registered under Section 6 of the Exchange Act or that is quoted in a
United States automated inter-dealer quotation system.
(gg) No form of general solicitation or general advertising (as defined
in Regulation D under the Securities Act) was used by either Issuer or any of
its representatives (other than the Initial Purchaser, as to whom the Issuers
make no representation) in connection with the offer and sale of the Units
contemplated hereby, including, but not limited to, articles, notices or other
communications published in any newspaper, magazine, or similar medium or
broadcast over television or radio, or any seminar or meeting whose attendees
have been invited by any general solicitation or general advertising. No
securities of the same class as the Series A Notes or the Warrants have been
issued and sold by Insilco or Holdings within the six-month period immediately
prior to the date hereof.
(hh) Prior to the effectiveness of any Registration Statement, the
Indenture is not required to be qualified under the TIA.
(ii) No registration under the Securities Act of the Units, the
Warrants or the Series A Notes is required for the sale of such securities to
the Initial Purchaser as contemplated hereby or for the Exempt Resales assuming
the accuracy of the Initial Purchaser's representations and warranties and
agreements set forth in Section 7 hereof.
(jj) There is no (i) material unfair labor practice complaint,
grievance or arbitration proceeding pending or, to the best knowledge of each
Issuer, threatened against either Issuer or any of their subsidiaries before the
National Labor Relations Board or any state or local labor relations board or
(ii) strike, labor dispute, slowdown or stoppage pending or, to the best
knowledge of each Issuer, threatened against either Issuer or any of their
subsidiaries, except for such actions specified in clause (i) or (ii) above,
which, singly or in the aggregate, would not have a Material Adverse Effect. To
the best of each Issuer's knowledge, no collective bargaining organizing
activities are taking place with respect to either Issuer or any of their
subsidiaries, which, singly or in the aggregate, would have a Material Adverse
Effect.
(kk) Each of the Issuers and their subsidiaries maintain a system of
internal accounting controls sufficient to provide reasonable assurance that (i)
transactions are recorded as necessary to permit preparation of financial
statements in conformity with generally accepted accounting principles and to
maintain asset accountability, and (ii) the recorded accountability
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for assets is compared with the existing assets at reasonable intervals and
appropriate action is taken with respect to any differences.
(ll) Except as otherwise set forth in the Offering Memorandum, the
Issuers and their subsidiaries own or possess, or can acquire on reasonable
terms, all patents, patent rights, licenses, inventions, copyrights, know-how
(including trade secrets and other unpatented and/or unpatentable proprietary or
confidential information, systems or procedures), trademarks, service marks and
trade names ("intellectual property") currently employed by them in connection
with the business now operated by them except where the failure to own or
possess or otherwise be able to acquire such intellectual property would not,
singly or in the aggregate, have a Material Adverse Effect; and, to the best of
each Issuer's knowledge, neither of the Issuers nor any of their subsidiaries
has received any notice of infringement of or conflict with asserted rights of
others with respect to any of such intellectual property which, singly or in the
aggregate, if the subject of an unfavorable decision, ruling or finding, would
have a Material Adverse Effect.
(mm) Each certificate signed by any officer of either Issuer and
delivered to the Initial Purchaser or counsel for the Initial Purchaser shall be
deemed to be a representation and warranty by such Issuer to the Initial
Purchaser as to the matters covered thereby.
Each Issuer acknowledges that the Initial Purchaser and, for purposes
of the opinions to be delivered to the Initial Purchaser pursuant to Section 9
hereof, counsel to the Issuer and counsel to the Initial Purchaser will rely
upon the accuracy and truth of the foregoing representations and hereby consents
to such reliance.
7. INITIAL PURCHASER'S REPRESENTATIONS AND WARRANTIES. The Initial
Purchaser represents and warrants to, and agrees with, the Issuers:
(a) The Initial Purchaser is either a QIB or an institutional
"accredited investor" (as such term is defined in Rule 501(a)(1), (2), (3) or
(7) under the Securities Act, an "Accredited Institution"), in either case,
with such knowledge and experience in financial and business matters as is
necessary in order to evaluate the merits and risks of an investment in the
Units.
(b) The Initial Purchaser is not acquiring the Units with a view to any
distribution thereof or with any present intention of offering or selling any of
the Units in a transaction that would violate the Securities Act or the
securities laws of any state of the United States or any other applicable
jurisdiction. The Initial Purchaser will be reoffering and reselling the Units
only to QIBs in reliance on the exemption from the registration requirements of
the Securities Act provided by Rule 144A.
(c) The Initial Purchaser agrees that no form of general solicitation
or general advertising (within the meaning of Regulation D under the Securities
Act) has been or will be used by the Initial Purchaser or any of its
representatives in connection with the offer and sale of the Units pursuant
hereto, including, but not limited to, articles, notices or other communications
published in any newspaper, magazine or similar medium or broadcast over
television or radio, or any seminar or meeting whose attendees have been invited
by any general solicitation or general advertising.
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(d) The Initial Purchaser agrees that, in connection with Exempt
Resales, the Initial Purchaser will solicit offers to buy the Units only from,
and will offer to sell the Units only to, Eligible Purchasers. The Initial
Purchaser further agrees that it will offer to sell the Units only to, and will
solicit offers to buy the Units only from Eligible Purchasers that the Initial
Purchaser reasonably believes are QIBs that agree that (x) the Units purchased
by them may be resold, pledged or otherwise transferred within the time period
referred to under Rule 144(k) (taking into account the provisions of Rule 144(d)
under the Securities Act, if applicable) under the Securities Act, as in effect
on the date of the transfer of such Units, only (I) to the Issuers or any of
their subsidiaries, (II) to a person whom the seller reasonably believes is a
QIB purchasing for its own account or for the account of a QIB in a transaction
meeting the requirements of Rule 144A under the Securities Act, (III) in a
transaction meeting the requirements of Rule 144 under the Securities Act, (IV)
to an Accredited Institution that, prior to such transfer (A) in the case of the
Series A Notes, furnishes the Trustee a signed letter containing certain
representations and agreements relating to the registration of transfer of such
Series A Notes (the form of which may be obtained from the Trustee) or (B) in
the case of the Warrants, furnishes the Warrant Agent a signed letter containing
certain representations and agreements relating to the registration of transfer
of such Warrants (the form of which may be obtained from the Warrant Agent),
and, with respect to the Series A Notes, if such transfer is in respect of an
aggregate principal amount of Series A Notes less than $250,000, and, with
respect to the Warrants, an opinion of counsel acceptable to the Issuers that
such transfer is in compliance with the Securities Act, (V) in accordance with
another exemption from the registration requirements of the Securities Act (and
based upon an opinion of counsel acceptable to the Issuer thereof) or (VI)
pursuant to an effective registration statement and, in each case, in accordance
with the applicable securities laws of any State of the United States or any
other applicable jurisdiction and (y) they will deliver to each person to whom
such Units or an interest therein is transferred a notice substantially to the
effect of the foregoing.
The Initial Purchaser acknowledges that the Issuers and, for purposes
of the opinions to be delivered to the Initial Purchaser pursuant to Section 9
hereof, counsel to the Issuers and counsel to the Initial Purchaser will rely
upon the accuracy and truth of the foregoing representations, and the Initial
Purchaser hereby consents to such reliance.
8. INDEMNIFICATION.
(a) The Issuers, jointly and severally, agree to indemnify and hold
harmless the Initial Purchaser, its directors, its officers and each person, if
any, who controls the Initial Purchaser within the meaning of Section 15 of the
Securities Act or Section 20 of the Exchange Act, from and against any and all
losses, claims, damages, liabilities and judgments (including, without
limitation, any legal or other expenses incurred in connection with
investigating or defending any matter, including any action, that could give
rise to any such losses, claims, damages, liabilities or judgments) caused by
any untrue statement or alleged untrue statement of a material fact contained in
the Offering Memorandum (or any amendment or supplement thereto), the
Preliminary Offering Memorandum or any Rule 144A Information provided by the
Issuers to any holder or prospective purchaser of Units pursuant to Section 5(h)
or caused by any omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements therein not
misleading, except insofar as such losses, claims, damages, liabilities or
judgments are caused by any such untrue statement or omission or
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alleged untrue statement or omission based upon information relating to the
Initial Purchaser furnished in writing to the Issuers by the Initial Purchaser;
provided, however, that the foregoing indemnity agreement with respect to any
Preliminary Offering Memorandum shall not inure to the benefit of the Initial
Purchaser if the Initial Purchaser fails to deliver a final Offering Memorandum
(as then amended or supplemented, provided by the Issuers to the Initial
Purchaser in the requisite quantity and on a timely basis to permit proper
delivery on or prior to the Closing Date) to the person asserting any losses,
claims, damages and liabilities and judgments caused by any untrue statement or
alleged untrue statement of a material fact contained in any Preliminary
Offering Memorandum, or caused by any omission or alleged omission to state
therein a material fact required to be stated therein or necessary to make the
statements therein not misleading, if such material misstatement or omission or
alleged material misstatement or omission was cured in the final Offering
Memorandum.
(b) The Initial Purchaser agrees to indemnify and hold harmless each
Issuer and its directors and officers and each person, if any, who controls
(within the meaning of Section 15 of the Securities Act or Section 20 of the
Exchange Act) such Issuer to the same extent as the foregoing indemnity from the
Issuers to the Initial Purchaser but only with reference to information relating
to the Initial Purchaser furnished in writing to the Issuers by the Initial
Purchaser expressly for use in the Preliminary Offering Memorandum or the
Offering Memorandum.
(c) In case any action shall be commenced involving any person in
respect of which indemnity may be sought pursuant to Section 8(a) or 8(b) (the
"Indemnified Party"), the Indemnified Party shall promptly notify the person
against whom such indemnity may be sought (the "Indemnifying Party") in
writing and the Indemnifying Party shall assume the defense of such action,
including the employment of counsel reasonably satisfactory to the Indemnified
Party and the payment of all fees and expenses of such counsel, as incurred
(except that, in the case of any action in respect of which indemnity may be
sought pursuant to both Sections 8(a) and 8(b), the Initial Purchaser shall not
be required to assume the defense of such action pursuant to this Section 8(c),
but may employ separate counsel and participate in the defense thereof, but the
fees and expenses of such counsel, except as provided below, shall be at the
expense of the Initial Purchaser). Any Indemnified Party shall have the right to
employ separate counsel in any such action and participate in the defense
thereof, but the fees and expenses of such counsel shall be at the expense of
the Indemnified Party unless (i) the employment of such counsel shall have been
specifically authorized in writing by the Indemnifying Party, (ii) the
Indemnifying Party shall have failed to assume the defense of such action or
employ counsel reasonably satisfactory to the Indemnified Party or (iii) the
named parties to any such action (including any impleaded parties) include both
the Indemnified Party and the Indemnifying Party, and the Indemnified Party
shall have been advised by such counsel that there may be one or more legal
defenses available to it which are different from or additional to those
available to the Indemnifying Party (in which case the Indemnifying Party shall
not have the right to assume the defense of such action on behalf of the
Indemnified Party). In any such case, the Indemnifying Party shall not, in
connection with any one action or separate but substantially similar or related
actions in the same jurisdiction arising out of the same general allegations or
circumstances, be liable for the fees and expenses of more than one separate
firm of attorneys (in addition to any local counsel) for all Indemnified Parties
and all such fees and expenses shall be reimbursed as they are incurred. Such
firm shall be designated
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in writing by Xxxxxxxxx, Xxxxxx & Xxxxxxxx Securities Corporation, in the case
of the parties indemnified pursuant to Section 8(a), and by the Issuers, in the
case of parties indemnified pursuant to Section 8(b). The Indemnifying Party
shall indemnify and hold harmless the Indemnified Party from and against any and
all losses, claims, damages, liabilities and judgments by reason of any
settlement of any action (i) effected with its written consent or (ii) effected
without its written consent if the settlement is entered into more than twenty
business days after the Indemnifying Party shall have received a request from
the Indemnified Party for reimbursement for the fees and expenses of counsel (in
any case where such fees and expenses are at the expense of the Indemnifying
Party) and, prior to the date of such settlement, the Indemnifying Party shall
have failed to comply with such reimbursement request. No Indemnifying Party
shall, without the prior written consent of the Indemnified Party, effect any
settlement or compromise of, or consent to the entry of judgment with respect
to, any pending or threatened action in respect of which the Indemnified Party
is or could have been a party and indemnity or contribution may be or could have
been sought hereunder by the Indemnified Party, unless such settlement,
compromise or judgment (i) includes an unconditional release of the Indemnified
Party from all liability on claims that are or could have been the subject
matter of such action and (ii) does not include a statement as to or an
admission of fault, culpability or a failure to act, by or on behalf of the
Indemnified Party.
(d) To the extent the indemnification provided for in this Section 8 is
unavailable to an Indemnified Party or insufficient in respect of any losses,
claims, damages, liabilities or judgments referred to therein, then each
Indemnifying Party, in lieu of indemnifying such Indemnified Party, shall
contribute to the amount paid or payable by such Indemnified Party as a result
of such losses, claims, damages, liabilities and judgments (i) in such
proportion as is appropriate to reflect the relative benefits received by the
Issuers, on the one hand, and the Initial Purchaser, on the other hand, from the
offering of the Units or (ii) if the allocation provided by clause 8(d)(i) above
is not permitted by applicable law, in such proportion as is appropriate to
reflect not only the relative benefits referred to in clause 8(d)(i) above but
also the relative fault of the Issuers, on the one hand, and the Initial
Purchaser, on the other hand, in connection with the statements or omissions
which resulted in such losses, claims, damages, liabilities or judgments, as
well as any other relevant equitable considerations. The relative benefits
received by the Issuers, on the one hand, and the Initial Purchaser, on the
other hand, shall be deemed to be in the same proportion as the total net
proceeds from the offering of the Units (after underwriting discounts and
commissions, but before deducting expenses) received by the Issuers, and the
total discounts and commissions received by the Initial Purchaser bear to the
total price to investors of the Units, in each case, as set forth in the table
on the cover page of the Offering Memorandum. The relative fault of the Issuers,
on the one hand, and the Initial Purchaser, on the other hand, shall be
determined by reference to, among other things, whether the untrue or alleged
untrue statement of a material fact or the omission or alleged omission to state
a material fact relates to information supplied by the Issuers, on the one hand,
or the Initial Purchaser, on the other hand, and the parties' relative intent,
knowledge, access to information and opportunity to correct or prevent such
statement or omission.
The Issuers and the Initial Purchaser agree that it would not be just
and equitable if contribution pursuant to this Section 8(d) were determined by
pro rata allocation or by any other method of allocation which does not take
account of the equitable considerations referred to in the immediately preceding
paragraph. The amount paid or payable by an Indemnified
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Party as a result of the losses, claims, damages, liabilities or judgments
referred to in the immediately preceding paragraph shall be deemed to include,
subject to the limitations set forth above, any legal or other expenses incurred
by such Indemnified Party in connection with investigating or defending any
matter, including any action, that could have given rise to such losses, claims,
damages, liabilities or judgments. Notwithstanding the provisions of this
Section 8, the Initial Purchaser shall not be required to contribute any amount
in excess of the amount by which the total discounts and commissions received by
the Initial Purchaser exceeds the amount of any damages which the Initial
Purchaser has otherwise been required to pay by reason of such untrue or alleged
untrue statement or omission or alleged omission. No person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Securities Act)
shall be entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation.
(e) The remedies provided for in this Section 8 are not exclusive and
shall not limit any rights or remedies which may otherwise be available to any
Indemnified Party at law or in equity.
9. CONDITIONS OF INITIAL PURCHASER'S OBLIGATIONS. The obligations of
the Initial Purchaser to purchase the Units under this Agreement are subject to
the satisfaction of each of the following conditions:
(a) All the representations and warranties of the Issuers contained in
this Agreement shall be true and correct on the Closing Date with the same force
and effect as if made on and as of the Closing Date.
(b) On or after the date hereof, (i) there shall not have occurred any
downgrading, suspension or withdrawal of, nor shall any notice have been given
of any potential or intended downgrading, suspension or withdrawal of, or of any
review (or of any potential or intended review) for a possible change that does
not indicate the direction of the possible change in, any rating of either
Issuer or any securities of either Issuer (including, without limitation, the
placing of any of the foregoing ratings on credit watch with negative or
developing implications or under review with an uncertain direction) by any
"nationally recognized statistical rating organization" (as such term is
defined for purposes of Rule 436(g)(2) under the Securities Act), (ii) there
shall not have occurred any change, nor shall any notice have been given of any
potential or intended change, in the outlook for any rating of either Issuer or
any securities of either Issuer by any such rating organization and (iii) no
such rating organization shall have given notice that it has assigned (or is
considering assigning) a lower rating to the Notes than that on which the Notes
were marketed.
(c) Since the respective dates as of which information is given in the
Offering Memorandum other than as set forth in the Offering Memorandum
(exclusive of any amendments or supplements thereto subsequent to the date of
this Agreement), (i) there shall not have occurred any change or any development
involving a prospective change in the condition, financial or otherwise, or the
earnings, business, management or operations of Holdings and its subsidiaries,
taken as a whole, (ii) there shall not have been any change or any development
involving a prospective change in the capital stock or in the long-term debt of
either Issuer or any of their subsidiaries and (iii) neither of the Issuers nor
any of their subsidiaries shall have incurred any liability or obligation,
direct or contingent, the effect of
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which, in any such case described in clause 9(c)(i), 9(c)(ii) or 9(c)(iii), in
the judgment of the Initial Purchaser, is material and adverse and, in the
judgment of the Initial Purchaser, makes it impracticable to market the Units on
the terms and in the manner contemplated in the Offering Memorandum.
(d) You shall have received on the Closing Date a certificate dated the
Closing Date, signed by the President and the Chief Financial Officer of each
Issuer, confirming the matters set forth in Sections 6(cc), 9(a), 9(b) and 9(c)
and stating that such Issuer has complied with all the agreements and satisfied
all of the conditions herein contained and required to be complied with or
satisfied on or prior to the Closing Date.
(e) The Initial Purchaser shall have received on the Closing Date an
opinion (satisfactory to the Initial Purchaser and counsel for the Initial
Purchaser), dated the Closing Date, of Xxxxxxx X. Xxxx, General Counsel for the
Issuers, to the effect that:
(i) each Issuer has been duly incorporated and is validly
existing in good standing under the laws of its jurisdiction of
organization and has the requisite power to enter into the Operative
Documents to which it is a party;
(ii) all the outstanding shares of capital stock of Insilco
are duly authorized and validly issued and are fully paid and
non-assessable and have not been issued in violation of any preemptive
rights pursuant to law or Insilco's certificate of incorporation;
(iii) all the shares of capital stock of Holdings
outstanding prior to the Mergers and the Merger Financing (as such
terms are defined in the Offering Memorandum), and any shares of
capital stock of Holdings issued subsequent to the Mergers and prior to
the date hereof, are duly authorized and validly issued and, to such
counsel's knowledge, fully paid and non-assessable and have not been
issued in violation of any preemptive rights pursuant to law or
Holding's certificate of incorporation;
(iv) each Significant Subsidiary is a corporation duly
incorporated, validly existing and in good standing under the laws of
its jurisdiction of incorporation and has all requisite corporate power
and authority to own its properties and to carry on its business as now
being conducted. Each Issuer and each Significant Subsidiary is a
corporation duly qualified to transact business and is in good standing
as a foreign corporation in each jurisdiction where the character of
its activities requires such qualification, except where the failure to
be so qualified would not have a Material Adverse Effect;
(v) all of the outstanding shares of the capital stock of
each Significant Subsidiary are duly authorized, validly issued, and,
to such counsel's knowledge, fully paid and nonassessable, and have not
been issued in violation of any preemptive rights pursuant to law or in
such certificate of incorporation of such Significant Subsidiary, and
all of the outstanding shares of the capital stock of each Significant
Subsidiary are owned by Insilco, however, as set forth in the Offering
Memorandum, all of such shares have been pledged to Insilco's lenders
under the Existing Credit Facility (as such term is defined in the
Offering Memorandum) and are expected to be pledged to Insilco's
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lenders under the New Credit Facility (as such term is defined in the
Offering Memorandum);
(vi) to such counsel's knowledge, there is no material
document, agreement or other instrument to which either Issuer is a
party (other than the Registration Rights Agreements, the Pledge
Agreement between Holdings and the lenders pursuant to the Existing
Credit Facility, with respect to the pledge of Insilco stock, and such
other registration rights agreements as are described in the Offering
Memorandum) granting any person the right to require either Issuer to
file a registration statement under the Securities Act with respect to
any securities of the Issuers or to require either Issuer to include
such securities with the Securities registered pursuant to any
Registration Statement; and
(vii) the execution, delivery and performance by the Issuers
of the Operative Documents to which each is a party, the consummation
of the transactions contemplated thereby and compliance by the Issuers
with the provisions thereof, and the consummation of the Offer to
Purchase, will not (i) except to the extent such has been obtained,
require any consent, approval, authorization or other order of, or
qualification with, any court or governmental body or agency (except
such as may be required under the Securities Act or the securities or
Blue Sky laws of the various states or by NASD or the Secretary of
State of Delaware), (ii) conflict with or constitute a breach of any of
the terms or provisions of, or a default under, (A) the certificate of
incorporation or bylaws of Insilco or Holdings, as the case may be, or
(B), assuming receipt of the consents from the lenders under the
Existing Credit Facility as described in the Offering Memorandum,
require any consent or approval (which has not been obtained or waived)
of parties to, or conflict with or constitute a breach of any of the
terms or provisions of, or a default under, any document, agreement or
other instrument to which Holdings or any of its subsidiaries is a
party or by which any of them is bound, (iii) to such counsel's
knowledge, violate or conflict with any statute or any order, rule or
regulation of any court or governmental agency or body having
jurisdiction over Holdings or any of its subsidiaries or any of their
respective properties, or (iv) result in the termination, suspension or
revocation of any Authorization of Holdings or any of its subsidiaries,
except in the case of clauses (i), (ii)(B), (iii) and (iv), as would
not, singly or in the aggregate, have a Material Adverse Effect.
The opinion of Xxxxxxx X. Xxxx described in this Section 9(e) shall be
rendered to the Initial Purchaser at the request of the Issuers and shall so
state therein.
(f) The Initial Purchaser shall have received on the Closing Date an
opinion (satisfactory to the Initial Purchaser and counsel for the Initial
Purchaser), dated the Closing Date, of Xxxxx Xxxx & Xxxxxxxx, to the effect
that:
(i) each Issuer is validly existing in good standing
under the laws of its jurisdiction of organization and has the
requisite power to enter into the Operative Documents to which it
is a party;
(ii) assuming all the outstanding shares of capital stock
of Insilco have been duly authorized and validly issued and are fully
paid and non-assessable, all shares of
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capital stock of Holdings issued in connection with the Mergers and the
Merger Financing were duly authorized and validly issued and are fully
paid and non-assessable and not subject to any preemptive or similar
rights, as applicable;
(iii) the execution, delivery and performance by each Issuer
of this Agreement and the other Operative Documents to which each
Issuer is a party, the compliance by each Issuer with the provisions
hereof and thereof, and the consummation of the Offer to Purchase, will
not (i) require any consent, approval, authorization or other order of,
or qualification with, any court or governmental body or agency (except
such as may be required under the Securities Act or the securities or
Blue Sky laws of the various states or by NASD or the Secretary of
State of Delaware), (ii) conflict with or constitute a breach of any of
the terms or provisions of, or a default under, (A) the certificate of
incorporation or bylaws of Insilco or Holdings, as the case may be, or
(B) require any consent or approval (which has not been obtained or
waived) of parties to, or conflict with or constitute a breach of any
of the terms or provisions of, or a default under, the Indenture dated
as of August 12, 1997 relating to the 10.25% Senior Subordinated Notes
due 2007 of Insilco, the Indenture dated as of August 17, 1998 relating
to the 14% Senior Discount Notes due 2008 of Holdings, any of the
Operative Documents or the Warrant Agreement or the Registration Rights
Agreements as defined in the Purchase Agreement, dated as of August 12,
1998, relating to the Holdings Units, (iii) violate or conflict with
any laws, rules, regulations or rulings normally applicable to general
business corporations in relation to transactions of the type
contemplated by the aforementioned agreements or court decrees
applicable to either Issuer or their properties, or (iv) result in the
imposition or creation of a Lien under any agreement referred to in
clause (ii)(B), except in the case of clauses (i), (ii)(B) and (iv), as
would not, singly or in the aggregate, have a Material Adverse Effect;
(iv) the Series A Notes have been duly authorized by
Insilco and, when executed and authenticated in accordance with the
provisions of the Indenture and delivered to and paid for by the
Initial Purchaser in accordance with the terms of this Agreement, will
be entitled to the benefits of the Indenture and will be valid and
binding obligations of Insilco, enforceable against Insilco in
accordance with their terms, except as (x) the enforceability thereof
may be limited by bankruptcy, insolvency, reorganization, moratorium or
similar laws affecting creditors' rights and remedies generally, (y) as
such enforcement may be limited by equitable principles of general
applicability, regardless of whether enforcement is sought in a
proceeding at law or in equity and (z) to the extent that a waiver of
rights under any usury or stay law may be unenforceable;
(v) the Indenture has been has been duly authorized,
executed and delivered by Insilco and is a valid and binding agreement
of Insilco, enforceable against Insilco in accordance with its terms,
except as (x) the enforceability thereof may be limited by bankruptcy,
insolvency, reorganization, moratorium or similar laws affecting
creditors' rights and remedies generally, (y) as such enforcement may
be limited by equitable principles of general applicability, regardless
of whether enforcement is sought in a proceeding at law or in equity
and (z) to the extent that a waiver of rights under any usury or stay
law may be unenforceable;
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(vi) the Series B Notes have been duly authorized;
(vii) this Agreement has been duly authorized, executed and
delivered by each Issuer;
(viii) the Warrants have been duly authorized by Holdings
and, when executed and countersigned in accordance with the provisions
of the Warrant Agreement 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 Warrant Agreement and will be valid and
binding obligations of Holdings, enforceable against Holdings in
accordance with their terms, except as (x) the enforceability thereof
may be limited by bankruptcy, insolvency, reorganization or moratorium
or similar laws affecting creditors' rights and remedies generally and
(y) as such enforcement may be limited by equitable principles of
general applicability, regardless of whether enforcement is sought in a
proceeding at law or in equity;
(ix) the Warrant Agreement has been has been duly
authorized, executed and delivered by Holdings and is a valid and
binding agreement of Holdings, enforceable against Holdings in
accordance with its terms, except as (x) the enforceability thereof may
be limited by bankruptcy, insolvency, reorganization, moratorium or
similar laws affecting creditors' rights and remedies generally and (y)
as such enforcement may be limited by equitable principles of general
applicability, regardless of whether enforcement is sought in a
proceeding at law or in equity;
(x) each of the Registration Rights Agreements has been
duly authorized, executed and delivered by the Issuer party thereto and
is a valid and binding agreement of such Issuer, enforceable against
such Issuer in accordance with its terms, except as (x) the
enforceability thereof may be limited by bankruptcy, insolvency,
reorganization, moratorium or similar laws affecting creditors' rights
and remedies generally, (y) as such enforcement may be limited by
equitable principles of general applicability, regardless of whether
enforcement is sought in a proceeding at law or in equity, and (z) as
rights to indemnity and contribution thereunder may be limited by
applicable law;
(xi) Holdings has duly authorized and reserved for issuance
the Warrant Shares to be issued upon the exercise of the Warrants and,
when issued and delivered upon the exercise of the Warrants against
payment of the exercise price as provided in the Warrant Agreement,
will have been validly issued and will be fully paid and non
assessable, and the issuance of the Warrant Shares will not be subject
to any preemptive or similar statutory rights;
(xii) the statements under the captions "Certain
Relationships and Related Party Transactions," "Description of
Certain Indebtedness," "Description of Holdings Capital Stock"
(other than the second sentence thereof), "Description of Units,"
"Description of the Notes," "Description of Warrants" and "Plan of
Distribution" and the description of the existing employment
agreements under "Executive Compensation - Employment and Severance
Benefit Agreements" in the Offering Memorandum, insofar as such
statements constitute a summary of the legal matters or documents
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referred to therein, fairly present in all material respects such legal
matters or documents;
(xiii) the statements made in the Offering Memorandum under
the caption "Certain Federal Income Tax Consequences," insofar as
they purport to constitute summaries of matters of United States
federal tax law and regulations or legal conclusions with respect
thereto, constitute accurate summaries of the matters described therein
in all material respects;
(xiv) the Indenture complies as to form in all material
respects with the requirements of the TIA, and the rules and
regulations of the Commission applicable to an indenture which is
qualified thereunder;
(xv) it is not necessary in connection with the offer, sale
and delivery of the Units to the Initial Purchaser in the manner
contemplated by this Agreement or in connection with the initial
placement of the Units by the Initial Purchaser in the manner
contemplated by the Offering Memorandum pursuant to Exempt Resales to
qualify the Indenture under the TIA, and no registration under the
Securities Act of the Units, the Series A Notes or the Warrants is
required for the sale of the Units, the Series A Notes and the Warrants
to the Initial Purchaser as contemplated by this Agreement or for the
initial placement of the Units by the Initial Purchaser in the manner
contemplated by the Offering Memorandum pursuant to Exempt Resales
assuming that (i) each Eligible Purchaser is a QIB, (ii) the accuracy
of, and compliance with, the Initial Purchaser's representations and
agreements contained in Section 7 of this Agreement, and (iii) the
accuracy of the agreements and representations of the Issuers set forth
in Sections 5(h) and (m) and 6(ee), (ff) and (gg) of this Agreement;
and
(xvi) Neither Issuer is, after giving effect to the offering
and sale of the Units in accordance with the terms of this Agreement
and the application of the net proceeds thereof as described in the
Offering Memorandum under the caption "Use of Proceeds," an
"investment company" within the meaning of the Investment Company Act
of 1940, as amended.
In addition, such counsel shall state that it has participated in the
preparation of the Offering Memorandum and any amendments or supplements
thereto, if applicable, and that although such counsel has not independently
verified the accuracy, completeness or fairness of the statements contained
therein, no facts have come to such counsel's attention to cause it to believe
that, as of the date of the Offering Memorandum or as of the Closing Date, the
Offering Memorandum, as amended or supplemented, if applicable (except for the
financial statements and other financial or statistical data included therein or
omitted therefrom, as to which such counsel need not express any belief)
contains any untrue statement of a material fact or omits 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.
The opinions of Xxxxx Xxxx & Xxxxxxxx described in this Section 9(p)
shall be rendered to the Initial Purchaser at the request of the Issuers and
shall so state therein.
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(g) The Initial Purchaser shall have received, at the Closing Date, an
opinion, dated the Closing Date, of Xxxxxxx Xxxxxxx & Xxxxxxxx, counsel for the
Initial Purchaser, in form and substance satisfactory to the Initial Purchaser.
(h) The Initial Purchaser shall have received, at the time this
Agreement is executed and at the Closing Date, letters dated the date hereof or
the Closing Date, as the case may be, in form and substance satisfactory to the
Initial Purchaser from KPMG Peat Marwick, independent public accountants,
containing the information and statements of the type ordinarily included in
accountants' "comfort letters" with respect to the financial statements and
certain financial information contained in the Offering Memorandum.
(i) The Units shall have been approved by the NASD for trading and duly
listed in PORTAL.
(j) The Initial Purchaser shall have received a counterpart, conformed
as executed, of (i) the Indenture which shall have been entered into by Insilco
and the Trustee and (ii) the Warrant Agreement which shall have been entered
into by Holdings and the Warrant Agent.
(k) Each Issuer shall have executed the Operative Documents to which it
is a party, and the Initial Purchaser shall have received an original copy
thereof, duly executed by such Issuer.
(l) Neither Issuer shall have failed at or prior to the Closing Date to
perform or comply with any of the agreements herein contained and required to be
performed or complied with by such Issuer at or prior to the Closing Date.
10. EFFECTIVENESS OF AGREEMENT AND TERMINATION. This Agreement shall
become effective upon the execution and delivery of this Agreement by the
parties hereto.
This Agreement may be terminated at any time on or prior to the Closing
Date by the Initial Purchaser by written notice to the Issuers if any of the
following has occurred: (i) any outbreak or escalation of hostilities or other
national or international calamity or crisis or change in economic conditions or
in the financial markets of the United States or elsewhere that, in the Initial
Purchaser's judgment, is material and adverse and, in the Initial Purchaser's
judgment, makes it impracticable to market the Units on the terms and in the
manner contemplated in the Offering Memorandum, (ii) the suspension or material
limitation of trading in securities or other instruments on the New York Stock
Exchange, the American Stock Exchange, the Chicago Board of Options Exchange,
the Chicago Mercantile Exchange, the Chicago Board of Trade or the Nasdaq
National Market or limitation on prices for securities or other instruments on
any such exchange or the Nasdaq National Market, (iii) the suspension of trading
of any securities of either Issuer on any exchange or in the over-the-counter
market, (iv) the enactment, publication, decree or other promulgation of any
federal or state statute, regulation, rule or order of any court or other
governmental authority which, in the Initial Purchaser's opinion, materially and
adversely affects, or will materially and adversely affect, the business,
prospects, financial condition or results of operations of Holdings and its
subsidiaries, taken as a whole, (v) the declaration of a banking moratorium by
either federal or New York State authorities or (vi) the taking of any action by
any federal, state or local government or agency in respect of its monetary or
fiscal affairs which, in the Initial Purchaser's opinion, has a material adverse
effect on the financial markets in the United States.
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11. MISCELLANEOUS. Notices given pursuant to any provision of this
Agreement shall be addressed as follows: (i) if to either Issuer, at 000 Xxxxx
Xxxxx Xxxxx, 0xx Xxxxx, Xxxxxx, XX 00000, Attn: Chief Financial Officer, and
(ii) if to the Initial Purchaser, to Xxxxxxxxx, Xxxxxx & Xxxxxxxx Securities
Corporation, 000 Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Syndicate
Department, or in any case to such other address as the person to be notified
may have requested in writing.
The respective indemnities, contribution agreements, representations,
warranties and other statements of the Issuers and the Initial Purchaser set
forth in or made pursuant to this Agreement shall remain operative and in full
force and effect, and will survive delivery of and payment for the Units,
regardless of (i) any investigation, or statement as to the results thereof,
made by or on behalf of the Initial Purchaser, the officers or directors of the
Initial Purchaser, any person controlling the Initial Purchaser, the Issuers,
the officers or directors of the Issuers, or any person controlling the Issuer,
(ii) acceptance of the Units and payment for them hereunder and (iii)
termination of this Agreement.
If for any reason the Units are not delivered by or on behalf of the
Issuers as provided herein (other than as a result of any termination of this
Agreement pursuant to Section 10), Insilco agrees to reimburse the Initial
Purchaser for all out-of-pocket expenses (including the fees and disbursements
of counsel) incurred by them. Notwithstanding any termination of this Agreement,
Insilco shall be liable for all expenses which the Issuers have agreed to pay
pursuant to Section 5(i) hereof. Insilco also agrees to reimburse the Initial
Purchaser and its officers, directors and each person, if any, who controls the
Initial Purchaser within the meaning of Section 15 of the Securities Act or
Section 20 of the Exchange Act for any and all fees and expenses (including
without limitation the fees and expenses of counsel) incurred by them in
connection with enforcing their rights under this Agreement (including without
limitation their rights under Section 8).
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Except as otherwise provided, this Agreement has been and is made
solely for the benefit of and shall be binding upon the Issuers, the Initial
Purchaser, the Initial Purchaser's directors and officers, any controlling
persons of the Initial Purchaser referred to herein, each Issuer's directors and
officers, any controlling persons of the Issuers referred to herein and their
respective successors and assigns, all as and to the extent provided in this
Agreement, and no other person shall acquire or have any right under or by
virtue of this Agreement. The term "successors and assigns" shall not include
a purchaser of any of the Units from the Initial Purchaser merely because of
such purchase.
This Agreement shall be governed and construed in accordance with the
internal laws of the State of New York.
This Agreement may be signed in various counterparts which together
shall constitute one and the same instrument.
Please confirm that the foregoing correctly sets forth the agreement
between the Issuers and the Initial Purchaser.
Very truly yours,
INSILCO CORPORATION
By:
------------------------------------------
Name:
Title:
INSILCO HOLDING CO.
By:
------------------------------------------
Name:
Title:
XXXXXXXXX, LUFKIN & XXXXXXXX
SECURITIES CORPORATION
By:
-------------------------------
Name:
Title:
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SCHEDULE A
SUBSIDIARIES
ARUP Alu-Xxxx und-Profil GmbH
Great Lake, Inc.
Insilco Corporation
Insilco Asia Corporation
Dalian General ThermoDynamics Incorporated Ltd.
InNet Technologies, Inc.
Insilco Deutschland GmbH
Insilco Teoranta
Signal Caribe, Inc.
Signal Dominicana, S.A.
Signal Transformer Co., Inc.
Steel Parts Corporation
Xxxxxxx Connector Systems, Inc.
Xxxxxxx Connector Systems GmbH
Xxxxxxx Connector Systems (Japan), Inc.
Xxxxxxx Connector Systems de Mexico, S.A. de X.X.
Xxxxxxx Stamping Corporation
Xxxxxx Publishing Company
Thermal Components Division, Inc.
Thermal Components, Inc.
Thermalex, Inc.
S-1
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SCHEDULE B
SIGNIFICANT SUBSIDIARIES
Signal Transformer Co., Inc.
Steel Parts Corporation
Xxxxxxx Connector Systems, Inc.
Xxxxxxx Stamping Corporation
Xxxxxx Publishing Company
S-1
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EXHIBIT A
FORM OF A/B REGISTRATION RIGHTS AGREEMENT
A-1
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EXHIBIT B
FORM OF WARRANT REGISTRATION RIGHTS AGREEMENT
