Exhibit 4.27
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PHILADELPHIA SUBURBAN CORPORATION
$135,000,000 4.87% Senior Notes
due July 31, 2023
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NOTE PURCHASE AGREEMENT
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DATED AS OF JULY 31, 2003
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TABLE OF CONTENTS
SECTION HEADING PAGE
SECTION 1. AUTHORIZATION OF NOTES.................................................................1
SECTION 2. SALE AND PURCHASE OF NOTES.............................................................1
Section 2.1. Notes..................................................................................1
SECTION 3. CLOSING................................................................................1
SECTION 4. CONDITIONS TO CLOSING..................................................................2
Section 4.1. Representations and Warranties.........................................................2
Section 4.2. Performance; No Default................................................................2
Section 4.3. Compliance Certificates................................................................2
Section 4.4. Opinions of Counsel....................................................................2
Section 4.5. Purchase Permitted by Applicable Law, Etc..............................................3
Section 4.6. Related Transactions...................................................................3
Section 4.7. Payment of Special Counsel Fees........................................................3
Section 4.8. Private Placement Number...............................................................3
Section 4.9. Changes in Corporate Structure.........................................................3
Section 4.10. Proceedings and Documents..............................................................3
SECTION 5. REPRESENTATIONS AND WARRANTIES OF THE COMPANY..........................................4
Section 5.1. Organization; Power and Authority......................................................4
Section 5.2. Authorization, Etc.....................................................................4
Section 5.3. Disclosure.............................................................................4
Section 5.4. Organization and Ownership of Shares of Subsidiaries...................................4
Section 5.5. Financial Statements...................................................................5
Section 5.6. Compliance with Laws, Other Instruments, Etc...........................................5
Section 5.7. Governmental Authorizations, Etc.......................................................5
Section 5.8. Litigation; Observance of Statutes and Orders..........................................6
Section 5.9. Taxes..................................................................................6
Section 5.10. Title to Property; Leases..............................................................6
Section 5.11. Licenses, Permits, Etc.................................................................6
Section 5.12. Compliance with ERISA..................................................................6
Section 5.13. Private Offering by the Company........................................................7
Section 5.14. Use of Proceeds; Margin Regulations....................................................7
Section 5.15. Existing Debt; Future Liens............................................................8
Section 5.16. Foreign Assets Control Regulations, Etc................................................8
Section 5.17. Status under Certain Statutes..........................................................8
Section 5.18. Environmental Matters..................................................................8
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SECTION 6. REPRESENTATIONS OF THE PURCHASER.......................................................9
Section 6.1. Purchase for Investment................................................................9
Section 6.2. Source of Funds........................................................................9
SECTION 7. INFORMATION AS TO COMPANY.............................................................11
Section 7.1. Financial and Business Information....................................................11
Section 7.2. Officer's Certificate.................................................................13
Section 7.3. Inspection............................................................................14
SECTION 8. PAYMENT OF THE NOTES..................................................................14
Section 8.1. Required Prepayments..................................................................14
Section 8.2. Optional Prepayments with Make-Whole Amount...........................................15
Section 8.3. Allocation of Partial Prepayments.....................................................15
Section 8.4. Maturity; Surrender, Etc..............................................................15
Section 8.5. Purchase of Notes.....................................................................15
Section 8.6. Make-Whole Amount.....................................................................16
Section 8.7. Change in Control.....................................................................17
SECTION 9. AFFIRMATIVE COVENANTS.................................................................19
Section 9.1. Compliance with Law...................................................................19
Section 9.2. Insurance.............................................................................19
Section 9.3. Maintenance of Properties.............................................................20
Section 9.4. Payment of Taxes......................................................................20
Section 9.5. Corporate Existence, Etc..............................................................20
Section 9.6. Designation of Subsidiaries...........................................................20
SECTION 10. NEGATIVE COVENANTS....................................................................21
Section 10.1. Limitation on Debt....................................................................21
Section 10.2. Limitation on Liens...................................................................21
Section 10.3. Sales of Assets.......................................................................23
Section 10.4. Merger, Consolidation and Sale of Stock...............................................24
Section 10.5. Limitation on Sale and Leasebacks.....................................................25
Section 10.6. Restricted Investments................................................................25
Section 10.7. Nature of Business...................................................................26
Section 10.8. Transactions with Affiliates..........................................................26
Section 10.9. Acquisitions..........................................................................27
Section 10.10. Unrestricted Subsidiaries.........................................................27
SECTION 11. EVENTS OF DEFAULT.....................................................................27
SECTION 12. REMEDIES ON DEFAULT, ETC..............................................................29
Section 12.1. Acceleration..........................................................................29
Section 12.2. Other Remedies........................................................................30
Section 12.3. Rescission............................................................................30
Section 12.4. No Waivers or Election of Remedies, Expenses, Etc.....................................30
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SECTION 13. REGISTRATION; EXCHANGE; SUBSTITUTION OF NOTES.........................................30
Section 13.1. Registration of Notes.................................................................30
Section 13.2. Transfer and Exchange of Notes........................................................31
Section 13.3. Replacement of Notes..................................................................31
SECTION 14. PAYMENTS ON NOTES.....................................................................32
Section 14.1. Place of Payment......................................................................32
Section 14.2. Home Office Payment...................................................................32
SECTION 15. EXPENSES, ETC.........................................................................32
Section 15.1. Transaction Expenses..................................................................32
Section 15.2. Survival..............................................................................33
SECTION 16. SURVIVAL OF REPRESENTATIONS AND WARRANTIES; ENTIRE AGREEMENT..........................33
SECTION 17. AMENDMENT AND WAIVER..................................................................33
Section 17.1. Requirements..........................................................................33
Section 17.2. Solicitation of Holders of Notes......................................................33
Section 17.3. Binding Effect, Etc...................................................................34
Section 17.4. Notes Held by Company, Etc............................................................34
SECTION 18. NOTICES...............................................................................34
SECTION 19. REPRODUCTION OF DOCUMENTS.............................................................35
SECTION 20. CONFIDENTIAL INFORMATION..............................................................35
SECTION 21. SUBSTITUTION OF PURCHASER.............................................................37
SECTION 22. MISCELLANEOUS.........................................................................37
Section 22.1. Successors and Assigns................................................................37
Section 22.2. Payments Due on Non-Business Days.....................................................37
Section 22.3. Severability..........................................................................37
Section 22.4. Construction..........................................................................37
Section 22.5. Counterparts..........................................................................37
Section 22.6. Governing Law.........................................................................38
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SCHEDULE A -- INFORMATION RELATING TO PURCHASERS
SCHEDULE B -- DEFINED TERMS
SCHEDULE 4.9 -- Changes in Corporate Structure
SCHEDULE 5.4 -- Subsidiaries of the Company, Ownership of Subsidiary Stock
SCHEDULE 5.5 -- Financial Statements
SCHEDULE 5.11 -- Licenses, Permits, Etc.
SCHEDULE 5.15 -- Existing Debt
EXHIBIT 1 -- Form of 4.87% Senior Note due July 31, 2023
EXHIBIT 4.4(a) -- Form of Opinion of General Counsel to the Company
EXHIBIT 4.4(b) -- Form of Opinion of Special Counsel to the Company
EXHIBIT 4.4(c) -- Form of Opinion of Special Counsel to the Purchasers
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PHILADELPHIA SUBURBAN CORPORATION
000 X. XXXXXXXXX XXXXXX
XXXX XXXX, XXXXXXXXXXXX 00000
4.87% SENIOR NOTES DUE JULY 31, 2023
Dated as of
July 31, 2003
TO THE PURCHASERS LISTED IN
THE ATTACHED SCHEDULE A:
Ladies and Gentlemen:
PHILADELPHIA SUBURBAN CORPORATION, a Pennsylvania corporation (the
"Company"), agrees with the Purchasers listed in the attached Schedule A (the
"Purchasers") to this Note Purchase Agreement (this "Agreement") as follows:
SECTION 1. AUTHORIZATION OF NOTES.
The Company will authorize the issue and sale of $135,000,000 aggregate
principal amount of its 4.87% Senior Notes due July 31, 2023 (the "Notes"; such
term shall also include any such notes issued in substitution therefor pursuant
to Section 13 of this Agreement). The Notes shall be substantially in the forms
set out in Exhibit 1 with such changes therefrom, if any, as may be approved by
the Purchasers and the Company. Certain capitalized terms used in this Agreement
are defined in Schedule B; references to a "Schedule" or an "Exhibit" are,
unless otherwise specified, to a Schedule or an Exhibit attached to this
Agreement.
SECTION 2. SALE AND PURCHASE OF NOTES.
Section 2.1. Notes. Subject to the terms and conditions of this
Agreement, the Company will issue and sell to each Purchaser and each Purchaser
will purchase from the Company, at the Closing provided for in Section 3, Notes
in the principal amount specified opposite such Purchaser's name in Schedule A
at the purchase price of 100% of the principal amount thereof. The obligations
of each Purchaser hereunder are several and not joint obligations and each
Purchaser shall have no obligation and no liability to any Person for the
performance or nonperformance by any other Purchaser hereunder.
SECTION 3. CLOSING.
The sale and purchase of the Notes to be purchased by each Purchaser
shall occur at the offices of Xxxxxxx and Xxxxxx LLP, 000 Xxxx Xxxxxx Xxxxxx,
Xxxxxxx, Xxxxxxxx 00000 at 10:00 a.m. Chicago time, at a closing (the "Closing")
on July 31, 2003 or on such other Business Day thereafter on or prior to August
8, 2003 as may be agreed upon by the Company and the Purchasers. At the Closing
the Company will deliver to each Purchaser the Notes to be purchased by such
Purchaser in the form of a single Note (or such greater number of Notes in
denominations of at least $100,000 as such Purchaser may request) dated the date
of the Closing and registered in such Purchaser's name (or in the name of such
Purchaser's nominee), against delivery by such Purchaser to the Company or its
order of immediately available funds in the amount of the purchase price
therefor by wire transfer of immediately available funds for the account of the
Company to account number 8541854208, account name Philadelphia Suburban
Corporation, at PNC Bank, N.A., Philadelphia, Pennsylvania, ABA Number
031-000053. If at the Closing the Company shall fail to tender such Notes to any
Purchaser as provided above in this Section 3, or any of the conditions
specified in Section 4 shall not have been fulfilled to any Purchaser's
satisfaction, such Purchaser shall, at such Purchaser's election, be relieved of
all further obligations under this Agreement, without thereby waiving any rights
such Purchaser may have by reason of such failure or such nonfulfillment.
SECTION 4. CONDITIONS TO CLOSING.
The obligation of each Purchaser to purchase and pay for the Notes to
be sold to such Purchaser at the Closing is subject to the fulfillment to such
Purchaser's satisfaction, prior to or at the Closing, of the following
conditions:
Section 4.1. Representations and Warranties of the Company. The
representations and warranties of the Company in this Agreement shall be correct
when made and at the time of the Closing.
Section 4.2. Performance; No Default. The Company shall have performed
and complied with all agreements and conditions contained in this Agreement
required to be performed or complied with by the Company prior to or at the
Closing, and after giving effect to the issue and sale of the Notes (and the
application of the proceeds thereof as contemplated by Section 5.14), no Default
or Event of Default shall have occurred and be continuing.
Section 4.3. Compliance Certificates.
(a) Officer's Certificate of the Company. The Company shall
have delivered to such Purchaser an Officer's Certificate, dated the
date of the Closing, certifying that the conditions specified in
Sections 4.1, 4.2 and 4.9 have been fulfilled.
(b) Secretary's Certificate of the Company. The Company shall
have delivered to such Purchaser a certificate certifying as to the
resolutions attached thereto and other corporate proceedings relating
to the authorization, execution and delivery of the Notes and this
Agreement.
Section 4.4. Opinions of Counsel. Such Purchaser shall have received
opinions in form and substance satisfactory to such Purchaser, dated the date of
the Closing (a) from Xxx X. Xxxxx, Esq., General Counsel of the Company,
covering the matters set forth in Exhibit 4.4(a) and covering such other matters
incident to the transactions contemplated hereby as such Purchaser or such
Purchaser's counsel may reasonably request (and the Company hereby instructs its
counsel to deliver such opinion to such Purchaser), (b) from Xxxxxxxx Xxxxxx,
LLP, special counsel to the Company, covering the matters set forth in Exhibit
4.4(b) and covering such other matters incident to the transactions contemplated
hereby as such Purchaser or such Purchaser's counsel may reasonably request (and
the Company hereby instructs its counsel to deliver such opinion to such
Purchaser), and (c) from Xxxxxxx and Xxxxxx LLP, the Purchasers' special counsel
in connection with such transactions, substantially in the form set forth in
Exhibit 4.4(c) and covering such other matters incident to such transactions as
such Purchaser may reasonably request.
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Section 4.5. Purchase Permitted by Applicable Law, Etc. On the date of
the Closing each purchase of Notes shall (a) be permitted by the laws and
regulations of each jurisdiction to which each Purchaser is subject, without
recourse to provisions (such as Section 1405(a)(8) of the New York Insurance
Law) permitting limited investments by insurance companies without restriction
as to the character of the particular investment, (b) not violate any applicable
law or regulation (including, without limitation, Regulation T, U or X of the
Board of Governors of the Federal Reserve System) and (c) not subject any
Purchaser to any tax, penalty or liability under or pursuant to any applicable
law or regulation, which law or regulation was not in effect on the date hereof.
If requested by any Purchaser, such Purchaser shall have received an Officer's
Certificate certifying as to such matters of fact as such Purchaser may
reasonably specify to enable such Purchaser to determine whether such purchase
is so permitted.
Section 4.6. Related Transactions. The Company shall have consummated
the sale of the entire principal amount of the Notes scheduled to be sold on the
date of Closing pursuant to this Agreement.
Section 4.7. Payment of Special Counsel Fees. Without limiting the
provisions of Section 15.1, the Company shall have paid on or before the
Closing, the reasonable fees, reasonable charges and reasonable disbursements of
the Purchasers' special counsel referred to in Section 4.4(c) to the extent
reflected in a statement of such counsel rendered to the Company at least one
Business Day prior to the Closing.
Section 4.8. Private Placement Number. A Private Placement Number
issued by Standard & Poor's CUSIP Service Bureau (in cooperation with the
Securities Valuation Office of the National Association of Insurance
Commissioners) shall have been obtained for the Notes.
Section 4.9. Changes in Corporate Structure. The Company shall not have
changed its jurisdiction of incorporation or, except as reflected in Schedule
4.9, been a party to any merger or consolidation and shall not have succeeded to
all or any substantial part of the liabilities of any other entity, at any time
following the date of the most recent financial statements referred to in
Schedule 5.5.
Section 4.10. Proceedings and Documents. All corporate and other
proceedings in connection with the transactions contemplated by this Agreement
and all documents and instruments incident to such transactions shall be
satisfactory to such Purchaser and such Purchaser's special counsel, and such
Purchaser and such Purchaser's special counsel shall have received all such
counterpart originals or certified or other copies of such documents as such
Purchaser or such Purchaser's special counsel may reasonably request.
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SECTION 5. REPRESENTATIONS AND WARRANTIES OF THE COMPANY.
The Company represents and warrants to each Purchaser that:
Section 5.1. Organization; Power and Authority. The Company is a
corporation duly organized, validly existing and in good standing under the laws
of its jurisdiction of incorporation, and is duly qualified as a foreign
corporation and is in good standing in each jurisdiction in which such
qualification is required by law, other than those jurisdictions as to which the
failure to be so qualified or in good standing could not, individually or in the
aggregate, reasonably be expected to have a Material Adverse Effect. The Company
has the corporate power and authority to own or hold under lease the properties
it purports to own or hold under lease, to transact the business it transacts
and proposes to transact, to execute and deliver this Agreement and the Notes
and to perform the provisions hereof and thereof.
Section 5.2. Authorization, Etc. This Agreement and the Notes have been
duly authorized by all necessary corporate action on the part of the Company,
and this Agreement constitutes, and upon execution and delivery thereof each
Note will constitute, a legal, valid and binding obligation of the Company
enforceable against the Company in accordance with its terms, except as such
enforceability may be limited by (i) applicable bankruptcy, insolvency,
reorganization, moratorium or other similar laws affecting the enforcement of
creditors' rights generally and (ii) general principles of equity (regardless of
whether such enforceability is considered in a proceeding in equity or at law).
Section 5.3. Disclosure. The Company, through its agent, PNC Capital
Markets, Inc., has delivered to each Purchaser a copy of a Private Placement
Memorandum, dated June, 2003 (the "Memorandum"), relating to the transactions
contemplated hereby. The Memorandum fairly describes, in all material respects,
the general nature of the business and principal properties of the Company and
its Subsidiaries. This Agreement (excluding the representations of the
Purchasers in Section 6), the Memorandum, the documents, certificates or other
writings delivered to the Purchasers by or on behalf of the Company in
connection with the transactions contemplated hereby and the financial
statements listed in Schedule 5.5, taken as a whole, do not contain any untrue
statement of a material fact or omit to state any material fact necessary to
make the statements therein not misleading in light of the circumstances under
which they were made. Since December 31, 2002, there has been no change in the
financial condition, operations, business or properties of the Company or any of
its Subsidiaries except changes that individually or in the aggregate could not
reasonably be expected to have a Material Adverse Effect. There is no fact known
to the Company that could reasonably be expected to have a Material Adverse
Effect that has not been set forth herein or in the Memorandum or in the other
documents, certificates and other writings delivered to each Purchaser by or on
behalf of the Company specifically for use in connection with the transactions
contemplated hereby.
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Section 5.4. Organization and Ownership of Shares of Subsidiaries. (a)
Schedule 5.4 contains (except as noted therein) a complete and correct list of
the Company's Subsidiaries, showing, as to each Subsidiary, the correct name
thereof, the jurisdiction of its organization, and the percentage of shares of
each class of its capital stock or similar equity interests outstanding owned by
the Company and each other Subsidiary.
(b) All of the outstanding shares of capital stock or similar equity
interests of each Subsidiary shown in Schedule 5.4 as being owned by the Company
and its Subsidiaries have been validly issued, are fully paid and nonassessable
and are owned by the Company or another Subsidiary free and clear of any Lien
(except as otherwise disclosed in Schedule 5.4).
(c) Each Subsidiary identified in Schedule 5.4 is a corporation or
other legal entity duly organized, validly existing and in good standing under
the laws of its jurisdiction of organization, and is duly qualified as a foreign
corporation or other legal entity and is in good standing in each jurisdiction
in which such qualification is required by law, other than those jurisdictions
as to which the failure to be so qualified or in good standing could not,
individually or in the aggregate, reasonably be expected to have a Material
Adverse Effect. Each such Subsidiary has the corporate or other power and
authority to own or hold under lease the properties it purports to own or hold
under lease and to transact the business it transacts and proposes to transact.
Section 5.5. Financial Statements. The Company has delivered to each
Purchaser copies of the financial statements of the Company and its Subsidiaries
listed on Schedule 5.5. All of said financial statements (including in each case
the related schedules and notes) fairly present in all material respects the
consolidated financial position of the Company and its Subsidiaries as of the
respective dates specified in such financial statements and the consolidated
results of their operations and cash flows for the respective periods so
specified and have been prepared in accordance with GAAP consistently applied
throughout the periods involved except as set forth in the notes thereto
(subject, in the case of any interim financial statements, to normal year-end
adjustments).
Section 5.6. Compliance with Laws, Other Instruments, Etc. The
execution, delivery and performance by the Company of this Agreement and the
Notes will not (a) contravene, result in any breach of, or constitute a default
under, or result in the creation of any Lien in respect of any property of the
Company or any Subsidiary under, any indenture, mortgage, deed of trust, loan,
purchase or credit agreement, lease, corporate charter or by-laws, or any other
Material agreement or instrument to which the Company or any Subsidiary is bound
or by which the Company or any Subsidiary or any of their respective properties
may be bound or affected, (b) conflict with or result in a breach of any of the
terms, conditions or provisions of any order, judgment, decree, or ruling of any
court, arbitrator or Governmental Authority applicable to the Company or any
Subsidiary, or (c) violate any provision of any statute or other rule or
regulation of any Governmental Authority applicable to the Company or any
Subsidiary, except for any such default, breach, contravention or violation
which would not reasonably be expected to have a Material Adverse Effect.
Section 5.7. Governmental Authorizations, Etc. No consent, approval or
authorization of, or registration, filing or declaration with, any Governmental
Authority is required in connection with the execution, delivery or performance
by the Company of this Agreement or the Notes.
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Section 5.8. Litigation; Observance of Statutes and Orders. (a) There
are no actions, suits or proceedings pending or, to the knowledge of the
Company, threatened against or affecting the Company or any Subsidiary or any
property of the Company or any Subsidiary in any court or before any arbitrator
of any kind or before or by any Governmental Authority that, individually or in
the aggregate, could reasonably be expected to have a Material Adverse Effect.
(b) Neither the Company nor any Subsidiary is in default under any
order, judgment, decree or ruling of any court, arbitrator or Governmental
Authority or is in violation of any applicable law, ordinance, rule or
regulation (including without limitation Environmental Laws) of any Governmental
Authority, which default or violation, individually or in the aggregate, would
reasonably be expected to have a Material Adverse Effect.
Section 5.9. Taxes. The Company and its Subsidiaries have filed all
income tax returns that are required to have been filed in any jurisdiction, and
have paid all taxes shown to be due and payable on such returns and all other
taxes and assessments payable by them to the extent such taxes and assessments
have become due and payable and before they have become delinquent, except for
any taxes and assessments (a) the amount of which is not individually or in the
aggregate Material or (b) the amount, applicability or validity of which is
currently being contested in good faith by appropriate proceedings and with
respect to which the Company or a Subsidiary, as the case may be, has
established adequate reserves in accordance with GAAP. The charges, accruals and
reserves on the books of the Company and its Subsidiaries in respect of federal,
state or other taxes for all fiscal periods are adequate. The federal income tax
liabilities of the Company and its Subsidiaries have been determined by an audit
by the Internal Revenue Service for the fiscal year ended December 31, 1999 and
all amounts owing in respect of such audit have been paid.
Section 5.10. Title to Property; Leases. The Company and its
Subsidiaries have good and sufficient title to their respective Material
properties, including all such properties reflected in the most recent audited
balance sheet referred to in Section 5.5 or purported to have been acquired by
the Company or any Subsidiary after said date (except as sold or otherwise
disposed of in the ordinary course of business), in each case free and clear of
Liens prohibited by this Agreement, except for those defects in title and Liens
that, individually or in the aggregate, would not have a Material Adverse
Effect. All Material leases are valid and subsisting and are in full force and
effect in all material respects.
Section 5.11. Licenses, Permits, Etc. Except as disclosed in Schedule
5.11, the Company and its Subsidiaries own or possess all licenses, permits,
franchises, certificates of conveyance and necessity, authorizations, patents,
copyrights, service marks, trademarks and trade names, or rights thereto, that
are Material, without known conflict with the rights of others except for those
conflicts, that, individually or in the aggregate, would not have a Material
Adverse Effect.
Section 5.12. Compliance with ERISA. (a) The Company and each ERISA
Affiliate have operated and administered each Plan in compliance with all
applicable laws except for such instances of noncompliance as have not resulted
in and could not reasonably be expected to result in a Material Adverse Effect.
Neither the Company nor any ERISA Affiliate has incurred any liability pursuant
to Title I or IV of ERISA or the penalty or excise tax provisions of the Code
relating to employee benefit plans (as defined in Section 3 of ERISA), and no
event, transaction or condition has occurred or exists that would reasonably be
expected to result in the incurrence of any such liability by the Company or any
ERISA Affiliate, or in the imposition of any Lien on any of the rights,
properties or assets of the Company or any ERISA Affiliate, in either case
pursuant to Title I or IV of ERISA or to such penalty or excise tax provisions
or to Section 401(a)(29) or 412 of the Code, other than such liabilities or
Liens as would not be individually or in the aggregate Material.
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(b) The present value of the accrued benefit liabilities under each of
the Plans (other than Multiemployer Plans), determined as of the end of such
Plan's most recently ended plan year on the basis of the actuarial assumptions
specified for funding purposes in such Plan's most recent actuarial valuation
report, did not exceed the aggregate current value of the assets of such Plan
allocable to such benefit liabilities. The term "benefit liabilities" has the
meaning specified in section 4001 of ERISA and the terms "current value" and
"present value" have the meaning specified in Section 3 of ERISA.
(c) The Company and its ERISA Affiliates have not incurred any
withdrawal liabilities (and are not subject to contingent withdrawal
liabilities) under Section 4201 or 4204 of ERISA in respect of Multiemployer
Plans that individually or in the aggregate are Material.
(d) The expected post-retirement benefit obligation (determined as of
the last day of the Company's most recently ended fiscal year in accordance with
Financial Accounting Standards Board Statement No. 106, without regard to
liabilities attributable to continuation coverage mandated by section 4980B of
the Code) of the Company and its Subsidiaries is not Material.
(e) The execution and delivery of this Agreement and the issuance and
sale of the Notes hereunder will not involve any transaction that is subject to
the prohibitions of Section 406 of ERISA or in connection with which a tax could
be imposed pursuant to Section 4975(c)(1)(A)-(D) of the Code. The representation
by the Company in the first sentence of this Section 5.12(e) is made in reliance
upon and subject to the accuracy of each Purchaser's representation in Section
6.2 as to the sources of the funds to be used to pay the purchase price of the
Notes to be purchased by such Purchaser.
Section 5.13. Private Offering by the Company. Neither the Company nor
anyone acting on the Company's behalf has offered the Notes or any similar
securities for sale to, or solicited any offer to buy any of the same from, or
otherwise approached or negotiated in respect thereof with, any Person other
than the Purchasers and not more than 24 other Institutional Investors, each of
which has been offered the Notes in connection with a private sale for
investment. Neither the Company nor anyone acting on its behalf has taken, or
will take, any action that would subject the issuance or sale of the Notes to
the registration requirements of Section 5 of the Securities Act.
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Section 5.14. Use of Proceeds; Margin Regulations. The Company will
apply the proceeds of the sale of the Notes for general corporate purposes of
the Company and its Subsidiaries (including the repayment of Debt of the Company
and its Subsidiaries) and to finance the acquisition of certain subsidiaries of
AquaSource, Inc. No part of the proceeds from the sale of the Notes hereunder
will be used, directly or indirectly, for the purpose of buying or carrying any
margin stock within the meaning of Regulation U of the Board of Governors of the
Federal Reserve System (12 CFR 221), or for the purpose of buying or carrying or
trading in any securities under such circumstances as to involve the Company in
a violation of Regulation X of said Board (12 CFR 224) or to involve any broker
or dealer in a violation of Regulation T of said Board (12 CFR 220). Margin
stock does not constitute more than 2% of the value of the consolidated assets
of the Company and its Subsidiaries and the Company does not have any present
intention that margin stock will constitute more than 2% of the value of such
assets. As used in this Section, the terms "margin stock" and "purpose of buying
or carrying" shall have the meanings assigned to them in said Regulation U.
Section 5.15. Existing Debts. Except as described therein, Schedule 5.15
sets forth a complete and correct list of all outstanding Debt of the Company
and its Subsidiaries as of June 30, 2003, since which date there has been no
Material change in the amounts, interest rates, sinking funds, installment
payments or maturities of the Debt of the Company or its Subsidiaries. Neither
the Company nor any Subsidiary is in default and no waiver of default is
currently in effect, in the payment of any principal or interest on any Debt of
the Company or such Subsidiary, and no event or condition exists with respect to
any Debt of the Company or any Subsidiary, the outstanding principal amount of
which exceeds $5,000,000, that would permit (or that with notice or the lapse of
time, or both, would permit) one or more Persons to cause such Debt to become
due and payable before its stated maturity or before its regularly scheduled
dates of payment.
Section 5.16. Foreign Assets Control Regulations, Etc. Neither the sale
of the Notes by the Company hereunder nor its use of the proceeds thereof will
violate the Trading with the Enemy Act, as amended, or any of the foreign assets
control regulations of the United States Treasury Department (31 CFR, Subtitle
B, Chapter V, as amended) or any enabling legislation or executive order
relating thereto or is in violation of any federal statute or Presidential
Executive Order, including without limitation Executive Order 13224 66 Fed. Reg.
49079 (September 25, 2001) (Blocking Property and Prohibiting Transactions with
Persons who Commit, Threaten to Commit or Support Terrorism).
Section 5.17. Status under Certain Statutes. Neither the Company nor any
Subsidiary is an "investment company" registered or required to be registered
under the Investment Company Act of 1940, as amended, or is subject to
regulation under the Public Utility Holding Company Act of 1935, as amended, the
ICC Termination Act of 1995, as amended, or the Federal Power Act, as amended.
Section 5.18. Environmental Matters. Neither the Company nor any
Subsidiary has knowledge of any claim or has received any notice of any claim,
and no proceeding has been instituted raising any claim against the Company or
any of its Subsidiaries or any of their respective real properties now or
formerly owned, leased or operated by any of them, or other assets, alleging
damage to the environment or any violation of any Environmental Laws, except, in
each case, such as could not reasonably be expected to result in a Material
Adverse Effect. Except as otherwise disclosed to each Purchaser in writing:
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(a) neither the Company nor any Subsidiary has knowledge of
any facts which would give rise to any claim, public or private, for
violation of Environmental Laws or damage to the environment emanating
from, occurring on or in any way related to real properties or to other
assets now or formerly owned, leased or operated by any of them or
their use, except, in each case, such as could not reasonably be
expected to result in a Material Adverse Effect;
(b) neither the Company nor any of its Subsidiaries has
stored any Hazardous Materials on real properties now or formerly
owned, leased or operated by any of them or has disposed of any
Hazardous Materials in each case in a manner contrary to any
Environmental Laws and in any manner that could reasonably be expected
to result in a Material Adverse Effect; and
(c) all buildings on all real properties now owned, leased or
operated by the Company or any of its Subsidiaries are in compliance
with applicable Environmental Laws, except where failure to comply
could not reasonably be expected to result in a Material Adverse
Effect.
SECTION 6. REPRESENTATIONS OF THE PURCHASER.
Section 6.1. Purchase for Investment. Each Purchaser represents that it
is purchasing the Notes for its own account or for one or more separate accounts
maintained by it or for the account of one or more pension or trust funds and
not with a view to the distribution thereof, provided that the disposition of
such Purchaser's or such pension or trust funds' property shall at all times be
within such Purchaser's or such pension or trust funds' control. Each Purchaser
understands that the Notes have not been registered under the Securities Act and
may be resold only if registered pursuant to the provisions of the Securities
Act or if an exemption from registration is available, except under
circumstances where neither such registration nor such an exemption is required
by law, and that the Company is not required to register the Notes.
Section 6.2. Source of Funds. Each Purchaser represents that at least
one of the following statements is an accurate representation as to each source
of funds (a "Source") to be used by it to pay the purchase price of the Notes to
be purchased by it hereunder:
(a) the Source is an "insurance company general account"
within the meaning of Department of Labor Prohibited Transaction
Exemption ("PTE") 95-60 (issued July 12, 1995) and there is no employee
benefit plan, treating as a single plan all plans maintained by the
same employer or employee organization, with respect to which the
amount of the general account reserves and liabilities for all
contracts held by or on behalf of such plan, exceeds ten percent (10%)
of the total reserves and liabilities of such general account
(exclusive of separate account liabilities) plus surplus, as set forth
in the NAIC Annual Statement for such Purchaser most recently filed
with such Purchaser's state of domicile; or
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(b) the Source is either (i) an insurance company pooled
separate account, within the meaning of PTE 90-1 (issued January 29,
1990), or (ii) a bank collective investment fund, within the meaning of
the PTE 91-38 (issued July 12, 1991) and, except as such Purchaser
prior to the execution and delivery of this Agreement has disclosed to
the Company in writing pursuant to this paragraph (b), no employee
benefit plan or group of plans maintained by the same employer or
employee organization beneficially owns more than 10% of all assets
allocated to such pooled separate account or collective investment
fund; or
(c) the Source constitutes assets of an "investment fund"
(within the meaning of Part V of the QPAM Exemption) managed by a
"qualified professional asset manager" or "QPAM" (within the meaning of
Part V of the QPAM Exemption), no employee benefit plan's assets that
are included in such investment fund, when combined with the assets of
all other employee benefit plans established or maintained by the same
employer or by an affiliate (within the meaning of Section V(c)(1) of
the QPAM Exemption) of such employer or by the same employee
organization and managed by such QPAM, exceed 20% of the total client
assets managed by such QPAM, the conditions of Part I(c) and (g) of the
QPAM Exemption are satisfied, neither the QPAM nor a person controlling
or controlled by the QPAM (applying the definition of "control" in
Section V(e) of the QPAM Exemption) owns a 5% or more interest in the
Company and (i) the identity of such QPAM and (ii) the names of all
employee benefit plans whose assets are included in such investment
fund have been disclosed to the Company in writing pursuant to this
paragraph (c) prior to the execution and delivery of this Agreement; or
(d) the Source is a governmental plan; or
(e) the Source is one or more employee benefit plans, or a
separate account or trust fund comprised of one or more employee
benefit plans, each of which prior to the execution and delivery of
this Agreement has been identified to the Company in writing pursuant
to this paragraph (e); or
(f) the Source does not include assets of any employee
benefit plan, other than a plan exempt from the coverage of ERISA; or
(g) the Source is an insurance company separate account
maintained solely in connection with the fixed contractual obligations
of the insurance company under which the amounts payable, or credited,
to any employee benefit plan (or its related trust) and to any
participant or beneficiary of such plan (including any annuitant) are
not affected in any manner by the investment performance of the
separate account.
If any Purchaser or any subsequent transferee of the Notes indicates that such
Purchaser or such transferee is relying on any representation contained in
paragraph (b), (c) or (e) above, the Company shall deliver on the date of
issuance of such Notes and on the date of any applicable transfer a certificate,
which shall either state that (i) it is neither a party in interest nor a
"disqualified person" (as defined in Section 4975(e)(2) of the Code), with
respect to any plan identified pursuant to paragraphs (b) or (e) above, or (ii)
with respect to any plan, identified pursuant to paragraph (c) above, neither it
nor any "affiliate" (as defined in Section V(c) of the QPAM Exemption) has at
such time, and during the immediately preceding one year, exercised the
authority to appoint or terminate said QPAM as manager of any plan identified in
writing pursuant to paragraph (c) above or to negotiate the terms of said QPAM's
management agreement on behalf of any such identified plan. As used in this
Section 6.2, the terms "employee benefit plan", "governmental plan", "party in
interest" and "separate account" shall have the respective meanings assigned to
such terms in Section 3 of ERISA.
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SECTION 7. INFORMATION AS TO COMPANY.
Section 7.1. Financial and Business Information. The Company shall
deliver to each holder of Notes that is an Institutional Investor:
(a) Quarterly Statements -- within 60 days after the end of
each quarterly fiscal period in each fiscal year of the Company (other
than the last quarterly fiscal period of each such fiscal year),
duplicate copies of,
(i) a consolidated balance sheet of the Company and
its Subsidiaries as at the end of such quarter, and
(ii) consolidated statements of income, changes in
shareholders' equity and cash flows of the Company and its
Subsidiaries, for such quarter and (in the case of the second
and third quarters) for the portion of the fiscal year ending
with such quarter,
setting forth in each case in comparative form the figures for the
corresponding periods in the previous fiscal year, all in reasonable
detail, prepared in accordance with GAAP applicable to quarterly
financial statements generally, and certified by a Senior Financial
Officer as fairly presenting, in all material respects, the financial
position of the companies being reported on and their results of
operations and cash flows, subject to changes resulting from year-end
adjustments, provided that delivery within the time period specified
above of copies of the Company's Quarterly Report on Form 10-Q prepared
in compliance with the requirements therefor and filed with the
Securities and Exchange Commission shall be deemed to satisfy the
requirements of this Section 7.1(a);
(b) Annual Statements -- within 120 days after the end of
each fiscal year of the Company, duplicate copies of,
(i) a consolidated balance sheet of the Company and
its Subsidiaries, as at the end of such year, and
(ii) consolidated statements of income, changes in
shareholders' equity and cash flows of the Company and its
Subsidiaries, for such year,
setting forth in each case in comparative form the figures for the
previous fiscal year, all in reasonable detail, prepared in accordance
with GAAP, and accompanied by an opinion thereon of independent
certified public accountants of recognized national standing, which
opinion shall state that such financial statements present fairly, in
all material respects, the financial position of the companies being
reported upon and their results of operations and cash flows and have
been prepared in conformity with GAAP, and that the examination of such
accountants in connection with such financial statements has been made
in accordance with generally accepted auditing standards, and that such
audit provides a reasonable basis for such opinion in the
circumstances, provided that the delivery within the time period
specified above of the Company's Annual Report on Form 10-K for such
fiscal year (together with the Company's annual report to shareholders,
if any, prepared pursuant to Rule 14a-3 under the Exchange Act)
prepared in accordance with the requirements therefor and filed with
the Securities and Exchange Commission shall be deemed to satisfy the
requirements of this Section 7.1(b);
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(c) SEC and Other Reports -- promptly upon their becoming
available, one copy of (i) each financial statement, report, notice or
proxy statement sent by the Company or any Subsidiary to public
securities holders generally, and (ii) each regular or periodic report,
each registration statement that shall have become effective (without
exhibits except as expressly requested by such holder), and each final
prospectus and all amendments thereto filed by the Company or any
Subsidiary with the Securities and Exchange Commission;
(d) Notice of Default or Event of Default -- promptly, and in
any event within five days after a Responsible Officer becomes aware of
the existence of any Default or Event of Default, a written notice
specifying the nature and period of existence thereof and what action
the Company is taking or proposes to take with respect thereto;
(e) ERISA Matters -- promptly, and in any event within five
days after a Responsible Officer becomes aware of any of the following,
a written notice setting forth the nature thereof and the action, if
any, that the Company or an ERISA Affiliate proposes to take with
respect thereto:
(i) with respect to any Plan, any reportable event,
as defined in Section 4043(c) of ERISA and the regulations
thereunder, for which notice thereof has not been waived
pursuant to such regulations as in effect on the date thereof;
or
(ii) the taking by the PBGC of steps to institute, or
the threatening by the PBGC of the institution of, proceedings
under Section 4042 of ERISA for the termination of, or the
appointment of a trustee to administer, any Plan, or the
receipt by the Company or any ERISA Affiliate of a notice from
a Multiemployer Plan that such action has been taken by the
PBGC with respect to such Multiemployer Plan; or
(iii) Any event, transaction or condition that could
result in the incurrence of any liability by the Company or
any ERISA Affiliate pursuant to Title I or IV of ERISA or the
imposition of a penalty or excise tax under the provisions of
the Code relating to employee benefit plans, or the imposition
of any Lien on any of the rights, properties or assets of the
Company or any ERISA Affiliate pursuant to Title I or IV of
ERISA or such penalty or excise tax provisions, if such
liability or Lien, taken together with any other such
liabilities or Liens then existing, would reasonably be
expected to have a Material Adverse Effect;
-12-
(f) Notices from Governmental Authority -- promptly, and in
any event within 30 days of receipt thereof, copies of any notice to
the Company or any Subsidiary from any federal or state Governmental
Authority relating to any order, ruling, statute or other law or
regulation that could reasonably be expected to have a Material Adverse
Effect; and
(g) Requested Information -- with reasonable promptness, such
other data and information relating to the business, operations,
affairs, financial condition, assets or properties of the Company or
any of its Subsidiaries or relating to the ability of the Company to
perform its obligations hereunder and under the Notes as from time to
time may be reasonably requested by any such holder of Notes.
In addition to the foregoing, in the event that one or more
Unrestricted Subsidiaries shall either (i) own more than 10% of the total
consolidated assets of the Company and its Subsidiaries, or (ii) account for
more than 10% of the consolidated gross revenues of the Company and its
Subsidiaries, determined in each case in accordance with GAAP, then, within the
respective periods provided in Section 7.1(a) and (b) above, the Company shall
deliver to each holder of Notes that is an Institutional Investor, unaudited
financial statements of the character and for the dates and periods as in said
Sections 7.1(a) and (b) covering such group of Unrestricted Subsidiaries (on a
consolidated basis), together with a consolidating statement reflecting
eliminations or adjustments required to reconcile the financial statements of
such group of Unrestricted Subsidiaries to the financial statements delivered
pursuant to Sections 7.1(a) and (b).
Section 7.2. Officer's Certificate. Each set of financial statements
delivered to a holder of Notes pursuant to Section 7.1(a) or Section 7.1(b)
hereof shall be accompanied by a certificate of a Senior Financial Officer
setting forth:
(a) Covenant Compliance -- the information (including
detailed calculations) required in order to establish whether the
Company was in compliance with the requirements of Section 10.1,
Section 10.2(k), Section 10.4, Section 10.5, Section 10.6(k) and
Section 10.10 hereof, inclusive, during the quarterly or annual period
covered by the statements then being furnished (including with respect
to each such Section, where applicable, the calculations of the maximum
or minimum amount, ratio or percentage, as the case may be, permissible
under the terms of such Sections, and the calculation of the amount,
ratio or percentage then in existence); and
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(b) Event of Default -- a statement that such officer has
reviewed the relevant terms hereof and has made, or caused to be made,
under his or her supervision, a review of the transactions and
conditions of the Company and its Subsidiaries from the beginning of
the quarterly or annual period covered by the statements then being
furnished to the date of the certificate and that such review shall not
have disclosed the existence during such period of any condition or
event that constitutes a Default or an Event of Default or, if any such
condition or event existed or exists (including, without limitation,
any such event or condition resulting from the failure of the Company
or any Subsidiary to comply with any Environmental Law), specifying the
nature and period of existence thereof and what action the Company
shall have taken or proposes to take with respect thereto.
Section 7.3. Inspection. The Company shall permit the representatives
of each holder of Notes that is an Institutional Investor:
(a) No Default -- if no Default or Event of Default then
exists, at the expense of such holder and upon reasonable prior notice
to the Company, to visit the principal executive office of the Company,
to discuss the affairs, finances and accounts of the Company and its
Subsidiaries with the Company's officers, and (with the consent of the
Company, which consent will not be unreasonably withheld) to visit the
other offices and properties of the Company and each Restricted
Subsidiary, all at such reasonable times during normal business hours
and as often as may be reasonably requested in writing; and
(b) Default -- if a Default or Event of Default then exists,
at the expense of the Company, to visit and inspect any of the offices
or properties of the Company or any Subsidiary, to examine all their
respective books of account, records, reports and other papers, to make
copies and extracts therefrom, and to discuss their respective affairs,
finances and accounts with their respective officers and independent
public accountants (and by this provision the Company authorizes said
accountants to discuss the affairs, finances and accounts of the
Company and its Subsidiaries), all at such times and as often as may be
requested.
SECTION 8. PAYMENT OF THE NOTES.
Section 8.1. Required Prepayments. (a) The Company will prepay the
principal of the Notes at par and without payment of the Make-Whole Amount or
any premium on the dates and in the amounts hereinafter set forth:
PRINCIPAL AMOUNT
PAYMENT DATE TO BE PREPAID
July 31, 2010 $27,000,000
July 31, 2013 $21,600,000
July 31, 2014 $27,000,000
July 31, 2016 $10,800,000
July 31, 2017 $10,800,000
July 31, 2018 $10,800,000
July 31, 2020 $16,200,000
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The entire unpaid principal amount of the Notes shall become due and payable on
July 31, 2023.
(b) Upon any partial prepayment of the Notes pursuant to Section 8.2 or
purchase of the Notes pursuant to Section 8.5 or Section 8.7, the principal
amount of each required prepayment of the Notes, becoming due under this Section
8.1 on and after the date of such prepayment or purchase shall be reduced in the
same proportion as the aggregate unpaid principal amount of the Notes, is
reduced as a result of such prepayment or purchase.
Section 8.2. Optional Prepayments with Make-Whole Amount. The Company
may, at its option, upon notice as provided below, prepay at any time all, or
from time to time any part of, the Notes, in an amount not less than 10% of the
aggregate principal amount of the Notes then outstanding in the case of a
partial prepayment, at 100% of the principal amount so prepaid, together with
interest accrued thereon to the date of such prepayment, plus the Make-Whole
Amount determined for the prepayment date with respect to such principal amount.
The Company will give each holder of Notes written notice of each optional
prepayment under this Section 8.2 not less than 30 days and not more than 60
days prior to the date fixed for such prepayment. Each such notice shall specify
such date, the aggregate principal amount of the Notes to be prepaid on such
date, the principal amount of each Note held by such holder to be prepaid
(determined in accordance with Section 8.3), and the interest to be paid on the
prepayment date with respect to such principal amount being prepaid, and shall
be accompanied by a certificate of a Senior Financial Officer as to the
estimated Make-Whole Amount due in connection with such prepayment (calculated
as if the date of such notice were the date of the prepayment), setting forth
the details of such computation. Two Business Days prior to such prepayment, the
Company shall deliver to each holder of Notes a certificate of a Senior
Financial Officer specifying the calculation of such Make-Whole Amount as of the
specified prepayment date.
Section 8.3. Allocation of Partial Prepayments. In the case of each
partial prepayment of the Notes, the principal amount of the Notes to be prepaid
shall be allocated among all of the Notes at the time outstanding in proportion,
as nearly as practicable, to the respective unpaid principal amounts thereof not
theretofore called for prepayment.
Section 8.4. Maturity; Surrender, Etc. In the case of each prepayment
of Notes pursuant to this Section 8, the principal amount of each Note to be
prepaid shall mature and become due and payable on the date fixed for such
prepayment, together with interest on such principal amount accrued to such date
and the applicable Make-Whole Amount, if any. From and after such date, unless
the Company shall fail to pay such principal amount when so due and payable,
together with the interest and Make-Whole Amount, if any, as aforesaid, interest
on such principal amount shall cease to accrue. Any Note paid or prepaid in full
shall be surrendered to the Company and cancelled and shall not be reissued, and
no Note shall be issued in lieu of any prepaid principal amount of any Note.
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Section 8.5. Purchase of Notes. The Company will not and will not
permit any Affiliate to purchase, redeem, prepay or otherwise acquire, directly
or indirectly, any of the outstanding Notes except (a) upon the payment or
prepayment of the Notes in accordance with the terms of this Agreement and the
Notes or (b) pursuant to an offer to purchase made by the Company or an
Affiliate pro rata to the holders of all Notes at the time outstanding upon the
same terms and conditions. Any such offer shall provide each holder with
sufficient information to enable it to make an informed decision with respect to
such offer, and shall remain open for at least 15 Business Days. If the holders
of more than 10% of the principal amount of the Notes then outstanding accept
such offer, the Company shall promptly notify the remaining holders of such fact
and the expiration date for the acceptance by holders of Notes of such offer
shall be extended by the number of days necessary to give each such remaining
holder at least 10 Business Days from its receipt of such notice to accept such
offer. The Company will promptly cancel all Notes acquired by it or any
Affiliate pursuant to any payment, prepayment or purchase of Notes pursuant to
any provision of this Agreement and no Notes may be issued in substitution or
exchange for any such Notes.
Section 8.6. Make-Whole Amounts. The term "Make-Whole Amount" means
with respect to a Note an amount equal to the excess, if any, of the Discounted
Value of the Remaining Scheduled Payments with respect to the Called Principal
of such Note over the amount of such Called Principal, provided that the
Make-Whole Amount may in no event be less than zero. For the purposes of
determining the Make-Whole Amount, the following terms have the following
meanings:
"Called Principal" means, with respect to a Note, the
principal of such Note that is to be prepaid pursuant to Section 8.2 or
has become or is declared to be immediately due and payable pursuant to
Section 12.1, as the context requires.
"Discounted Value" means, with respect to the Called Principal
of any Note, the amount obtained by discounting all Remaining Scheduled
Payments with respect to such Called Principal from their respective
scheduled due dates to the Settlement Date with respect to such Called
Principal, in accordance with accepted financial practice and at a
discount factor (applied on the same periodic basis as that on which
interest on the Notes is payable) equal to the Reinvestment Yield with
respect to such Called Principal.
"Reinvestment Yield" means, with respect to the Called
Principal of any Note, 0.50% plus the yield to maturity implied by (i)
the yields reported, as of 10:00 A.M. (New York City time) on the
second Business Day preceding the Settlement Date with respect to such
Called Principal, on the display designated as "PX-1" on the Bloomberg
Financial Market Screen (or such other display as may replace "PX-1" on
the Bloomberg Financial Market Screen) for actively traded U.S.
Treasury securities having a maturity equal to the Remaining Average
Life of such Called Principal as of such Settlement Date, or (ii) if
such yields are not reported as of such time or the yields reported as
of such time are not ascertainable, the Treasury Constant Maturity
Series Yields reported, for the latest day for which such yields have
been so reported as of the second Business Day preceding the Settlement
Date with respect to such Called Principal, in Federal Reserve
Statistical Release H.15 (519) (or any comparable successor
publication) for actively traded U.S. Treasury securities having a
constant maturity equal to the Remaining Average Life of such Called
Principal as of such Settlement Date. Such implied yield will be
determined, if necessary, by (a) converting U.S. Treasury xxxx
quotations to bond-equivalent yields in accordance with accepted
financial practice and (b) interpolating linearly on a straight line
basis between (1) the actively traded U.S. Treasury security with the
maturity closest to and greater than the Remaining Average Life and (2)
the actively traded U.S. Treasury security with the maturity closest to
and less than the Remaining Average Life.
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"Remaining Average Life" means, with respect to any Called
Principal, the number of years (calculated to the nearest one-twelfth
year) obtained by dividing (i) such Called Principal into (ii) the sum
of the products obtained by multiplying (a) the principal component of
each Remaining Scheduled Payment with respect to such Called Principal
by (b) the number of years (calculated to the nearest one-twelfth year)
that will elapse between the Settlement Date with respect to such
Called Principal and the scheduled due date of such Remaining Scheduled
Payment.
"Remaining Scheduled Payments" means, with respect to the
Called Principal of any Note, all payments of such Called Principal and
interest thereon that would be due after the Settlement Date with
respect to such Called Principal if no payment of such Called Principal
were made prior to its scheduled due date, provided that if such
Settlement Date is not a date on which interest payments are due to be
made under the terms of the Notes, then the amount of the next
succeeding scheduled interest payment will be reduced by the amount of
interest accrued to such Settlement Date and required to be paid on
such Settlement Date pursuant to Section 8.2 or 12.1.
"Settlement Date" means, with respect to the Called Principal
of any Note, the date on which such Called Principal is to be prepaid
pursuant to Section 8.2 or has become or is declared to be immediately
due and payable pursuant to Section 12.1, as the context requires.
Section 8.7. Change in Control.
(a) Notice of Change in Control or Control Event. The Company will,
within five Business Days after any Responsible Officer has knowledge of the
occurrence of any Change in Control or Control Event, give written notice of
such Change in Control or Control Event to each holder of Notes unless notice in
respect of such Change in Control (or the Change in Control contemplated by such
Control Event) shall have been given pursuant to subparagraph (b) of this
Section 8.7. If a Change in Control has occurred, such notice shall contain and
constitute an offer to prepay Notes as described in subparagraph (c) of this
Section 8.7 and shall be accompanied by the certificate described in
subparagraph (g) of this Section 8.7.
(b) Condition to Company Action. The Company will not take any action
that consummates or finalizes a Change in Control unless (i) at least 20 days
prior to such action it shall have given to each holder of Notes written notice
containing and constituting an offer to prepay Notes as described in
subparagraph (c) of this Section 8.7, accompanied by the certificate described
in subparagraph (g) of this Section 8.7, and (ii) contemporaneously with such
action, it prepays all Notes required to be prepaid in accordance with this
Section 8.7.
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(c) Offer to Prepay Notes. The offer to prepay Notes contemplated by
subparagraphs (a) and (b) of this Section 8.7 shall be an offer to prepay, in
accordance with and subject to this Section 8.7, all, but not less than all, the
Notes held by each holder (in this case only, "holder" in respect of any Note
registered in the name of a nominee for a disclosed beneficial owner shall mean
such beneficial owner) on a date specified in such offer (the "Proposed
Prepayment Date"). If such Proposed Prepayment Date is in connection with an
offer contemplated by subparagraph (a) of this Section 8.7, such date shall be
not less than 20 days and not more than 60 days after the date of such offer (if
the Proposed Prepayment Date shall not be specified in such offer, the Proposed
Prepayment Date shall be the 30th day after the date of such offer).
(d) Acceptance/Rejection. A holder of Notes may accept the offer to
prepay made pursuant to this Section 8.7 by causing a notice of such acceptance
to be delivered to the Company at least 5 days prior to the Proposed Prepayment
Date. A failure by a holder of Notes to respond to an offer to prepay made
pursuant to this Section 8.7 shall be deemed to constitute acceptance of such
offer by such holder.
(e) Prepayment. Prepayment of the Notes to be prepaid pursuant to this
Section 8.7 shall be at 100% of the principal amount of such Notes together with
interest on such Notes accrued to the date of prepayment. On the Business Day
preceding the date of prepayment, the Company shall deliver to each holder of
Notes being prepaid a statement showing the amount due in connection with such
prepayment and setting forth the details of the computation of such amount. The
prepayment shall be made on the Proposed Prepayment Date except as provided in
subparagraph (f) of this Section 8.7.
(f) Deferral Pending Change in Control. The obligation of the Company
to prepay Notes pursuant to the offers required by subparagraph (c) and accepted
in accordance with subparagraph (d) of this Section 8.7 is subject to the
occurrence of the Change in Control in respect of which such offers and
acceptances shall have been made. In the event that such Change in Control does
not occur on the Proposed Prepayment Date in respect thereof, the prepayment
shall be deferred until and shall be made on the date on which such Change in
Control occurs. The Company shall keep each holder of Notes reasonably and
timely informed of (i) any such deferral of the date of prepayment, (ii) the
date on which such Change in Control and the prepayment are expected to occur,
and (iii) any determination by the Company that efforts to effect such Change in
Control have ceased or been abandoned (in which case the offers and acceptances
made pursuant to this Section 8.7 in respect of such Change in Control shall be
deemed rescinded).
(g) Officer's Certificate. Each offer to prepay the Notes pursuant to
this Section 8.7 shall be accompanied by a certificate, executed by a Senior
Financial Officer of the Company and dated the date of such offer, specifying:
(i) the Proposed Prepayment Date; (ii) that such offer is made pursuant to this
Section 8.7; (iii) the principal amount of each Note offered to be prepaid; (iv)
the interest that would be due on each Note offered to be prepaid, accrued to
the Proposed Prepayment Date; (v) that the conditions of this Section 8.7 have
been fulfilled; (vi) in reasonable detail, the nature and date of the Change in
Control; and (vii) that the failure to respond to such offer of prepayment shall
constitute acceptance of such offer.
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(h) "Change in Control" Defined. "Change in Control" means each and
every issue, sale or other disposition of shares of stock of the Company which
results in any person (as such term is used in section 13(d) and section
14(d)(2) of the Exchange Act) or related persons constituting a group (as such
term is used in Rule 13d-5 under the Exchange Act), becoming the "beneficial
owners" (as such term is used in Rule 13d-3 under the Exchange Act as in effect
on the date of the Closing), directly or indirectly, of more than 50% of the
total voting power of all classes then outstanding of the Company's voting
stock.
(i) "Control Event" Defined. "Control Event" means:
(a) the execution by the Company or any of its Subsidiaries
or Affiliates of any agreement or binding letter of intent with respect
to any proposed transaction or event or series of transactions or
events which, individually or in the aggregate, could reasonably be
expected to result in a Change in Control;
(b) the execution of any written agreement which, when fully
performed by the parties thereto, would result in a Change in Control;
or
(c) the making of any written offer by any person (as such
term is used in section 13(d) and section 14(d)(2) of the Exchange Act
as in effect on the date of the Closing) or related persons
constituting a group (as such term is used in Rule 13d-5 under the
Exchange Act as in effect on the date of the Closing) to the holders of
the common stock of the Company, which offer, if accepted by the
requisite number of holders, would result in a Change in Control unless
such offer is rejected or expires pursuant to its terms prior to the
date on which notice of such Change in Control is required to be
delivered pursuant to Section 8.7(a).
SECTION 9. AFFIRMATIVE COVENANTS.
The Company covenants that so long as any of the Notes are outstanding:
Section 9.1. Compliance with Law. The Company will, and will cause each
of its Subsidiaries to, comply with all laws, ordinances or governmental rules
or regulations to which each of them is subject, including, without limitation,
Environmental Laws, and will obtain and maintain in effect all licenses,
certificates, permits, certificates of convenience and necessity, franchises and
other governmental authorizations necessary to the ownership of their respective
properties or to the conduct of their respective businesses, in each case to the
extent necessary to ensure that non-compliance with such laws, ordinances or
governmental rules or regulations or failures to obtain or maintain in effect
such licenses, certificates, permits, certificates of convenience and necessity,
franchises and other governmental authorizations would not reasonably be
expected, individually or in the aggregate, to have a materially adverse effect
on the business, operations, affairs, financial condition, properties or assets
of the Company and its Subsidiaries taken as a whole.
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Section 9.2. Insurance. The Company will, and will cause each of its
Subsidiaries to, maintain, with financially sound and reputable insurers,
insurance with respect to their respective properties and businesses against
such casualties and contingencies, of such types, on such terms and in such
amounts (including deductibles, co-insurance and self-insurance, if adequate
reserves are maintained with respect thereto) as is customary in the case of
entities of established reputations engaged in the same or a similar business
and similarly situated.
Section 9.3. Maintenance of Properties. The Company will, and will
cause each of its Subsidiaries to, maintain and keep, or cause to be maintained
and kept, their respective properties in good repair, working order and
condition (other than ordinary wear and tear), so that the business carried on
in connection therewith may be properly conducted at all times, provided that
this Section shall not prevent the Company or any Subsidiary from discontinuing
the operation and the maintenance of any of its properties if such
discontinuance is desirable in the conduct of its business and the Company has
concluded that such discontinuance would not, individually or in the aggregate,
have a materially adverse effect on the business, operations, affairs, financial
condition, properties or assets of the Company and its Subsidiaries taken as a
whole.
Section 9.4. Payment of Taxes. The Company will, and will cause each of
its Subsidiaries to, file all income tax or similar tax returns required to be
filed in any jurisdiction and to pay and discharge all taxes shown to be due and
payable on such returns and all other taxes, assessments, governmental charges,
or levies payable by any of them, to the extent such taxes and assessments have
become due and payable and before they have become delinquent; provided that
neither the Company nor any Subsidiary need pay any such tax or assessment if
(i) the amount, applicability or validity thereof is contested by the Company or
such Subsidiary on a timely basis in good faith and in appropriate proceedings,
and the Company or a Subsidiary has established adequate reserves therefor in
accordance with GAAP on the books of the Company or such Subsidiary or (ii) the
nonpayment of all such taxes and assessments in the aggregate would not
reasonably be expected to have a materially adverse effect on the business,
operations, affairs, financial condition, properties or assets of the Company
and its Subsidiaries taken as a whole.
Section 9.5. Corporate Existence, Etc. Subject to Sections 10.3 and
10.4, the Company will at all times preserve and keep in full force and effect
its corporate existence, and will at all times preserve and keep in full force
and effect the corporate existence of each of its Restricted Subsidiaries
(unless merged into the Company or a Wholly-Owned Subsidiary) and all rights and
franchises of the Company and its Restricted Subsidiaries unless, in the good
faith judgment of the Company, the termination of or failure to preserve and
keep in full force and effect such corporate existence, right or franchise would
not, individually or in the aggregate, have a materially adverse effect on the
business, operations, affairs, financial condition, properties or assets of the
Company and its Restricted Subsidiaries taken as a whole.
Section 9.6. Designation of Subsidiaries. The Company may from time to
time cause any Subsidiary acquired after the date of this Agreement to be
designated as an Unrestricted Subsidiary or any Unrestricted Subsidiary to be
designated as a Subsidiary, provided, however, that at the time of such
designation and immediately after giving effect thereto, no Default or Event of
Default would exist under the terms of this Agreement, and provided, further,
that once a Restricted Subsidiary has been designated an Unrestricted
Subsidiary, it shall not thereafter be redesignated as a Restricted Subsidiary
on more than one occasion. Within ten (10) days following any designation
described above, the Company will deliver to you a notice of such designation
accompanied by a certificate signed by a Senior Financial Officer of the Company
certifying compliance with all requirements of this Section 9.6 and setting
forth all information required in order to establish such compliance.
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SECTION 10. NEGATIVE COVENANTS.
The Company covenants that so long as any of the Notes are outstanding:
Section 10.1. Limitation on Debt. The Company will not permit
Consolidated Debt (determined as of the last day of each fiscal quarter) to
exceed 65% of Consolidated Total Capitalization as of such date.
Section 10.2. Limitation on Liens. The Company will not, and will not
permit any of its Restricted Subsidiaries to, directly or indirectly create,
incur, assume or permit to exist (upon the happening of a contingency or
otherwise) any Lien on or with respect to any property or asset (including,
without limitation, any document or instrument in respect of goods or accounts
receivable) of the Company or any such Restricted Subsidiary, whether now owned
or held or hereafter acquired, or any income or profits therefrom, or assign or
otherwise convey any right to receive income or profits, except:
(a) Liens for taxes, assessments or other governmental
charges that are not yet due and payable or the payment of which is not
at the time required by Section 9.4; provided, any such tax, assessment
or other governmental charge shall be paid prior to the commencement of
any proceedings to foreclose any Lien related thereto;
(b) any attachment or judgment Lien, unless the judgment it
secures shall not, within 60 days after the entry thereof, have been
discharged or execution thereof stayed pending appeal, or shall not
have been discharged within 60 days after the expiration of any such
stay;
(c) Liens incidental to the conduct of business or the
ownership of properties and assets (including landlords', carriers',
warehousemen's, mechanics', materialmen's and other similar Liens for
sums not yet due and payable or which are being contested in good faith
by appropriate proceedings diligently conducted) and Liens to secure
the performance of bids, tenders, leases, or trade contracts, or to
secure statutory obligations (including obligations under workers
compensation, unemployment insurance and other social security
legislation), surety or appeal bonds or other Liens incurred in the
ordinary course of business and not in connection with the borrowing of
money;
(d) leases or subleases granted to others, zoning
restrictions, easements, rights-of-way, restrictions and other similar
charges or encumbrances, in each case incidental to the ownership of
property or assets or the ordinary conduct of the business of the
Company or any of its Restricted Subsidiaries, provided that such Liens
do not, materially impair the use of such property or materially
detract from the value of such property and which are not violated in
any material respect by the existing or proposed use by the Company and
its Subsidiaries of the properties subject to such Liens;
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(e) Liens securing Debt of a Restricted Subsidiary to the
Company or to a Wholly-Owned Restricted Subsidiary;
(f) Liens created under indentures, mortgages and deeds of
trust securing Debt of Restricted Subsidiaries;
(g) Liens incurred after the date of Closing (including Liens
of Capital Lease Obligations) given to secure the payment of all or any
portion of the purchase price incurred in connection with the
acquisition, construction or improvement of property (other than
accounts receivable) useful and intended to be used in carrying on the
business of the Company or a Restricted Subsidiary, including Liens
existing on such property at the time of acquisition or construction
thereof, or Liens incurred within 180 days of such acquisition or the
completion of such construction or improvement, provided that (i) the
Lien shall attach solely to the property acquired, purchased,
constructed or improved and, if required by the terms of the instrument
originally creating such Lien, other property which is an improvement
to or is acquired for specific use in connection with such acquired
property; (ii) at the time of acquisition, construction or improvement
of such property, the aggregate amount remaining unpaid on all Debt
secured by Liens on such property, whether or not assumed by the
Company or a Restricted Subsidiary, shall not exceed the lesser of (y)
the cost of such acquisition, construction or improvement or (z) the
Fair Market Value of such property; and (iii) at the time of such
incurrence and after giving effect thereto, no Default or Event of
Default would exist;
(h) any Lien existing on property of a Person immediately
prior to its being consolidated with or merged into the Company or a
Restricted Subsidiary or its becoming a Restricted Subsidiary, or any
Lien existing on any property acquired by the Company or any Restricted
Subsidiary at the time such property is so acquired (whether or not the
Debt secured thereby shall have been assumed), provided that (i) no
such Lien shall have been created or assumed in contemplation of such
consolidation or merger or such Person's becoming a Restricted
Subsidiary or such acquisition of property, (ii) each such Lien shall
extend solely to the item or items of property so acquired and, if
required by the terms of the instrument originally creating such Lien,
other property which is an improvement to or is acquired for specific
use in connection with such acquired property, and (iii) at the time of
such incurrence and after giving effect thereto, no Default or Event of
Default would exist;
(i) Liens granted by the Company or its Restricted
Subsidiaries to secure obligations of the Company or its Restricted
Subsidiaries incurred in connection with loans or advances made to the
Company or its Restricted Subsidiaries by Governmental Authorities;
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(j) any extensions, renewals or replacements of any Lien
permitted by the preceding subparagraphs (g) and (i) of this Section
10.2, provided that (i) no additional property shall be encumbered by
such Liens, (ii) the unpaid principal amount of the Debt or other
obligations secured thereby shall not be increased on or after the date
of any extension, renewal or replacement, and (iii) at such time and
immediately after giving effect thereto, no Default or Event of Default
shall have occurred and be continuing; and
(k) in addition to the Liens permitted by the preceding
subparagraphs (a) through (j), inclusive, of this Section 10.2, Liens
securing Debt of the Company or any Restricted Subsidiary, provided
that the sum of (i) unsecured Debt of Restricted Subsidiaries (other
than Debt owing to the Company or a Wholly-Owned Restricted
Subsidiary), (ii) Debt of Unrestricted Subsidiaries (other than Debt
owing to the Company or a Wholly-Owned Subsidiary) and (iii) the
aggregate principal amount of Debt secured by Liens pursuant to this
Section 10.2(k) shall not exceed 15% of Consolidated Net Worth.
Section 10.3. Sales of Assets. The Company will not, and will not permit
any Restricted Subsidiary to, sell, lease or otherwise dispose of any
substantial part (as defined below) of the assets of the Company and its
Restricted Subsidiaries (including, without limitation, accounts receivable,
leasehold interests and the capital stock or other equity interests in any
Restricted Subsidiary); provided, however, that the Company or any Restricted
Subsidiary may sell, lease or otherwise dispose of assets constituting a
substantial part of the assets of the Company and its Restricted Subsidiaries if
such assets are sold for cash in an arms length transaction for Fair Market
Value and, at such time and after giving effect thereto, no Default or Event of
Default shall have occurred and be continuing and an amount equal to the Net
Proceeds received from such sale, lease or other disposition (but excluding any
portion of the Net Proceeds which are attributable to assets which constitute
less than a substantial part of the assets of the Company and its Restricted
Subsidiaries) shall be used, in any combination:
(1) within three years of such sale, lease or disposition to
acquire productive assets used or useful in carrying on the business of
the Company and its Restricted Subsidiaries and having (i) a value at
least equal to the value of such assets sold, leased or otherwise
disposed of, and (ii) the ability to generate operating income at least
equal to the operating income of such assets sold, leased or otherwise
disposed of; or
(2) to prepay or retire first, Senior Debt secured by a Lien
on property of the Company and/or its Restricted Subsidiaries and
second, unsecured Senior Debt of the Company and/or its Restricted
Subsidiaries; provided that in the case of any such prepayment of
unsecured Senior Debt, the Notes shall be prepaid pro rata in
accordance with Section 8.2 of this Agreement.
As used in this Section 10.3, a sale, lease or other disposition of
assets shall be deemed to be a "substantial part" of the assets of the Company
and its Restricted Subsidiaries if the book value of such assets, when added to
the book value of all other assets sold, leased or otherwise disposed of by the
Company and its Restricted Subsidiaries during such fiscal year, exceeds 15% of
the book value of Consolidated Total Assets, determined as of the end of the
fiscal year immediately preceding such sale, lease or other disposition;
provided that there shall be excluded from any determination of a "substantial
part" any (i) sale or disposition of assets in the ordinary course of business
of the Company and its Restricted Subsidiaries, and (ii) any transfer of assets
from the Company to any Wholly-Owned Restricted Subsidiary or from any
Restricted Subsidiary to the Company or a Wholly-Owned Restricted Subsidiary.
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Section 10.4. Merger, Consolidation and Sale of Stock. (a) The Company
will not, and will not permit any of its Restricted Subsidiaries to, consolidate
with or merge with any other corporation or convey, transfer or lease
substantially all of its assets in a single transaction or series of
transactions to any Person; provided that:
(1) a Restricted Subsidiary of the Company may (x)
consolidate with or merge with, or convey, transfer or lease
substantially all of its assets in a single transaction or series of
transactions to, the Company or a Wholly-Owned Restricted Subsidiary so
long as in any merger or consolidation involving the Company, the
Company shall be the surviving or continuing corporation, or (y)
convey, transfer or lease all of its assets in compliance with the
provisions of Section 10.3; and
(2) the foregoing restriction does not apply to the
consolidation or merger of the Company with, or the conveyance,
transfer or lease of substantially all of the assets of the Company in
a single transaction or series of transactions to, any Person so long
as:
(a) the successor formed by such consolidation or
the survivor of such merger or the Person that acquires by
conveyance, transfer or lease substantially all of the assets
of the Company as an entirety, as the case may be (the
"Successor Corporation"), shall be a solvent corporation
organized and existing under the laws of the United States of
America, any State thereof or the District of Columbia;
(b) if the Company is not the Successor Corporation,
such Successor Corporation shall have executed and delivered
to each holder of Notes its assumption of the due and punctual
performance and observance of each covenant and condition of
this Agreement and the Notes (pursuant to such agreements and
instruments as shall be reasonably satisfactory to the
Required Holders), and the Company shall have caused to be
delivered to each holder of Notes an opinion of nationally
recognized independent counsel, to the effect that all
agreements or instruments effecting such assumption are
enforceable in accordance with their terms and comply with the
terms hereof; and
(c) immediately after giving effect to such
transaction no Default or Event of Default would exist.
No such conveyance, transfer or lease of substantially all of the
assets of the Company shall have the effect of releasing the Company or any
successor corporation that shall theretofore have become such in the manner
prescribed in this Section 10.4 from its liability under this Agreement or the
Notes.
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(b) The Company will not permit any Restricted Subsidiary to issue or
sell any shares of stock or other equity interests of any class (including as
"stock" for the purposes of this Section 10.4(b), any warrants, rights or
options to purchase or otherwise acquire stock or other equity interests or
other securities exchangeable for or convertible into stock or other equity
interests) of such Restricted Subsidiary to any Person other than the Company or
a Wholly-Owned Restricted Subsidiary, except for the purpose of qualifying
directors, or except in satisfaction of the validly pre-existing preemptive or
contractual rights of minority shareholders in connection with the simultaneous
issuance of stock or other equity interests to the Company and/or a Restricted
Subsidiary whereby the Company and/or such Restricted Subsidiary maintain their
same proportionate interest in such Subsidiary.
(c) The Company will not sell, transfer or otherwise dispose of any
shares of stock or other equity interests of any Restricted Subsidiary (except
to qualify directors), and will not permit any Restricted Subsidiary to sell,
transfer or otherwise dispose of (except to the Company or a Wholly-Owned
Restricted Subsidiary) any shares of stock or other equity interests of any
other Restricted Subsidiary, unless (i) the consideration for such sale,
transfer or other disposition is either cash or shares of stock, (ii) such sale,
transfer or other disposition is made to a Person (other than an Affiliate), of
the Company's entire Investment in such Restricted Subsidiary and (iii) such
sale, transfer or other disposition can be made within the limitations of
Section 10.3.
Section 10.5. Limitation on Sale and Leasebacks. The Company will not,
and will not permit any Restricted Subsidiary to, enter into any Sale and
Leaseback Transaction; provided that the foregoing restriction shall not apply
to any Sale and Leaseback Transaction if immediately after the consummation of
such Sale and Leaseback Transaction and after giving effect thereto,
Attributable Debt will not exceed 25% of Consolidated Net Worth.
Section 10.6. Restricted Investments. The Company will not, and will not
permit any Restricted Subsidiary to, make or permit to be outstanding any
Investment except:
(a) Investments in one or more Restricted Subsidiaries or any
Person that becomes a Restricted Subsidiary;
(b) current assets arising from the sale of goods and
services in the ordinary course of business of the Company and its
Restricted Subsidiaries;
(c) property to be used in the ordinary course of business of
the Company and its Restricted Subsidiaries;
(d) Investments in obligations issued by or guaranteed by the
United States of America or an agency thereof, provided that such
obligations mature within 365 days from the date of acquisition
thereof;
(e) Investments in certificates of deposit, time deposits or
banker's acceptances issued by (or accepted by) an Acceptable Bank,
provided that such obligations mature within 365 days from the date of
acquisition thereof;
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(f) Investments in commercial paper rated in the highest
ratings classifications by Xxxxx'x or S&P and maturing not more than
270 days from the date of creation thereof;
(g) Investments in Repurchase Agreements;
(h) Investments in tax-exempt obligations of any state of the
United States of America, or any municipality of any such state, in
each case rated "AA" or higher by Xxxxx'x or "Aa2" or higher by S&P or
an equivalent credit rating by another credit rating agency of
recognized national standing, provided that such obligations mature
within 365 days from the date of acquisition thereof;
(i) Investments in money market instrument programs which are
classified as current assets in accordance with GAAP, which money
market instrument programs are administered by an "investment company"
regulated under the Investment Company Act of 1940 and which money
market instrument programs hold only Investments satisfying the
criteria set forth in clauses (d), (e), (f), (g) and (h) above;
(j) Investments in businesses (including Unrestricted
Subsidiaries) which are in industries which are fundamentally related
to the businesses engaged in by the Company and its Subsidiaries on the
date of this Agreement; and
(k) Investments in addition to the Investments permitted by
the preceding clauses (a) through (j); provided that the aggregate
principal amount of Investments outstanding pursuant to this clause (k)
shall not at any time exceed 25% of Consolidated Net Worth.
In valuing Investments for purposes of applying the limitations set forth in
clause (k) of this Section 10.6, such Investments shall be taken at the original
cost thereof, without allowance for any subsequent write-offs or appreciation or
depreciation therein, but less any amount repaid or recovered on account of
capital or principal.
Section 10.7. Nature of Business. Neither the Company nor any Restricted
Subsidiary will engage in any business, if, as a result, when taken as a whole,
the general nature of the business of the Company and its Restricted
Subsidiaries would be substantially changed from the general nature of the
business of the Company and its Restricted Subsidiaries on the date of this
Agreement.
Section 10.8. Transactions with Affiliates. The Company will not and
will not permit any Restricted Subsidiary to enter into directly or indirectly
any Material transaction or group of related transactions (including without
limitation the purchase, lease, sale or exchange of properties of any kind or
the rendering of any service) with any Affiliate (other than the Company or
another Restricted Subsidiary), except upon fair and reasonable terms no less
favorable to the Company or such Restricted Subsidiary than would be obtainable
in a comparable arm's-length transaction with a Person not an Affiliate. In
addition, the Company will not, and will not permit any Restricted Subsidiary
to, make any loan or advance to the Company or any Restricted Subsidiary except
in the ordinary course of business and in accordance with the reasonable
requirements of the business of the Company or any such Restricted Subsidiary.
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Section 10.9. Acquisitions. The Company will not, and will not permit
any Restricted Subsidiary to, make any acquisition of all or substantially all
of the assets or capital stock of any business entity if at the time of such
acquisition and after giving effect thereto, a Default or Event of Default shall
exist.
Section 10.10. Unrestricted Subsidiaries. The Company will not at any
time permit Unrestricted Subsidiaries to (i) own more than 40% of the
consolidated total assets of the Company and its Subsidiaries, or (ii) account
for more than 40% of the consolidated gross revenues of the Company and its
Subsidiaries, determined in each case in accordance with GAAP.
SECTION 11. EVENTS OF DEFAULT.
An "Event of Default" shall exist if any of the following conditions or
events shall occur and be continuing:
(a) the Company defaults in the payment of any principal or
Make-Whole Amount, if any, on any Note when the same becomes due and
payable, whether at maturity or at a date fixed for prepayment or by
declaration or otherwise; or
(b) the Company defaults in the payment of any interest on
any Note for more than five Business Days after the same becomes due
and payable; or
(c) the Company defaults in the performance of or compliance
with any term contained in Section 8.5, 10.1, 10.2, 10.3, 10.4 or 10.5;
or
(d) the Company defaults in the performance of or compliance
with any term contained herein (other than those referred to in
paragraphs (a), (b) and (c) of this Section 11) and such default is not
remedied within 30 days after the earlier of (i) a Responsible Officer
obtaining actual knowledge of such default and (ii) the Company
receiving written notice of such default from any holder of a Note (any
such written notice to be identified as a "notice of default" and to
refer specifically to this paragraph (d) of Section 11); or
(e) any representation or warranty made in writing by or on
behalf of the Company or by any officer of the Company in this
Agreement or in any writing furnished in connection with the
transactions contemplated hereby or thereby proves to have been false
or incorrect in any material respect on the date as of which made; or
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(f) (i) the Company, any Restricted Subsidiary or any
Significant Subsidiary is in default (as principal or as guarantor or
other surety) in the payment of any principal of or premium or
make-whole amount or interest on any Debt (other than the Notes) or
other security that is outstanding in an aggregate principal amount (or
which has a par or stated value) in excess of $10,000,000 beyond any
period of grace provided with respect thereto, or (ii) the Company, any
Restricted Subsidiary or any Significant Subsidiary is in default in
the performance of or compliance with any term of any instrument,
mortgage, indenture or other agreement relating to any Debt (other than
the Notes) or other security in an aggregate principal amount (or which
has a par or stated value) in excess of $10,000,000 or any other
condition exists, and as a consequence of such default or condition
such Debt or security has become, or has been declared, due and payable
before its stated maturity or before its regularly scheduled dates of
payment, or (iii) as a consequence of the occurrence or continuation of
any event or condition (other than the passage of time or the right of
the holder of Debt or other security to convert such Debt or other
security into equity interests), the Company, any Restricted Subsidiary
or any Significant Subsidiary has become obligated to purchase or repay
Debt (other than the Notes) or such other security before its regular
maturity or before its regularly scheduled dates of payment in an
aggregate outstanding principal amount (or which has a par or stated
value) in excess of $10,000,000; or
(g) the Company, any Restricted Subsidiary or any Significant
Subsidiary (i) is generally not paying, or admits in writing its
inability to pay, its debts as they become due, (ii) files, or consents
by answer or otherwise to the filing against it of, a petition for
relief or reorganization or arrangement or any other petition in
bankruptcy, for liquidation or to take advantage of any bankruptcy,
insolvency, reorganization, moratorium or other similar law of any
jurisdiction, (iii) makes an assignment for the benefit of its
creditors, (iv) consents to the appointment of a custodian, receiver,
trustee or other officer with similar powers with respect to it or with
respect to any substantial part of its property, (v) is adjudicated as
insolvent or to be liquidated, or (vi) takes corporate action for the
purpose of any of the foregoing; or
(h) a court or governmental authority of competent
jurisdiction enters any order appointing, without consent by the
Company, any Restricted Subsidiary or any Significant Subsidiary, a
custodian, receiver, trustee or other officer with similar powers with
respect to it or with respect to any substantial part of its property,
or constituting an order for relief or approving a petition for relief
or reorganization or any other petition in bankruptcy or for
liquidation or to take advantage of any bankruptcy or insolvency law of
any jurisdiction, or ordering the dissolution, winding-up or
liquidation of the Company, any Restricted Subsidiary or any
Significant Subsidiary, or any such petition shall be filed against the
Company, any Restricted Subsidiary or any Significant Subsidiary and
such petition shall not be dismissed within 60 days; or
(i) a final judgment or judgments for the payment of money
aggregating in excess of $10,000,000 are rendered against one or more
of the Company, its Restricted Subsidiaries and its Significant
Subsidiaries and which judgments are not, within 90 days after entry
thereof, bonded, discharged or stayed pending appeal, or are not
discharged within 90 days after the expiration of such stay; or
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(j) if (i) any Plan shall fail to satisfy the minimum funding
standards of ERISA or the Code for any plan year or part thereof or a
waiver of such standards or extension of any amortization period is
sought or granted under Section 412 of the Code, (ii) a notice of
intent to terminate any Plan shall have been or is reasonably expected
to be filed with the PBGC or the PBGC shall have instituted proceedings
under Section 4042 of ERISA to terminate or appoint a trustee to
administer any Plan or the PBGC shall have notified the Company or any
ERISA Affiliate that a Plan may become a subject of any such
proceedings, (iii) the unfunded present value of accumulated plan
benefits under all Plans, determined in accordance with Title IV of
ERISA, shall exceed $10,000,000, (iv) the Company or any ERISA
Affiliate shall have incurred or is reasonably expected to incur any
liability pursuant to Title I or IV of ERISA or the penalty or excise
tax provisions of the Code relating to employee benefit plans, (v) the
Company or any ERISA Affiliate withdraws from any Multiemployer Plan,
or (vi) the Company or any Subsidiary establishes or amends any
employee welfare benefit plan that provides post-employment welfare
benefits in a manner that would increase the liability of the Company
or any Subsidiary thereunder; and any such event or events described in
clauses (i) through (vi) above, either individually or together with
any other such event or events, would reasonably be expected to have a
Material Adverse Effect.
As used in Section 11(j), the terms "employee benefit plan" and "employee
welfare benefit plan" shall have the respective meanings assigned to such terms
in Section 3 of ERISA.
SECTION 12. REMEDIES ON DEFAULT, ETC.
Section 12.1. Acceleration. (a) If an Event of Default with respect to
the Company or a Significant Subsidiary described in paragraph (g) or (h) of
Section 11 (other than an Event of Default described in clause (i) of paragraph
(g) or described in clause (vi) of paragraph (g) by virtue of the fact that such
clause encompasses clause (i) of paragraph (g)) has occurred, all the Notes then
outstanding shall automatically become immediately due and payable.
(b) If any other Event of Default has occurred and is continuing, any
holder or holders of more than 60% in aggregate principal amount of the Notes at
the time outstanding may at any time at its or their option, by notice or
notices to the Company, declare all the Notes then outstanding to be immediately
due and payable.
(c) If any Event of Default described in paragraph (a) or (b) of
Section 11 has occurred and is continuing, any holder or holders of Notes at the
time outstanding affected by such Event of Default may at any time, at its or
their option, by notice or notices to the Company, declare all the Notes held by
such holder or holders to be immediately due and payable.
Upon any Note's becoming due and payable under this Section 12.1,
whether automatically or by declaration, such Note will forthwith mature and the
entire unpaid principal amount of such Note, plus (i) all accrued and unpaid
interest thereon and (ii) the Make-Whole Amount determined in respect of such
principal amount (to the full extent permitted by applicable law), shall all be
immediately due and payable, in each and every case without presentment, demand,
protest or further notice, all of which are hereby waived. The Company
acknowledges, and the parties hereto agree, that each holder of a Note has the
right to maintain its investment in the Notes free from repayment by the Company
(except as herein specifically provided for) and that the provision for payment
of a Make-Whole Amount by the Company in the event that the Notes are prepaid or
are accelerated as a result of an Event of Default, is intended to provide
compensation for the deprivation of such right under such circumstances.
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Section 12.2. Other Remedies. If any Default or Event of Default has
occurred and is continuing, and irrespective of whether any Notes have become or
have been declared immediately due and payable under Section 12.1, the holder of
any Note at the time outstanding may proceed to protect and enforce the rights
of such holder by an action at law, suit in equity or other appropriate
proceeding, whether for the specific performance of any agreement contained
herein or in any Note, or for an injunction against a violation of any of the
terms hereof or thereof, or in aid of the exercise of any power granted hereby
or thereby or by law or otherwise.
Section 12.3. Rescission. At any time after any Notes have been declared
due and payable pursuant to clause (b) or (c) of Section 12.1, the holders of
more than 60% in aggregate principal amount of the Notes then outstanding, by
written notice to the Company, may rescind and annul any such declaration and
its consequences if (a) the Company has paid all overdue interest on the Notes,
all principal of and Make-Whole Amount, if any, on any Notes that are due and
payable and are unpaid other than by reason of such declaration, and all
interest on such overdue principal and Make-Whole Amount, if any, and (to the
extent permitted by applicable law) any overdue interest in respect of the
Notes, at the Default Rate, (b) all Events of Default and Defaults, other than
non-payment of amounts that have become due solely by reason of such
declaration, have been cured or have been waived pursuant to Section 17, and (c)
no judgment or decree has been entered for the payment of any monies due
pursuant hereto or to the Notes. No rescission and annulment under this Section
12.3 will extend to or affect any subsequent Event of Default or Default or
impair any right consequent thereon.
Section 12.4. No Waivers or Election of Remedies, Expenses, Etc. No
course of dealing and no delay on the part of any holder of any Note in
exercising any right, power or remedy shall operate as a waiver thereof or
otherwise prejudice such holder's rights, powers or remedies. No right, power or
remedy conferred by this Agreement or by any Note upon any holder thereof shall
be exclusive of any other right, power or remedy referred to herein or therein
or now or hereafter available at law, in equity, by statute or otherwise.
Without limiting the obligations of the Company under Section 15, the Company
will pay to the holder of each Note on demand such further amount as shall be
sufficient to cover all costs and expenses of such holder incurred in any
enforcement or collection under this Section 12, including, without limitation,
the reasonable attorneys' fees, expenses and disbursements for the holders as
set forth in Section 15.
SECTION 13. REGISTRATION; EXCHANGE; SUBSTITUTION OF NOTES.
Section 13.1. Registration of Notes. The Company shall keep at its
principal executive office a register for the registration and registration of
transfers of Notes. The name and address of each holder of one or more Notes,
each transfer thereof and the name and address of each transferee of one or more
Notes shall be registered in such register. Prior to due presentment for
registration of transfer, the Person in whose name any Note shall be registered
shall be deemed and treated as the owner and holder thereof for all purposes
hereof, and the Company shall not be affected by any notice or knowledge to the
contrary. The Company shall give to any holder of a Note that is an
Institutional Investor promptly upon request therefor, a complete and correct
copy of the names and addresses of all registered holders of Notes.
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Section 13.2. Transfer and Exchange of Notes. Upon surrender of any Note
at the principal executive office of the Company for registration of transfer or
exchange (and in the case of a surrender for registration of transfer, duly
endorsed or accompanied by a written instrument of transfer duly executed by the
registered holder of such Note or its attorney duly authorized in writing and
accompanied by the address for notices of each transferee of such Note or part
thereof), the Company shall execute and deliver not more than 5 Business Days
following surrender of such Note, at the Company's expense (except as provided
below), one or more new Notes (as requested by the holder thereof) in exchange
therefor, in an aggregate principal amount equal to the unpaid principal amount
of the surrendered Note. Each such new Note shall be payable to such Person as
such holder may request and shall be substantially in the form of the Note
originally issued hereunder. Each such new Note shall be dated and bear interest
from the date to which interest shall have been paid on the surrendered Note or
dated the date of the surrendered Note if no interest shall have been paid
thereon. The Company may require payment of a sum sufficient to cover any stamp
tax or governmental charge imposed in respect of any such transfer of Notes.
Notes shall not be transferred in denominations of less than $100,000, provided
that if necessary to enable the registration of transfer by a holder of its
entire holding of Notes, one Note may be in a denomination of less than
$100,000. Any transferee, by its acceptance of a Note registered in its name (or
the name of its nominee), shall be deemed to have made the representation set
forth in Section 6.2, provided that such holder may (in reliance upon
information provided by the Company, which shall not be unreasonably withheld)
make a representation to the effect that the purchase by such holder of any Note
will not constitute a non-exempt prohibited transaction under Section 406(a) of
ERISA.
The Notes have not been registered under the Securities Act or under
the securities laws of any state and may not be transferred or resold unless
registered under the Securities Act and all applicable state securities laws or
unless an exemption from the requirement for such registration is available.
Section 13.3. Replacement of Notes. Upon receipt by the Company of
evidence reasonably satisfactory to it of the ownership of and the loss, theft,
destruction or mutilation of any Note (which evidence shall be, in the case of
an Institutional Investor, notice from such Institutional Investor of such
ownership and such loss, theft, destruction or mutilation), and
(a) in the case of loss, theft or destruction, of indemnity
reasonably satisfactory to it (provided that if the holder of such Note
is, or is a nominee for, an original Purchaser or another holder of a
Note with a minimum net worth of at least $50,000,000, such Person's
own unsecured agreement of indemnity shall be deemed to be
satisfactory), or
(b) in the case of mutilation, upon surrender and
cancellation thereof,
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the Company at its own expense shall execute and deliver not more than five
Business Days following satisfaction of such conditions, in lieu thereof, a new
Note, dated and bearing interest from the date to which interest shall have been
paid on such lost, stolen, destroyed or mutilated Note or dated the date of such
lost, stolen, destroyed or mutilated Note if no interest shall have been paid
thereon.
SECTION 14. PAYMENTS ON NOTES.
Section 14.1. Place of Payment. Subject to Section 14.2, payments of
principal, Make-Whole Amount, if any, and interest becoming due and payable on
the Notes shall be made in New York, New York at the principal office of PNC
Bank, N.A., in such jurisdiction. The Company may at any time, by notice to each
holder of a Note, change the place of payment of the Notes so long as such place
of payment shall be either the principal office of the Company in such
jurisdiction or the principal office of a bank or trust company in such
jurisdiction.
Section 14.2. Home Office Payment. So long as any Purchaser or such
Purchaser's nominee shall be the holder of any Note, and notwithstanding
anything contained in Section 14.1 or in such Note to the contrary, the Company
will pay all sums becoming due on such Note for principal, Make-Whole Amount, if
any, and interest by the method and at the address specified for such purpose
for such Purchaser on Schedule A hereto, or by such other method or at such
other address as such Purchaser shall have from time to time specified to the
Company in writing for such purpose, without the presentation or surrender of
such Note or the making of any notation thereon, except that upon written
request of the Company made concurrently with or reasonably promptly after
payment or prepayment in full of any Note, such Purchaser shall surrender such
Note for cancellation, reasonably promptly after any such request, to the
Company at its principal executive office or at the place of payment most
recently designated by the Company pursuant to Section 14.1. Prior to any sale
or other disposition of any Note held by any Purchaser or such Person's nominee,
such Person will, at its election, either endorse thereon the amount of
principal paid thereon and the last date to which interest has been paid thereon
or surrender such Note to the Company in exchange for a new Note or Notes
pursuant to Section 13.2. The Company will afford the benefits of this Section
14.2 to any Institutional Investor that is the direct or indirect transferee of
any Note.
SECTION 15. EXPENSES, ETC.
Section 15.1. Transaction Expenses. Whether or not the transactions
contemplated hereby are consummated, the Company will pay all reasonable costs
and expenses (including reasonable attorneys' fees of one special counsel for
the Purchasers and, if reasonably required, local or other counsel) incurred by
the Purchasers and the holders of Notes in connection with such transactions and
in connection with any amendments, waivers or consents under or in respect of
this Agreement or the Notes (whether or not such amendment, waiver or consent
becomes effective), including, without limitation: (a) the reasonable costs and
expenses incurred in enforcing or defending (or determining whether or how to
enforce or defend) any rights under this Agreement or the Notes or in responding
to any subpoena or other legal process or informal investigative demand by any
Governmental Authority issued in connection with this Agreement or the Notes, or
by reason of being a holder of any Note, and (b) the reasonable costs and
expenses, including financial advisors' fees, incurred in connection with the
insolvency or bankruptcy of the Company or any Subsidiary or in connection with
any work-out or restructuring of the transactions contemplated hereby and by the
Notes. The Company will pay, and will save each Purchaser and each other holder
of a Note harmless from, all claims in respect of any reasonable fees, costs or
expenses if any, of brokers and finders (other than those retained by the
Purchasers).
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Section 15.2. Survival. The obligations of the Company under this
Section 15 will survive the payment or transfer of any Note, the enforcement,
amendment or waiver of any provision of this Agreement or the Notes, and the
termination of this Agreement.
SECTION 16. SURVIVAL OF REPRESENTATIONS AND WARRANTIES; ENTIRE AGREEMENT.
All representations and warranties contained herein shall survive the
execution and delivery of this Agreement and the Notes, the purchase or transfer
by any Purchaser of any Note or portion thereof or interest therein and the
payment of any Note may be relied upon by any subsequent holder of any such
Note, regardless of any investigation made at any time by or on behalf of any
Purchaser or any other holder of any such Note. All statements contained in any
certificate or other instrument delivered by or on behalf of the Company
pursuant to this Agreement shall be deemed representations and warranties of the
Company under this Agreement. Subject to the preceding sentence, this Agreement
and the Notes embody the entire agreement and understanding between the
Purchasers and the Company and supersede all prior agreements and understandings
relating to the subject matter hereof.
SECTION 17. AMENDMENT AND WAIVER.
Section 17.1. Requirements. This Agreement and the Notes may be amended,
and the observance of any term hereof or of the Notes may be waived (either
retroactively or prospectively), with (and only with) the written consent of the
Company and the Required Holders, except that (a) no amendment or waiver of any
of the provisions of Section 1, 2, 3, 4, 5, 6 or 21 hereof, or any defined term
(as it is used therein) will be effective as to any holder of Notes unless
consented to by such holder of Notes in writing, and (b) no such amendment or
waiver may, without the written consent of the holder of each Note at the time
outstanding affected thereby, (i) subject to the provisions of Section 12
relating to acceleration or rescission, change the amount or time of any
prepayment or payment of principal of, or reduce the rate or change the time of
payment or method of computation of interest or of the Make-Whole Amount on, the
Notes, (ii) change the percentage of the principal amount of the Notes the
holders of which are required to consent to any such amendment or waiver, or
(iii) amend any of Sections 8, 11(a), 11(b), 12, 17 or 20.
Section 17.2. Solicitation of Holders of Notes.
(a) Solicitation. The Company will provide each holder of the Notes
(irrespective of the amount of Notes then owned by it) with sufficient
information, sufficiently far in advance of the date a decision is required, to
enable such holder to make an informed and considered decision with respect to
any proposed amendment, waiver or consent in respect of any of the provisions
hereof or of the Notes. The Company will deliver executed or true and correct
copies of each amendment, waiver or consent effected pursuant to the provisions
of this Section 17 to each holder of outstanding Notes promptly following the
date on which it is executed and delivered by, or receives the consent or
approval of, the requisite holders of Notes.
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(b) Payment. The Company will not directly or indirectly pay or cause
to be paid any remuneration, whether by way of supplemental or additional
interest, fee or otherwise, or grant any security, to any holder of Notes as
consideration for or as an inducement to the entering into by such holder of
Notes of any waiver or amendment of any of the terms and provisions hereof
unless such remuneration is concurrently paid, or security is concurrently
granted, on the same terms, ratably to each holder of Notes then outstanding
even if such holder did not consent to such waiver or amendment.
(c) Consent in Contemplation of Transfer. Any consent made pursuant to
this Section 17 by a holder of Notes that has transferred or has agreed to
transfer its Notes to the Company, any Subsidiary or any Affiliate of the
Company and has provided or has agreed to provide such written consent as a
condition to such transfer shall be void and of no force or effect except solely
as to such holder, and any amendments effected or waivers granted or to be
effected or granted that would not have been or would not be so effected or
granted but for such consent (and the consents of all other holders of Notes
that were acquired under the same or similar conditions) shall be void and of no
force or effect except solely as to such holder.
Section 17.3. Binding Effect, Etc. Any amendment or waiver consented to
as provided in this Section 17 applies equally to all holders of Notes and is
binding upon them and upon each future holder of any Note and upon the Company
without regard to whether such Note has been marked to indicate such amendment
or waiver. No such amendment or waiver will extend to or affect any obligation,
covenant, agreement, Default or Event of Default not expressly amended or waived
or impair any right consequent thereon. No course of dealing between the Company
and the holder of any Note nor any delay in exercising any rights hereunder or
under any Note shall operate as a waiver of any rights of any holder of such
Note. As used herein, the term "this Agreement" and references thereto shall
mean this Agreement as it may from time to time be amended or supplemented.
Section 17.4. Notes Held by Company, Etc. Solely for the purpose of
determining whether the holders of the requisite percentage of the aggregate
principal amount of Notes then outstanding approved or consented to any
amendment, waiver or consent to be given under this Agreement or the Notes, or
have directed the taking of any action provided herein or in the Notes to be
taken upon the direction of the holders of a specified percentage of the
aggregate principal amount of Notes then outstanding, Notes directly or
indirectly owned by the Company or any of its Affiliates shall be deemed not to
be outstanding.
SECTION 18. NOTICES.
All notices and communications provided for hereunder shall be in
writing and sent (a) by telefacsimile if the sender on the same day sends a
confirming copy of such notice by a recognized overnight delivery service
(charges prepaid), or (b) by a recognized overnight delivery service (with
charges prepaid). Any such notice must be sent:
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(i) if to a Purchaser or such Purchaser's nominee, to such
Purchaser or such Purchaser's nominee at the address specified for such
communications in Schedule A to this Agreement, or at such other
address as such Purchaser or such Purchaser's nominee shall have
specified to the Company in writing pursuant to this Section 18;
(ii) if to any other holder of any Note, to such holder at
such address as such other holder shall have specified to the Company
in writing pursuant to this Section 18, or
(iii) if to the Company, to the Company at its address set
forth at the beginning hereof to the attention of Chief Financial
Officer, with a copy to the General Counsel, or at such other address
as the Company shall have specified to the holder of each Note in
writing.
Notices under this Section 18 will be deemed given only when actually received.
SECTION 19. REPRODUCTION OF DOCUMENTS.
This Agreement and all documents relating thereto, including, without
limitation, (a) consents, waivers and modifications that may hereafter be
executed, (b) documents received by each Purchaser at the Closing (except the
Notes themselves), and (c) financial statements, certificates and other
information previously or hereafter furnished to each Purchaser, may be
reproduced by such Purchaser by any photographic, photostatic, microfilm,
microcard, miniature photographic or other similar process and such Purchaser
may destroy any original document so reproduced. The Company agrees and
stipulates that, to the extent permitted by applicable law, any such
reproduction shall be admissible in evidence as the original itself in any
judicial or administrative proceeding (whether or not the original is in
existence and whether or not such reproduction was made by such Purchaser in the
regular course of business) and any enlargement, facsimile or further
reproduction of such reproduction shall likewise be admissible in evidence. This
Section 19 shall not prohibit the Company or any other holder of Notes from
contesting any such reproduction to the same extent that it could contest the
original, or from introducing evidence to demonstrate the inaccuracy of any such
reproduction.
SECTION 20. CONFIDENTIAL INFORMATION.
For the purposes of this Section 20, "Confidential Information" means
information delivered to any Purchaser by or on behalf of the Company or any
Subsidiary in connection with the transactions contemplated by or otherwise
pursuant to this Agreement that is proprietary in nature and that was clearly
marked or labeled or otherwise adequately identified when received by such
Purchaser as being confidential information of the Company or such Subsidiary,
provided that such term does not include information that (a) was publicly known
or otherwise known to such Purchaser prior to the time of such disclosure, (b)
subsequently becomes publicly known through no act or omission by such Purchaser
or any Person acting on such Purchaser's behalf, (c) otherwise becomes known to
such Purchaser other than through disclosure by the Company or any Subsidiary or
(d) constitutes financial statements delivered to such Purchaser under Section
7.1 that are otherwise publicly available. Each Purchaser will maintain the
confidentiality of such Confidential Information in accordance with procedures
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adopted by such Purchaser in good faith to protect confidential information of
third parties delivered to such Purchaser, provided that such Purchaser may
deliver or disclose Confidential Information to (i) such Purchaser's directors,
trustees, officers, employees, agents, attorneys and affiliates (to the extent
such disclosure reasonably relates to the administration of the investment
represented by such Purchaser's Notes), (ii) such Purchaser's financial advisors
and other professional advisors who agree to hold confidential the Confidential
Information substantially in accordance with the terms of this Section 20, (iii)
any other holder of any Note, (iv) any Institutional Investor to which such
Purchaser sells or offers to sell such Note or any part thereof or any
participation therein (if such Person has agreed in writing prior to its receipt
of such Confidential Information to be bound by the provisions of this Section
20), (v) any Person from which such Purchaser offers to purchase any security of
the Company (if such Person has agreed in writing prior to its receipt of such
Confidential Information to be bound by the provisions of this Section 20), (vi)
any federal or state regulatory authority having jurisdiction over such
Purchaser, (vii) the National Association of Insurance Commissioners or any
similar organization, or any nationally recognized rating agency that requires
access to information about such Purchaser's investment portfolio, (viii) any
other Person to which such delivery or disclosure may be necessary or
appropriate (w) to effect compliance with any law, rule, regulation or order
applicable to such Purchaser, (x) in response to any subpoena or other legal
process, (y) in connection with any litigation to which such Purchaser is a
party or (z) if an Event of Default has occurred and is continuing, to the
extent such Purchaser may reasonably determine such delivery and disclosure to
be necessary or appropriate in the enforcement or for the protection of the
rights and remedies under such Purchaser's Notes and this Agreement or, (ix) any
and all Persons, without limitation, to the extent any such Confidential
Information pertains to the U.S. federal tax treatment and U.S. federal tax
structure of the transaction contemplated by this Agreement and all materials of
any kind (including opinions or other U.S. federal tax analyses) that are
provided to the Purchasers relating to such U.S. federal tax treatment and U.S.
federal tax structure. However, any such information relating to such U.S.
federal tax treatment and U.S. federal tax structure is required to be kept
confidential to the extent necessary to comply with any applicable securities
laws. Clause (ix) of the preceding sentence is intended to cause the transaction
contemplated hereby not to be treated as having been offered under conditions of
confidentiality for purposes of Sections 1.6011-4(b)(3) and 301.6111-2(a)(2)(ii)
(or any successor provisions) of the U.S. Treasury Regulations issued under the
Code and shall be construed in a manner consistent with such purpose. Each
holder of a Note, by its acceptance of a Note, will be deemed to have agreed to
be bound by and to be entitled to the benefits of this Section 20 as though it
were a party to this Agreement. On reasonable request by the Company in
connection with the delivery to any holder of a Note of information required to
be delivered to such holder under this Agreement or requested by such holder
(other than a holder that is a party to this Agreement or its nominee), such
holder will enter into an agreement with the Company embodying the provisions of
this Section 20.
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SECTION 21. SUBSTITUTION OF PURCHASER.
Each Purchaser shall have the right to substitute any one of such
Purchaser's Affiliates as the purchaser of the Notes that such Purchaser has
agreed to purchase hereunder, by written notice to the Company, which notice
shall be signed by both such Purchaser and such Purchaser's Affiliate, shall
contain such Affiliate's agreement to be bound by this Agreement and shall
contain a confirmation by such Affiliate of the accuracy with respect to it of
the representations set forth in Section 6. Upon receipt of such notice,
wherever the word "Purchaser" is used in this Agreement (other than in this
Section 21), such word shall be deemed to refer to such Affiliate in lieu of
such Purchaser. In the event that such Affiliate is so substituted as a
purchaser hereunder and such Affiliate thereafter transfers to such Purchaser
all of the Notes then held by such Affiliate, upon receipt by the Company of
notice of such transfer, wherever the word "Purchaser" is used in this Agreement
(other than in this Section 21), such word shall no longer be deemed to refer to
such Affiliate, but shall refer to such Purchaser, and such Purchaser shall have
all the rights of an original holder of the Notes under this Agreement.
SECTION 22. MISCELLANEOUS.
Section 22.1. Successors and Assigns. All covenants and other agreements
contained in this Agreement by or on behalf of any of the parties hereto bind
and inure to the benefit of their respective successors and assigns (including,
without limitation, any subsequent holder of a Note) whether so expressed or
not.
Section 22.2. Payments Due on Non-Business Days. Anything in this
Agreement or the Notes to the contrary notwithstanding, any payment of principal
of or Make-Whole Amount or interest on any Note that is due on a date other than
a Business Day shall be made on the next succeeding Business Day without
including the additional days elapsed in the computation of the interest payable
on such next succeeding Business Day.
Section 22.3. Severability. Any provision of this Agreement that is
prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction,
be ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof, and any such prohibition or
unenforceability in any jurisdiction shall (to the full extent permitted by law)
not invalidate or render unenforceable such provision in any other jurisdiction.
Section 22.4. Construction. Each covenant contained herein shall be
construed (absent express provision to the contrary) as being independent of
each other covenant contained herein, so that compliance with any one covenant
shall not (absent such an express contrary provision) be deemed to excuse
compliance with any other covenant. Where any provision herein refers to action
to be taken by any Person, or which such Person is prohibited from taking, such
provision shall be applicable whether such action is taken directly or
indirectly by such Person.
Section 22.5. Counterparts. This Agreement may be executed in any number
of counterparts, each of which shall be an original but all of which together
shall constitute one instrument. Each counterpart may consist of a number of
copies hereof, each signed by less than all, but together signed by all, of the
parties hereto.
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Section 22.6. Governing Law. This Agreement shall be construed and
enforced in accordance with, and the rights of the parties shall be governed by,
the law of the State of New York excluding choice-of-law principles of the law
of such State that would require the application of the laws of a jurisdiction
other than such State.
* * * * *
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The execution hereof by the Purchasers shall constitute a contract
among the Company and the Purchasers for the uses and purposes hereinabove set
forth. This Agreement may be executed in any number of counterparts, each
executed counterpart constituting an original but all together only one
agreement.
Very truly yours,
PHILADELPHIA SUBURBAN CORPORATION
By \s\ Xxxxx X. Xxxx
-----------------------------------
Name: Xxxxx X. Xxxx
-----------------------------
Title: Vice President and Treasurer
----------------------------
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Accepted as of the first date written above.
[VARIATION]
The Baltimore Life Insurance Company The Equitable Life Assurance Society of the
By: \s\ Xxxxxxx Xxxxxxxxx By: \s\ Xxxx X. Xxxxxxxxxxx
----------------------- -----------------------
Name: Xxxxxxx Xxxxxxxxx Name: Xxxx X. Xxxxxxxxxxx
Title: Senior VP Title: Investment Officer
MONY Life Insurance Company Nationwide Life Insurance Company
By: \s\ Xxxxxx X. Xxxxxx By: \s\ Xxxx X. Xxxxxxxxxx
-------------------------------- ----------------------
Name: Xxxxxx X. Xxxxxx Name: Xxxx X. Xxxxxxxxxx
Title: Senior Managing Director Title: Authorized Signatory
Nationwide Life Insurance Company of Teachers Insurance and Annuity Association of
America America
By: \s\ Xxxx X. Xxxxxxxxxx By: \s\ Xxxxxxx Xxxxxxx
----------------------- -------------------
Name: Xxxx X. Xxxxxxxxxx Name: Xxxxxxx Xxxxxxx
Title: Authorized Signatory Title: Director - Private Placements
-40-
PRINCIPAL AMOUNT
OF NOTES TO BE
NAME OF PURCHASERS SERIES PURCHASED
[____________________________________] A $[_________]
[____________________________________] B $[_________]
[____________________________________] C $[_________]
[____________________________________]
[____________________________________]
Payments
All payments on or in respect of the Notes to be by bank wire transfer of Federal or other immediately available funds
(identifying each payment as "Philadelphia Suburban Corporation, and as to interest rate, security description, Series maturity
date, PPN, principal, premium or interest") to:
[____________________________________]
[____________________________________]
[____________________________________]
With telephone advice of payment to the [_______________________________] Department of [_______________________________] at
[(___) _________].
Notices
All notices and communications to be addressed as first provided above, except notices with respect to payments, to be addressed
Attention: [_______________________________] Department [_____].
Name of Nominee in which Notes are to be issued: None
Taxpayer I.D. Number: [_______]
SCHEDULE A
(to Note Purchase Agreement)
DEFINED TERMS
As used herein, the following terms have the respective meanings set
forth below or set forth in the Section hereof following such term:
"Acceptable Bank" shall mean Bank of America or any other bank or trust
company (i) which is organized under the laws of the United States of America or
any State thereof, (ii) which has capital, surplus and undivided profits
aggregating at least $250,000,000, and (iii) whose long-term unsecured debt
obligations (or the long-term unsecured debt obligations of the bank holding
company owning all of the capital stock of such bank or trust company) shall be
rated "A3" or higher by Xxxxx'x or "A-" or higher by S&P.
"Acceptable Broker-Dealer" shall mean any Person other than a natural
person (i) which is registered as a broker or dealer pursuant to the Exchange
Act and (ii) whose long-term unsecured debt obligations shall have been given a
rating of "A" or better by S&P or "A2" or better by Xxxxx'x.
"Affiliate" means, at any time, and with respect to any Person, (a) any
other Person that at such time directly or indirectly through one or more
intermediaries Controls, or is Controlled by, or is under common Control with,
such first Person, and (b) any Person beneficially owning or holding, directly
or indirectly, 10% or more of any class of voting or equity interests of the
Company or any Subsidiary or any Person of which the Company and its
Subsidiaries beneficially own or hold, in the aggregate, directly or indirectly,
10% or more of any class of voting or equity interests. As used in this
definition, "Control" means the possession, directly or indirectly, of the power
to direct or cause the direction of the management and policies of a Person,
whether through the ownership of voting securities, by contract or otherwise.
Unless the context otherwise clearly requires, any reference to an "Affiliate"
is a reference to an Affiliate of the Company.
"Attributable Debt" means in connection with any Sale and Leaseback
Transaction entered into within the limitations of Section 10.5, as of the date
of any determination thereof, the aggregate amount of Rentals due and to become
due (discounted from the respective due dates thereof at the interest rate
implicit in such Rentals and otherwise in accordance with GAAP) under the lease
relating to such Sale and Leaseback Transaction.
"Business Day" means (a) for the purposes of Section 8.6 only, any day
other than a Saturday, a Sunday or a day on which commercial banks in New York
City are required or authorized to be closed, and (b) for the purposes of any
other provision of this Agreement, any day other than a Saturday, a Sunday or a
day on which commercial banks in Philadelphia, Pennsylvania or New York, New
York are required or authorized to be closed.
"Capital Lease" means, at any time, a lease with respect to which the
lessee is required concurrently to recognize the acquisition of an asset and the
incurrence of a liability in accordance with GAAP.
SCHEDULE B
(to Note Purchase Agreement)
"Capital Lease Obligation" means, with respect to any Person and a
Capital Lease, the amount of the obligation of such Person as the lessee under
such Capital Lease which would, in accordance with GAAP, appear as a liability
on a balance sheet of such Person.
"Change in Control" is defined in Section 8.7.
"Closing" is defined in Section 3.
"Code" means the Internal Revenue Code of 1986, as amended from time to
time, and the rules and regulations promulgated thereunder from time to time.
"Company" means Philadelphia Suburban Corporation, a Pennsylvania
corporation.
"Confidential Information" is defined in Section 20.
"Consolidated Debt" means, as of any date of determination, the total
of all Debt of the Company and its Subsidiaries outstanding on such date, after
eliminating all offsetting debits and credits between the Company and its
Subsidiaries and all other items required to be eliminated in the course of the
preparation of consolidated financial statements of the Company and its
Subsidiaries in accordance with GAAP.
"Consolidated Funded Debt" means, as of any date of determination, the
total of all Funded Debt of the Company and its Subsidiaries outstanding on such
date, after eliminating all offsetting debits and credits between the Company
and its Subsidiaries and all other items required to be eliminated in the course
of the preparation of consolidated financial statements of the Company and its
Subsidiaries in accordance with GAAP.
"Consolidated Net Worth" means, as of any date of determination, the
sum of (i) the par value (or value stated on the books of the corporation) of
the capital stock (but excluding treasury stock and capital stock subscribed and
unissued) of the Company and its Subsidiaries plus (ii) the amount of the
paid-in capital and retained earnings of the Company and its Subsidiaries, in
each case as such amounts would be shown on a consolidated balance sheet of the
Company and its Subsidiaries as of such time prepared in accordance with GAAP.
"Consolidated Total Assets" means, as of any date of determination, the
total amount of all assets of the Company and its Subsidiaries, as such amounts
would be shown on a consolidated balance sheet of the Company and its
Subsidiaries as of such time prepared in accordance with GAAP.
"Consolidated Total Capitalization" means, as of any date of
determination, the sum of (i) Consolidated Funded Debt and (ii) Consolidated Net
Worth.
"Debt" means, with respect to any Person, without duplication,
(a) its liabilities for borrowed money;
B-2
(b) its liabilities for the deferred purchase price of
property acquired by such Person (excluding accounts payable and other
accrued liabilities arising in the ordinary course of business but
including, without limitation, all liabilities created or arising under
any conditional sale or other title retention agreement with respect to
any such property);
(c) its Capital Lease Obligations;
(d) all liabilities for borrowed money secured by any Lien
with respect to any property owned by such Person (whether or not it
has assumed or otherwise become liable for such liabilities);
(e) all non-contingent liabilities in respect of
reimbursement agreements or similar agreements in respect of letters of
credit or instruments serving a similar function issued or accepted for
its account by banks and other financial institutions;
(f) Swaps of such Person; and
(g) Guarantees of such Person with respect to liabilities of
a type described in any of clauses (a) through (f) hereof.
Debt of any Person shall include all obligations of such Person of the
character described in clauses (a) through (g) to the extent such Person
remains legally liable in respect thereof notwithstanding that any such
obligation is deemed to be extinguished under GAAP.
"Default" means an event or condition the occurrence or existence of
which would, with the lapse of time or the giving of notice or both, become an
Event of Default.
"Default Rate" means that rate of interest that is the greater of (i)
6.87% per annum, or (ii) 2% over the rate of interest publicly announced by PNC
Bank, N.A. in New York, New York as its "base" or "prime" rate.
"Environmental Laws" means any and all federal, state, local, and
foreign statutes, laws, regulations, ordinances, rules, judgments, orders,
decrees, permits, concessions, grants, franchises, licenses, agreements or
governmental restrictions relating to pollution and the protection of the
environment or the release of any materials into the environment, including but
not limited to those related to hazardous substances or wastes, air emissions
and discharges to waste or public systems.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended from time to time, and the rules and regulations promulgated thereunder
from time to time in effect.
"ERISA Affiliate" means any trade or business (whether or not
incorporated) that is treated as a single employer together with the Company
under section 414 of the Code.
"Event of Default" is defined in Section 11.
B-3
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
"Fair Market Value" means, at any time and with respect to any
property, the sale value of such property that would be realized in an
arm's-length sale at such time between an informed and willing buyer and an
informed and willing seller (neither being under a compulsion to buy or sell),
as reasonably determined in the good faith opinion of the Company's board of
directors.
"Funded Debt" means, with respect to any Person, (i) all Debt of such
Person which by its terms or by the terms of any instrument or agreement
relating thereto matures, or which is otherwise payable or unpaid, one year or
more from, or is directly or indirectly renewable or extendible at the option of
the obligor in respect thereof to a date one year or more (including, without
limitation, an option of such obligor under a revolving credit or similar
agreement obligating the lender or lenders to extend credit over a period of one
year or more) from, the date of the creation thereof, (ii) all payments in
respect of the Debt described in the preceding clause (i) that are required to
be made within one year from the date of determination of Funded Debt, whether
or not such payments shall constitute a current liability of the obligor under
GAAP, and (iii) all Guaranties of the Debt described in clauses (i) and (ii).
"GAAP" means generally accepted accounting principles as in effect from
time to time in the United States of America.
"Governmental Authority" means
(a) the government of
(i) the United States of America or any state or
other political subdivision thereof, or
(ii) any jurisdiction in which the Company or any
Subsidiary conducts all or any part of its business, or which
has jurisdiction over any properties of the Company or any
Subsidiary, or
(b) any entity exercising executive, legislative, judicial,
regulatory or administrative functions of, or pertaining to, any such
government.
"Guaranty" means, with respect to any Person, any obligation (except
the endorsement in the ordinary course of business of negotiable instruments for
deposit or collection) of such Person guaranteeing or in effect guaranteeing any
Debt, dividend or other obligation of any other Person in any manner, whether
directly or indirectly, including (without limitation) obligations incurred
through an agreement, contingent or otherwise, by such Person:
(a) to purchase such Debt or obligation or any property
constituting security therefor primarily for the purpose of assuring
the owner of such Debt or obligation of the ability of any other Person
to make payment of the Debt or obligation;
B-4
(b) to advance or supply funds (i) for the purchase or
payment of such Debt or obligation, or (ii) to maintain any working
capital or other balance sheet condition or any income statement
condition of any other Person or otherwise to advance or make available
funds for the purchase or payment of such Debt or obligation;
(c) to lease properties or to purchase properties or services
primarily for the purpose of assuring the owner of such Debt or
obligation of the ability of any other Person to make payment of the
Debt or obligation; or
(d) otherwise to assure the owner of such Debt or obligation
against loss in respect thereof.
In any computation of the Debt or other liabilities of the obligor
under any Guaranty, the Debt or other obligations that are the subject of such
Guaranty shall be assumed to be direct obligations of such obligor, provided
that the amount of such Debt outstanding for purposes of this Agreement shall
not be exceed the maximum amount of Debt that is the subject of such Guaranty.
"Hazardous Material" means any and all pollutants, toxic or hazardous
wastes or any other substances that might pose a hazard to health or safety, the
removal of which may be required or the generation, manufacture, refining,
production, processing, treatment, storage, handling, transportation, transfer,
use, disposal, release, discharge, spillage, seepage, or filtration of which is
or shall be restricted, prohibited or penalized by any applicable law
(including, without limitation, asbestos, urea formaldehyde foam insulation and
polychlorinated biphenyls).
"holder" means, with respect to any Note, the Person in whose name such
Note is registered in the register maintained by the Company pursuant to Section
13.1.
"Institutional Investor" means (a) any original purchaser of a Note,
(b) any holder of more than $5,000,000 of the aggregate principal amount of the
Notes then outstanding, and (c) any bank, trust company, savings and loan
association or other financial institution, any pension plan, any investment
company, any insurance company, any broker or dealer, or any other similar
financial institution or entity, regardless of legal form.
"Investments" shall mean all investments, in cash or by delivery of
property made, directly or indirectly in any Person, whether by acquisition of
shares of capital stock, Debt or other obligations or securities or by loan,
advance, capital contribution or otherwise.
"Lien" means, with respect to any Person, any mortgage, lien, pledge,
charge, security interest or other encumbrance, or any interest or title of any
vendor, lessor, lender or other secured party to or of such Person under any
conditional sale or other title retention agreement (other than an operating
lease) or Capital Lease, upon or with respect to any property or asset of such
Person (including, in the case of stock, shareholder agreements, voting trust
agreements and all similar arrangements).
B-5
"Material" means material in relation to the business, operations,
affairs, financial condition, assets or properties of the Company and its
Subsidiaries taken as a whole.
"Make-Whole Amount" shall have the meaning set forth in Section 8.6.
"Material Adverse Effect" means a material adverse effect on (a) the
business, operations, affairs, financial condition, assets or properties of the
Company and its Subsidiaries taken as a whole, or (b) the ability of the Company
to perform its obligations under this Agreement and the Notes, or (c) the
validity or enforceability of this Agreement or the Notes.
"Memorandum" is defined in Section 5.3.
"Moody's" shall mean Xxxxx Investors Service, Inc.
"Multiemployer Plan" means any Plan that is a "multiemployer plan" (as
such term is defined in Section 4001(a)(3) of ERISA).
"Net Proceeds" means with respect to any sale of property by any Person
an amount equal to (a) the aggregate amount of the consideration received by
such Person in respect of such sale (valued at the Fair Market Value of such
consideration at the time of such sale), minus (b) the sum of (i) all
out-of-pocket costs and expenses actually incurred by such Person in connection
with such sale, and (ii) all state, federal and foreign taxes incurred, or to be
incurred, by the seller in connection with such sale.
"Notes" is defined in Section 1.
"Officer's Certificate" means a certificate of a Senior Financial
Officer or of any other officer of the Company whose responsibilities extend to
the subject matter of such certificate.
"PBGC" means the Pension Benefit Guaranty Corporation referred to and
defined in ERISA or any successor thereto.
"Person" means an individual, partnership, corporation, limited
liability company, association, trust, unincorporated organization, or a
government or agency or political subdivision thereof.
"Plan" means an "employee benefit plan" (as defined in Section 3(3) of
ERISA) that is or, within the preceding five years, has been established or
maintained, or to which contributions are or, within the preceding five years,
have been made or required to be made, by the Company or any ERISA Affiliate or
with respect to which the Company or any ERISA Affiliate may have any liability.
"property" or "properties" means, unless otherwise specifically
limited, real or personal property of any kind, tangible or intangible, xxxxxx
or inchoate.
"Purchasers" means the purchasers of the Notes named in Schedule A
hereto.
B-6
"QPAM Exemption" means Prohibited Transaction Class Exemption 84-14
issued by the United States Department of Labor.
"Required Holders" means, at any time, the holders of more than 60% in
principal amount of the Notes at the time outstanding (exclusive of Notes then
owned by the Company or any of its Affiliates).
"Responsible Officer" means any Senior Financial Officer and any other
officer of the Company with responsibility for the administration of the
relevant portion of this Agreement.
"Repurchase Agreement" shall mean any written agreement:
(a) that provides for (1) the transfer of one or more United
States Governmental Securities in an aggregate principal amount at
least equal to the amount of the Transfer Price (defined below) to the
Company or any of its Subsidiaries from an Acceptable Bank or an
Acceptable Broker-Dealer against a transfer of funds (the "Transfer
Price") by the Company to such Acceptable Bank or Acceptable
Broker-Dealer, and (2) a simultaneous agreement by the Company, in
connection with such transfer of funds, to transfer to such Acceptable
Bank or Acceptable Broker-Dealer the same or substantially similar
United States Governmental Securities for a price not less than the
Transfer Price plus a reasonable return thereon at a date certain not
later than 365 days after such transfer of funds,
(b) in respect of which the Company shall have the right,
whether by contract or pursuant to applicable law, to liquidate such
agreement upon the occurrence of any default thereunder, and
(c) in connection with which the Company, or an agent
thereof, shall have taken all action required by applicable law or
regulations to perfect a Lien in such United States Governmental
Securities.
"Restricted Subsidiary" shall mean each Subsidiary listed as a
Subsidiary on Schedule 5.4 and any other Subsidiary,
(1) a majority of each class of voting securities of which is
legally and beneficially owned by the Company and its Restricted
Subsidiaries; and
(2) which has been designated as a Restricted Subsidiary
pursuant to Section 9.6.
"Sale-and-Leaseback Transaction" means a transaction or series of
transactions pursuant to which the Company or any Subsidiary shall sell or
transfer to any Person (other than the Company or a Wholly-owned Subsidiary) any
property, whether now owned or hereafter acquired, and, as part of the same
transaction or series of transactions, the Company or any Subsidiary shall rent
or lease as lessee (other than pursuant to a Capital Lease), or similarly
acquire the right to possession or use of, such property or one or more
properties which it intends to use for the same purpose or purposes as such
property.
B-7
"S&P" means Standard & Poor's Ratings Group, a division of The
XxXxxx-Xxxx Companies, Inc.
"Securities Act" means the Securities Act of 1933, as amended from time
to time, together with the rules and regulations promulgated thereunder.
"Senior Debt" means, as of the date of any determination thereof, all
Consolidated Debt, other than Subordinated Debt.
"Senior Financial Officer" means the chief financial officer, principal
accounting officer, treasurer or comptroller of the Company.
"Significant Subsidiary" means, at any time, any Subsidiary that
accounts for more than (i) 10% of the consolidated assets of the Company and its
Subsidiaries or (ii) 10% of consolidated revenue of the Company and its
Subsidiaries.
"Subordinated Debt" means all unsecured Debt of the Company which shall
contain or have applicable thereto subordination provisions providing for the
subordination thereof to other Debt of the Company (including, without
limitation, the obligations of the Company under this Agreement).
"Subsidiary" means, as to any Person, any corporation, association or
other business entity in which such Person or one or more of its Subsidiaries or
such Person and one or more of its Subsidiaries owns sufficient equity or voting
interests to enable it or them (as a group) ordinarily, in the absence of
contingencies, to elect a majority of the directors (or Persons performing
similar functions) of such entity, and any partnership or joint venture if more
than a 50% interest in the profits or capital thereof is owned by such Person or
one or more of its Subsidiaries or such Person and one or more of its
Subsidiaries (unless such partnership can and does ordinarily take major
business actions without the prior approval of such Person or one or more of its
Subsidiaries). Unless the context otherwise clearly requires, any reference to a
"Subsidiary" is a reference to a Subsidiary of the Company.
"Swaps" means, with respect to any Person, payment obligations with
respect to interest rate swaps, currency swaps and similar obligations
obligating such Person to make payments, whether periodically or upon the
happening of a contingency. For the purposes of this Agreement, the amount of
the obligation under any Swap shall be the amount determined in respect thereof
as of the end of the then most recently ended fiscal quarter of such Person,
based on the assumption that such Swap had terminated at the end of such fiscal
quarter, and in making such determination, if any agreement relating to such
Swap provides for the netting of amounts payable by and to such Person
thereunder or if any such agreement provides for the simultaneous payment of
amounts by and to such Person, then in each such case, the amount of such
obligation shall be the net amount so determined.
B-8
"Unrestricted Subsidiary" means any Subsidiary acquired after the date
of this Agreement which is so designated by the Company.
"Wholly-Owned Restricted Subsidiary" means, at any time, any Restricted
Subsidiary one hundred percent (100%) of all of the equity interests (except
directors' qualifying shares) and voting interests of which are owned by any one
or more of the Company and the Company's other Wholly-Owned Restricted
Subsidiaries at such time.
B-9
CHANGES IN CORPORATE STRUCTURE
None.
SCHEDULE 4.9
(to Note Purchase Agreement)
PHILADELPHIA SUBURBAN CORPORATION
Subsidiaries of the Company,
Ownership of Subsidiary Stock
State of
Subsidiary Incorporation Stockholder
---------- ------------- -----------
1. Aclarius Corporation Pennsylvania 100%
2. Aqua Acquisition Corporation Pennsylvania 100%
3. Consumers Applegrove Water Company Ohio 100%
4. Consumers Applied Technologies, Inc. Maine 100%
5. Consumers Illinois Water Company Illinois 100%
6. Consumers Indiana Water Company Indiana 100%
7. Consumers Maine Water Company Maine 100%
8. Consumers New Jersey Water Company New Jersey 100%
9. Consumers Ohio Water Company Ohio 100%
10. Consumers Water Company Pennsylvania 100%
11. Drexel Hill Corporation Pennsylvania 100%
12. Hydraulics, Ltd. North Carolina 100%
13. Little Washington Wastewater Company Pennsylvania 100%
14. Pennsylvania Suburban Water Company Pennsylvania 100%
15. Philadelphia Suburban Corporation Pennsylvania 100%
16. PSC Services, Inc. Delaware 100%
17. Raleigh Acquisition Corporation New Hampshire 100%
18. Suburban Environmental Services Company Pennsylvania 100%
19. The Xxxxxx Water Company Pennsylvania 80%
20. Utility & Municipal Services, Inc. Pennsylvania 100%
A. AquaSource Development Company Texas 100%
B. AquaSource Utility, Inc. Texas 100%
1. Reston/Lake Anne Air Conditioning Corp. Virginia 100%
3. AquaSource Utility-North Carolina, Inc. North Carolina 100%
5. AquaSource Utility-Virginia, Inc. Virginia 100%
6. AquaSource Utility-New Jersey, Inc. New Jersey 100%
7. AquaSource/CU, Inc. Missouri 100%
8. AquaSource/RU, Inc. Missouri 100%
9. AquaSource/UC, Inc. Texas 100%
a. Utility Center, Inc. Indiana 100%
10. Xxxxxxxxx Utility Company, Inc. Florida 100%
11. Blue Ridge Utility Company Virginia 100%
12. Brookside Sewer District, Inc. South Carolina 100%
13. Cambridge Water Works, Inc. New York 100%
14. Crystal River Utilities, Inc. Florida 100%
15. Dolomite Utilities Corp. Florida 100%
a. Kensington Park Utilities, Inc. Florida 100%
i. Longwood Run Utilities, Inc. Florida 100%
16. Dykeer Water Company, Inc. New York 100%
17. Earlysville Forest Water Company Virginia 100%
18. Eastern Connecticut Regional Water Company, Inc. Connecticut 100%
19. Fairways Utilities, Inc. North Carolina 100%
20. Glynnwood Water Systems, Inc. North Carolina 100%
21. Heritage Homes of Virginia, Inc. Virginia 100%
22. Indian River Water Company Virginia 100%
23. Jasmine Lakes Utilities Corp. Florida 100%
25. Kingsvale Water Company, Inc. New York 100%
26. Lake Monticello Service Company Virginia 100%
27. Lake Suzy Utility, Inc. Florida 100%
28. Land 'Or Utility Company, Inc. Virginia 100%
29. Maxim Sewerage Corporation New Jersey 100%
30. Mayfore Water Company, Inc. Virginia 100%
31. Mountain Point Utilities, Inc. North Carolina 100%
32. Mountainview Water Co., Inc. Virginia 100%
33. Ocala Oaks Utilities, Inc. Florida 100%
34. Rainbow Forest Water Corporation Virginia 100%
35. Rayco Utilities, Inc. North Carolina 100%
36. Xxxxxx Hydrodynamics, Inc. Virginia 100%
a. Alpha Water Corporation Virginia 100%
b. AquaSource SL, Inc. Virginia 100%
c. Xxxxxxxx Utilities, Inc. Virginia 100%
x. Xxxxxxxx Xxxxx, Incorporated Virginia 100%
x. Xxxxx River Service Corporation Virginia 100%
f. Powhatan Water Works, Incorporated Virginia 100%
x. Xxxxxx Water Corporation Virginia 100%
37. Waccabuc Water Works Inc. New York 100%
38. Water Distributors, Inc. Virginia 100%
39. Wild Oaks Water Company, Inc. New York 100%
40. Willowbrook Utility Company, Inc. North Carolina 100%
C. The Xxxxxxxx Group, Inc. Indiana 100%
1. Capitol Engineering, Inc. Indiana 100%
2. Xxxxxxxxx County Wastewater, LLC Indiana 80%
3. Indiana Water Infrastructure Group, Inc. Indiana 100%
a. Chimney Wood Sewage Works, Inc. Indiana 100%
c. Wastewater One, LLC Indiana 100%
d. Water One, Inc. Indiana 100%
e. Wildwood Shores Utilities Corp. Indiana 100%
f. Wymberly Sanitary Works, Inc. Indiana 100%
4. Xxxxxxxx Operations Corporation Indiana 100%
D. AquaSource Operations, Inc. Delaware 100%
SCHEDULE 5.4
(to Note Purchase Agreement)
PHILADELPHIA SUBURBAN CORPORATION
Organization and Ownership of Shares of Subsidiaries
Philadelphia Suburban Corporation has 1,720 shares of Series B Preferred Stock
outstanding.
Pennsylvania Suburban Water Company owns 316 of the total 392 shares outstanding
of The Xxxxxx Water Company.
With respect to the AquaSource companies to be acquired on or about July 31,
2003:
There are 10 shares of preferred stock issued by AquaSource
Utility, Inc. Philadelphia Suburban Corporation has an
agreement with the holders of such shares to purchase such
shares for $400,000, or 80% of their liquidation value upon
the Closing of Philadelphia Suburban Corporation's purchase of
the AquaSource operations.
Approximately 80% of the ownership units of Xxxxxxxxx County
Wastewater LLC are owned by The Xxxxxxxx Group, Inc., which is
one of the companies to be acquired by Philadelphia Suburban
Corporation upon the Closing of Philadelphia Suburban
Corporation's purchase of the AquaSource operations.
SCHEDULE 5.4(b)
(to Note Purchase Agreement)
FINANCIAL STATEMENTS
Audited Financial Statements for fiscal year ended December 31, 2001 and
December 31, 2002 and Quarterly Report for fiscal period ended March 31, 2003.
Schedule 5.5
(TO NOTE PURCHASE AGREEMENT)
PHILADELPHIA SUBURBAN CORPORATION
Licenses, Permits, Etc.
Pennsylvania Suburban Water Company is in the process of transferring
the Pennsylvania environmental permits held by the various Pennsylvania utility
subsidiaries of Philadelphia Suburban Corporation that were merged into
Pennsylvania Suburban Water Company on January 1, 2001.
SCHEDULE 5.11
(to Note Purchase Agreement)
EXISTING DEBT
PHILADELPHIA SUBURBAN CORPORATION AND SUBSIDIARIES
LONG AND SHORT TERM DEBT
06/30/03
Balance
Outstanding
Illinois FMB 6,000,000.00
Illinois FMB 4,500,000.00
Illinois FMB 8,000,000.00
Illinois FMB 6,000,000.00
Illinois Tax Exempt -
Illinois Tax Exempt -
Illinois Tax Exempt 4,500,000.00
Illinois Contract 49,400.00
Illinois Note 1,000,000.00
Illinois Tax Exempt 2,785,000.00
Illinois Tax Exempt 9,970,000.00
Illinois Long-term 42,804,400.00
Maine FMB-Sink -
Maine FMB 9,000,000.00
Maine Tax Exempt 2,115,000.00
Maine SRLF 784,000.00
Maine SRLF 1,148,879.00
Maine SRLF 120,202.00
Maine Long-term 13,168,081.00
New Jersey FMB 4,000,000.00
New Jersey Tax Exempt 0.00
New Jersey Tax Exempt 0.00
New Jersey Tax Exempt 7,500,000.00
New Jersey 475,000.00
New Jersey 1,285,000.00
New Jersey 396,740.13
New Jersey 1,055,962.02
New Jersey 6,000,000.00
New Jersey 5,330,000.00
New Jersey 1,670,000.00
New Jersey Long-term 27,712,702.15
Ohio FMB 1,200,000.00
Ohio FMB 7,022,000.00
Ohio FMB 7,100,000.00
Ohio Tax Exempt -
SCHEDULE 5.15
(to Note Purchase Agreement)
Ohio Tax Exempt -
Ohio Tax Exempt 10,260,000.00
Ohio Tax Exempt 12,000,000.00
Ohio Tax Exempt 5,530,000.00
Ohio Tax Exempt 5,350,000.00
Ohio Long-term 48,462,000.00
PSW UTMA Note 1,304,830.00
PA UTMA Note 1,304,830.00
PSW Tax Exempt 30,000,000.00
PSW Tax Exempt 25,000,000.00
PSW Tax Exempt -
PSW Tax Exempt 25,000,000.00
Shenango Tax Exempt 18,360,000.00
PSW Tax Exempt 22,000,000.00
PSW Tax Exempt 14,000,000.00
Roaring Cr Tax Exempt -
PSW Tax Exempt 2,800,000.00
PA Tax Exempt 25,000,000.00
PA Tax Exempt 162,160,000.00
Roaring Cr Penvest 428,290.61
Susquehana Penvest 151,643.26
Susquehana Penvest 377,536.49
Shenango Penvest 569,263.46
Shenango Penvest 1,306,288.34
PSW Penvest 696,344.48
PSW Penvest 65,416.29
NUI Penvest 3,500,000.00
PSW Penvest 8,995,195.60
PSW Penvest 1,656,878.36
PSW Penvest 1,076,162.86
PSW Penvest 993,172.76
PSW Penvest 5,139,605.86
PSW Penvest 615,465.00
PSW Penvest 1,028,407.81
PSW Penvest 1,116,403.57
PSW Penvest 353,469.35
PSW Penvest 704,673.48
Fawn Lake Penvest -
Western Penvest 482,416.03
Hawley Penvest 330,994.80
Hawley Penvest 677,221.80
Waymart Penvest -
Waymart Penvest -
Roaring Cr Penvest 325,084.15
PA Penvest 30,589,934.36
PSW FMB -
5.15-2
PSW FMB 10,000,000.00
PSW FMB 25,000,000.00
PSW FMB 15,000,000.00
PSW FMB 10,000,000.00
PSW FMB 15,000,000.00
PSW FMB -
PSW FMB 10,000,000.00
PSW FMB 10,000,000.00
PSW FMB 10,000,000.00
PSW FMB 12,000,000.00
PSW FMB 10,000,000.00
PSW FMB 10,000,000.00
PSW FMB 10,000,000.00
PSW FMB 15,000,000.00
PSW FMB 11,000,000.00
PSW FMB 10,000,000.00
PSW FMB 15,000,000.00
Shenango FMB 4,000,000.00
Susquehana FMB 1,500,000.00
Shenango FMB 3,500,000.00
PSW FMB 20,000,000.00
PSW FMB 7,600,000.00
PSW FMB 5,000,000.00
Shenango FMB 2,340,889.68
PSW FMB 12,000,000.00
Shenango FMB 1,320,000.00
Roaring Cr FMB 4,000,000.00
PSW FMB 5,000,000.00
PSW FMB 5,000,000.00
PSW FMB 5,000,000.00
PA FMB 274,260,889.68
Fawn Lake Bank Notes -
Fawn Lake Bank Notes -
Fawn Lake Bank Notes -
Fawn Lake Bank Notes -
Western Bank Notes -
PA Bank Notes 0.00
PA Long-term 468,315,654.04
LWW Note 2775234.99
LWW Note 1893631.47
LWW Long-term 4,668,866.46
PSC Note 788,000.00
PSC Long-term 788,000.00
Total Long-Term 605,919,703.65
Illinois Nat City LOC 10,905,000.00
Illinois CoBank LOC 5,250,000.00
5.15-3
Illinois Short-term 16,155,000.00
Maine Fleet LOC 760,000.00
Maine CoBank LOC 1,200,000.00
Maine Short-term 1,960,000.00
New Jersey CoBank LOC 4,600,000.00
New Jersey Citizens LOC 1,200,000.00
New Jersey First Union LOC -
New Jersey Short-term 5,800,000.00
Ohio CoBank LOC 1,700,000.00
Ohio Nat City LOC 2,700,000.00
Ohio Short-term 4,400,000.00
PSW Revolver 9,000,000.00
PSW Revolver 13,400,000.00
PSW Revolver 20,800,000.00
PSW Revolver 8,001,000.00
PSW Revolver
PSW Revolver
PSW Revolver 51,201,000.00
Roaring Creek Mellon LOC
Roaring Creek LOC
Shenango Nat City LOC
Shenango LOC
Susquehanna Mellon LOC
Susquehanna LOC
PA Short-term 51,201,000.00
CWC Revolver 11,393,237.00
CWC Revolver
CWC Revolver
CWC Revolver
CWC Revolver
CWC Short-term 11,393,237.00
PSC PNC LOC 0.00
PSC PNC LOC 9,000,000.00
PSC PNC LOC 2,000,000.00
PSC PNC LOC 11,000,000.00
PSC Citizens LOC 7,400,000.00
PSC Citizens LOC 0.00
PSC Citizens LOC 0.00
PSC Citizens LOC 7,400,000.00
PSC Short-term 18,400,000.00
Total Short-term 109,309,237.00
Total L-T and S-T 715,228,940.65
*AquaSource Note July 31, 2003 90,000,000.00
5.15-4
[FORM OF NOTE]
PHILADELPHIA SUBURBAN CORPORATION
4.87% SENIOR NOTE, DUE JULY 31, 2023
No. [_______] [Date]
$[__________] PPN 718009 A@ 2
FOR VALUE RECEIVED, the undersigned, PHILADELPHIA SUBURBAN CORPORATION
(herein called the "Company"), a corporation organized and existing under the
laws of the Commonwealth of Pennsylvania, hereby promises to pay to
[_____________________] or registered assigns, the principal sum of
[______________] DOLLARS on July 31, 2023 with interest (computed on the basis
of a 360-day year of twelve 30-day months) (a) on the unpaid balance thereof at
the rate of 4.87% per annum from the date hereof, payable semi-annually, on the
thirty-first day of January and July in each year and at maturity, commencing
with the January or July next succeeding the date hereof, until the principal
hereof shall have become due and payable, and (b) to the extent permitted by law
on any overdue payment (including any overdue prepayment) of principal, any
overdue payment of interest and any overdue payment of any Make-Whole Amount (as
defined in the Note Purchase Agreement referred to below), payable semi-annually
as aforesaid (or, at the option of the registered holder hereof, on demand), at
a rate per annum from time to time equal to the greater of (i) 6.87% or (ii) 2%
over the rate of interest publicly announced by PNC Bank, N.A. from time to time
in New York, New York as its "base" or "prime" rate.
Payments of principal of, interest on and any Make-Whole Amount with
respect to this Note are to be made in lawful money of the United States of
America at the principal office of PNC Bank, N.A. in New York, New York or at
such other place as the Company shall have designated by written notice to the
holder of this Note as provided in the Note Purchase Agreement referred to
below.
This Note is one of a series of Senior Notes (herein called the
"Notes") issued pursuant to the Note Purchase Agreement, dated as of July 31,
2003 (as from time to time amended, the "Note Purchase Agreement"), between the
Company and the respective Purchasers named therein and is entitled to the
benefits thereof. Each holder of this Note will be deemed, by its acceptance
hereof, (i) to have agreed to the confidentiality provisions set forth in
Section 20 of the Note Purchase Agreement and (ii) to have made the
representation set forth in Section 6.2 of the Note Purchase Agreement.
This Note is a registered Note and, as provided in the Note Purchase
Agreement, upon surrender of this Note for registration of transfer, duly
endorsed, or accompanied by a written instrument of transfer duly executed, by
the registered holder hereof or such holder's attorney duly authorized in
writing, a new Note for a like principal amount will be issued to, and
registered in the name of, the transferee. Prior to due presentment for
registration of transfer, the Company may treat the person in whose name this
Note is registered as the owner hereof for the purpose of receiving payment and
for all other purposes, and the Company will not be affected by any notice to
the contrary.
EXHIBIT 1
(to Note Purchase Agreement)
The Company will make required prepayments of principal on the dates
and in the amounts specified in the Note Purchase Agreement. This Note is also
subject to optional prepayment, in whole or from time to time in part, at the
times and on the terms specified in the Note Purchase Agreement, but not
otherwise.
If an Event of Default, as defined in the Note Purchase Agreement,
occurs and is continuing, the principal of this Note may be declared or
otherwise become due and payable in the manner, at the price (including any
applicable Make-Whole Amount) and with the effect provided in the Note Purchase
Agreement.
This Note shall be construed and enforced in accordance with, and the
rights of the issuer and holder hereof shall be governed by, the law of the
State of New York excluding choice-of-law principles of the law of such State
that would require the application of the laws of a jurisdiction other than such
State.
PHILADELPHIA SUBURBAN CORPORATION
By
Name: _________________________________
Title: ________________________________
E-1-2
FORM OF OPINION OF GENERAL COUNSEL
TO THE COMPANY
The closing opinion of Xxx X. Xxxxx, Esq., General Counsel of the
Company, which is called for by Section 4.4 of the Note Purchase Agreement,
shall be dated the date of Closing and addressed to the Purchasers, shall be
satisfactory in scope and form to each Purchaser and shall be to the effect
that:
1. The Company has the full corporate power and the corporate
authority to conduct the activities in which it is now engaged and is duly
licensed or qualified and is in good standing as a foreign corporation in each
jurisdiction in which the character of the properties owned or leased by it or
the nature of the business transacted by it makes such licensing or
qualification necessary except in jurisdictions where the failure to be so
qualified or licensed would not have a material adverse effect on the business
of the Company.
2. Each Subsidiary is a corporation duly incorporated, validly existing
and in good standing under the laws of its jurisdiction of incorporation, and is
duly licensed or qualified and is in good standing and has valid and subsisting
franchises and certificates of conveyance and necessity in each jurisdiction in
which the character of the properties owned or leased by it or the nature of the
business transacted by it makes such licensing or qualification or the
possession of such franchises and certificates of conveyance and necessity
necessary except in jurisdictions where the failure to be so qualified or
licensed to possess such would not have a material adverse effect on the
business of the Subsidiaries and the Company taken as a whole. Except as set
forth in Schedule 5.4 to the Note Purchase Agreement, all of the issued and
outstanding shares of capital stock of each such Subsidiary have been duly
issued, are fully paid and non-assessable and are owned by the Company, by one
or more Subsidiaries, or by the Company and one or more Subsidiaries.
3. The issuance and sale of the Notes and the execution, delivery and
performance by the Company of the Note Purchase Agreement do not violate any
provision of any law or other rule or regulation of any Governmental Authority
applicable to the Company or any Subsidiary or conflict with or result in any
breach of any of the provisions of or constitute a default under or result in
the creation or imposition of any Lien upon any of the property of the Company
pursuant to the provisions of the Articles of Incorporation or By-laws of the
Company or any agreement or other instrument known to such counsel to which the
Company is a party or by which the Company may be bound.
4. There are no actions, suits or proceedings pending or, to the
knowledge of such counsel after due inquiry, threatened against or affecting the
Company or any Subsidiary in any court or before any governmental authority or
arbitration board or tribunal which are both likely to be, adversely determined,
and if so determined would have a materially adverse effect on the properties,
business, prospects, profits or condition, (financial or otherwise) of the
Company and its Subsidiaries taken as a whole or the ability of the Company to
perform its obligations under the Note Purchase Agreement and the Notes or on
the legality, validity or enforceability of the Company's obligations under the
Note Purchase Agreement or the Notes. To the knowledge of such counsel, neither
the Company nor any Subsidiary is in default with respect to any order of any
court or governmental authority, or arbitration board or tribunal which default
would have a materially adverse effect on the Subsidiaries and the Company taken
as a whole.
EXHIBIT 4.4(a)
(to Note Purchase Agreement)
The opinion of Xxx X. Xxxxx, Esq., shall cover such other matters
relating to the sale of the Notes as each Purchaser may reasonably request. With
respect to matters of fact on which such opinion is based, such counsel shall be
entitled to rely on appropriate certificates of public officials and other
officers of the Company.
E-4.4(a)-2
FORM OF OPINION OF SPECIAL COUNSEL
TO THE COMPANY
The closing opinion of Xxxxxxxx Xxxxxx, LLP, special counsel to the
Company, which is called for by Section 4.4 of the Note Purchase Agreement,
shall be dated the date of Closing and addressed to the Purchasers, shall be
satisfactory in scope and form to each Purchaser and shall be to the effect
that:
1. The Company is a corporation, duly incorporated, validly existing
and in good standing under the laws of its jurisdiction of incorporation, has
the corporate power and the corporate authority to execute and perform the Note
Purchase Agreement and to issue the Notes and has the full corporate power and
the corporate authority to conduct the activities in which it is now engaged.
2. The Note Purchase Agreement constitutes the legal, valid and
binding contract of the Company enforceable in accordance with its terms,
subject to bankruptcy, insolvency, fraudulent conveyance and similar laws
affecting creditors' rights generally, and general principles of equity
(regardless of whether the application of such principles is considered in a
proceeding in equity or at law).
3. The Notes constitute the legal, valid and binding obligations of
the Company enforceable in accordance with their terms, subject to bankruptcy,
insolvency, fraudulent conveyance and similar laws affecting creditors' rights
generally, and general principles of equity (regardless of whether the
application of such principles is considered in a proceeding in equity or at
law).
4. No approval, consent or withholding of objection on the part of, or
filing, registration or qualification with, any governmental body, Federal or
state, is necessary in connection with the execution and delivery of the Note
Purchase Agreement or the Notes.
5. The issuance, sale and delivery of the Notes under the
circumstances contemplated by the Note Purchase Agreement do not, under existing
law, require the registration of the Notes under the Securities Act of 1933, as
amended, or the qualification of an indenture under the Trust Indenture Act of
1939, as amended.
6. Neither the issuance of the Notes nor the application of the
proceeds of the sale of the Notes will violate or result in a violation of
Section 7 of the Securities Exchange Act of 1934, as amended, or any regulation
issued pursuant thereto, including, without limitation, Regulation T, U or X of
the Board of Governors of the Federal Reserve System.
7. The Company is not an "investment company" or a company
"controlled" by an "investment company", within the meaning of the Investment
Company Act of 1940, as amended.
EXHIBIT 4.4(b)
(to Note Purchase Agreement)
The opinion of Xxxxxxxx Xxxxxx, LLP, shall cover such other matters
relating to the sale of the Notes as each Purchaser may reasonably request. With
respect to matters of fact on which such opinion is based, such counsel shall be
entitled to rely on appropriate certificates of public officials and other
officers of the Company.
E-4.4(b)-2
FORM OF OPINION OF SPECIAL COUNSEL
TO THE PURCHASERS
The closing opinion of Xxxxxxx and Xxxxxx LLP, special counsel to the
Purchasers, called for by Section 4.4 of the Note Purchase Agreement, shall be
dated the date of Closing and addressed to each Purchaser, shall be satisfactory
in form and substance to each Purchaser and shall be to the effect that:
1. The Company is a corporation, validly existing and in good standing
under the laws of its jurisdiction of incorporation and has the corporate power
and the corporate authority to execute and deliver the Note Purchase Agreement
and to issue the Notes.
2. The Note Purchase Agreement has been duly authorized by all
necessary corporate action on the part of the Company, has been duly executed
and delivered by the Company and constitutes the legal, valid and binding
contract of the Company enforceable in accordance with its terms, subject to
bankruptcy, insolvency, fraudulent conveyance and similar laws affecting
creditors' rights generally, and general principles of equity (regardless of
whether the application of such principles is considered in a proceeding in
equity or at law).
3. The Notes have been duly authorized by all necessary corporate
action on the part of the Company, and the Notes being delivered on the date
hereof have been duly executed and delivered by the Company and constitute the
legal, valid and binding obligations of the Company enforceable in accordance
with their terms, subject to bankruptcy, insolvency, fraudulent conveyance and
similar laws affecting creditors' rights generally, and general principles of
equity (regardless of whether the application of such principles is considered
in a proceeding in equity or at law).
4. The issuance, sale and delivery of the Notes under the
circumstances contemplated by the Note Purchase Agreement do not, under existing
law, require the registration of the Notes under the Securities Act of 1933, as
amended, or the qualification of an indenture under the Trust Indenture Act of
1939, as amended.
The opinion of Xxxxxxx and Xxxxxx LLP shall also state that the
opinions of Xxx X. Xxxxx, Esq., General Counsel to the Company, and Xxxxxxxx
Xxxxxx, LLP, special Counsel to the Company, are satisfactory in scope and form
to Xxxxxxx and Xxxxxx LLP and that, in their opinion, the Purchasers are
justified in relying thereon. With respect to matters of fact upon which such
opinion is based, Xxxxxxx and Xxxxxx LLP may rely on appropriate certificates of
public officials and officers of the Company and upon representations of the
Company and the Purchasers delivered in connection with the issuance and sale of
the Notes.
EXHIBIT 4.4(c)
(to Note Purchase Agreement)
In rendering the opinion set forth in paragraph 1 above, Xxxxxxx and
Xxxxxx LLP may rely, as to matters referred to in paragraph 1, solely upon an
examination of the Articles of Incorporation certified by, and a certificate of
good standing of the Company from, the Secretary of State of the State of
Delaware, the Bylaws of the Company and the general business corporation law of
the State of Delaware. The opinion of Xxxxxxx and Xxxxxx LLP is limited to the
laws of the State of New York, the general business corporation law of the State
of Delaware and the Federal laws of the United States.
E-4.4(c)-2
