15% Series A Senior Secured Discount Notes Due 2007 and Warrants
of MIDDLE AMERICAN TISSUE INC.
PURCHASE AGREEMENT
July 9, 1999
To the Initial Purchasers
named on Schedule 1 hereto
Dear Ladies and Gentlemen:
Middle American Tissue Inc., a Delaware corporation ("Holdings"), proposes
to issue and sell to the initial purchasers named on Schedule 1 hereto
(together, the "Initial Purchasers") $35,755,788 aggregate principal amount of
its 15% Series A Senior Secured Discount Notes due 2007 (the "Series A Notes")
and 24 warrants (the "Warrants," and together with the Series A Notes, the
"Securities") to purchase at an exercise price of $0.01, shares of common stock,
par value $0.01 per share, of Holdings (the "Holdings Common Stock")
representing an aggregate of twelve percent (12%) of the Holdings Common Stock
outstanding on a fully diluted basis as of the date hereof, subject to the terms
and conditions set forth herein. The Holdings Common Stock issuable upon
exercise of the Warrants is referred to herein as the "Warrant Shares." The
Series A Notes are to be issued pursuant to the provisions of an indenture (the
"Indenture"), to be dated as of the Closing Date (as defined), among Holdings
and The Chase Manhattan Bank, as trustee (the "Trustee"). The Warrants are to be
issued in the form contained in the Warrant Agreement (the "Warrant Agreement")
attached hereto as Exhibit A and will be exercisable for Holdings Common Stock
having the rights, restrictions, privileges and preferences set forth in the
Certificate of Incorporation of Holdings in the form of Exhibit B attached
hereto (the "Certificate of Incorporation"). The Warrants will have the benefit
of the registration rights set forth in the Stockholders Agreement, dated as of
July 9, 1999 by and among Holdings and the other signatories thereto (the
"Stockholders Agreement") attached hereto as Exhibit C. The Series A Notes and
the Series B Notes (as defined) issuable in exchange therefor are collectively
referred to herein as the "Notes." The term "Designated Subsidiaries" as used
herein refers to each of the entities listed on Schedule 2 hereto. Capitalized
terms used but not defined herein shall have the meanings given to such terms in
the Indenture.
1. Offering Memorandum. The Series A Notes will be offered and sold to the
Initial Purchasers pursuant to one or more exemptions from the registration
requirements under the Securities Act of 1933, as amended (the "Act"). American
Tissue Inc. (the "Company") and the other Designated Subsidiaries have prepared
a preliminary offering memorandum, dated June 8, 1999 (the "Preliminary Offering
Memorandum"), and a final offering memorandum, dated July 9, 1999 (the "Offering
Memorandum"), relating to the $165,000,000 12 1/2 % Series A Senior Secured
Notes Due 2006 ("Series A Company Notes" and together with Series B Company
Notes (as defined), the "Company Notes") and the related subsidiary guarantees.
Upon original issuance thereof, and until such time as the same is no
longer required pursuant to the Indenture, the Securities (and all securities
issued in exchange therefor, in substitution thereof or upon conversion thereof)
shall bear the following legend:
"THIS SECURITY (OR ITS PREDECESSOR) HAS NOT BEEN REGISTERED UNDER THE U.S.
SECURITIES ACT OF 1933, AS AMENDED (THE 'SECURITIES ACT'), AND,
ACCORDINGLY, MAY NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED
WITHIN THE UNITED STATES OR TO, OR FOR THE ACCOUNT OR BENEFIT OF, U.S.
PERSONS, EXCEPT AS SET FORTH IN THE SECOND SENTENCE HEREOF. BY ITS
ACQUISITION HEREOF OR OF A BENEFICIAL INTEREST HEREIN, THE HOLDER (1)
REPRESENTS THAT (A) IT IS A 'QUALIFIED INSTITUTIONAL BUYER' (AS DEFINED IN
RULE 144A UNDER THE SECURITIES ACT) (A 'QIB'), OR (B) IT IS ACQUIRING THIS
SECURITY IN AN OFFSHORE TRANSACTION IN COMPLIANCE WITH REGULATION S UNDER
THE SECURITIES ACT OR (C) IT IS AN INSTITUTIONAL 'ACCREDITED INVESTOR' (AS
DEFINED IN RULE 501(a)(1), (2), (3) OR (7) UNDER THE SECURITIES ACT), (2)
AGREES THAT IT WILL NOT, WITHIN THE TIME PERIOD REFERRED TO UNDER RULE
144(k) (TAKING INTO ACCOUNT THE PROVISIONS OF RULE 144(d) UNDER THE
SECURITIES ACT, IF APPLICABLE) UNDER THE SECURITIES ACT AS IN EFFECT ON THE
DATE OF THE TRANSFER OF THIS SECURITY, RESELL OR OTHERWISE TRANSFER THIS
NOTE, EXCEPT (A) TO HOLDINGS OR ANY OF ITS SUBSIDIARIES, (B) TO A PERSON
WHO THE SELLER REASONABLY BELIEVES IS A QIB PURCHASING FOR ITS OWN ACCOUNT
OR FOR THE ACCOUNT OF A QIB IN A TRANSACTION MEETING THE REQUIREMENTS OF
RULE 144A, (C) IN AN OFF-
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SHORE TRANSACTION MEETING THE REQUIREMENTS OF RULE 903 OR 904 OF THE
SECURITIES ACT, (D) IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 144
UNDER THE SECURITIES ACT, (E) TO AN INSTITUTIONAL 'ACCREDITED INVESTOR' (AS
DEFINED IN RULE 501(a)(1), (2), (3) OR (7) OF REGULATION D UNDER THE
SECURITIES ACT) THAT, PRIOR TO SUCH TRANSFER, FURNISHES THE TRUSTEE A
SIGNED LETTER CONTAINING CERTAIN REPRESENTATIONS AND AGREEMENTS RELATING TO
THE TRANSFER OF THIS SECURITY (THE FORM OF WHICH CAN BE OBTAINED FROM THE
TRUSTEE) AND, IF SUCH TRANSFER IS IN RESPECT OF AN AGGREGATE PRINCIPAL
AMOUNT OF SECURITIES LESS THAN $250,000, AN OPINION OF COUNSEL ACCEPTABLE
TO HOLDINGS THAT SUCH TRANSFER IS IN COMPLIANCE WITH THE SECURITIES ACT,
(F) IN ACCORDANCE WITH ANOTHER EXEMPTION FROM THE REGISTRATION REQUIREMENTS
OF THE SECURITIES ACT (AND BASED UPON AN OPINION OF COUNSEL ACCEPTABLE TO
HOLDINGS) OR (G) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT AND, IN
EACH CASE, IN ACCORDANCE WITH THE APPLICABLE SECURITIES LAWS OF ANY STATE
OF THE UNITED STATES OR ANY OTHER APPLICABLE JURISDICTION AND (3) AGREES
THAT IT WILL DELIVER TO EACH PERSON TO WHOM THIS SECURITY OR AN INTEREST
HEREIN IS TRANSFERRED A NOTICE SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND.
AS USED HEREIN, THE TERMS 'OFFSHORE TRANSACTION' AND 'UNITED STATES' HAVE
THE MEANINGS GIVEN TO THEM BY RULE 902 OF REGULATION S UNDER THE SECURITIES
ACT. THE INDENTURE CONTAINS A PROVISION REQUIRING THE TRUSTEE TO REFUSE TO
REGISTER ANY TRANSFER OF THIS NOTE IN VIOLATION OF THE FOREGOING."
2. Agreements to Sell and Purchase. On the basis of the representations,
warranties and covenants contained in this Agreement, and subject to the terms
and conditions contained herein, Holdings agrees to issue and sell to each
Initial Purchaser, and each Initial Purchaser agrees to purchase from Holdings,
the Securities set forth opposite the name of such Initial Purchaser on Schedule
1 hereto at the purchase price set forth opposite such name equal to $447.48 for
each $1,000 principal amount of Series A Notes and $166,666.67 for each Warrant.
Holdings and the Initial Purchasers agree to use an aggregate purchase price of
$16 million for the Notes and $4 million for the Warrants in determining issue
prices for U.S. federal income tax purposes.
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3. Terms of Offering. The Initial Purchasers have advised Holdings that the
Initial Purchasers may make offers (the "Exempt Resales") of the Securities
purchased hereunder, solely (i) to persons whom the Initial Purchasers
reasonably believe to be "qualified institutional buyers" as defined in Rule
144A under the Act ("QIBs"), (ii) to persons permitted to purchase the Series A
Notes in offshore transactions in reliance upon Regulation S under the Act
(each, a "Regulation S Purchaser") and (iii) to a limited number of
institutional "accredited investors" as defined in Rule 501(a)(1), (2), (3) or
(7) ("Accredited Investors") (such persons specified in clauses (i), (ii) and
(iii) being referred to herein as the "Eligible Purchasers").
Holders (including subsequent transferees) of the Series A Notes will have
the registration rights set forth in the registration rights agreement (the
"Registration Rights Agreement"), to be dated the Closing Date, in substantially
the form of Exhibit D hereto, for so long as such Series A Notes constitute
"Transfer Restricted Securities" (as defined in the Registration Rights
Agreement). Pursuant to the Registration Rights Agreement, Holdings will agree
to file with the Securities and Exchange Commission (the "Commission") under the
circumstances set forth therein, (i) a registration statement under the Act (the
"Exchange Offer Registration Statement") relating to Holdings' 15% Series B
Senior Discount Notes Due 2007 (the "Series B Notes"), to be offered in exchange
for the Series A Notes (such offer to exchange being referred to as the
"Exchange Offer") and (ii) a shelf registration statement pursuant to Rule 415
under the Act (the "Shelf Registration Statement" and, together with the
Exchange Offer Registration Statement, the "Registration Statements") relating
to the resale by certain holders of the Series A Notes and to use its
commercially reasonable best efforts to cause such Registration Statements to be
declared and remain effective and usable for the periods specified in the
Registration Rights Agreement and to consummate the Exchange Offer.
The Securities are being offered and sold by Holdings in part to finance
the transactions contemplated by that certain Asset Purchase Agreement, dated as
of March 24, 1999 (the "Asset Purchase Agreement"), by and among Crown Paper
Co., Crown Vantage New Hampshire Electric, Inc. and Berlin Xxxxx Railway, Inc.,
as sellers (collectively, "Crown"), Pulp & Paper of America LLC ("PPA") and the
Company, pursuant to which PPA and/or its designees will, upon the terms and
subject to the conditions set forth therein, acquire certain assets of Crown,
including, without limitation, the Xxxxxxx Pulp Mill in Berlin, New Hampshire
and the Cascade Paper Mill in Gorham, New Hampshire (together, the
"Xxxxxx-Xxxxxx Xxxxx"). In connection with these transactions, the Company
entered into a Purchase Agreement ("Company Notes Purchase Agreement") dated as
of July 1, 1999 among the Company, the other Designated Subsidiaries and
Xxxxxxxxx, Lufkin & Xxxxxxxx Securities Corporation ("Company Notes Purchaser")
and will enter into on the date hereof (a) an indenture (the "Company Notes
Indenture") pursuant to which the Series A Company Notes will be issued, (b) a
registration rights agreement (the "Company
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Notes Registration Rights Agreement") providing certain registration rights to
the holders of Series A Company Notes, (c) the Collateral Documents (as defined
in the Company Notes Indenture) pursuant to which the Company and the other
Designated Subsidiaries have agreed, among other things, to grant (i) a first
priority security interest in their respective property, plant and equipment as
set forth in the Collateral Documents and (ii) a second priority security
interest in their respective property, accounts receivable and inventory as set
forth in the Collateral Documents, in the case of each of clauses (i) and (ii)
subject to certain exceptions and otherwise in accordance with the terms of the
Company Notes Indenture and the Collateral Documents, and (d) a Revolving Credit
Facility (as defined in the Company Indenture).
The Initial Purchasers and their direct and indirect transferees of the
Securities will also be entitled to the benefits of the Securities Pledge
Agreement dated as of the Closing Date made by Holdings in favor of the Initial
Purchasers (the "Securities Pledge Agreement") pursuant to which Holdings has
agreed to grant to the Trustee a first priority security interest in all the
Company's capital stock to secure Holdings' obligations under the Indenture and
certain obligations under the Stockholders Agreement.
This Agreement, the Indenture, the Notes, the Warrants, the Warrant Shares,
the Warrant Agreement, the Registration Rights Agreement, the Securities Pledge
Agreement, the Stockholders Agreement, the Company Notes Purchase Agreement, the
Company Notes Indenture, the Company Notes, the Company Notes Registration
Rights Agreement, the Subsidiary Guarantees (as defined in the Company Notes
Purchase Agreement) and the Collateral Documents are hereinafter sometimes
referred to collectively as the "Operative Documents."
4. Delivery and Payment.
(a) Delivery of, and payment of the Purchase Price for, the Series A Notes
and the Warrants shall be made at the offices of Xxxxxx Xxxxxx & Xxxxxxx at 00
Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, or such other location as may be mutually
acceptable to the parties hereto. Such delivery and payment shall be made at
9:00 a.m. New York City time, on July 9, 1999 or at such other time as shall be
agreed upon by the Initial Purchasers and Holdings. The time and date of such
delivery and the payment are herein called the "Closing Date."
(b) One or more of the Series A Notes in definitive global form, registered
in the name of Cede & Co., as nominee of The Depository Trust Company ("DTC"),
having an aggregate principal amount corresponding to the aggregate principal
amount of the Series A Notes (collectively, the "Global Note") and one or more
certificates representing the Warrants shall be delivered by Holdings to the
Initial Purchasers (or as the Initial Purchasers direct) in each case with any
transfer taxes thereon duly paid by Holdings
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against payment by the Initial Purchasers of the aggregate purchase price
therefor by wire transfer in immediately available funds to the order of
Holdings. The Global Note shall be made available to the Initial Purchasers for
inspection not later than 9:30 a.m., New York City time, on the business day
immediately preceding the Closing Date.
5. Agreements of Holdings. Holdings hereby agrees with the Initial
Purchasers as follows:
(a) To advise the Initial Purchasers promptly and, if requested by the
Initial Purchasers, confirm such advice in writing, (i) of the issuance by
any state securities commission of any stop order suspending the
qualification or exemption from qualification of the Securities for
offering or sale in any jurisdiction designated by the Initial Purchasers
pursuant to Section 5(e) hereof, or the initiation of any proceeding by any
state securities commission or any other federal or state regulatory
authority for such purpose and (ii) of the happening of any event during
the period referred to in Section 5(c) below that makes any statement of a
material fact made in the Preliminary Offering Memorandum or the Offering
Memorandum untrue or that requires any additions to or changes in the
Preliminary Offering Memorandum or the Offering Memorandum in order to make
the statements therein not misleading. Holdings shall use its commercially
reasonable best efforts to prevent the issuance of any stop order or order
suspending the qualification or exemption of the Securities under any state
securities or Blue Sky laws and, if at any time any state securities
commission or other federal or state regulatory authority shall issue an
order suspending the qualification or exemption of the Securities under any
state securities or Blue Sky laws, Holdings shall use its commercially
reasonable best efforts to obtain the withdrawal or lifting of such order
at the earliest possible time.
(b) To furnish the Initial Purchasers and those persons identified by
the Initial Purchasers to Holdings as many copies of the Preliminary
Offering Memorandum and the Offering Memorandum, and any amendments or
supplements thereto, as the Initial Purchasers may reasonably request.
Subject to the Initial Purchasers' compliance with its representations and
warranties and agreements set forth in Section 7 hereof, Holdings consents
to the use of the Preliminary Offering Memorandum and the Offering
Memorandum, and any amendments and supplements thereto required pursuant
hereto, by the Initial Purchasers in connection with Exempt Resales.
(c) During such period as in the opinion of counsel for the Initial
Purchasers an Offering Memorandum is required by law to be delivered in
connection with Exempt Resales by the Initial Purchasers, (i) not to make
any amendment or supplement to the Offering Memorandum which the Initial
Purchasers shall not pre-
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viously have been advised of and shall have reasonably objected to after
being so advised (except to the extent any such amendment or supplement is
necessary, in the judgment of counsel to Holdings, in order to make the
statements in the Offering Memorandum not misleading) and (ii) to prepare
promptly upon the Initial Purchasers' reasonable request, any amendment or
supplement to the Offering Memorandum which may be necessary or advisable
in connection with such Exempt Resales (except to the extent any such
amendment or supplement requested would, in the judgment of counsel to
Holdings, render the statements made in the Offering Memorandum, as
proposed to be amended or supplemented, misleading).
(d) If, during the period referred to in Section 5(c) above, any event
shall occur or condition shall exist as a result of which, in the opinion
of counsel to the Initial Purchasers, it becomes necessary to amend or
supplement the Offering Memorandum in order to make the statements therein,
in the light of the circumstances when such Offering Memorandum is
delivered to an Eligible Purchaser, not misleading, or if, in the opinion
of counsel to the Initial Purchasers, it is necessary to amend or
supplement the Offering Memorandum to comply with any applicable law,
forthwith to prepare an appropriate amendment or supplement to such
Offering Memorandum so that the statements therein, as so amended or
supplemented, will not, in the light of the circumstances when it is so
delivered, be misleading, or so that such Offering Memorandum will comply
with applicable law, and to furnish to the Initial Purchasers and such
other persons as the Initial Purchasers may designate such number of copies
thereof as the Initial Purchasers may reasonably request.
(e) Prior to the sale of all Securities pursuant to Exempt Resales as
contemplated hereby, to cooperate with the Initial Purchasers and counsel
to the Initial Purchasers in connection with the registration or
qualification of the Securities pursuant to Exempt Resales under the
securities or Blue Sky laws of such jurisdictions as the Initial Purchasers
may reasonably request and to continue such qualification in effect so long
as required for Exempt Resales and to file such consents to service of
process or other documents as may be necessary in order to effect such
registration or qualification; provided, however, that Holdings shall not
be required in connection therewith to register or qualify as a foreign
corporation or limited liability company in any jurisdiction in which it is
not now so qualified or to take any action that would subject it to general
consent to service of process or taxation other than as to matters and
transactions relating to the Preliminary Offering Memorandum, the Offering
Memorandum or Exempt Resales, in any jurisdiction in which it is not now so
subject.
(f) So long as the Securities are outstanding, (i) to mail and make
generally available as soon as practicable after the end of each fiscal
year to the record
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holders of the Securities a financial report of Holdings and its
subsidiaries on a consolidated basis (and a similar financial report of all
unconsolidated subsidiaries, if any), all such financial reports to include
a consolidated balance sheet, a consolidated statement of operations, a
consolidated statement of cash flows and a consolidated statement of
shareholders' equity as of the end of and for such fiscal year, together
with comparable information as of the end of and for the preceding year,
certified by Holdings' independent public accountants and (ii) to mail and
make generally available as soon as practicable after the end of each
quarterly period (except for the last quarterly period of each fiscal year)
to such holders, a consolidated balance sheet, a consolidated statement of
operations and a consolidated statement of cash flows (and similar
financial reports of all unconsolidated subsidiaries, if any) as of the end
of and for such period, and for the period from the beginning of such year
to the close of such quarterly period, together with comparable information
for the corresponding periods of the preceding year. In addition, so long
as the Initial Purchasers or their affiliates hold Securities, Holdings
shall furnish the Initial Purchasers or their affiliates with financial
information on a monthly basis. Each Initial Purchaser on behalf of itself
and its affiliates which become Holders of the Securities, agrees to
maintain the confidentiality of the information referred to in the
preceding sentence and shall not be used other than in connection with its
holding of Securities, except that such information may be disclosed (a) to
its and its affiliates' directors, officers, employees and agents,
including accountants, legal counsel and other advisors in connection with
matters concerning the Securities (it being understood that the Persons to
whom such disclosure is made will be informed of the confidential nature of
such information and instructed to keep such information confidential), (b)
to the extent requested by any regulatory authority, (c) to the extent
required by applicable laws or regulations or by any subpoena or similar
legal process, (d) in connection with the exercise of any remedies
hereunder or any suit, action or proceeding relating to this Agreement or
any other Operative Document or the enforcement of rights hereunder or
thereunder, (e) with the consent of Holdings or (f) to the extent such
information (i) becomes publicly available other than as a result of a
breach of this Section or (ii) becomes available to the Initial Purchasers
or their affiliates on a nonconfidential basis from a source other than
Holdings or any Designated Subsidiary.
(g) For a period of five years following the date of this Agreement,
to furnish to the Initial Purchasers as soon as available copies of all
reports or other communications furnished by Holdings or any of the
Designated Subsidiaries to its security holders or furnished to or filed
with the Commission or any national securities exchange on which any class
of securities of Holdings or any of the Designated Subsidiaries is listed
and such other publicly available information concerning Holdings and/or
its subsidiaries as the Initial Purchasers may reasonably request.
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(h) So long as any of the Securities remain outstanding and during any
period in which Holdings is not subject to Section 13 or 15(d) of the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), to make
available to any holder of Securities in connection with any sale thereof
and any prospective purchaser of such Securities from such holder, the
information ("Rule 144A Information") required by Rule 144A(d)(4) under the
Act.
(i) Whether or not the transactions contemplated in this Agreement are
consummated or this Agreement is terminated, to pay or cause to be paid all
expenses incurred in connection with the performance of the obligations by
Holdings under this Agreement, including: (i) the fees, disbursements and
expenses of counsel to Holdings and accountants of Holdings in connection
with the sale and delivery of the Securities to the Initial Purchasers and
pursuant to Exempt Resales, and all other fees or expenses (other than the
fees and disbursements of counsel for the Initial Purchasers) in connection
with the preparation, printing, filing, if any, and distribution of the
Preliminary Offering Memorandum, the Offering Memorandum and all amendments
and supplements to any of the foregoing (including financial statements)
specified in Section 5(b), 5(c) and 5(d) prior to or during the period
specified in Section 5(c), including the mailing and delivering of copies
thereof to the Initial Purchasers and persons designated by it in the
quantities specified herein, (ii) all costs and expenses related to the
transfer and delivery of the Securities to the Initial Purchasers and
pursuant to Exempt Resales, including any transfer or other taxes payable
thereon, (iii) all costs, if any, of copying this Agreement, the other
Operative Documents and any other agreements or documents in connection
with the offering, purchase, sale or delivery of the Securities, (iv) all
expenses in connection with the registration or qualification of the
Securities for offer and sale under the securities or Blue Sky laws of the
several states and all costs of printing or producing any preliminary and
supplemental Blue Sky memoranda in connection therewith (including the
filing fees in connection with such registration or qualification and
memoranda relating thereto but excluding any fees and disbursements of
counsel), (v) the cost of printing certificates representing the
Securities, (vi) all expenses and listing fees in connection with the
application for quotation of the Securities in the National Association of
Securities Dealers, Inc. ("NASD") Automated Quotation System - PORTAL
("PORTAL"), (vii) the fees and expenses of the Trustee and the Trustee's
counsel in connection with the Indenture and the Notes, (viii) the fees and
expenses of the Trustee and its counsel in connection with the Securities
Pledge Agreement and any intercreditor agreements, (ix) the costs and
charges of any transfer agent, registrar and/or depositary (including DTC),
(x) any fees charged by rating agencies for the rating of the Notes, (xi)
all costs and expenses of the Exchange Offer and any Registration Statement
required to be borne by Holdings, as set forth in the Registration Rights
Agreement, and (xii) all other costs and expenses as set
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forth in the Engagement Letter dated as of March 1, 1999 by and between the
Company Notes Purchaser and the Company. Notwithstanding the foregoing,
other than as set forth in the first sentence of the third paragraph of
Section 11, Holdings shall not be obligated to pay any fees or
disbursements of counsel for the Initial Purchasers.
(j) To use its commercially reasonable best efforts to effect the
inclusion of the Notes in PORTAL and to maintain the listing of the Notes
on PORTAL for so long as the Notes are outstanding.
(k) To use its commercially reasonable best efforts (i) to obtain the
approval of DTC for "book-entry" transfer of the Notes and (ii) to comply
in all material respects with all of its agreements set forth in the
representation letters of Holdings to DTC relating to the approval of the
Notes by DTC for "book-entry" transfer.
(l) During the period beginning on the date hereof and continuing to
and including the Closing Date, not to offer, sell, contract to sell or
otherwise transfer or dispose of any debt securities of Holdings, or any
warrants, rights or options to purchase or otherwise acquire debt
securities of Holdings substantially similar to the Securities (other than
the Securities), without the prior written consent of the Initial
Purchasers).
(m) Not to sell, offer for sale or solicit offers to buy or otherwise
negotiate in respect of any security (as defined in the Act) that would be
integrated with the sale of the Securities to the Initial Purchasers or
pursuant to Exempt Resales in a manner that would require the registration
of any such sale of the Securities under the Act.
(n) Not to voluntarily claim, and to actively resist any attempts to
claim, the benefit of any usury laws against the holders of any Securities.
(o) To cause the Exchange Offer to be made in the appropriate form to
permit Exchange Notes registered pursuant to the Act to be offered in
exchange for the Notes to comply with all applicable federal and state
securities laws in connection with the Exchange Offer.
(p) To comply in all material respects with all of its agreements set
forth in the Registration Rights Agreement, the Stockholders Agreement and
the Warrant Agreement.
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(q) To use the proceeds received from the sale of the Securities in
the manner specified in the Offering Memorandum under the heading "Use of
Proceeds."
(r) Prior to the Closing Date, to furnish to the Initial Purchasers,
as soon as practicable after they have been prepared, a copy of any
unaudited interim consolidated financial statements of the Company for any
period subsequent to the period covered by the most recent financial
statements appearing in the Offering Memorandum.
(s) To use commercially reasonable best efforts to do and perform all
things required or necessary to be done and performed under this Agreement
by it prior to the Closing Date and to satisfy all conditions precedent to
the delivery of the Securities.
6. Representations, Warranties and Agreements of Holdings. As of the date
hereof Holdings represents and warrants to, and agrees with, the Initial
Purchasers that:
(a) The Preliminary Offering Memorandum as of its date does not, and
the Offering Memorandum as of its date and the Closing Date does not, and
any supplement or amendment to them will not, contain any untrue statement
of a material fact or omit to state any material fact required to be stated
therein or necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading, except that the
representations and warranties contained in this paragraph (a) shall not
apply to statements in or omissions from the Preliminary Offering
Memorandum or the Offering Memorandum (or any supplement or amendment
thereto) based upon information relating to the Company Notes Purchaser
furnished to Holdings or the Company in writing by the Company Notes
Purchaser expressly for use therein. No stop order preventing the use of
the Preliminary Offering Memorandum or the Offering Memorandum, or any
amendment or supplement thereto, or any order asserting that any of the
transactions contemplated by this Agreement are subject to the registration
requirements of the Act, has been issued.
(b) Each of Holdings and the Designated Subsidiaries has been duly
organized, is validly existing as a corporation or limited liability
company in good standing under the laws of its jurisdiction of organization
and has the requisite power and authority to carry on its business as
described in the Preliminary Offering Memorandum and the Offering
Memorandum and to own, lease, license and operate its properties, and each
is duly qualified and is in good standing as a foreign corporation or
limited liability company, as applicable, authorized to do business in each
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jurisdiction in which the nature of its business or its ownership or
leasing of property requires such qualification, except where the failure
to be so qualified would not (i) have a material adverse effect on the
business, prospects, condition (financial or otherwise) or results of
operations of Holdings and the Designated Subsidiaries, taken as a whole,
or (ii) draw into question the validity of this Agreement or any of the
other Operative Documents (a "Material Adverse Effect").
(c) All outstanding shares of capital stock of Holdings have been duly
authorized and validly issued and are fully paid, non-assessable and not
subject to any preemptive or similar rights and are free and clear of any
security interest, claim, lien, encumbrance or adverse interest of any
nature (each, a "Lien") created by it, except as set forth in the
Stockholders Agreement, dated as of July 9, 1999, by and among the Company
and the parties named therein and in the Stockholders Agreement entered
into as of July 9, 1999 among the stockholders of Super American Tissue
Inc. The authorized, issued and outstanding capital stock of the Company
is, and as of the Closing Date will be, as set forth under the caption
"Capitalization" in the Offering Memorandum and in the financial
statements, and the related notes, included in the Offering Memorandum and
Holdings will have authorized, issued and outstanding capitalization set
forth in Exhibit E hereto.
(d) The entities listed on Schedule A hereto will be the only
subsidiaries, direct or indirect, of Holdings on the Closing Date. All of
the outstanding shares of capital stock or other equity interests
(including, without limitation, membership interests in limited liability
companies) of each of the Designated Subsidiaries have been duly authorized
and validly issued and are fully paid and non-assessable, except for those
of the Designated Subsidiaries that are New York corporations, as provided
in Section 630 of the New York Business Corporation Law, are not subject to
any preemptive or similar rights, except for those Designated Subsidiaries
(other than Xxxxxx Realty Corp.) that are New York corporations, as
provided in Section 622 of the New York Business Corporation Law, and are
owned by Holdings, directly or indirectly, through one or more
subsidiaries, free and clear of any Liens, except for the Liens to be
created on the Closing Date by the Collateral Documents and the Securities
Pledge Agreement.
(e) This Agreement has been duly authorized, executed and delivered by
Holdings.
(f) The Indenture has been duly authorized by Holdings and, on the
Closing Date, will have been validly executed and delivered by Holdings.
When the Indenture has been duly executed and delivered by Holdings
(assuming the due authorization and execution thereof by the Trustee), the
Indenture will be a valid and binding obligation of Holdings, enforceable
against Holdings in accordance with its
12
terms, except as (A) the enforceability thereof may be limited by the
effect of (i) bankruptcy, insolvency, reorganization, fraudulent transfer,
moratorium and other or similar laws now in effect relating to or affecting
the rights and remedies of creditors and (ii) general principles of equity,
whether enforcement is considered in a proceeding at law or in equity, and
the discretion of the court before which any proceeding therefor may be
brought, (B) rights of acceleration and the availability of equitable
remedies may be limited by equitable principles of general applicability
and (C) rights of indemnification may be limited by public policy
considerations. On the Closing Date, the Indenture will conform in all
material respects to the requirements of the Trust Indenture Act of 1939,
as amended (the "TIA" or "Trust Indenture Act"), and the rules and
regulations of the Commission applicable to an indenture which is qualified
thereunder.
(g) The Notes have been duly authorized and, on the Closing Date, will
have been validly executed and delivered by Holdings. When the Notes have
been issued, executed and authenticated in accordance with the terms of the
Indenture and delivered to and paid for by the Initial Purchasers in
accordance with the terms of this Agreement, the Notes will be entitled to
the benefits of the Indenture and will be valid and binding obligations of
Holdings, enforceable against Holdings in accordance with their terms,
except as (A) the enforceability thereof may be limited by the effect of
(i) bankruptcy, insolvency, reorganization, fraudulent transfer, moratorium
and other similar laws affecting the rights and remedies of creditors and
(ii) general principles of equity, whether enforcement is considered in a
proceeding at law or in equity, and the discretion of the court before
which any proceeding therefor may be brought and (B) rights of acceleration
and the availability of equitable remedies may be limited by equitable
principles of general applicability.
(h) On the Closing Date, the Exchange Notes will have been duly
authorized by Holdings. When the Exchange Notes are issued, executed and
authenticated in accordance with the terms of the Exchange Offer and the
Indenture, the Exchange Notes will be entitled to the benefits of the
Indenture and will be valid and binding obligations of Holdings,
enforceable against Holdings in accordance with their terms, except as (A)
the enforceability thereof may be limited by the effect of (i) bankruptcy,
insolvency, reorganization, fraudulent transfer, moratorium and other
similar laws affecting the rights and remedies of creditors and (ii)
general principles of equity, whether enforcement is considered in a
proceeding at law or in equity, and the discretion of the court before
which any proceeding therefor may be brought and (B) rights of acceleration
and the availability of equitable remedies may be limited by equitable
principles of general applicability.
13
(i) The Warrant Agreement has been duly authorized by Holdings, and,
on the Closing Date, will have been duly executed and delivered by
Holdings. When the Warrant Agreement has been duly executed and delivered
by Holdings, the Warrant Agreement will be a valid and binding obligation
of Holdings, enforceable against Holdings in accordance with its terms,
except as (A) the enforceability thereof may be limited by the effect of
(i) bankruptcy, insolvency, reorganization, fraudulent transfer, moratorium
and other similar laws affecting the rights and remedies of creditors and
(ii) general principles of equity, whether enforcement is considered in a
proceeding at law or in equity, and the discretion of the court before
which any proceeding therefor may be brought and (B) the availability of
equitable remedies may be limited by equitable principles of general
applicability.
(j) The Securities Pledge Agreement has been duly authorized by
Holdings, and, on the Closing Date, will have been duly executed and
delivered by Holdings. When the Securities Pledge Agreement has been duly
executed and delivered, the Securities Pledge Agreement will (assuming the
due authorization and execution by the other parties thereto) be a valid
and binding obligation of Holdings, enforceable against Holdings in
accordance with its terms, except as (A) the enforceability thereof may be
limited by the effect of (i) bankruptcy, insolvency, reorganization,
fraudulent transfer, moratorium or other similar laws affecting the rights
and remedies of creditors and (ii) general principles of equity, whether
enforcement is considered in a proceeding at law or in equity, and the
discretion of the court before which any proceeding therefor may be brought
and (B) rights of acceleration and the availability of equitable remedies
may be limited by equitable principles of general applicability.
(k) The Registration Rights Agreement has been duly authorized by
Holdings and, on the Closing Date, will have been duly executed and
delivered by Holdings. When the Registration Rights Agreement has been duly
executed and delivered, the Registration Rights Agreement will be a valid
and binding obligation of Holdings, enforceable against Holdings in
accordance with its terms, except as (A) the enforceability thereof may be
limited by the effect of (i) bankruptcy, insolvency, reorganization,
fraudulent transfer, moratorium and other similar laws affecting the rights
and remedies of creditors and (ii) general principles of equity, whether
enforcement is considered in a proceeding at law or in equity, and the
discretion of the court before which any proceeding therefor may be
brought, (B) the availability of equitable remedies may be limited by
equitable principles of general applicability and (C) rights of
indemnification and contribution may be limited by federal and state
securities laws and public policy considerations.
14
(l) The Warrants have been duly authorized by Holdings and when
executed by Holdings in accordance with the provisions of the Warrant
Agreement, and delivered and paid for by the Initial Purchasers, will be
entitled to the benefits of the Warrant Agreement and will constitute valid
and binding obligations of Holdings, enforceable against Holdings in
accordance with their terms, except as (A) the enforceability thereof may
be limited by the effect of (i) bankruptcy, insolvency, reorganization,
fraudulent transfer, moratorium and other similar laws affecting the rights
and remedies of creditors and (ii) general principles of equity, whether
enforcement is considered in a proceeding at law or in equity, and the
discretion of the court before which any proceeding therefor may be brought
and (B) the availability of equitable remedies may be limited by equitable
principles of general applicability.
(m) When issued and paid for in accordance with the terms and
conditions contained in the Warrant Agreement upon exercise of the
Warrants, the Warrant Shares will be duly authorized, validly issued, fully
paid and non-assessable and will not be subject to any preemptive or
similar rights. The Warrant Shares have been duly reserved for issuance in
accordance with the terms of the Warrants and the Warrant Agreement.
(n) The Stockholders Agreement has been duly authorized by Holdings
and, on the Closing Date, will have been duly authorized, executed and
delivered by Holdings. When the Stockholders Agreement has been duly
executed and delivered by all of the parties thereto, the Stockholders
Agreement will be a valid and binding obligation of Holdings, enforceable
against Holdings in accordance with its terms, except as (A) the
enforceability thereof may be limited by the effect of (i) bankruptcy,
insolvency, reorganization, fraudulent transfer, moratorium and other
similar laws affecting the rights and remedies of creditors and (ii)
general principles of equity, whether enforcement is considered in a
proceeding at law or in equity, and the discretion of the court before
which any proceeding therefor may be brought, (B) the availability of
equitable remedies may be limited by equitable principles of general
applicability and (C) rights of indemnification and contribution may be
limited by federal and state securities laws and public policy
considerations.
(o) Neither Holdings nor any of the Designated Subsidiaries is (i) in
violation of its respective charter, by-laws or other organizational
document, (ii) to the best knowledge of Holdings after due inquiry, in
violation of any applicable law, statute, rule, regulation, judgment,
order, writ or decree of any government, government instrumentality or
court, domestic or foreign, that is applicable to Holdings or any of the
Designated Subsidiaries or (iii) to the best knowledge of Holdings after
due inquiry, in default in the performance of any obligation, agreement,
covenant or condition contained in any indenture, loan agreement, mortgage,
lease or other
15
agreement or instrument that is material to Holdings and any of the
Designated Subsidiaries, taken as a whole, to which Holdings or any of the
Designated Subsidiaries is a party or by which Holdings or any of the
Designated Subsidiaries or their respective property is bound (each, a
"Contract" and collectively the "Contracts") that, in the case of clauses
(i), (ii) and (iii) above, would be reasonably expected, in the aggregate,
to have a Material Adverse Effect.
(p) Holdings and Designated Subsidiaries, as applicable, have all
requisite corporate power and authority to execute, deliver and perform
each of its obligations, if any, under this Agreement and the other
Operative Documents and to perform its obligations under the Asset Purchase
Agreement.
(q) The execution, delivery and performance of this Agreement and the
other Operative Documents (other than the Securities and Warrant Shares) by
Holdings and each of the Designated Subsidiaries which is a party thereto,
the issuance, authentication, sale and delivery of the Securities and the
Warrant Shares upon the exercise of the Warrants against payment therefor
and compliance by Holdings and each of the Designated Subsidiaries with the
terms thereof and the consummation of the transactions contemplated hereby
and thereby (including, without limitation, consummation of the
transactions contemplated by the Asset Purchase Agreement) will not (i)
require any consent, approval, authorization or other order of, or
qualification with, any court or governmental body or agency (except such
as will have been obtained by the Closing Date, as may be required under
the securities or Blue Sky laws of the various states or filings and
recordings with certain governmental bodies to perfect Liens under the
Collateral Documents and Securities Pledge Agreement), (ii) conflict with
or constitute a breach of any of the terms or provisions of, or a default
under, the charter, by-laws or other organizational document of Holdings or
any of the Designated Subsidiaries or any Contract to which Holdings or any
of the Designated Subsidiaries is a party, (iii) violate or conflict with
any applicable law or any rule, regulation, judgment, order or decree of
any court or any governmental body or agency having jurisdiction over
Holdings, any of the Designated Subsidiaries or their respective property,
(iv) result in the imposition or creation of (or the obligation to create
or impose) a Lien under any agreement or instrument to which Holdings or
any of the Designated Subsidiaries is a party or by which Holdings or any
of the Designated Subsidiaries or their respective property is bound (other
than any Liens created by the Collateral Documents and Securities Pledge
Agreement), or (v) result in the termination or revocation of any
Authorization (as defined) of Holdings or any of the Designated
Subsidiaries or result in any other impairment of the rights of the holder
of any such Authorization, except insofar as any such violation, conflict,
default, Lien, termination, revocation or impairment would not reasonably
be expected to result in a Material Adverse Effect.
16
(r) There are no legal or governmental proceedings pending or, to the
best knowledge of Holdings after due inquiry, threatened to which Holdings
or any of the Designated Subsidiaries is or could be a party or to which
any of their respective property is or could be subject, which would
reasonably be expected to result, singly or in the aggregate, in a Material
Adverse Effect.
(s) There is no (i) significant unfair labor practice complaint
pending or threatened against Holdings or any of the Designated
Subsidiaries nor, to the best knowledge of Holdings, threatened against any
of them, before the National Labor Relations Board, any state or local
labor relations board or any foreign labor relations board, (ii)
significant grievance or significant arbitration proceeding arising out of
or under any collective bargaining agreement is so pending against Holdings
or any of the Designated Subsidiaries or, to the best knowledge of
Holdings, threatened against Holdings or any of the Designated Subsidiaries
and (iii) significant strike, labor dispute, slowdown or stoppage is
pending against Holdings or any of the Designated Subsidiaries or
threatened against Holdings or any of the Designated Subsidiaries, except
in each case of clause (i), (ii) or (iii) such as would not result in a
Material Adverse Effect. Neither Holdings nor any of the Designated
Subsidiaries has violated any federal, state or local law or foreign law
relating to discrimination in hiring, promotion or pay of employees, nor
any applicable wage or hour laws, which would result in a Material Adverse
Effect.
(t) In the ordinary course of business, Holdings and the Designated
Subsidiaries conduct a periodic review of the effect of Environmental Laws
(as defined) on the business, operations and properties of Holdings and the
Designated Subsidiaries, taken as a whole in the course of which it
identifies and evaluates associated costs and liabilities (including,
without limitation, capital and operating expenditures required for
response and corrective actions, closure of properties, permits, licenses
and approvals, related constraints on operating activities and all
potential liabilities to third parties). On the basis of such review,
except as set forth in the Offering Memorandum, Holdings has reasonably
concluded that such associated costs and liabilities would not, singly or
in the aggregate, have a Material Adverse Effect. Except as described in
the Offering Memorandum, to the knowledge of Holdings, Holdings and the
Designated Subsidiaries are in compliance with all applicable existing
Environmental Laws, except for such instances of non-compliance which would
not have a Material Adverse Effect or which are being contested in good
faith by appropriate proceedings by Holdings or the Designated Subsidiaries
affected thereby. For the purposes of this Agreement, "Environmental Laws"
means any Federal, state and local laws, rules or regulations, any orders,
decrees, judgments or injunctions and the common law relating to pollution
or protection of human health, safety or the environment, including,
without limitation, ambient air, indoor air,
17
soil, surface water, ground water, wetlands, land or subsurface strata to
which Holdings or the Designated Subsidiaries are subject, including,
without limitation, those relating to releases or threatened releases of
Hazardous Materials into the environment, or otherwise relating to the
manufacture, processing, generation, distribution, use, treatment, storage,
disposal, transport or handling of Hazardous Materials. For the purposes of
this Agreement, "Hazardous Material" shall mean any pollutant, contaminant,
toxic, hazardous or extremely hazardous substance, constituent or waste, or
any other constituent, waste, material, compound or substance (including,
without limitation, petroleum including crude oil and any fraction thereof,
or any petroleum product), subject to regulation under any Environmental
Law.
(u) Each of Holdings and the Designated Subsidiaries has such permits,
licenses, consents, exemptions, franchises, authorizations and other
approvals (each, an "Authorization") of, and has made all filings with and
notices to, all governmental or regulatory authorities and self-regulatory
organizations and all courts and other tribunals, including without
limitation, under any applicable Environmental Laws, as are necessary to
own, lease, license and operate its respective properties and to conduct
its business, except where the failure to have any such Authorization or to
make any such filing or notice would not, singly or in the aggregate, have
a Material Adverse Effect. Each such Authorization is valid and in full
force and effect and each of Holdings and the Designated Subsidiaries is in
compliance with all the terms and conditions thereof and with the rules and
regulations of the authorities and governing bodies having jurisdiction
with respect thereto; and no event has occurred (including, without
limitation, the receipt of any notice from any authority or governing body)
which allows or, after notice or lapse of time or both, would allow
revocation, suspension or termination of any such Authorization or results
or, after notice or lapse of time or both, would result in any other
impairment of the rights of the holder of any such Authorization; and such
Authorizations contain no restrictions that are burdensome to Holdings and
the Designated Subsidiaries taken as a whole, except where such failure to
be valid and in full force and effect or to be in compliance, the
occurrence of any such event or the presence of any such restriction would
not, in the aggregate, have a Material Adverse Effect.
(v) The accountants Xxxxxx Xxxxxxxx LLP, Xxxxx Xxxxxxxxxx & Co., LLP
and Ernst & Young LLP have each certified certain of the financial
statements, the related notes and supporting schedules included in the
Preliminary Offering Memorandum and the Offering Memorandum. Xxxxxx
Xxxxxxxx LLP are, and Xxxxx Xxxxxxxxxx & Co., LLP were, independent public
accountants with respect to the Company and the other Designated
Subsidiaries, as required by the Act and the Exchange Act. To the knowledge
of Holdings, Ernst & Young LLP are independ-
18
ent public accountants with respect to the Xxxxxx-Xxxxxx Xxxxx, as required
by the Act and the Exchange Act. The unaudited consolidated historical
financial statements, together with related schedules and notes, set forth
in the Preliminary Offering Memorandum and the Offering Memorandum comply
as to form in all material respects, with the requirements applicable to
registration statements on Form S-1 under the Act.
(w) The historical financial statements of the Company and its
subsidiaries together with related schedules and notes forming part of the
Offering Memorandum (and any amendment or supplement thereto), present
fairly, in all material respects, the consolidated financial position,
results of operations and cash flows of the Company and its subsidiaries on
the basis stated in the Offering Memorandum at the respective dates or for
the respective periods to which they apply and such statements and related
schedules and notes have been prepared in accordance with generally
accepted accounting principles consistently applied throughout the periods
involved, except as otherwise disclosed therein; and the other financial
and statistical information and data pertaining to the Company and its
subsidiaries set forth in the Offering Memorandum (and any amendment or
supplement thereto) are, in all material respects, accurately presented and
prepared on a basis consistent with such financial statements and the books
and records of the Company (except as otherwise noted therein or in the
Offering Memorandum).
(x) The pro forma financial statements, and the related notes,
included in the Offering Memorandum have been prepared on a basis
consistent with the historical financial statements of the Company and its
subsidiaries and give effect to assumptions used in the preparation thereof
on a reasonable basis and in good faith and present fairly, in all material
respects, the historical and proposed transactions contemplated by the
Offering Memorandum; and such pro forma financial statements comply as to
form, in all material respects, with the requirements applicable to pro
forma financial statements included in registration statements on Form S-1
under the Act. The other pro forma financial and statistical information
and data included in the Offering Memorandum are, in all material respects,
accurately presented and prepared on a basis consistent with the pro forma
financial statements.
(y) The statistical and market-related data included in the Offering
Memorandum are based on or derived from sources which Holdings believes to
be reliable and accurate.
(z) The execution and delivery of this Agreement, the other Operative
Documents and the sale of the Securities will not involve any prohibited
transaction within the meaning of Section 406 of ERISA or Section 4975 of
the Internal Reve-
19
nue Code of 1986, as amended. The representation made by Holdings in the
preceding sentence is made solely in reliance upon and subject to the
accuracy of, and compliance with, the representations and covenants made or
deemed made by the prospective investors as set forth in the Offering
Memorandum under "Notices to Investors."
(aa) Neither Holdings nor any Designated Subsidiaries is and, after
giving effect to the offering and sale of the Securities and the
application of the net proceeds thereof as described in the Offering
Memorandum, neither Holdings nor any Designated Subsidiaries will be, an
"investment company" or an entity "controlled" by an "investment company,"
as such terms are defined in the Investment Company Act of 1940, as
amended.
(bb) The present fair salable value of the assets of Holdings and the
Designated Subsidiaries exceeds the amount that will be required to be paid
on or in respect of the existing debts and other liabilities (including the
maximum amount of liability that may be reasonably expected to result from
contingent liabilities) of each such person as they become absolute and
matured. The assets of each of Holdings and the Designated Subsidiaries do
not constitute unreasonably small capital to carry out such person's
businesses as conducted or as proposed to be conducted. Holdings and the
Designated Subsidiaries do not intend to, nor do any of them believe that
they will, incur debts beyond their ability to pay such debts as they
mature. Upon the issuance of the Securities and the consummation of the
other transactions contemplated in the Offering Memorandum, the present
fair salable value of the assets of each of Holdings and the Designated
Subsidiaries will exceed the amount that will be required to be paid on or
in respect of the existing debts and other liabilities (including the
maximum amount of liability that may reasonably be expected to result from
contingent liabilities) of each such person as they become absolute and
matured. The assets of each of Holdings and the Designated Subsidiaries,
upon the issuance of the Securities and the consummation of the other
transactions contemplated in the Offering Memorandum, will not constitute
unreasonably small capital to carry out such person's business as now
conducted, including the capital needs of each of Holdings and the
Designated Subsidiaries, taking into account the projected capital
requirements and capital availability of each of Holdings and the
Designated Subsidiaries.
(cc) Except for the Operative Documents, there are no contracts,
agreements or understandings between Holdings or any of the Designated
Subsidiaries and any person granting such person the right to require
Holdings or any of the Designated Subsidiaries to file a registration
statement under the Act with respect to any securities of Holdings or any
of the Designated Subsidiaries or to require Hold-
20
ings or any of the Designated Subsidiaries to include such securities with
Notes registered pursuant to any Registration Statement.
(dd) Neither Holdings nor any Designated Subsidiaries nor any agent
thereof acting on the behalf of them has taken, and none of them will take,
any action that might cause this Agreement or the issuance or sale of
Securities to violate Regulation T (12 C.F.R. Part 220), Regulation U (12
C.F.R. Part 221) or Regulation X (12 C.F.R. Part 224) of the Board of
Governors of the Federal Reserve System.
(ee) Since the respective dates as of which information is given in
the Offering Memorandum, other than as set forth in the Offering Memorandum
(exclusive of any amendments or supplements thereto subsequent to the date
of this Agreement), (i) there has not occurred any material adverse change
or any development involving a prospective material adverse change in the
condition (financial or otherwise), earnings, business, management or
operations of Holdings and its subsidiaries, taken as a whole, (ii) there
has not been any material adverse change or any development involving a
prospective material adverse change in the capital stock or in the
long-term debt of Holdings or any of its subsidiaries and (iii) neither
Holdings nor any of its subsidiaries has incurred any material liability or
obligation, direct or contingent, which is material to Holdings and its
subsidiaries taken as a whole.
(ff) Each of the Preliminary Offering Memorandum and the Offering
Memorandum, as of its date, contains all the information specified in, and
meeting the requirements of, Rule 144A(d)(4) under the Act.
(gg) When the Securities are issued and delivered pursuant to this
Agreement and the Warrant Shares are issued upon exercise of the Warrants,
neither the Securities nor Warrant Shares will be of the same class (within
the meaning of Rule 144A under the Act) as any security of Holdings or the
Designated Subsidiaries that is listed on a national securities exchange
registered under Section 6 of the Exchange Act or that is quoted in a
United States automated inter-dealer quotation system.
(hh) No form of general solicitation or general advertising (as
defined in Regulation D under the Act) was used by Holdings, the Designated
Subsidiaries or any of their respective representatives (other than the
Initial Purchasers, as to which Holdings and the Designated Subsidiaries
make no representation) in connection with the offer and sale of the
Securities contemplated hereby, including, but not limited to, articles,
notices or other communications published in any newspaper, magazine, or
similar medium or broadcast over television or radio, or any seminar or
meeting whose attendees have been invited by any general solicitation or
general
21
advertising. No securities of the same class as the Securities have been
issued and sold by Holdings within the six-month period immediately prior
to the date hereof.
(ii) Prior to the effectiveness of any Registration Statement, the
Indenture is not required to be qualified under the TIA.
(jj) None of Holdings, Designated Subsidiaries nor any of their
respective affiliates or any person acting on its or their behalf (other
than the Initial Purchasers, as to which Holdings and Designated
Subsidiaries make no representation) has engaged or will engage in any
directed selling efforts within the meaning of Regulation S under the Act
("Regulation S") with respect to the Securities.
(kk) The Securities offered and sold in reliance on Regulation S have
been and will be offered and sold only in offshore transactions.
(ll) The sale of the Securities pursuant to Regulation S is not part
of a plan or scheme to evade the registration provisions of the Act.
(mm) No registration under the Act of the Securities is required for
the sale of the Securities to the Initial Purchasers as contemplated hereby
or for the Exempt Resales, assuming the accuracy of the Initial Purchasers'
representations and warranties and agreements set forth in Section 7
hereof.
(nn) No "nationally recognized statistical rating organization," as
such term is defined for purposes of Rule 436(g)(2) under the Act, (i) has
imposed (or has informed Holdings or any Designated Subsidiary that it is
considering imposing) any condition on Holdings or any Designated
Subsidiary retaining any rating assigned to Holdings, any Designated
Subsidiary or any securities of Holdings or any Designated Subsidiary or
(ii) has indicated to Holdings or any Designated Subsidiary that it is
considering (a) the downgrading, suspension or withdrawal of, or any review
for a possible change that does not indicate the direction of the possible
change in, any rating so assigned or (b) any change in the outlook for any
rating of Holdings or any Designated Subsidiary or any securities of
Holdings or any Designated Subsidiary.
(oo) Each certificate signed by any officer of Holdings or any
Designated Subsidiary and delivered to the Initial Purchasers or counsel
for the Initial Purchasers shall be deemed to be a representation and
warranty by Holdings or such Designated Subsidiary to the Initial
Purchasers as to the matters covered thereby.
(pp) Holdings and each Designated Subsidiary has good and marketable
title in fee simple to all real property it purports to own, including,
without limita-
22
tion, all Mortgaged Property (as defined in the Notes Indenture) and good
and legal title to all personal property it purports to own, whether owned,
leased or licensed, including, without limitation, all Collateral (as
defined in the Notes Indenture) owned by them which is material to the
business of Holdings and its subsidiaries, taken as a whole, and described
in the Offering Memorandum, in each case free and clear of all Liens,
except (i) such as are described in the Offering Memorandum, (ii) such as
do not materially affect the value of such property and do not interfere
with the use made and proposed to be made of such property by Holdings and
its subsidiaries and (iii) Liens permitted by the Notes Indenture,
Collateral Documents and Securities Pledge Agreement; and any real
property, including, without limitation, all Mortgaged Property personal
property, including, without limitation, all Pledged Collateral and
buildings held under lease by Holdings and each Designated Subsidiary are
held by them under valid, subsisting and enforceable leases with such
exceptions as are not material and do not interfere with the use made and
proposed to be made of such real property, personal property and buildings
by Holdings and each Designated Subsidiary, in each case except as
described in the Offering Memorandum.
(qq) Holdings and each Designated Subsidiary owns or possesses, or has
the right to use, all patents, patent rights, licenses, inventions,
copyrights, know-how (including trade secrets and other unpatented and/or
unpatentable proprietary or confidential information, systems or
procedures), trademarks, service marks and trade names ("intellectual
property") currently employed by them in connection with the business now
operated by them except where the failure to own or possess or otherwise be
able to acquire or use such intellectual property would not, singly or in
the aggregate, have a Material Adverse Effect; and neither Holdings nor any
of the Designated Subsidiaries has received any notice of infringement of
or conflict with asserted rights of others with respect to any of such
intellectual property which, singly or in the aggregate, if the subject of
an unfavorable decision, ruling or finding, would have a Material Adverse
Effect.
(rr) Holdings and each Designated Subsidiary will carry or are covered
by insurance issued by insurers of recognized financial responsibility in
such amounts and covering such risks for the conduct of its business and
the value of their properties as is customary for companies engaged in
similar businesses in the areas in which such business is located and, in
the case of its properties, as would be maintained by a prudent operator of
properties similar in use and configuration to such properties and located
in the locality where such properties are located; and neither Holdings nor
any of the Designated Subsidiaries (i) has received notice from any insurer
or agent of such insurer that substantial capital improvements or other
material expenditures will have to be made in order to continue such
insurance or (ii) has any
23
reason to believe that it will not be able to renew its existing insurance
coverage as and when such coverage expires or to obtain similar coverage
from similar insurers at a cost that would not have a Material Adverse
Effect.
(ss) Except as disclosed in the Offering Memorandum, no relationship,
direct or indirect, exists between or among Holdings or any of its
subsidiaries on the one hand, and the directors, officers, stockholders,
customers or suppliers of Holdings or any of its subsidiaries on the other
hand, which would be required by the Act to be described in the Offering
Memorandum if the Offering Memorandum were a prospectus included in a
registration statement on Form S-1 filed with the Commission.
(tt) Except as disclosed in the Offering Memorandum, Holdings and each
of its subsidiaries maintains a system of internal accounting controls
sufficient to provide reasonable assurance that (i) transactions are
executed in accordance with management's general or specific
authorizations; (ii) transactions are recorded as necessary to permit
preparation of financial statements in conformity with generally accepted
accounting principles and to maintain asset accountability; (iii) access to
assets is permitted only in accordance with management's general or
specific authorization; and (iv) the recorded accountability for assets is
compared with the existing assets at reasonable intervals and appropriate
action is taken with respect to any differences.
(uu) All material tax returns required to be filed by Holdings and
each of the Designated Subsidiaries in any jurisdiction have been filed,
other than those filings or failures to have filed being contested in good
faith, and all material taxes, including withholding taxes, penalties and
interest, assessments, fees and other charges due pursuant to such returns
or pursuant to any assessment received by Holdings or any of its
subsidiaries have been paid or provided for, other than those being
contested in good faith and for which adequate reserves have been provided.
(vv) To the knowledge of Holdings and the Designated Subsidiaries, no
action has been taken and no law, statute, rule or regulation or order has
been enacted, adopted or issued by any governmental agency or body which
prevents the execution, delivery and performance of any of the Operative
Documents, the issuance of the Securities or the issuance of the Warrant
Shares upon exercise of the Warrants, or suspends the sale of the
Securities or the issuance of the Warrant Shares upon exercise of the
Warrants in any jurisdiction referred to in Section 5(e); and no
injunction, restraining order or other order or relief of any nature by a
federal or state court or other tribunal of competent jurisdiction has been
issued with respect to Holdings or the Designated Subsidiaries which would
prevent or suspend
24
the issuance or sale of Securities or the issuance of the Warrant Shares
upon exercise of the Warrants in any jurisdiction referred to in Section
5(e).
(ww) The Securities Pledge Agreement, once executed and delivered,
will create, in favor of the Trustee for the benefit of the Trustee and the
holders of the Securities, a valid and enforceable, and upon filing or
recording with the appropriate governmental authorities (including payment
of the appropriate filing or recording fees and any applicable taxes) and
delivery of the applicable documents to Trustee, including, without
limitation, the certificates representing the outstanding capital stock of
the Company, the Trustee will have a perfected security interest in and
Lien upon all of the Pledged Securities (as defined in the Securities
Pledge Agreement), and subject to no other Liens except for Liens expressly
permitted to exist on such Pledged Securities by the terms of the
Securities Pledge Agreement. (A) The enforceability of the obligations of
Holdings under the Securities Pledge Agreement may be limited by the effect
of (i) bankruptcy, insolvency, reorganization, fraudulent transfer,
moratorium or other similar laws affecting the rights and remedies of
creditors and (ii) general principles of equity, whether enforcement is
considered in a proceeding at law or in equity, and the discretion of the
court before which any proceeding therefor may be brought, and (B) rights
of acceleration and the availability of equitable remedies may be limited
by equitable principles of general applicability.
(xx) Holdings and each of the Designated Subsidiaries have reviewed
its respective operations and that of its respective subsidiaries to
evaluate the extent to which the business or operations of it or its
subsidiaries will be affected by the Year 2000 Problem (that is, any
significant risk that computer hardware or software applications used by
such person and its respective subsidiaries will not, in the case of dates
or time periods occurring after December 31, 1999, function at least as
effectively as in the case of dates or times periods occurring prior to
January 1, 2000); as a result of such review, Holdings and each of
Designated Subsidiaries do not believe, except as disclosed in the Offering
Memorandum, that (A) there are any issues related to this preparedness to
address the Year 2000 Problem that are of a character required to be
described or referred to in the Offering Memorandum which have not been
accurately described in the Offering Memorandum and (B) the Year 2000
Problem will have a Material Adverse Effect.
(yy) Holdings has delivered to counsel for the Initial Purchasers a
true and correct copy of the Asset Purchase Agreement, together with all
related agreements and all schedules and exhibits thereto, and there shall
have been no material amendments, alterations, modifications or waivers of
any of the provisions of any such documents since their respective dates of
execution, other than any such
25
amendments, alterations, modifications and waivers as to which the Initial
Purchasers has been advised in writing and which would be required to be
disclosed in the Offering Memorandum. To the best knowledge of Holdings,
there exists no event or condition which would constitute a default or an
event of default under the Asset Purchase Agreement or such ancillary
agreements which would result in a Material Adverse Effect or materially
adversely affect the ability of the Company or Pulp & Paper of America LLC
to consummate the transactions contemplated thereby.
Holdings and the Designated Subsidiaries acknowledge that the Initial
Purchasers and counsel to the Initial Purchasers will rely upon the accuracy and
truth of the foregoing representations and hereby consent to such reliance.
7. Initial Purchasers' Representations and Warranties. Each Initial
Purchaser represents and warrants to, and agrees with, Holdings and the
Designated Subsidiaries that:
(a) Such Initial Purchaser is either a QIB or a Regulation S Purchaser
or an institutional Accredited Investor, in any case, with such knowledge
and experience in financial and business matters as is necessary in order
to evaluate the merits and risks of an investment in the Securities.
(b) Such Initial Purchaser (A) is not acquiring the Securities with a
view to any distribution thereof or with any present intention of offering
or selling any of the Securities in a transaction that would violate the
Act or the securities laws of any state of the United States or any other
applicable jurisdiction and (B) will be reoffering and reselling the
Securities only (x) to QIBs in reliance on the exemption from the
registration requirements of the Act provided by Rule 144A, (y) to
Regulation S Purchasers in offshore transactions in reliance upon
Regulation S under the Act, and (z) to a limited number of institutional
Accredited Investors that prior to their purchase of the Securities deliver
to the Initial Purchasers a letter containing representations and
agreements satisfactory to the Initial Purchasers.
(c) Such Initial Purchaser agrees that no form of general solicitation
or general advertising (within the meaning of Regulation D under the Act)
has been or will be used by such Initial Purchaser or any of its
representatives in connection with the offer and sale of the Securities
pursuant hereto, including, but not limited to, articles, notices or other
communications published in any newspaper, magazine or similar medium or
broadcast over television or radio, or any seminar or meeting whose
attendees have been invited by any general solicitation or general
advertising.
(d) Such Initial Purchaser agrees that, in connection with Exempt
Resales, such Initial Purchaser will solicit offers to buy the Securities
only from, and
26
will offer to sell the Securities only to, Eligible Purchasers. It further
agrees that it will offer to sell the Securities only to, and will solicit
offers to buy the Securities only from (A) Eligible Purchasers that such
Initial Purchaser reasonably believes are QIBs or institutional Accredited
Investors and (B) Regulation S Purchasers, in each case, that agree that
(x) the Securities purchased by them may be resold, pledged or otherwise
transferred within the time period referred to under Rule 144(k) (taking
into account the provisions of Rule 144(d) under the Act, if applicable)
under the Act, as in effect on the date of the transfer of such Securities,
only (I) to Holdings or any of its subsidiaries, (II) to a person whom the
seller reasonably believes is a QIB purchasing for its own account or for
the account of a QIB in a transaction meeting the requirements of Rule 144A
under the Act, (III) in an offshore transaction (as defined in Rule 902
under the Act) meeting the requirements of Rule 904 of the Act, (IV) in a
transaction meeting the requirements of Rule 144 under the Act, (V) in
accordance with another exemption from the registration requirements of the
Act (and based upon an opinion of counsel acceptable to Holdings), (VI) to
an institutional Accredited Investor that, prior to such transfer,
furnishes to the Trustee, a signed letter containing certain
representations and agreements relating to the restrictions on transfer of
the Securities or (VII) pursuant to an effective registration statement
and, in each case, in accordance with the applicable securities laws of any
state of the United States or any other applicable jurisdiction and (y)
they will deliver to each person to whom such Securities or an interest
therein is transferred a notice substantially to the effect of the
foregoing.
(e) None of such Initial Purchaser nor any of its affiliates or any
person acting on its or their behalf has engaged or will engage in any
directed selling efforts within the meaning of Regulation S with respect to
the Securities.
(f) The Securities offered and sold by such Initial Purchaser pursuant
hereto in reliance on Regulation S have been and will be offered and sold
only in offshore transactions.
(g) The sale of the Securities offered and sold by such Initial
Purchasers pursuant hereto in reliance on Regulation S is not part of a
plan or scheme to evade the registration provisions of the Act.
(h) Such Initial Purchaser agrees that it will not offer, sell or
deliver any of the Securities in any jurisdiction outside the United States
except under circumstances that will result in compliance with the
applicable laws thereof, and that it will take at its own expense whatever
action is required to permit its purchase and resale of the Securities in
such jurisdictions. Such Initial Purchaser understands that no action has
been taken to permit a public offering in any jurisdiction outside the
United States where action would be required for such purpose.
27
(i) Such Initial Purchaser acknowledges that Holdings and the
Designated Subsidiaries and, for purposes of the opinions to be delivered
to the Initial Purchasers pursuant to Section 9 hereof, counsel to Holdings
and the Designated Subsidiaries and counsel to the Initial Purchasers will
rely upon the accuracy and truth of the foregoing representations and the
Initial Purchasers hereby consents to such reliance.
8. Indemnification.
(a) Holdings agrees to indemnify and hold harmless the Initial Purchasers,
their directors, their officers and each person, if any, who controls (within
the meaning of Section 15 of the Act or Section 20 of the Exchange Act) any of
the Initial Purchasers, from and against any and all losses, claims, damages,
liabilities and judgments (including, without limitation, any legal or other
expenses incurred in connection with investigating or defending any matter,
including any action, that could give rise to any such losses, claims, damages,
liabilities or judgments) caused by any untrue statement or alleged untrue
statement of a material fact contained in the Offering Memorandum (or any
amendment or supplement thereto), the Preliminary Offering Memorandum or any
Rule 144A Information provided by Holdings or any of its subsidiaries to any
holder or prospective purchaser of Securities pursuant to Section 5(h) or caused
by any omission or alleged omission to state therein a material fact required to
be stated therein or necessary to make the statements therein not misleading,
except insofar as such losses, claims, damages, liabilities or judgments are
caused by any such untrue statement or omission or alleged untrue statement or
omission based upon information relating to the Company Notes Purchaser
furnished in writing to Holdings by such Company Notes Purchaser expressly for
use in the Preliminary Offering Memorandum or the Offering Memorandum; provided
that with respect to any such untrue statement in or omission from the
Preliminary Offering Memorandum, the indemnity agreement contained in this
Section 8(a) shall not inure to the benefit of the Initial Purchasers or any
other person indemnified under this Section 8(a) to the extent that any such
loss, claim, damage, liability or judgment results from the fact that both (A) a
copy of the Offering Memorandum was not sent or given to such person at or prior
to the written confirmation of the sale of Securities to such person and (B) the
untrue statement in or omission from the Preliminary Offering Memorandum was
corrected in the Offering Memorandum, unless, in either case, such failure to
deliver the Offering Memorandum was a result of non-compliance by Holdings with
Section 5(b).
(b) [Intentionally Omitted]
(c) In case any action shall be commenced involving any person in respect
of which indemnity may be sought pursuant to Section 8(a) (the "indemnified
party"), the indemnified party shall promptly notify the person against whom
such indemnity may be
28
sought (the "indemnifying party") in writing and the indemnifying party shall
assume the defense of such action, including the employment of counsel
reasonably satisfactory to the indemnified party and the payment of all fees and
expenses of such counsel, as incurred. Any indemnified party shall have the
right to employ separate counsel in any such action and participate in the
defense thereof, but the fees and expenses of such counsel shall be at the
expense of the indemnified party unless (i) the employment of such counsel shall
have been specifically authorized in writing by the indemnifying party, (ii) the
indemnifying party shall have failed to assume the defense of such action or
employ counsel reasonably satisfactory to the indemnified party or (iii) the
named parties to any such action (including any impleaded parties) include both
the indemnified party and the indemnifying party, and the indemnified party
shall have been advised by such counsel that there may be one or more legal
defenses available to it which are different from or additional to those
available to the indemnifying party (in which case the indemnifying party shall
not have the right to assume the defense of such action on behalf of the
indemnified party) (and except in the case of clause (ii) hereof, such counsel
shall be reasonably satisfactory to the indemnifying party). In any such case,
the indemnifying party shall not, in connection with any one action or separate
but substantially similar or related actions in the same jurisdiction arising
out of the same general allegations or circumstances, be liable for the fees and
expenses of more than one separate firm of attorneys (in addition to any local
counsel) for all indemnified parties and all such fees and expenses shall be
reimbursed as they are incurred. Such firm shall be designated in writing by DLJ
Merchant Banking Partners, L.P. The indemnifying party shall indemnify and hold
harmless the indemnified party from and against any and all losses, claims,
damages, liabilities and judgments by reason of any settlement of any action (i)
effected with its written consent or (ii) effected without its written consent
if the settlement is entered into more than twenty business days after the
indemnifying party shall have received a request from the indemnified party for
reimbursement for the fees and expenses of counsel (in any case where such fees
and expenses are at the expense of the indemnifying party) and, prior to the
date of such settlement, the indemnifying party shall have failed to comply with
such reimbursement request. Except as set forth in the immediately preceding
sentence, the indemnifying party shall not be liable for any settlement entered
into by an indemnified party without the prior written consent, which consent
shall not be unreasonably withheld, of the indemnifying party. No indemnifying
party shall, without the prior written consent of the indemnified party, effect
any settlement or compromise of, or consent to the entry of judgment with
respect to, any pending or threatened action in respect of which the indemnified
party is or could have been a party and indemnity or contribution may be or
could have been sought hereunder by the indemnified party, unless such
settlement, compromise or judgment (i) includes an unconditional release of the
indemnified party from all liability on claims that are or could have been the
subject matter of such action and (ii) does not include a statement as to or an
admission of fault, culpability or a failure to act, by or on behalf of the
indemnified party.
29
(d) To the extent the indemnification provided for in this Section 8 is
unavailable to an indemnified party or insufficient in respect of any losses,
claims, damages, liabilities or judgments referred to therein, then each
indemnifying party, in lieu of indemnifying such indemnified party, shall
contribute to the amount paid or payable by such indemnified party as a result
of such losses, claims, damages, liabilities and judgments (i) in such
proportion as is appropriate to reflect the relative benefits received by
Holdings, on the one hand, and the Initial Purchasers, on the other hand, from
the offering of the Securities or (ii) if the allocation provided by clause
8(d)(i) above is not permitted by applicable law, in such proportion as is
appropriate to reflect not only the relative benefits referred to in clause
8(d)(i) above but also the relative fault of Holdings, on the one hand, and the
Initial Purchasers, on the other hand, in connection with the statements or
omissions which resulted in such losses, claims, damages, liabilities or
judgments, as well as any other relevant equitable considerations. The relative
benefits received by Holdings, on the one hand, and the Initial Purchasers, on
the other hand, shall be deemed to be in the same proportion as the total net
proceeds from the offering of the Securities (before deducting expenses)
received by Holdings, and the total discounts and commissions received by the
Initial Purchasers bear to the total price to investors of the Securities, in
each case as set forth in the table on the cover page of the Offering
Memorandum. The relative fault of Holdings, on the one hand, and the Initial
Purchasers, on the other hand, shall be determined by reference to, among other
things, whether the untrue or alleged untrue statement of a material fact or the
omission or alleged omission to state a material fact relates to information
supplied by Holdings, on the one hand, or the Initial Purchasers, on the other
hand, and the parties' relative intent, knowledge, access to information and
opportunity to correct or prevent such statement or omission.
Holdings and the Initial Purchasers agree that it would not be just and
equitable if contribution pursuant to this Section 8(d) were determined by pro
rata allocation or by any other method of allocation which does not take account
of the equitable considerations referred to in the immediately preceding
paragraph. The amount paid or payable by an indemnified party as a result of the
losses, claims, damages, liabilities or judgments referred to in the immediately
preceding paragraph shall be deemed to include, subject to the limitations set
forth above, any legal or other expenses incurred by such indemnified party in
connection with investigating or defending any matter, including any action,
that could have given rise to such losses, claims, damages, liabilities or
judgments. Notwithstanding the provisions of this Section 8, the Initial
Purchasers shall not be required to contribute any amount in excess of the
amount by which the total price of the Securities purchased by it were sold to
investors in Exempt Resales exceeds the amount of any damages which the Initial
Purchasers has otherwise been required to pay by reason of such untrue or
alleged untrue statement or omission or alleged omission. No person guilty of
fraudulent misrepresentation (within the meaning of Section 11(f) of the Act)
shall be entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation.
30
(e) The remedies provided for in this Section 8 are not exclusive and shall
not limit any rights or remedies which may otherwise be available to any
indemnified party at law or in equity.
9. Conditions of Initial Purchasers' Obligations. The obligations of the
Initial Purchasers to purchase the Securities under this Agreement are subject
to the satisfaction of each of the following conditions:
(a) All the representations and warranties of Holdings contained in
this Agreement shall be true and correct in all material respects on the
Closing Date after giving effect to the Transactions, with the same force
and effect as if made on and as of the Closing Date.
(b) On or after the date hereof, (i) there shall not have occurred any
downgrading, suspension or withdrawal of, nor shall any notice have been
given of any potential or intended downgrading, suspension or withdrawal
of, or of any review (or of any potential or intended review) for a
possible change that does not indicate the direction of the possible change
in, any rating of Holdings or any Designated Subsidiary or any securities
of Holdings or any Designated Subsidiary (including, without limitation,
the placing of any of the foregoing ratings on credit watch with negative
or developing implications or under review with an uncertain direction) by
any "nationally recognized statistical rating organization" as such term is
defined for purposes of Rule 436(g)(2) under the Act and (ii) there shall
not have occurred any change, nor shall any notice have been given of any
potential or intended change, in the outlook for the rating of Holdings or
any Designated Subsidiary or any securities of Holdings or any Designated
Subsidiary by any such rating organization
(c) The Initial Purchasers shall have received on the Closing Date a
certificate dated the Closing Date, signed by the President and the Chief
Financial Officer of Holdings, confirming the matters set forth in Sections
9(a), 9(b) and 9(d).
(d) [Intentionally omitted.]
(e) The Initial Purchasers shall have received on the Closing Date an
opinion (satisfactory to you and counsel for the Initial Purchasers), dated
the Closing Date, of Xxxxxx & Xxxxxx P.C., counsel for Holdings and the
Designated Subsidiaries, to the effect that:
(i) each of Holdings and the Designated Subsidiaries has been
duly organized, is validly existing as a corporation or limited
liability company in good standing under the laws of its jurisdiction
of organization
31
and has the requisite power and authority to carry on its business as
described in the Offering Memorandum and to own, lease, license and
operate its properties;
(ii) each of Holdings and the Designated Subsidiaries is duly
qualified and is in good standing as a foreign corporation or limited
liability company, as applicable, authorized to do business in each
jurisdiction in which the nature of its business or its ownership or
leasing of property requires such qualification, except where the
failure to be so qualified would not have a Material Adverse Effect;
(iii) all the outstanding shares of capital stock of Holdings
have been duly authorized and validly issued and are fully paid,
non-assessable and not subject to any preemptive or similar rights and
are free and clear of any Liens created by it;
(iv) all of the outstanding shares of capital stock or other
equity interests (including, without limitation, membership interests
in limited liability companies) of each of the Designated Subsidiaries
has been duly authorized and validly issued and are fully paid and
non-assessable, except, in the case of those guarantors of the Company
Notes that are New York corporations, as provided in Section 630 of
the New York Business Corporation Law, are not subject to any
preemptive or similar rights, except, in the case of the Designated
Subsidiaries (other than Xxxxxx Realty Corp.) that are New York
corporations, as provided in Section 622 of the New York Business
Corporation Law; and are owned by Holdings free and clear of any
Liens, except for Liens to be created on the Closing Date by the
Securities Pledge Agreement;
(v) the Notes have been duly authorized and, when executed and
authenticated in accordance with the provisions of the Indenture and
delivered to and paid for by the Initial Purchasers in accordance with
the terms of this Agreement, will be entitled to the benefits of the
Indenture and will be valid and binding obligations of Holdings,
enforceable against Holdings in accordance with their terms;
(vi) the Indenture has been duly authorized, executed and
delivered by Holdings and is a valid and binding obligation of
Holdings, enforceable against Holdings in accordance with its terms;
(vii) this Agreement has been duly authorized, executed and
delivered by Holdings;
32
(viii) the Securities Pledge Agreement has been duly authorized,
executed and delivered by Holdings and the Securities Pledge Agreement
constitutes a valid and binding obligation of Holdings, enforceable
against Holdings in accordance with its terms;
(ix) the Registration Rights Agreement has been duly authorized,
executed and delivered by Holdings and is a valid and binding
obligation of Holdings, enforceable against Holdings in accordance
with its terms;
(x) the Exchange Notes have been duly authorized by Holdings, and
when issued, executed and authenticated in accordance with the terms
of the Registration Rights Agreement, the Exchange Offer and the
Indenture, will be entitled to the benefits of the Indenture and will
be valid and binding obligations of Holdings, enforceable against
Holdings in accordance with their terms;
(xi) the Warrant Agreement has been duly authorized, executed and
delivered by Holdings and constitutes a valid and legally binding
agreement of Holdings, enforceable against Holdings in accordance with
its terms;
(xii) the Warrants have been duly and validly authorized,
executed and delivered by Holdings and constitute valid and binding
obligations of Holdings enforceable in accordance with their terms;
(xiii) when issued and paid for in accordance with the terms and
conditions in the Warrant Agreement upon exercise of the Warrants, the
Warrant Shares will be duly authorized, validly issued, fully paid and
non-assessable and will not be subject to any preemptive or similar
rights. The Warrant Shares have been duly reserved for issuance in
accordance with the terms of the Warrants and the Warrant Agreement;
(xiv) the Stockholders Agreement has been duly authorized,
executed and delivered by Holdings and constitutes a valid and legally
binding agreement of Holdings, enforceable against Holdings in
accordance with its terms;
(xv) the statements under the captions "Description of Notes" and
"Plan of Distribution" in the Offering Memorandum, insofar as such
statements constitute a summary of the legal matters, documents or
proceedings referred to therein, fairly present in all material
respects such legal matters, documents and proceedings;
33
(xvi) such counsel is of the opinion ascribed to it in the
Offering Memorandum under the caption "Certain United States Federal
Income Tax Considerations";
(xvii) to the best of such counsel's knowledge after due inquiry,
neither Holdings nor any of the Designated Subsidiaries is in
violation of its respective charter, by-laws or other organizational
document and, to the best of such counsel's knowledge after due
inquiry, neither the Company nor any of its subsidiaries is (i) in
violation of any applicable law, statute, rule, regulation, judgment,
order, writ or decree of any government, government instrumentality or
court, domestic or foreign, that is applicable to Holdings nor any of
the Designated Subsidiaries or (ii) except as disclosed in the
Offering Memorandum, in default in the performance of any obligation,
agreement, covenant or condition contained in any Contract that in the
case of clauses (i) and (ii) would have a Material Adverse Effect;
(xviii) Holdings and the Designated Subsidiaries, as applicable,
has the requisite corporate power and authority to execute, deliver
and perform each of its obligations under this Agreement and the other
Operative Documents;
(xix) to the best of such counsel's knowledge after due inquiry,
the execution, delivery and performance of this Agreement and the
other Operative Documents (other than Securities and Warrant Shares)
by Holdings and each of the Designated Subsidiaries a party thereto,
the issuance, authentication, sale and delivery of the Securities and
the Warrant Shares upon the exercise of the Warrants and compliance by
Holdings and each of the Designated Subsidiaries with terms thereof
and the consummation of the transactions contemplated hereby and
thereby (including, without limitation, consummation of the
transactions contemplated by the Asset Purchase Agreement) will not,
as of the date hereof (i) require any consent, approval, authorization
or other order of, or qualification with, any court or governmental
body or agency (except such as have been obtained, as may be required
under any applicable federal or state securities law or filings and
recordings with certain government bodies to perfect Liens under the
Collateral Documents and the Securities Pledge Agreement), (ii)
conflict with or constitute a breach of any of the terms or provisions
of, or a default under, the charter, by-laws or other organizational
document of Holdings or any Designated Subsidiaries or any Contract to
which Holdings or any Designated Subsidiary is a party, (iii) violate
any existing applicable law or any rule, regulation, judgment, order
or decree of any court or any governmental body or
34
agency having jurisdiction over Holdings, any of the Designated
Subsidiaries or their respective property, (iv) result in the
imposition or creation of (or the obligation to create or impose) a
Lien under, any agreement or instrument to which Holdings or any of
the Designated Subsidiaries is a party or by which the Company or any
of its subsidiaries or their respective property is bound (other than
any Liens created by the Notes Indenture, the Collateral Documents and
the Securities Pledge Agreement), or (v) result in the termination or
revocation of any Authorization of Holdings or any of the Designated
Subsidiaries or result in any other impairment of the rights of the
holder of any such Authorization, except insofar as any such
violation, conflict, default, Liens, termination, revocation or
impairment would not reasonably be expected to result in a Material
Adverse Effect; provided that counsel's opinion in this paragraph need
not address any impact Holdings or any of the Designated Subsidiaries'
actions may have under any financial covenants or tests in the
Contracts specified in clause (ii) above, any consequences a default
by Holdings under the Purchase Agreement, the Registration Rights
Agreement, the Warrant Agreement or the Indenture may have under any
Contract specified in clause (ii) above, or any cross-default
provisions in the Contracts specified in the clause (ii) above;
(xx) to the knowledge of such counsel, there is no pending or
threatened action, suit or proceeding before any court or other
governmental authority to which Holdings or any Designated Subsidiary
is a party that is required to be disclosed in the Offering Memorandum
and which is not adequately disclosed therein;
(xxi) to the best of such counsel's knowledge after due inquiry,
each of Holdings and the Designated Subsidiaries has such
Authorizations of, and has made all filings with and notices to, all
governmental or regulatory authorities and self-regulatory
organizations and all courts and other tribunals, including without
limitation, under any applicable Environmental Laws, as are necessary
to own, lease, license and operate its respective properties and to
conduct its business, except where the failure to have any such
Authorization or to make any such filing or notice would not, singly
or in the aggregate, have a Material Adverse Effect. Each such
Authorization is valid and in full force and effect and each of
Holdings and its subsidiaries is in compliance with all the terms and
conditions thereof and with the rules and regulations of the
authorities and governing bodies having jurisdiction with respect
thereto; and to the best of such counsel's knowledge after due
inquiry, no event has occurred (including the receipt of any notice
from any authority or governing body) which allows or, after notice or
lapse of time or
35
both, would allow, revocation, suspension or termination of any such
Authorization or results or, after notice or lapse of time or both,
would result in any other impairment of the rights of the holder of
any such Authorization; and to the best of such counsel's knowledge
after due inquiry, such Authorizations contain no restrictions that
are burdensome to Holdings and the Designated Subsidiaries taken as a
whole; except where such failure to be valid and in full force and
effect or to be in compliance, the occurrence of any such event or the
presence of any such restriction would not, singly or in the
aggregate, have a Material Adverse Effect;
(xxii) to the best of such counsel's knowledge after due inquiry,
neither Holdings nor any Designated Subsidiary is and, after giving
effect to the offering and sale of the Securities and the application
of the net proceeds thereof as described in the Offering Memorandum,
neither Holdings nor any Designated Subsidiary will be, an "investment
company" or an entity "controlled" by an "investment company", as such
terms are defined in the Investment Company Act of 1940, as amended;
(xxiii) to the best of such counsel's knowledge after due
inquiry, there are no contracts, agreements or understandings between
Holdings or any Designated Subsidiary and any person granting such
person the right to require Holdings or such Designated Subsidiary to
file a registration statement under the Act with respect to any
securities of Holdings or to require Holdings to include such
securities with the Notes or Warrants registered pursuant to any
Registration Statement, except as provided in the Operative Documents;
(xxiv) assuming the proceeds from the issuance of the Securities
are applied as provided in the Offering Memorandum, neither the
consummation of the transactions contemplated by this Agreement nor
the sale, issuance, execution or delivery of the Securities, nor the
application of the proceeds therefrom (applied as described in the
Offering Memorandum under the caption "Use of Proceeds"), will violate
Regulation T (12 C.F.R. Part 220), Regulation U (12 C.F.R. Part 221)
or Regulation X (12 C.F.R. Part 224) of the Board of Governors of the
Federal Reserve System;
(xxv) each of the Preliminary Offering Memorandum and the
Offering Memorandum, as of its date (except for the financial
statements and the notes thereto and other financial and accounting
data included therein, as to which no opinion need be expressed),
complied in all material respects with the informational requirements
specified in and meeting the requirements of Rule 144A(d)(4) under the
Act;
36
(xxvi) the Indenture complies in all material respects to the
requirements of the TIA, and the rules and regulations of the
Commission applicable to an indenture which is qualified thereunder.
It is not necessary in connection with the offer, sale and delivery of
the Securities to the Initial Purchasers in the manner contemplated by
this Agreement or in connection with the Exempt Resales to qualify the
Indenture under the TIA;
(xxvii) assuming the accuracy of and compliance with the
representations and warranties and agreements of Holdings and the
Initial Purchasers in the Purchase Agreement, no registration under
the Act of the Securities is required for the sale of the Securities
to the Initial Purchasers as contemplated by this Agreement or for the
Exempt Resales assuming the accuracy of, and compliance with, the
Initial Purchasers' representations and agreements contained in
Section 7 of this Agreement;
(xxviii) to the best of such counsel's knowledge after due
inquiry, except as disclosed in the Offering Memorandum, no
relationship, direct or indirect, exists between or among Holdings or
any of its subsidiaries on the one hand, and the directors, officers,
stockholders, customers or suppliers of Holdings or any of its
subsidiaries on the other hand, which would be required by the Act to
be described in the Offering Memorandum if the Offering Memorandum
were a prospectus included in a registration statement on Form S-1
filed with the Commission;
(xxix) after giving effect to the delivery of the certificates
representing the Pledged Shares (as defined in the Securities Pledge
Agreement) listed on Schedule 1 to the Securities Pledge Agreement,
together with undated stock powers, duly endorsed in blank, and
assuming the continued possession and control by the Trustee of such
Pledged Shares in the State of New York, the security interest created
in favor of the Trustee under the Securities Pledge Agreement
constitutes a valid and perfected security interest in such Pledged
Shares in favor of the Trustee, and no filings or recordings in the
State of New York under the UCC as in effect in the State of New York
("UCC") are required to perfect (or maintain perfection of) such
security interests so long as such Pledged Shares continue to be
"certificated securities" as defined in the UCC;
(xxx) the execution, delivery, filing, recordation and
performance by Holdings of the Operative Documents to which it is a
party do not, and the payment of the indebtedness evidenced by the
Notes will not, result in any violation of the law of the United
States or New York State, or any rule or regulation thereunder;
37
(xxxi) the Trustee is permitted under the laws of New York State,
without naming all of the Initial Purchasers in the applicable legal
proceeding, to apply to a court of competent jurisdiction to seek to
exercise remedies under the applicable Operative Documents in respect
of any of the Collateral in its own name, as collateral agent for the
Initial Purchasers;
(xxxii) no taxes or other charges, including, without limitation,
intangible or documentary stamp taxes, mortgage or recording taxes,
transfer taxes or similar charges, are payable to New York State on
account of the execution and delivery of the Operative Documents or
the creation of the indebtedness evidenced or secured by any of the
Operative Documents or the filing of the Securities Pledge Agreement,
except for nominal filing or recording fees; and
(xxxiii) the transfer of all or any portion of the Collateral in
connection with the exercise of any remedy under the Securities Pledge
Agreement, including, without limitation, by way of judicial
foreclosure, will not restrict, affect or impair the liability of
Holdings with respect to the indebtedness secured thereby or the
beneficiary's rights or remedies to the foreclosure or enforcement of
any other security interest or liens securing such indebtedness.
In addition, such counsel shall state that it has participated in
conferences with directors and other representatives of Holdings and the
Designated Subsidiaries, representatives of the independent certified
public accountants for Holdings and the Designated Subsidiaries, the
Initial Purchasers and its representatives and counsel, at which the
contents of the Offering Memorandum and related matters were discussed and,
although such counsel is not passing upon, and does not assume any
responsibility for, the accuracy, completeness or fairness of the
statements contained in the Offering Memorandum and has not made any
independent check or verification thereof (other than as expressly
described in paragraphs (xv) and (xvi) above), during the course of such
participation (relying as to materiality to the extent they have deemed
appropriate upon the statements of officers and other representatives of
Holdings and the Designated Subsidiaries), no facts came to such counsel's
attention that caused such counsel to believe that the Offering Memorandum,
as of its date or as of the date hereof, contained or contains an untrue
statement of a material fact or omitted or omits to state a material fact
necessary to make the statements therein, in the light of the circumstances
under which they were made, not misleading; it being understood that such
counsel need express no belief with respect to the financial statements,
including the notes thereto, pro forma financial statements and other
financial and statistical data included in the Offering Memorandum.
38
In rendering such opinion, counsel for Holdings and the Designated
Subsidiaries will opine only as to the Delaware General Corporation Law,
the laws of the State of New York and the federal laws of the United
States. Such counsel will be permitted to except from its opinions with
respect to enforceability: (A) the effect of bankruptcy, insolvency,
reorganization, fraudulent transfer, moratorium and other similar laws now
or hereafter in effect relating to or affecting the rights and remedies of
creditors; (B) the effect of general equitable principles, whether such
enforceability is considered in a proceeding in equity or at law, and the
discretion of the court before which any proceeding therefor may be
brought; (C) that rights of acceleration and the availability of equitable
remedies may be limited by equitable principles of general applicability;
(D) with respect to the Registration Rights Agreement, rights of
indemnification and contribution may be limited by federal and state
securities laws and public policy considerations; (E) the unenforceability
of any provision requiring the payment of attorney's fees (except to the
extent that a court determines such fees to be reasonable) or liquidated
damages; (F) compliance with laws relating to permissible rates of
interest; and (G) the application by a court of competent jurisdiction of
principles of due process and public policy considerations may limit or
restrict certain right and remedies provided for in Indenture. In
determining whether any matters would have a Material Adverse Effect, such
counsel may rely on statements of officers and responsible employees and
consultants of Holdings and/or the Designated Subsidiaries without
independently attempting to verify the accuracy of such statements.
The opinion of Xxxxxx & Xxxxxx P.C. described in this Section 9(e)
shall be rendered to you and the Trustee at the request of Holdings and
shall so state therein.
(f) The Initial Purchasers shall have received on the Closing Date an
opinion, dated the Closing Date, of Xxxxxx Xxxxxx & Xxxxxxx, counsel for
the Initial Purchasers, in form and substance reasonably satisfactory to
the Initial Purchasers.
(g) The Initial Purchasers shall have received, on or prior to the
Closing Date, letters in form and substance reasonably satisfactory to the
Initial Purchasers from each of Xxxxxx Xxxxxxxx LLP, Xxxxx & Xxxxx LLP and
Xxxxx Xxxxxxxxxx & Co., LLP, independent public accountants, containing the
information and statements of the type ordinarily included in accountants'
"comfort letters" to the Initial Purchasers with respect to the applicable
financial statements and certain financial information contained in the
Offering Memorandum.
(h) The Notes shall have been approved by the NASD for trading and
duly listed in PORTAL.
39
(i) Holdings and the Trustee shall have executed the Indenture and the
Initial Purchasers shall have received an original copy thereof, duly
executed by Holdings and the Trustee.
(j) Holdings shall have executed the Registration Rights Agreement,
Warrant Agreement and Securities Pledge Agreement and the Initial
Purchasers shall have received an original copy of each thereof, duly
executed by Holdings.
(k) Holdings shall have executed the Warrants and each Initial
Purchaser shall have received an original copy thereof, duly executed by
Holdings.
(l) Holdings shall have executed the Stockholders Agreement and each
Initial Purchaser shall have received an original copy thereof, duly
executed by Holdings and each of the other parties thereto.
(m) Holdings and the Designated Subsidiaries shall not have failed at
or prior to the Closing Date to perform or comply in any material respect
with any of the agreements herein contained and required to be performed or
complied with by Holdings and the Designated Subsidiaries at or prior to
the Closing Date.
(n) The Notes shall have been duly executed and delivered by Holdings
and duly authenticated by the Trustee.
(o) The consummation of the transactions contemplated by the Asset
Purchase Agreement shall occur on the Closing Date.
(p) On the Closing Date, all related party debt of the Company and its
subsidiaries shall have been assumed by a newly formed indirect parent
company of the Company, Super American Tissue Inc. ("Super American
Tissue"), as described in the Offering Memorandum, and the terms and
conditions of such assumed debt shall be reasonably satisfactory to the
Initial Purchasers in all respects.
(q) On the Closing Date, the Company shall have consummated the sale
of $165,000,000 of its 12 1/2% Senior Secured Notes due 2006 and Super
American Tissue Inc. shall have contributed as equity $5.0 million in cash
to Holdings, in each case as described in the Offering Memorandum, and the
terms and conditions of such investments shall be reasonably satisfactory
to the Initial Purchasers in all respects.
(r) Holdings shall have paid to Xxxxxxxxx, Lufkin & Xxxxxxxx
Securities Corporation a fee of 2.75% of the gross proceeds of the
Securities.
40
(s) On the Closing Date, the Initial Purchasers and counsel for the
Initial Purchasers shall have received such further documents, opinions,
certificates and schedules or instruments relating to the business,
corporate, legal and financial affairs of Holdings and the Designated
Subsidiaries as they shall have heretofore reasonably requested from
Holdings and the Designated Subsidiaries.
10. Effectiveness of Agreement and Termination. This Agreement shall become
effective upon the execution and delivery of this Agreement by the parties
hereto.
This Agreement may be terminated at any time prior to the Closing Date by
the Initial Purchasers by written notice to Holdings if any of the following has
occurred: (i) any outbreak or escalation of hostilities or other national or
international calamity or crisis or change in economic conditions or in the
financial markets of the United States or elsewhere that, in the Initial
Purchasers' judgment, is material and adverse and, in the Initial Purchasers'
judgment, makes it impracticable to market the Securities on the terms and in
the manner contemplated in the Offering Memorandum, (ii) the suspension or
material limitation of trading in securities or other instruments on the New
York Stock Exchange, the American Stock Exchange, the Chicago Board of Options
Exchange, the Chicago Mercantile Exchange, the Chicago Board of Trade or the
Nasdaq National Market or limitation on prices for securities or other
instruments on any such exchange or the Nasdaq National Market, (iii) the
suspension of trading of any securities of Holdings or any Designated Subsidiary
on any exchange or in the over-the-counter market, (iv) the enactment,
publication, decree or other promulgation of any federal or state statute,
regulation, rule or order of any court or other governmental authority which in
the Initial Purchasers' opinion materially and adversely affects, or will
materially and adversely affect, the business, prospects, condition (financial
or otherwise) or results of operations of Holdings and its subsidiaries, taken
as a whole, (v) the declaration of a banking moratorium by either federal or New
York State authorities or (vi) the taking of any action by any federal, state or
local government or agency in respect of its monetary or fiscal affairs which in
your opinion has a material adverse effect on the financial markets in the
United States.
11. Miscellaneous. Notices given pursuant to any provision of this
Agreement shall be addressed as follows: (i) if to Holdings, to American Tissue
Holdings, Inc., 000 Xxxxxxxxx Xxxx, Xxxxxxxxx, Xxx Xxxx 00000 Attention:
President and Chief Executive Officer, with a copy to Xxxxxx & Xxxxxx P.C., 000
Xxxx 00xx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Xxxxxxxx X. Xxxxxx, Esq.,
and (ii) if to the Initial Purchasers, to the respective addresses set forth on
Schedule 1 hereto, in each case with a copy to Xxxxxx Xxxxxx & Xxxxxxx, 00 Xxxx
Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Xxxx Xxxxxxxx, Esq., or in any case
to such other address as the person to be notified may have requested in
writing.
41
The respective indemnities, contribution agreements, representations,
warranties and other statements of Holdings and the Initial Purchasers set forth
in or made pursuant to this Agreement shall remain operative and in full force
and effect, and will survive delivery of and payment for the Securities,
regardless of (i) any investigation, or statement as to the results thereof,
made by or on behalf of the Initial Purchasers, the officers or directors of the
Initial Purchasers, any person controlling the Initial Purchasers, Holdings, the
officers or directors of Holdings, or any person controlling Holdings, (ii)
acceptance of the Securities and payment for them hereunder and (iii)
termination of this Agreement.
If for any reason the Securities are not delivered by or on behalf of
Holdings as provided herein (other than as a result of any termination of this
Agreement pursuant to Section 10), Holdings agrees to reimburse the Initial
Purchasers only for all out-of-pocket expenses (including the fees and
disbursements of counsel) incurred by them; provided, further the Initial
Purchasers shall not be entitled to receive any other amount. Notwithstanding
any termination of this Agreement, Holdings shall be liable for all expenses
which it has agreed to pay pursuant to Section 5(i) hereof. Holdings agrees to
reimburse the Initial Purchasers and their officers, directors and each person,
if any, who controls any Initial Purchasers within the meaning of Section 15 of
the Act or Section 20 of the Exchange Act for any and all fees and expenses
(including without limitation the fees and expenses of counsel) incurred by them
in connection with enforcing their rights under this Agreement (including
without limitation their rights under this Section 11).
Except as otherwise provided, this Agreement has been and is made solely
for the benefit of and shall be binding upon Holdings, the Initial Purchasers,
the Initial Purchasers' directors and officers, any controlling persons referred
to herein, the directors of Holdings and its respective successors and assigns,
all as and to the extent provided in this Agreement, and no other person shall
acquire or have any right under or by virtue of this Agreement. The term
"successors and assigns" shall not include a purchaser of any of the Securities
from the Initial Purchasers merely because of such purchase.
This Agreement shall be governed and construed in accordance with the laws
of the State of New York, without giving effect to the choice of law rules
thereof.
This Agreement may be signed in various counterparts which together shall
constitute one and the same instrument.
42
Please confirm that the foregoing correctly sets forth the agreement among
Holdings and the Initial Purchasers.
Very truly yours,
MIDDLE AMERICAN TISSUE INC.
By: /s/ X. Xxxxxxxxxx
---------------------
Xxxxxxxxx Xxxxxxxxxx
Chairman of the Board
By: /s/ Xxxxx Xxxxxxxxxx
---------------------
Xxxxx Xxxxxxxxxx
President
Initial Purchasers:
DLJMB Funding II, Inc.
By: DLJMB Funding, Inc.
/s/ Xxxxxx Xxxx
-----------------------------
Name:
Title:
DLJ Merchant Banking Partners II, L.P.
By: DLJ Merchant Banking II, Inc. Managing
General Partner
/s/ Xxxxxx Xxxx
-----------------------------
Name:
Title:
S-1
DLJ Merchant Banking Partners II-A, L.P.
By: DLJ Merchant Banking II, Inc.
Managing General Partner
/s/ Xxxxxx Xxxx
-----------------------------
Name:
Title:
DLJ FIRST ESC L.P.
By: DLJ LBO PLANS MANAGEMENT
CORPORATION
General Partner
/s/ Xxxxxx Xxxx
-----------------------------
Name:
Title:
DLJ OFFSHORE PARTNERS II, C.V.
By: DLJ MERCHANT BANKING II, INC.
Managing General Partner
/s/ Xxxxxx Xxxx
-----------------------------
Name:
Title:
DLJ EAB PARTNERS, L.P.
By: DLJ LBO PLANS MANAGEMENT
CORPORATION
General Partner
/s/ Xxxxxx Xxxx
-----------------------------
Name:
Title:
X-0
XXX ESC II L.P.
By: DLJ LBO PLANS MANAGEMENT
CORPORATION
General Partner
/s/ Xxxxxx Xxxx
-----------------------------
Name:
Title:
DLJ DIVERSIFIED PARTNERS, L.P.
By: DLJ DIVERSIFIED PARTNERS, INC.
Managing General Partner
/s/ Xxxxxx Xxxx
-----------------------------
Name:
Title:
DLJ DIVERSIFIED PARTNERS-A, L.P.
By: DLJ DIVERSIFIED PARTNERS, INC.
Managing General Partner
/s/ Xxxxxx Xxxx
-----------------------------
Name:
Title:
DLJ MILLENNIUM PARTNERS, L.P.
By: DLJ MERCHANT BANKING II, INC.
Managing General Partner
/s/ Xxxxxx Xxxx
-----------------------------
Name:
Title:
S-3
DLJ MILLENNIUM PARTNERS-A, L.P.
By: DLJ MERCHANT BANKING II, INC.
Managing General Partner
/s/ Xxxxxx Xxxx
-----------------------------
Name:
Title:
S-4
