Exhibit 10.21
ACCURIDE CORPORATION
$200,000,000
9 1/4% Senior Subordinated Notes due 2008
PURCHASE AGREEMENT
January 15, 1998
BT ALEX. XXXXX INCORPORATED
CITICORP SECURITIES, INC.
X.X. XXXXXX SECURITIES INC.
c/o BT ALEX. XXXXX INCORPORATED
Bankers Trust Plaza
000 Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
Accuride Corporation, a Delaware corporation (the ACOMPANY@), hereby
confirms its agreement with each of BT Alex. Xxxxx Incorporated, Citicorp
Securities, Inc. and X.X. Xxxxxx Securities Inc. (collectively, the "INITIAL
PURCHASERS"), as set forth below.
1. THE NOTES. Subject to the terms and conditions herein contained, the
Company proposes to issue and sell to the Initial Purchasers $200,000,000
aggregate principal amount of its 9 1/4% Senior Subordinated Notes due 2008 (the
"NOTES"). The Notes are to be issued under an indenture (the "INDENTURE") to be
dated as of January 21, 1998 by and between the Company and U.S. Trust Company
of California, N.A., as Trustee (the "TRUSTEE").
The Notes will be offered and sold (the "OFFERING") to the Initial
Purchasers without being registered under the Securities Act of 1933, as amended
(the "ACT"), in reliance on exemptions therefrom.
In connection with the sale of the Notes, the Company has prepared a
preliminary offering memorandum dated January 4, 1998 (the "PRELIMINARY
MEMORANDUM") and a final offering memorandum dated the date hereof (the "FINAL
MEMORANDUM"; the Preliminary Memorandum and the Final Memorandum each herein
being referred to as a "MEMORANDUM"), each setting forth or including
descriptions of the terms of the Notes and the terms of the Offering and the
transactions contemplated hereby, the Company and its business.
The Company understands that the Initial Purchasers propose to make an
offering of the Notes only on the terms and in the manner set forth in the Final
Memorandum and Section 8 hereof as soon
as the Initial Purchasers deem advisable after this Agreement has been executed
and delivered, to (i) persons in the United States whom the Initial Purchasers
reasonably believe to be qualified institutional buyers ("QUALIFIED
INSTITUTIONAL BUYERS" or "QIBS") as defined in Rule 144A under the Act, as such
rule may be amended from time to time ("RULE 144A") and (ii) in offshore
transactions in reliance on Regulation S under the Act.
The Initial Purchasers and their direct and indirect transferees of
the Notes will be entitled to the benefits of the Registration Rights Agreement,
substantially in the form attached hereto as EXHIBIT A (the "REGISTRATION RIGHTS
AGREEMENT"), to be dated the Closing Date (as defined in Section 3 below),
pursuant to which the Company will agree, among other things, to (i) file a
registration statement (the "EXCHANGE OFFER REGISTRATION STATEMENT") with the
Securities and Exchange Commission (the "COMMISSION") registering the Exchange
Notes (as defined in the Registration Rights Agreement) under the Act or (ii)
under certain circumstances file a shelf registration statement pursuant to Rule
415 registering the Notes under the Act (the "Shelf Registration Statement").
2. REPRESENTATIONS AND WARRANTIES OF THE COMPANY. The Company represents
and warrants to each Initial Purchaser that:
(a) Neither the Final Memorandum nor any amendment or supplement
thereto as of the date thereof and at all times subsequent thereto up to
the Closing Date (as defined in Section 3 below) contained or will contain
any untrue statement of a material fact or omitted or will omit to state a
material fact necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading, except that the
representations and warranties set forth in this Section 2(a) do not apply
to statements or omissions made in reliance upon and in conformity with
information relating to the Initial Purchasers furnished to the Company in
writing by the Initial Purchasers expressly for use in the Final Memorandum
or any amendment or supplement thereto.
(b) The Company, each of its Significant Subsidiaries (as such term
is defined in Regulation S-X promulgated under the Securities Exchange Act
of 1934, as amended (the "EXCHANGE ACT")) and each of AKW, L.P. ("AKW"),
Accuride de Mexico S.A. de C.V. ("ADM") and AOT, Inc. ("AOT", and, together
with AKW and ADM, the "Ventures") is (i) a corporation, limited liability
company or limited partnership, as applicable, duly organized, validly
existing and in good standing under the laws of the jurisdiction of its
formation, (ii) has all requisite organizational power and authority to
own, lease and operate its properties, and to conduct its business as
described in the Preliminary Memorandum and the Final Memorandum and (iii)
is duly qualified to do business in each jurisdiction in which it owns or
leases real property or in which the conduct of its business requires such
qualification except where the failure to be so qualified would not,
individually or in the aggregate, reasonably be expected to have a material
adverse effect on the condition (financial or otherwise), business or
results of operations of the Company and its subsidiaries, taken as a whole
(a 'MATERIAL ADVERSE EFFECT').
(c) As of September 30, 1997, the Company had the authorized, issued
and outstanding capitalization as set forth under the heading
"Capitalization" in the Final Memorandum. All of the issued and
outstanding shares of capital stock or limited partnership interests or
membership interests, as the case may be, of the Company, each of its
Significant Subsidiaries and each of the Ventures have been duly authorized
and validly issued, and were not issued in violation of any preemptive or
similar rights, and all shares of capital stock of the Company and each of
its subsidiaries and each of the Ventures that is a corporation are fully
paid and nonassessable. Except as otherwise stated in the Final
Memorandum, all of the outstanding shares of capital stock or
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limited partnership interests or membership interests, as the case may be,
of each of the Company's subsidiaries and each of the Ventures are owned,
directly or indirectly, by the Company and all of the outstanding shares of
capital stock, limited partnership interests or membership interests, as
the case may be, of the Company, each of its subsidiaries and each of the
Ventures are free and clear of all liens, encumbrances, equities and claims
or restrictions on transferability (other than those imposed by the Act and
the securities or "Blue Sky" laws of certain jurisdictions) or voting,
other than those contained in (i) the senior secured term loan facility by
and among the Company and the lenders named therein and the senior secured
term loan facility by and among Accuride Canada, Inc. and the lenders named
therein (together, the "Term Loan Facilities"), (ii) the Company's senior
secured revolving credit facility by and among the Company and the lenders
named therein (the "Revolving Credit Facility" and, together with the Term
Loan Facilities, the "Credit Facilities"), (iii) the Stock Subscription and
Redemption Agreement, dated as of November 17, 1997 (the "Subscription
Agreement"), by and among the Company, Hubcap Acquisition LLC and Xxxxxx
Dodge Corporation, (iv) the ADM Credit Facility (as such term is defined in
the Final Memorandum) (v) the Stockholders' Agreement, dated June 12, 1991,
between the Company and Goodyear Tire and Rubber Company, as amended May 9,
1996, (vi) the Service Agreement, dated as of June 14, 1991, between AOT
and the Company, as amended May 7, 1996 and as further amended or extended,
(vii) the Contribution Agreement, dated as of May 1, 1997, among the
Company, Xxxxxx Aluminum Chemical Corporation ("Kaiser"), AKW General
Partner L.L.C. and AKW, and related agreements, (viii) Limited Partnership
Agreement of AKW L.P., dated as of May 1, 1997; (ix) Limited Liability
Company Agreement of AKW General Partner LLC, dated as of May 1, 1997; (x)
the Letter of Intent, dated September 16, 1996, from the Company to Kaiser
regarding AKW, (xi) the Memorandum of Agreement regarding Cast Aluminum
Wheel Venture, dated December 1, 1995, between the Company and Speedline
Aluminum S.p.A., and related agreements; (xii) the Joint Venture Agreement,
dated November 5, 1997, among the Company, Industria Automotriz S.A. de
C.V., Grupo Industrial Xxxxxxx, X.X. and ADM, and related agreements;
(xiii) the ADM Credit Facility and (xiv) the bylaws of ADM. Except as
disclosed in or contemplated by the Final Memorandum and the financial
statements of the Company, and the related notes thereto included in the
Final Memorandum, none of the Company or any Significant Subsidiary has
outstanding any options to purchase or any preemptive rights or other
rights to subscribe for or to purchase, any securities or obligations
convertible into, or any contracts or commitments to issue or sell, shares
of its capital stock or any such options, rights, convertible securities or
obligations.
(d) The Company has all requisite corporate power and authority to
execute, deliver and perform each of its obligations under the Notes and
the Exchange Notes (as defined in the Registration Rights Agreement). The
Notes, when issued, will be substantially in the form contemplated by the
Indenture. The Notes and the Exchange Notes have been duly and validly
authorized by the Company and, when issued, authenticated and delivered in
accordance with the provisions of the Indenture (assuming due
authorization, execution and delivery of the Indenture by the Trustee) and,
in the case of the Notes, when delivered to and paid for by the Initial
Purchasers in accordance with the terms of this Agreement and the
Indenture, and, in the case of the Exchange Notes, when issued and
delivered upon exchange for the Notes in accordance with the terms of the
Registration Rights Agreement and the Indenture, will constitute valid and
legally binding obligations of the Company, entitled to the benefits of the
Indenture, and enforceable against the Company in accordance with their
terms, except to the extent that the enforcement of the Notes and the
Exchange Notes may be subject to (i) bankruptcy, fraudulent conveyance,
insolvency, reorganization, moratorium or other similar laws now or
hereafter in effect relating to or affecting creditors' rights generally,
and (ii) general principles of equity (regardless of whether enforcement is
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in a proceeding at law or in equity) and the discretion of the court before
which any proceeding therefor may be brought.
(e) The Company has all requisite corporate power and authority to
execute, deliver and perform its obligations under the Indenture. The
Indenture meets the requirements for qualification under the Trust
Indenture Act of 1939, as amended (the "TIA"). The Indenture has been duly
and validly authorized by the Company. Assuming the due authorization,
execution and delivery of the Indenture by the Trustee, the Indenture, when
executed and delivered by the Company, will constitute a valid and legally
binding agreement of the Company, enforceable against the Company in
accordance with its terms, except to the extent that (A) the enforcement
thereof may be subject to (i) bankruptcy, fraudulent conveyance,
insolvency, reorganization, moratorium or other similar laws now or
hereafter in effect relating to creditors' rights generally and (ii)
general principles of equity (regardless of whether enforcement is in a
proceeding at law or in equity) and the discretion of the court before
which any proceeding therefor may be brought and (B) any rights to
indemnity or contribution thereunder may be limited by federal or state
securities laws or public policy considerations. With respect to the
foregoing, the Company makes no representation or warranty with respect to
the indemnification provisions contained in Section 607 of the Indenture to
the extent they are deemed by a court of law to be contrary to public
policy.
(f) The Company has all requisite corporate power and authority to
execute, deliver and perform its obligations under the Registration Rights
Agreement. The Registration Rights Agreement has been duly and validly
authorized by the Company. Assuming the due authorization, execution and
delivery of the Registration Rights Agreement by the Initial Purchasers,
the Registration Rights Agreement, when executed and delivered by the
Company, will constitute a valid and legally binding agreement of the
Company, enforceable against the Company in accordance with its terms,
except to the extent that (A) the enforcement thereof may be subject to (i)
bankruptcy, insolvency, reorganization, moratorium or other similar laws
now or hereafter in effect relating to creditors' rights generally and (ii)
general principles of equity (regardless of whether enforcement is in a
proceeding at law or in equity) and the discretion of the court before
which any proceeding therefor may be brought and (B) any rights to
indemnity or contribution thereunder may be limited by federal or state
securities laws or public policy considerations.
(g) The Company has all requisite corporate power and authority to
execute, deliver and perform its obligations under the Subscription
Agreement. The Subscription Agreement has been duly and validly
authorized, executed and delivered by the Company. Assuming that the
Subscription Agreement has been duly authorized, executed and delivered by
the other parties thereto, the Subscription Agreement constitutes a valid
and legally binding agreement of the Company, enforceable against the
Company in accordance with its terms, except to the extent that (A) the
enforcement thereof may be subject to (i) bankruptcy, insolvency,
reorganization, moratorium or other similar laws now or hereafter in effect
relating to creditors' rights generally and (ii) general principles of
equity (regardless of whether enforcement is in a proceeding at law or in
equity) and the discretion of the court before which any proceeding
therefor may be brought and (B) any rights to indemnity or contribution
thereunder may be limited by federal or state securities laws or public
policy considerations.
(h) The Company has all requisite corporate power and authority to
execute, deliver and perform its obligations under this Agreement and to
consummate the transactions contemplated hereby. This Agreement and the
consummation by the Company of the transactions contemplated hereby have
been duly authorized by the Company and this Agreement has been duly
executed and
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delivered by the Company. The execution, delivery and performance by the
Company of this Agreement, the Indenture and the Registration Rights
Agreement, and the consummation of the transactions contemplated hereby and
thereby will not result in a breach or violation of any of the terms and
provisions of, or constitute a default under, (i) any of the terms or
provisions of any indenture, mortgage, deed of trust, loan agreement, note,
lease, license, franchise agreement, permit, certificate, contract,
partnership, joint venture agreement or other agreement or instrument to
which the Company, any of its Significant Subsidiaries or any of the
Ventures is a party or to which any of them or their respective properties
or assets is subject (collectively, "CONTRACTS"), (ii) the charter or
by-laws (or similar organizational document) of the Company, any of its
Significant Subsidiaries or any of the Ventures, or (iii) (assuming
compliance with all applicable state securities laws or "Blue Sky" laws)
any statute, judgment, decree, order, rule or regulation of any court or
governmental agency or body having jurisdiction over the Company, any of
its Significant Subsidiaries or any of the Ventures or any of their
respective properties, except in the case of (i) or (iii) for such
breaches, violations or defaults which would not, either individually or in
the aggregate, reasonably be expected to have a Material Adverse Effect; no
consent, approval, authorization or order of, or filing with, any court or
governmental agency or body is required for the issuance and sale by the
Company of the Notes to the Initial Purchasers or the consummation of the
transactions contemplated by this Agreement in connection with the issuance
or sale of the Notes except such as (i) have been obtained or made, (ii)
may be required to comply with the provisions of the Registration Rights
Agreement or the Credit Facilities, or (iii) may be required under state
securities laws or "Blue Sky" laws.
(i) The audited consolidated financial statements of the Company and
its consolidated subsidiaries, and the related notes thereto, included in
the Final Memorandum present fairly in all material respects the
consolidated financial position of the Company and its consolidated
subsidiaries, as of the respective dates of such financial statements, and
the results of operations and changes in financial position of the Company
for the respective periods covered thereby. Such statements and related
notes have been prepared in accordance with generally accepted accounting
principles applied on a consistent basis, except as otherwise stated
therein. The summary and selected financial data set forth in the Final
Memorandum under the captions "Capitalization," "Summary Historical
Consolidated Financial and Other Data," "Summary Pro Forma Consolidated
Financial Data," "Pro Forma Consolidated Condensed Financial Statements,"
"Selected Historical Consolidated Financial and Other Data" and
"Management's Discussion and Analysis of Financial Condition and Results of
Operations" fairly present in all material respects (subject to year-end
audit adjustments with respect to interim financial information) the
information set forth therein on the basis stated in the Final Memorandum.
The other financial and statistical information and data set forth in the
Preliminary Memorandum and the Final Memorandum are based on or derived
from sources which the Company and the subsidiaries believe to be reliable
and materially accurate. Deloitte & Touche LLP, who has certified certain
financial statements of the Company and its consolidated subsidiaries, and
whose report appears in the Final Memorandum, is an independent public
accounting firm within the meaning of the Act and the rules and regulations
promulgated thereunder.
(j) The pro forma consolidated condensed financial statements and
other pro forma financial information (including the notes thereto)
included in the Final Memorandum (A) present fairly in all material
respects the information shown therein and (B) have been prepared in
accordance with applicable requirements of Regulation S-X promulgated under
the Exchange Act. The assumptions used in the preparation of the pro forma
financial statements and other pro forma consolidated condensed financial
information included in the Final Memorandum are reasonable
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and the adjustments used therein are appropriate to give effect to the
transactions or circumstances referred to therein.
(k) Except as disclosed in the Final Memorandum, none of the Company,
any of its Significant Subsidiaries or any of the Ventures is (i) in
violation of its charter or by-laws (or similar organizational document),
(ii) in breach or violation of any statute, judgment, decree, order, rule
or regulation applicable to the Company, its Significant Subsidiaries or
the Ventures or any of their properties or assets, or (iii) in breach or
default in the performance of any Contract, or to which any of the property
or assets of the Company or such Significant Subsidiaries or the Ventures
is subject, except for any such violation, breach or default that would
not, individually or in the aggregate, reasonably be expected to have a
Material Adverse Effect.
(l) The descriptions in the Final Memorandum of statutes, legal and
governmental proceedings and contracts and other documents are accurate and
fairly present in all material respects the information that would be
required to be described in a registration statement under the Act or in a
document incorporated by reference therein.
(m) The Notes, the Indenture and the Registration Rights Agreement
conform in all material respects to the descriptions thereof contained in
the Final Memorandum.
(n) Except as disclosed in the Final Memorandum, there is (i) no
action, suit or proceeding before or by any court, arbitrator or
governmental agency, body or official, domestic or foreign, now pending, or
to the knowledge of the Company, threatened or contemplated to which the
Company, any of its Significant Subsidiaries or any of the Ventures is or
may be a party or to which the business or property of the Company, any of
its Significant Subsidiaries or any of the Ventures is or may be subject,
(ii) to the knowledge of the Company, its Significant Subsidiaries and the
Ventures, no statute, rule, regulation or order that has been enacted,
adopted or issued by any governmental agency or that has been proposed by
any governmental body (other than "Blue Sky" laws, regulations or orders),
or (iii) no injunction, restraining order or order of any nature by a
federal or state court of competent jurisdiction to which the Company, any
of its Significant Subsidiaries or any of the Ventures is or may be
subject, issued and outstanding that, in the case of clauses (i), (ii) or
(iii) above, except as disclosed in the Final Memorandum, would reasonably
be expected to (x) have a Material Adverse Effect or (y) seek to restrain,
enjoin, interfere with or adversely affect the transactions contemplated by
this Agreement in any material respect.
(o) Except as otherwise disclosed in the Final Memorandum, each of
the Company, its Significant Subsidiaries and the Ventures has good and
marketable title, free and clear of all liens, claims, encumbrances and
restrictions, to all property and assets described in the Final Memorandum
as being owned by it and good title to all leasehold estates in the real
property described in the Final Memorandum as being leased by it except for
(i) liens for taxes not yet due and payable, (ii) such liens and
encumbrances as are contemplated by the Credit Facilities, (iii) such
liens, claims, encumbrances and restrictions as do not materially interfere
with the use made and proposed to be made of such properties (including,
without limitation, purchase money mortgages), and (iv) to the extent the
failure to have such title or the existence of such liens, claims,
encumbrances and restrictions would not have a Material Adverse Effect.
(p) Since the respective dates as of which information is given in
the Final Memorandum, and except as described in or specifically
contemplated by the Final Memorandum: (i) the Company, its Significant
Subsidiaries and the Ventures have not incurred any material
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liabilities or obligations, direct or contingent, or entered into any
material agreement or other material transaction, which is not in the
ordinary course of business; (ii) the Company has not paid or declared any
dividends or other distributions with respect to its capital stock and the
Company, its Significant Subsidiaries and the Ventures are not in default
in the payment of principal or interest on any outstanding debt
obligations; and (iii) there has not been any change in the condition
(financial or otherwise), business or results of operations of the Company,
its Significant Subsidiaries and the Ventures, taken as a whole, which
could have a Material Adverse Effect.
(q) The Company, each of its subsidiaries and each of the Ventures
own or possess adequate licenses or other rights to use all patents,
trademarks, service marks, trade names and copyrights necessary to conduct
the business described in the Final Memorandum, except where the failure to
own or possess or have the ability to acquire any of the foregoing would
not have a Material Adverse Effect, and none of the Company, any of its
subsidiaries or any of the Ventures has received any notice of infringement
of or conflict with asserted rights of others with respect to any patents,
trademarks, service marks, trade names or copyrights which, if such
assertion of infringement or conflict were sustained, would have a Material
Adverse Effect.
(r) None of the Company, any of its Significant Subsidiaries or any
of the Ventures has any material liability for any prohibited transaction
or funding deficiency or any complete or partial withdrawal liability with
respect to any pension, profit sharing or other plan which is subject to
the Employee Retirement Income Security Act of 1974, as amended ("ERISA"),
to which it makes or ever has made a contribution and in which any employee
of it is or has ever been a participant. With respect to such plans, the
Company, each of its subsidiaries and each of the Ventures is in compliance
in all material respects with all applicable provisions of ERISA.
(s) Except as disclosed in the Final Memorandum, none of the Company,
any of its Significant Subsidiaries or any of the Ventures is involved in
any material labor dispute nor, to the best of the knowledge of the
Company, its Significant Subsidiaries and each of the Ventures, is any
material labor dispute threatened which, if such dispute were to occur,
would reasonably be expected to have a Material Adverse Effect.
(t) Except as disclosed in the Final Memorandum and except as would
not, individually or in the aggregate, reasonably be expected to have a
Material Adverse Effect, to the best of the knowledge of the Company, the
Company, its Significant Subsidiaries and each of the Ventures are in
material compliance with all applicable existing federal, state, local and
foreign laws and regulations relating to the protection of human health or
the environment or imposing liability or requiring standards of conduct
concerning any Hazardous Materials ('ENVIRONMENTAL LAWS'). The term
'HAZARDOUS MATERIAL' means (a) any 'hazardous substance' as defined by the
Comprehensive Environmental Response, Compensation and Liability Act of
1980, as amended, (b) any Ahazardous waste@ as defined by the Resource
Conservation and Recovery Act, as amended, (c) any petroleum or petroleum
product, (d) any polychlorinated biphenyl and (e) any pollutant or
contaminant or hazardous, dangerous or toxic chemical, material, waste or
substance regulated under or within the meaning of any other Environmental
Law. Except as disclosed in the Final Memorandum, none of the Company, any
of its subsidiaries or any of the Ventures has received any written notice
and there is no pending or, to the best knowledge of the Company,
threatened action, suit or proceeding before or by any court or
governmental agency or body alleging liability (including, without
limitation, alleged or potential liability for investigatory costs, cleanup
costs, governmental response costs, natural resources damages, property
damages, personal injuries, or penalties) of the Company, any of its
Significant Subsidiaries or any of the Ventures
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arising out of, based on or resulting from (i) the presence or release into
the environment of any Hazardous Material at any location owned or operated
by the Company, any of its Significant Subsidiaries or any of the Ventures
or previously owned by the Company, any of its Significant Subsidiaries or
any of the Ventures, or (ii) any violation or alleged violation of any
Environmental Law, in either case (x) which alleged or potential liability
would be required to be described in a registration statement under the
Act, or (y) which alleged or potential liability, singly or in the
aggregate, would reasonably be expected to have a Material Adverse Effect.
(u) Each of the Company, its subsidiaries and the Ventures has filed
all necessary federal, state and foreign income and franchise tax returns,
except where the failure to so file such returns would not, individually or
in the aggregate, have a Material Adverse Effect, and has paid all material
taxes shown as due thereon; and other than tax deficiencies which the
Company, any subsidiary or any of the Ventures is contesting in good faith
and for which the Company, such subsidiary or such Ventures has provided
adequate reserves, there is no tax deficiency that has been asserted
against the Company, any of the subsidiaries or any of the Ventures that
would have, individually or in the aggregate, a Material Adverse Effect.
(v) Each of the Company, its subsidiaries and the Ventures possesses
all licenses, permits, certificates, consents, orders, approvals and other
authorizations from, and have made all declarations and filings with, all
appropriate federal, state, local and other governmental authorities, all
self-regulatory organizations and all courts and other tribunals, presently
required or necessary to own or lease, as the case may be, and to operate
their respective properties and to carry on the business of the Company,
its subsidiaries and the Ventures as now conducted as set forth in the
Final Memorandum, the lack of which would have a Material Adverse Effect
("Permits"); each of the Company, its subsidiaries and the Ventures has
fulfilled and performed all of its respective obligations with respect to
such Permits and, to the best knowledge of the Company, no event has
occurred which allows, or after notice or lapse of time would allow,
revocation or termination thereof or results in any other impairment of the
rights of the holder of any such Permit, except where the failure to
fulfill or perform such obligations or such impairment, would not,
individually or in the aggregate, reasonably be expected to have a Material
Adverse Effect; and none of the Company, any subsidiary or any Venture has
received any notice of any proceeding relating to revocation or
modification of any such Permit, except as described in the Final
Memorandum and except where such revocation or modification would not,
individually or in the aggregate, reasonably be expected to have a Material
Adverse Effect.
(w) None of the Company, any of its subsidiaries or any of the
Ventures or any of their respective Affiliates (as defined in Rule 501(b)
of Regulation D under the Act) has directly, or through any agent, (i)
sold, offered for sale, solicited offers to buy or otherwise negotiated in
respect of, any "security" (as defined in the Act) which is or reasonably
could be integrated with the sale of the Notes in a manner that would
require the registration under the Act of the Notes or (ii) engaged in any
form of general solicitation or general advertising (as those terms are
used in Regulation D under the Act) in connection with the offering of the
Notes or in any manner involving a public offering within the meaning of
Section 4(2) of the Act. Assuming (i) the representations and warranties
of the Initial Purchasers in Section 8 hereof are true and correct in all
material respects, (ii) compliance by the Initial Purchasers with the
offering and transfer restrictions described in the Final Memorandum and
(iii) the accuracy of the representations, warranties and agreements of
each of the purchasers to whom the Initial Purchasers initially resells the
Notes in compliance with Section 8 hereof, it is not necessary in
connection with the offer, sale and delivery of the Notes to
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the Initial Purchasers in the manner contemplated by this Agreement to
register any of the Notes under the Act or to qualify the Indenture under
the TIA.
(x) No securities of the Company are of the same class (within the
meaning of Rule 144A under the Act) as the Notes and listed on a national
securities exchange registered under Section 6 of the Exchange Act, or
quoted in a U.S. automated inter-dealer quotation system.
(y) None of the Company, any of its Significant Subsidiaries or any
of the Ventures is an Ainvestment company@ or "promoter" or "principal
underwriter" for an "investment company" under the Investment Company Act
of 1940, as amended, and the rules and regulations thereunder.
(z) The Company, each of its Significant Subsidiaries and each of the
Ventures maintain insurance insuring against such losses and risks as the
Company reasonably believes is adequate to protect the Company, each of its
Significant Subsidiaries and each of the Ventures and their respective
businesses, except where the failure to maintain such insurance would not
reasonably be expected to have a Material Adverse Effect.
(aa) None of the Company, any of its Significant Subsidiaries or any
of the Ventures has taken nor will it take, directly or indirectly, any
action designed to or that might be reasonably expected to cause or result
in stabilization or manipulation of the price of the Notes or to facilitate
the sale or resale of the Notes.
(bb) Neither the issuance, sale and delivery of the Notes, nor the
application of the proceeds thereof by the Company, its Significant
Subsidiaries and the Ventures as set forth in the Final Memorandum, will
violate Regulations G, T, U or X promulgated by the Board of Governors of
the Federal Reserve System.
(cc) Other than as contemplated by this Agreement or the Subscription
Agreement, or as otherwise described in the Final Memorandum, there is no
broker, finder or other party that is entitled to receive from the Company
any brokerage or finder's fee or other fee or commission as a result of any
of the transactions contemplated hereby or thereby.
(dd) The Company has complied with all provisions of Section 517.075
Florida Statutes, relating to doing business with the Government of Cuba or
with any person or any affiliate located in Cuba.
(ee) Other than the Registration Rights Agreement and the actions
permitted thereby or as otherwise disclosed in the Final Memorandum, there
are no contracts, agreements or understandings between the Company and any
person granting such person the right to require the Company to file a
registration statement under the Act with respect to any debt securities of
the Company owned or to be owned by such person or to require the Company
to include such debt securities in the securities registered pursuant to an
Exchange Offer Registration Statement or Shelf Registration Statement, or
in any securities being registered pursuant to any other registration
statement filed by the Company under the Act.
(ff) The Company has not distributed and will not distribute any
offering material in connection with the offering and sale of the Notes
other than the Final Memorandum and the other materials permitted by the
Act.
9
Each certificate signed by any officer of the Company and delivered to the
Initial Purchasers or counsel for the Initial Purchasers shall be deemed a joint
and several representation and warranty by the Company and each of the
subsidiaries to each Initial Purchaser as to the matters covered thereby.
3. PURCHASE, SALE AND DELIVERY OF THE NOTES. On the basis of the
representations, warranties, agreements and covenants herein contained and
subject to the terms and conditions herein set forth, the Company agrees to
issue and sell to the Initial Purchasers, and each Initial Purchaser agrees
severally, but not jointly, to purchase from the Company, the principal amount
of Notes set forth opposite such Initial Purchaser's name on Schedule I hereto
at 99.448% of their principal amount. One or more certificates in definitive
form for the Notes that the Initial Purchasers have agreed to purchase
hereunder, and in such denomination or denominations and registered in such name
or names as the Initial Purchasers request upon notice to the Company at least
48 hours prior to the Closing Date, shall be delivered by or on behalf of the
Company to the Initial Purchasers, against payment by or on behalf of the
Initial Purchasers of the purchase price therefor by wire transfer (immediately
available funds), to such account or accounts as the Company shall specify prior
to the Closing Date, or by such means as the parties hereto shall agree prior to
the Closing Date. Such delivery of and payment for the Notes shall be made at
the offices of Xxxxxx & Xxxxxxx, 000 Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000 at
10:00 a.m., New York time, on January 21, 1998, or at such other place, time or
date as the Initial Purchasers, on the one hand, and the Company, on the other
hand, may agree upon, such time and date of delivery against payment being
herein referred to as the "CLOSING DATE." The Company will make such
certificate or certificates for the Notes available for checking and packaging
by the Initial Purchasers at the offices of BT Securities Corporation in New
York, New York, or at such other place as BT Securities Corporation may
designate, at least 24 hours prior to the Closing Date.
4. RESALE BY INITIAL PURCHASERS. The Initial Purchasers propose to
resell the Notes at the price and upon the terms set forth in the Final
Memorandum, as soon as practicable after this Agreement is entered into and as
in the judgement of the Initial Purchasers is advisable.
5. AGREEMENTS OF THE COMPANY. The Company covenants and agrees with each
of the Initial Purchasers as follows:
(a) The Company will not amend or supplement the Final Memorandum or
any amendment or supplement thereto of which the Initial Purchasers shall
not previously have been advised and furnished a copy for a reasonable
period of time prior to the proposed amendment or supplement and as to
which the Initial Purchasers shall not have given their consent. The
Company will, promptly, upon the reasonable request of the Initial
Purchasers or counsel for the Initial Purchasers, make any amendments or
supplements to the Preliminary Memorandum or the Final Memorandum that may
be necessary or advisable in connection with the resale of the Notes by the
Initial Purchasers.
(b) The Company will cooperate with the Initial Purchasers in
arranging for the qualification of the Notes for offering and sale under
the securities or "Blue Sky" laws of such jurisdictions as the Initial
Purchasers may designate and will continue such qualifications in effect
for as long as may be necessary to complete the resale of the Notes;
PROVIDED, HOWEVER, that in connection therewith, the Company shall not be
required to qualify as a foreign corporation or to execute a general
consent to service of process in any jurisdiction or subject itself to
taxation in excess of a nominal dollar amount in any such jurisdiction
where it is not then so subject.
10
(c) If, any time prior to the completion of the distribution by the
Initial Purchasers of the Notes, any event occurs or information becomes
known as a result of which the Final Memorandum as then amended or
supplemented would include any untrue statement of a material fact, or omit
to state a material fact necessary to make the statements therein, in the
light of the circumstances under which they were made, not misleading, or
if for any other reason it is necessary at any time to amend or supplement
the Final Memorandum to comply with applicable law, the Company will
promptly notify the Initial Purchasers thereof and will prepare, at its own
expense, an amendment or supplement to the Final Memorandum that corrects
such statement or omission or effects such compliance.
(d) The Company will, without charge, furnish to the Initial
Purchasers and their counsel as many copies of the Preliminary Memorandum
and the Final Memorandum or any amendment or supplement thereto as the
Initial Purchasers may from time to time reasonably request. The Company
consents to the use, in accordance with the provisions of the Act and with
the securities or "Blue Sky" laws of the jurisdictions in which the Notes
are offered by the several Initial Purchasers and by dealers, of each
Preliminary Memorandum and Final Memorandum furnished by the Company.
(e) The Company will apply the net proceeds from the sale of the
Notes to be sold by it hereunder for the purposes set forth under "Use of
Proceeds" in the Final Memorandum.
(f) For so long as any of the Notes remain outstanding, the Company
will furnish to the Initial Purchasers, upon request, copies of all reports
and other communications (financial or otherwise) furnished by the Company
to the Trustee or to the holders of the Notes and, as soon as available,
copies of any reports or financial statements furnished to or filed by the
Company with the Commission or any national securities exchange on which
any class of securities of the Company may be listed.
(g) None of the Company or any of its affiliates will sell, offer for
sale or solicit offers to buy or otherwise negotiate in any respect of any
"security" (as defined in the Act) which could be integrated with the sale
of the Notes in a manner which would require the registration under the Act
of the Notes.
(h) The Company will not, and will not permit any of its subsidiaries
to, engage in any form of general solicitation or general advertising (as
those terms are used in Regulation D under the Act) in connection with the
offering of the Notes or in any manner involving a public offering within
the meaning of Section 4(2) of the Act.
(i) For as long as it is required to do so under the Indenture, the
Company will make available at its expense, upon request, to any holder of
such Notes and any prospective purchasers thereof, the information
specified in Rule 144A(d)(4) under the Act, unless the Company is then
subject to Section 13 or 15(d) of the Exchange Act.
(j) The Company will use its best efforts to (i) permit the Notes to
be designated PORTAL securities in accordance with the rules and
regulations adopted by NASD relating to trading in the Private Offerings,
Resales and Trading through Automated Linkages market (the "PORTAL MARKET")
and (ii) permit the Notes to be eligible for clearance and settlement
through The Depository Trust Company.
11
(k) Prior to the effective date of the Exchange Offer Registration
Statement or the sale of all the Notes under the Shelf Registration
Statement, the Company shall take such steps as shall be necessary to
ensure that the Company shall not become an "investment company" within the
meaning of the Investment Company Act of 1940, as amended.
The Initial Purchasers may, in their sole discretion, waive in writing the
performance by the Company of any one or more of the foregoing covenants or
extend the time for their performance.
6. EXPENSES. The Company agrees to pay all costs and expenses incident
to the performance of its obligations under this Agreement, whether or not the
transactions contemplated herein are consummated or this Agreement is terminated
pursuant to Section 11 hereof, including all costs and expenses incident to
(i) the costs of printing, word processing or other production of documents for
the Preliminary Memorandum and the Final Memorandum and any amendment or
supplement thereto, and any "Blue Sky" memoranda, (ii) all arrangements relating
to the delivery to the Initial Purchasers of copies of the foregoing documents,
(iii) the fees and disbursements of counsel, the accountants and any other
experts or advisors retained by the Company (but not the Initial Purchasers),
(iv) preparation (including printing), issuance and delivery to the Initial
Purchasers of the Notes, (v) the qualification of the Notes under state
securities and "Blue Sky" laws, including filing fees and fees and disbursements
of counsel for the Initial Purchasers relating thereto, (vi) expenses in
connection with any meetings with prospective investors in the Notes; (vii) fees
and expenses of the Trustee including fees and expenses of its counsel,
(viii) all expenses and listing fees incurred in connection with the application
for quotation of the Notes on the PORTAL Market, and (ix) any fees charged by
investment rating agencies for the rating of the Notes. If the sale of the
Notes provided for herein is not consummated because any condition to the
obligations of the Initial Purchasers set forth in Section 7 hereof is not
satisfied, because this Agreement is terminated pursuant to Section 11(a)(i)
hereof or because of any failure, refusal or inability on the part of the
Company to perform all obligations and satisfy all conditions on its part to be
performed or satisfied hereunder (other than by reason of a default by the
Initial Purchasers), the Company agrees to promptly reimburse the Initial
Purchasers upon demand (accompanied by documentation) for all reasonable out-of-
pocket expenses (including reasonable fees, disbursements and charges of Xxxxxxx
Xxxxxxx & Xxxxxxxx, counsel for the Initial Purchasers) that shall have been
incurred by the Initial Purchasers in connection with the proposed purchase and
sale of the Notes.
7. CONDITIONS OF INITIAL PURCHASERS' OBLIGATIONS. The several
obligations of the Initial Purchasers to purchase and pay for the Notes shall be
subject to the satisfaction or waiver of the following conditions on or prior to
the Closing Date:
(a) On the Closing Date, there shall have been furnished to the
Initial Purchasers, in form and substance satisfactory to the Initial
Purchasers, opinions, each addressed to the Initial Purchasers and dated
the Closing Date, of (i) Xxxxxx & Xxxxxxx, counsel for the Company,
substantially in the form of Annex I-A hereto, (ii) Xxxxx X. Xxxxxxx, Esq.,
General Counsel to Xxxxxx Dodge Corporation, substantially in the form of
Annex I-B hereto, and (iii) Osler, Haskin & Harcourt, Canadian counsel to
the Company, substantially in the form of Annex I-C hereto.
(b) On the Closing Date, the Initial Purchasers shall have received
the opinion in form and substance satisfactory to the Initial Purchasers,
dated as of the Closing Date and addressed to the Initial Purchasers, of
Xxxxxxx Xxxxxxx & Xxxxxxxx, counsel for the Initial Purchasers, with
respect to certain legal matters as you reasonably may request. In
rendering such opinion, Xxxxxxx Xxxxxxx & Xxxxxxxx shall have received and
may rely upon such certificates and other documents and information as it
may reasonably request to enable them to pass upon such matters.
12
(c) The Initial Purchasers shall have received from Deloitte & Touche
LLP, independent accountants, a comfort letter or letters, the first one to
be dated the date of this Agreement and the second one to be dated the
Closing Date, in form and substance satisfactory to the Initial Purchasers
(which comfort letters shall include reference to the performance of a
review conducted in accordance with the American Institute of Certified
Public Accountants' Statements on Standards for Accounting and Review
Services on the consolidated financial statements of the Company for the
year ended December 31, 1997).
(d) The representations and warranties of the Company contained in
this Agreement shall be true and correct in all material respects on and as
of the date of this Agreement and on and as of the Closing Date as if made
on and as of the Closing Date; the statements of the officers of the
Company made pursuant to any certificate delivered in accordance with the
provisions hereof shall be true and correct as of the date made and on and
as of the Closing Date; and the Company shall have performed in all
material respects all covenants and agreements and satisfied in all
material respects all conditions on their part to be performed or satisfied
hereunder at or prior to the Closing Date.
(e) The sale of the Notes hereunder shall not be enjoined
(temporarily or permanently) on the Closing Date.
(f) The Initial Purchasers shall have received a certificate of the
Company executed by (i) the president or any vice president and (ii) the
chief financial or accounting officer of the Company, dated the Closing
Date, to the effect that:
(A) The representations and warranties of the Company
in this Agreement are true and correct in all material respects as of
the date of this Agreement and as of the Closing Date (except to the
extent such representations or warranties specifically relate to an
earlier date and time) and the Company has complied in all material
respects with all the agreements and satisfied all the conditions on
its part to be performed or satisfied under this Agreement on or prior
to the Closing Date;
(B) Each of the respective signers of the certificate
has carefully examined the Final Memorandum; in his opinion and to the
best of his knowledge, neither the Final Memorandum nor any amendment
or supplement thereto includes any untrue statement of a material fact
or omits to state any material fact required to be stated therein or
necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading;
(C) At the Closing Date, since the respective dates as
of which information is given in the Final Memorandum (exclusive of
any amendment or supplement after the date hereof), there has not
occurred any event or events that, individually or in the aggregate,
would have a Material Adverse Effect (except as disclosed in or
contemplated by the Final Memorandum); and
(D) The sale of the Notes hereunder has not been
enjoined (temporarily or permanently).
13
(g) On the Closing Date, the Initial Purchasers shall have received
the Registration Rights Agreement executed by the Company and, assuming due
execution and delivery by the Initial Purchasers, such agreement shall be
in full force and effect.
(h) The Indenture shall have been duly executed and delivered by the
Company and duly authorized, executed and delivered by the Trustee, and the
Notes shall have been duly executed and delivered by the Company and duly
authenticated by the Trustee.
(i) The Company shall have received from Hubcap Acquisition LLC or an
affiliate thereof an equity investment equal to $108.0 million, pursuant to
the Subscription Agreement.
(j) The Company shall have entered into the Credit Facilities for an
aggregate borrowing of up to $275.0 million and shall have delivered fully
executed agreements with respect to the Credit Facilities.
All such opinions, certificates, letters and documents shall be in
compliance with the provisions hereof only if they are reasonably satisfactory
to the Initial Purchasers and, as to legal matters, to Xxxxxxx Xxxxxxx &
Xxxxxxxx, counsel for the Initial Purchasers. The Company shall furnish you
with such manually signed or conformed copies of such opinions, certificates,
letters and documents as you reasonably request.
8. OFFERING OF NOTES; RESTRICTIONS ON TRANSFER.
(a) Each of the Initial Purchasers represents and warrants (as to
itself only) that it is a QIB. Each Initial Purchaser has advised the Company
that it proposes to offer the Initial Notes for resale upon the terms and
conditions set forth in this Agreement and in the Final Memorandum. Each
Initial Purchaser acknowledges and agrees that the Initial Notes have not been
and, other than pursuant to the Company's obligations under the Registration
Rights Agreement, will not be, registered under the Act, and may not be offered
or sold within the United States unless the Initial Notes are registered under
the Act or an exemption from the registration requirements of the Act is
available. Each of the Initial Purchasers hereby represents and warrants and
agrees with, the Company (as to itself only) that (i) it has not and will not
solicit offers for, or offer or sell, the Initial Notes by any form of general
solicitation or general advertising (as those terms are used in Regulation D
under the Act) or in any manner involving a public offering within the meaning
of Section 4(2) of the Act; and (ii) it has and will solicit offers for the
Initial Notes only from, and will offer the Initial Notes only to (A) in the
case of offers inside the United States, persons whom the Initial Purchasers
reasonably believe to be QIBs or, if any such person is buying for one or more
institutional accounts for which such person is acting as fiduciary or agent,
only when such person has represented to the Initial Purchasers that each such
account is a QIB, to whom notice has been given that such sale or delivery is
being made in reliance on Rule 144A, and, in each case, in transactions under
Rule 144A and (B) in the case of offers outside the United States, to persons
other than U.S. persons ("FOREIGN PURCHASERS," which term shall include dealers
or other professional fiduciaries in the United States acting on a discretionary
basis for foreign beneficial owners (other than an estate or trust)); PROVIDED,
HOWEVER, that, in the case of this clause (B), in purchasing such Initial Notes
such persons are deemed to have represented and agreed as provided under the
caption "Transfer Restrictions" contained in the Final Memorandum (or, if the
Final Memorandum is not in existence, in the most recent Memorandum).
(b) Each of the Initial Purchasers represents and warrants (as to
itself only) with respect to offers and sales outside the United States that (i)
it has and will comply with all applicable laws and regulations in each
jurisdiction in which it acquires, offers, sells or delivers Initial Notes or
has in its possession or distributes any Memorandum or any such other material,
in all cases at its own expense; (ii)
14
the Initial Notes have not been and will not be offered or sold within the
United States or to, or for the account or benefit of, U.S. persons except in
accordance with Regulation S under the Act or pursuant to an exemption from the
registration requirements of the Act; (iii) it has offered the Initial Notes and
will offer and sell the Initial Notes (A) as part of its distribution at any
time and (B) otherwise until 40 days after the later of the commencement of the
offering and the Closing Date, only in accordance with Rule 903 of Regulation S
and, accordingly, neither it nor any persons acting on its behalf have engaged
or will engage in any directed selling efforts (within the meaning of Regulation
S) with respect to the Initial Notes, and any such persons have complied and
will comply with the offering restrictions requirement of Regulation S; and (iv)
it agrees that, at or prior to confirmation of sales of the Initial Notes, it
will have sent to each distributor, dealer or person receiving a selling
concession, fee or other remuneration that purchases Initial Notes from it
during the restricted period a confirmation or notice to substantially the
following effect:
"The Securities covered hereby have not been
registered under the United States Securities Act of 1933
(the "Securities Act") and may not be offered and sold
within the United States or to, or for the account or
benefit of, U.S. persons (i) as part of the distribution of
the Securities at any time or (ii) otherwise until 40 days
after the later of the commencement of the offering and the
closing date of the offering, except in either case in
accordance with Regulation S (or Rule 144A if available)
under the Securities Act. Terms used above have the meaning
given to them in Regulation S."
Terms used in this Section 8 and not defined in this Agreement have the meanings
given to them in Regulation S under the Act.
9. INDEMNIFICATION AND CONTRIBUTION.
(a) The Company agrees to indemnify and hold harmless the Initial
Purchasers, each of their officers and directors, and each person, if any,
who controls any Initial Purchaser within the meaning of Section 15 of the
Act or Section 20 of the Exchange Act, against any losses, claims, damages
or liabilities to which the Initial Purchasers, each of their officers and
directors, or such controlling person may become subject under the Act, the
Exchange Act or otherwise, insofar as any such losses, claims, damages or
liabilities (or actions in respect thereof) arise out of or are based upon:
(i) any untrue statement or alleged untrue statement of any
material fact contained in any Memorandum or any amendment or
supplement thereto or any application or other document, or any
amendment or supplement thereto, executed by the Company or based upon
written information furnished by or on behalf of the Company filed in
any jurisdiction in order to qualify the Notes under the securities or
"Blue Sky" laws thereof or filed with any securities association or
securities exchange (each, an "APPLICATION"); or
(ii) the omission or alleged omission to state, in any Memorandum
or any amendment or supplement thereto or any Application, a material
fact required to be stated therein or necessary to make the statements
therein not misleading,
and will reimburse (promptly following the receipt of invoices
therefor), as incurred, the Initial Purchasers and each such controlling
person for any reasonable legal or other expenses incurred by the Initial
Purchasers or such controlling person in connection with investigating,
defending against
15
or appearing as a third-party witness in connection with any such loss,
claim, damage, liability or action; PROVIDED, HOWEVER, the Company will not
be liable in any such case to the extent that any such loss, claim, damage,
or liability arises out of or is based upon any untrue statement or alleged
untrue statement or omission or alleged omission made in any Memorandum or
any amendment or supplement thereto or any Application in reliance upon and
in conformity with written information concerning the Initial Purchasers
furnished to the Company by the Initial Purchasers specifically for use
therein and PROVIDED FURTHER, that the Company will not be liable to the
Initial Purchasers or any person controlling the Initial Purchasers with
respect to any such untrue statement or omission made in any Preliminary
Memorandum that is corrected in the Final Memorandum (or any amendment or
supplement thereto) if the person asserting any such loss, claim, damage or
liability purchased the Notes from any Initial Purchaser in reliance upon a
Preliminary Memorandum but was not sent or given a copy of the Final
Memorandum (as amended or supplemented) at or prior to the written
confirmation of the sale of such Notes to such person, unless such failure
to deliver the Final Memorandum (as amended or supplemented) was a result
of noncompliance by the Company with Section 5(d) of this Agreement. This
indemnity agreement will be in addition to any liability that Company may
otherwise have to the indemnified parties. The Company shall not be liable
under this Section 9 for any settlement of any claim or action effected
without its prior written consent, which shall not be unreasonably
withheld.
(b) The Initial Purchasers, severally and not jointly, agree to
indemnify and hold harmless the Company, its directors, its officers and
each person, if any, who controls the Company within the meaning of Section
15 of the Act or Section 20 of the Exchange Act against any losses, claims,
damages or liabilities to which the Company or any director, officer or
controlling person may become subject under the Act, the Exchange Act or
otherwise, insofar as such losses, claims, damages or liabilities (or
actions in respect thereof) arise out of or are based upon (i) any untrue
statement or alleged untrue statement of any material fact contained in any
Memorandum or any amendment or supplement thereto or any Application, or
(ii) the omission or the alleged omission to state therein a material fact
required to be stated in any Memorandum or any amendment or supplement
thereto or any Application, or necessary to make the statements therein not
misleading, in each case to the extent, but only to the extent, that such
untrue statement or alleged untrue statement or omission or alleged
omission was made in reliance upon and in conformity with written
information concerning such Initial Purchasers, furnished to the Company by
the Initial Purchasers specifically for use therein; and subject to the
limitation set forth immediately preceding this clause, will reimburse, as
incurred, any reasonable legal or other expenses incurred by the Company or
any director, officer or controlling person in connection with
investigating or defending against or appearing as a third party witness in
connection with any such loss, claim, damage, liability or action in
respect thereof. This indemnity agreement will be in addition to any
liability that the Initial Purchasers may otherwise have to the indemnified
parties. No Initial Purchaser shall be liable under this Section 9 for any
settlement of any claim or action effected without their consent, which
shall not be unreasonably withheld.
16
(c) Promptly after receipt by an indemnified party under this Section
9 of notice of the commencement of any action for which such indemnified
party is entitled to indemnification under this Section 9, such indemnified
party will, if a claim in respect thereof is to be made against the
indemnifying party under this Section 9, notify the indemnifying party of
the commencement thereof in writing; but the omission to so notify the
indemnifying party (i) will not relieve it from any liability under
paragraph (a) or (b) above unless and to the extent such failure results in
the forfeiture by the indemnifying party of substantial rights and defenses
or material prejudice and (ii) will not, in any event, relieve the
indemnifying party from any obligations to any indemnified party other than
the indemnification obligation provided in paragraphs (a) and (b) above.
In case any such action is brought against any indemnified party, and it
notifies the indemnifying party of the commencement thereof, the
indemnifying party will be entitled to participate therein and, to the
extent that it may wish, jointly with any other indemnifying party
similarly notified, to assume the defense thereof, with counsel reasonably
satisfactory to such indemnified party; PROVIDED, HOWEVER, that if the
defendants in any such action include both the indemnified party and the
indemnifying party and the indemnified party shall have reasonably
concluded that there may be one or more legal defenses available to it
and/or other indemnified parties that are different from or additional to
those available to the indemnifying party, then, the indemnifying party
shall not have the right to direct the defense of such action on behalf of
such indemnified party or parties and such indemnified party or parties
shall have the right to select separate counsel to defend such action on
behalf of such indemnified party or parties. After notice from the
indemnifying party to such indemnified party of its election so to assume
the defense thereof and approval by such indemnified party of counsel
appointed to defend such action, the indemnifying party will not be liable
to such indemnified party under this Section 9 for any legal or other
expenses, other than reasonable costs of investigation, subsequently
incurred by such indemnified party in connection with the defense thereof,
unless (i) the indemnified party shall have employed separate counsel in
accordance with the proviso to the immediately preceding sentence (it being
understood, however, that in connection with such action the indemnifying
party shall not be liable for the expenses of more than one separate
counsel (in addition to local counsel) in any one action or separate but
substantially similar actions in the same jurisdiction arising out of the
same general allegations or circumstances, designated by BT Alex. Xxxxx
Incorporated in the case of paragraph (a) of this Section 9 or the Company
in the case of paragraph (b) of this Section 9, representing the
indemnified parties under such paragraph (a) or paragraph (b), as the case
may be, who are parties to such action or actions) or (ii) the indemnifying
party has authorized in writing the employment of counsel for the
indemnified party at the expense of the indemnifying party. After such
notice from the indemnifying party to such indemnified party, the
indemnifying party will not be liable for the costs and expenses of any
settlement of such action effected by such indemnified party without the
prior written consent of the indemnifying party (which consent shall not be
unreasonably withheld), unless such indemnified party waived in writing its
rights under this Section 9, in which case the indemnified party may effect
such a settlement without such consent.
(d) In circumstances in which the indemnity agreement provided for in
the preceding paragraphs of this Section 9 is unavailable to, or
insufficient to hold harmless, an indemnified party in respect of any
losses, claims, damages or liabilities (or actions in respect thereof),
each indemnifying party, in order to provide for just and equitable
contribution, shall contribute to the amount paid or payable by such
indemnified party as a result of such losses, claims, damages or
liabilities (or actions in respect thereof) in such proportion as is
appropriate to reflect (i) the relative benefits received by the
indemnifying party or parties on the one hand and the indemnified party on
the other from the offering of the Notes or (ii) if the allocation provided
by the foregoing clause (i) is not permitted by applicable law, not only
such relative benefits but also the relative fault of the
17
indemnifying party or parties on the one hand and the indemnified party on
the other in connection with the statements or omissions or alleged
statements or omissions that resulted in such losses, claims, damages or
liabilities (or actions in respect thereof). The relative benefits
received by the Company on the one hand and any Initial Purchaser on the
other shall be deemed to be in the same proportion as the total net
proceeds from the Offering (before deducting expenses) received by the
Company bear to the total discounts received by the Initial Purchasers.
The relative fault of the parties shall be determined by reference to,
among other things, whether the untrue or alleged untrue statement of a
material fact or the omission or alleged omission to state a material fact
relates to information supplied by the Company on the one hand, or any
Initial Purchaser on the other, the parties' relative intent, knowledge,
access to information and opportunity to correct or prevent such statement
or omission or alleged statement or omission, and any other equitable
considerations appropriate in the circumstances. The Company and the
Initial Purchasers agree that it would not be equitable if the amount of
such contribution were determined by pro rata or per capita allocation or
by any other method of allocation that does not take into account the
equitable considerations referred to in the first sentence of this
paragraph (d). Notwithstanding any other provision of this paragraph (d),
no Initial Purchaser shall be obligated to make contributions hereunder
that in the aggregate exceed the total discount and other compensation
received by such Initial Purchaser under this Agreement, less the aggregate
amount of any damages that such Initial Purchaser has otherwise been
required to pay by reason of the untrue or alleged untrue statements or the
omissions or alleged omissions to state a material fact, and 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. For purposes of this
paragraph (d), 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 and each of the Initial Purchasers' officers and directors shall have
the same rights to contribution as such Initial Purchaser, and each
director or officer of the Company and each person, if any, who controls
the Company within the meaning of Section 15 of the Act or Section 20 of
the Exchange Act, shall have the same rights to contribution as the
Company.
10. REPRESENTATIONS AND INDEMNITIES TO SURVIVE DELIVERY. The respective
indemnities, agreements, representations, warranties, covenants and other
statements of the Company, of its officers and of the Initial Purchasers set
forth in or made pursuant to this Agreement will remain in full force and
effect, regardless of (i) any investigation made by or on behalf of any Initial
Purchaser or the Company or any of its or their partners, officers or directors
or any controlling person, as the case may be, and (ii) delivery of and payment
for the Notes. The respective agreements, covenants, indemnities and other
statements set forth in Sections 6 and 9 hereof shall remain in full force and
effect, regardless of any termination or cancellation of this Agreement.
11. TERMINATION OF AGREEMENT. Without limiting the right to terminate
this Agreement pursuant to any other provision hereof:
(a) This Agreement may be terminated in the sole discretion of the
Initial Purchasers by notice to the Company given at or prior to the
Closing Date in the event that the Company shall have failed, refused or
been unable to perform all obligations and satisfy all conditions on its
part to be performed or satisfied hereunder at or prior thereto or, if at
or prior to the Closing Date:
(i) any of the Company, its Significant Subsidiaries or the
Ventures shall have sustained any loss or interference with respect to
its businesses or properties from fire, flood, hurricane, accident or
other calamity, whether or not covered by insurance, or from any labor
dispute or any legal or governmental proceeding, which loss or
interference has
18
had or has a Material Adverse Effect, or there shall have been any
material adverse change, or any development involving a prospective
material adverse change (including, without limitation, a change in
management or control of the Company), in the business, results of
operations or condition (financial or other) of the Company, its
subsidiaries and the Ventures, taken as a whole, except in each case
as described in or contemplated by the Final Memorandum (exclusive of
any amendment or supplement thereto);
(ii) trading in securities generally on the New York Stock
Exchange, American Stock Exchange or the NASDAQ National Market shall
have been suspended or minimum or maximum prices shall have been
established on any such exchange;
(iii) a banking moratorium shall have been declared by New York
or United States authorities; or
(iv) there shall have been (A) an outbreak or escalation of
hostilities between the United States and any foreign power, or (B) an
outbreak or escalation of any other insurrection or armed conflict
involving the United States, or (C) any material change in the
financial markets of the United States which in the case of (A), (B)
or (C) above and in the sole judgment of the Initial Purchasers, makes
it impracticable or inadvisable to proceed with the offering or the
delivery of the Notes as contemplated by the Final Memorandum.
(b) Termination of this Agreement pursuant to this Section 11 shall
be without liability of any party to any other party except as provided in
Section 10 hereof.
12. EFFECTIVE DATE OF AGREEMENT. This Agreement shall become effective
upon the execution and delivery hereof by the parties hereto.
13. INFORMATION FURNISHED BY THE INITIAL PURCHASERS. The statements set
forth in the last paragraph on the cover page, the stabilization legend on page
i, the statements in the first, third and fourth paragraphs, the fourth and
fifth sentences of the sixth paragraph, and the seventh and eighth paragraphs
under the caption "Private Placement" in the Final Memorandum (to the extent
such statements relate to the Initial Purchasers) constitute the only
information furnished by or on behalf of the Initial Purchasers to the Company
for the purposes of Sections 2(a) and 9 hereof. The Initial Purchasers confirm
that such statements (to the extent such statements relate to the Initial
Purchasers) are correct.
14. MISCELLANEOUS. Except as otherwise provided herein, notice given
pursuant to any provision of this Agreement shall be in writing and shall be
delivered (i) if to the Company, at the office of the Company at 0000 Xxxxx
Xxxx, X.X. Xxx 00, Xxxxxxxxx, Xxxxxxxx, 00000, Attention: Chief Financial
Officer, with a copy to Xxxxxxx X. Xxxxxxx, Xxxxxx & Xxxxxxx, 000 Xxxx Xxxxx
Xxxxxx, Xxxxx 0000, Xxx Xxxxxxx, Xxxxxxxxxx 00000; or (ii) if to the Initial
Purchasers, care of BT Alex. Xxxxx Incorporated, Bankers Trust Plaza, 000
Xxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Corporate Finance
Department, with a copy to Xxxxxx X. Xxxxxxxx, Esq., Xxxxxxx Xxxxxxx & Xxxxxxxx,
000 Xxxxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000.
15. SUCCESSORS. This Agreement has been and is made solely for the
benefit of the several Initial Purchasers, the Company, its directors and
officers, and the other controlling persons referred to in Section 9 hereof and
their respective successors and assigns, to the extent provided herein, and no
other person shall acquire or have any right under or by virtue of this
Agreement except that (i) the indemnities of the Company contained in Section 9
of this Agreement shall also be for the benefit of any person or persons
19
who control the Initial Purchasers within the meaning of Section 15 of the Act
or Section 20 of the Exchange Act and (ii) the indemnities of the Initial
Purchasers contained in Section 9 of this Agreement shall also be for the
benefit of the directors of the Company, its officers and any person or persons
who control the Company within the meaning of Section 15 of the Act or
Section 20 of the Exchange Act. Neither the term 'successor' nor the term
'successors and assigns' as used in this Agreement shall include a purchaser
from any Initial Purchaser of any of the Notes in his status as such purchaser.
16. APPLICABLE LAW. This Agreement shall be governed by and construed in
accordance with the laws of the State of New York applicable to contracts made
and to be performed within the State of New York.
17. PARTIAL UNENFORCEABILITY. The invalidity or unenforceability of any
Section, paragraph or provision of this Agreement shall not affect the validity
or enforceability of any other Section, paragraph or provision hereof. If any
Section, paragraph or provision of this Agreement is for any reason determined
to be invalid or unenforceable, there shall be deemed to be made such minor
changes (and only such minor changes) as are necessary to make it valid and
enforceable.
18. GENERAL. This Agreement constitutes the entire agreement of the
parties to this Agreement and supersedes all prior written or oral and all
contemporaneous oral agreements, understandings and negotiations with respect to
the subject matter hereof. This Agreement may be signed in various counterparts
which together constitute one and the same instrument. If signed in
counterparts, this Agreement shall not become effective unless at least one
counterpart hereof shall have been executed and delivered on behalf of each
party hereto.
In this Agreement the masculine, feminine and neuter genders and the
singular and the plural include one another. The section headings in this
Agreement are for the convenience of the parties only and will not affect the
construction or interpretation of this Agreement. This Agreement may be amended
or modified, and the observance of any term of this Agreement may be waived,
only by a writing signed by the Company and the Initial Purchasers.
[signature page follows]
20
Please confirm that the foregoing correctly sets forth the agreement
between the Company and the several Initial Purchasers.
Very truly yours,
ACCURIDE CORPORATION
By: /s/ Xxxxxxx X. Xxxxxxx
-----------------------
Name: Xxxxxxx X. Xxxxxxx
Title: President
The foregoing Purchase Agreement is hereby confirmed and accepted by us in New
York, New York as of the date first above written.
BT ALEX. XXXXX INCORPORATED
By: /s/ Xxxxxx X. Xxxxxxxx, Xx.
---------------------------
Name: Xxxxxx X. Xxxxxxxx, Xx.
Title: Managing Director
CITICORP SECURITIES, INC.
By: /s/ Xxxxx Xxxxxx
---------------------------
Name: Xxxxx Xxxxxx
Title: Managing Director
X.X. XXXXXX SECURITIES INC.
By: /s/ Xxxx Xxxxxxx
---------------------------
Name: Xxxx Xxxxxxx
Title: Vice President
21
SCHEDULE I
PRINCIPAL AMOUNT OF
INITIAL PURCHASER NOTES
BT Alex. Xxxxx Incorporate$ 120,000,000
Citicorp Securities, Inc 40,000,000
X.X. Xxxxxx Securities Inc 40,000,000
$ 200,000,000
ANNEX I-A
Opinion of Xxxxxx & Xxxxxxx
Referred to in Section 7(a) hereof
1. The Company and each of the Subsidiaries (a) is a corporation,
limited liability company or limited partnership, as applicable, duly organized,
validly existing and in good standing under the laws of the State of Delaware
and (b) has all requisite organizational power and authority to own, lease and
operate its properties and to conduct its business as described in the Final
Memorandum.
2. The Purchase Agreement has been duly authorized, executed and
delivered by the Company.
3. The Indenture has been duly authorized, executed and delivered by
the Company and, assuming the due authorization, execution and delivery thereof
by the Trustee, will be a legally valid and binding agreement of the Company,
enforceable against the Company in accordance with its terms.
4. The Notes have been duly authorized by the Company and, when
executed, issued and authenticated in accordance with the terms of the Indenture
and delivered to and paid for by you in accordance with the terms of the
Purchase Agreement, will be legally valid and binding obligations of the
Company, enforceable against the Company in accordance with their terms.
5. The Registration Rights Agreement has been duly authorized,
executed and delivered by the Company and, assuming the due authorization,
execution and delivery thereof by you, will be a legally valid and binding
agreement of the Company, enforceable against the Company in accordance with its
terms.
6. The statements made in the Final Memorandum under the captions
"Description of Notes" and "Exchange Offer; Registration Rights," insofar as
they purport to constitute summaries of certain terms of documents referred to
therein, constitute accurate summaries of the terms of such documents in all
material respects.
7. No registration of the Notes under the Securities Act, and no
qualification of the Indenture under the Trust Indenture Act of 1939, as amended
(the "TIA"), is required for the purchase of the Notes by you or the initial
resale of the Notes by you to eligible purchasers, in each case, in the manner
contemplated by the Purchase Agreement. We express no opinion, however, as to
when or under what circumstances any Notes initially sold by you may be
reoffered or resold.
8. The execution, delivery and performance by the Company of the
Purchase Agreement, the Indenture and the Registration Rights Agreement and the
issuance, sale and delivery of the
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Notes to you will not result in a breach or a default under (or an event that
with notice or passage of time or both would constitute a default under) or
violation of any of (a) except as set forth in the Final Memorandum, the terms
or provisions of any contract to which the Company is a party and which has been
identified to us by the Company as material and listed on Annex A attached
hereto (the "Material Agreements"), except for any such breach, violation,
default or event that could not reasonably be expected, individually or in the
aggregate, to have a material adverse effect on the Company and its
subsidiaries, taken as a whole (a "Material Adverse Effect"), (b) the Governing
Documents of the Company or any of the Subsidiaries, or (c) to our knowledge,
any federal or New York statute, rule, regulation, judgment, decree or order, or
the DGCL or any rule or regulation thereunder or any judgment, decree or order
pursuant thereto, known to us to be applicable to the Company or the
Subsidiaries or any of their respective properties or assets, except for any
such conflict, breach or violation that would not individually or in the
aggregate have a Material Adverse Effect.
9. The Company has the authorized, issued and outstanding capital
stock as set forth under "Capitalization" in the Final Memorandum. All the
shares of capital stock, limited partnership interests and membership interests
of Kentucky Holding, Accuride Xxxxxxxxx, Henderson LLC, Tennessee Holding,
Accuride Columbia and Columbia LP have been duly authorized and validly issued,
and all of the shares of capital stock of Kentucky Holding, Accuride Henderson,
Tennessee Holding and Accuride Columbia are fully paid and nonassessable.
10. Neither the sale, issuance, or delivery of the Notes will violate
Regulation G, T (assuming that you do not sell the Notes to any person or entity
subject to Regulation T for such person's or entity's own account), U or X of
the Board of Governors of the Federal Reserve System.
11. No securities of the same class (within the meaning of Rule
144A(d)(3) under the Act) as the Notes are listed on any national securities
exchange registered under Section 6 of the Exchange Act or quoted on an
automated inter-dealer quotation system.
12. No consent, approval authorization or order of, or filing or
qualification with, any federal or New York governmental agency or body or any
Delaware governmental agency or body acting pursuant to the DGCL or, to our
knowledge, any federal or New York court or any Delaware court acting pursuant
to the DGCL, is required in connection with the sale of the Notes by the Company
pursuant to the Purchase Agreement, except such as may be required under state
securities law, as to which we express no opinion, and such as may be required
under the TIA in connection with the Purchase Agreement and the Registration
Rights Agreement, and those that have already been obtained.
13. The Company, immediately after the sale of the Notes to be sold
hereunder and the application of the proceeds from such sale (as described in
the Final Memorandum under the caption "Use of Proceeds"), will not be an
"investment company" as such term is defined in the Investment Company Act of
1940, as amended.
14. The descriptions in the Final Memorandum of contracts and other
documents are accurate and fairly present in all material respects the
information that would be required to be described in a registration statement
under the Act or in a document incorporated by reference therein. To our
knowledge, there are no contracts or documents of the Company or its
Subsidiaries that would be required to be described in a registration statement
under the Act or in a document incorporated by reference therein, that are not
otherwise described in the Final Memorandum.
In addition, we have participated in conferences with officers and
other representatives of the Company, counsel to the Company, representatives of
the independent public accountants for the
I-2
Company, and your representatives, at which the contents of the Final Memorandum
and related matters were discussed and, although we are not passing upon, and do
not assume any responsibility for, the accuracy, completeness or fairness of the
statements contained in the Final Memorandum (except and only to the extent set
forth in paragraph 6) and have not made any independent check or verification
thereof, during the course of such participation, no facts came to our attention
that caused us to believe that the Final Memorandum, as of its date, contained
an untrue statement of a material fact or omitted 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 we express
no belief with respect to the financial statements and schedules or other
financial data included in the Final Memorandum.
I-3
ANNEX I-B
Opinion of Xxxxx X. Xxxxxxx, Esq.
Referred to in Section 7(a) hereof
1. CORPORATE STATUS AND AUTHORITY. The Company is a corporation,
duly incorporated, validly existing and in good standing under the laws of the
State of Delaware. The Company has all necessary corporate power to conduct its
business and to own or lease its properties, as now conducted, owned or leased.
2. NO CONFLICTS. Except as set forth in Section 2.2 of the
Shareholder's Disclosure Schedule, the execution and delivery by the Shareholder
and the Company of the Agreement and the Documents, the performance by them of
their respective obligations thereunder and the consummation of the transactions
contemplated thereby will not result in (i) any conflict with the certificate of
incorporation or the by-laws of the Shareholder or the Company, (ii) a violation
or breach of, or constitute an event of default under, any contract, agreement,
note, bond, mortgage, indenture, license, lease or other instrument or
obligation known to me to which the Shareholder or the Company is a party or by
which the Shareholder or the Company is bound, except where such breaches or
defaults would not have, individually or in the aggregate, a Material Adverse
Effect and would not, individually or in the aggregate, reasonably be expected
to materially impair the ability of the Shareholder or the Company to perform
their respective obligations under, or to consummate the transactions
contemplated by the Agreement and the Documents, (iii) a breach, violation of or
default under any statute, regulation, order or decree known to me to be
applicable to the Shareholder or the Company or any of their respective assets
under the federal laws of the United States except where such breaches or
defaults would not have, individually or in the aggregate, a Material Adverse
Effect or (iv) to my knowledge, the creation of any Lien on any asset or
properties owned or used by the Company or its Subsidiaries, except for such
Liens as would not have, individually or in the aggregate, a Material Adverse
Effect and would not, individually or in the aggregate, reasonably be expected
to materially impair the ability of the Shareholder or the Company to perform
their respective obligations under, or to consummate the transactions
contemplated by the Agreement and the Documents.
3. CAPITALIZATION OF THE COMPANY. After giving effect to the
purchase by the Company of the Redeemed Shares from the Shareholder and the
issuance and sale by the Company of the Shares to the Purchaser, the authorized
capital stock of the Company will consist of 1,000 shares of common stock, 100
of which will be issued and outstanding and 90 of which will be held in
treasury. All of the foregoing 100 outstanding shares of common stock are or
will be, upon issuance thereof pursuant to the Agreement, duly authorized,
validly issued, fully paid and non-assessable. There are no other shares of
capital stock or other voting securities of the Company authorized, issued or
outstanding. There are no outstanding options, warrants, conversion, exchange
or other rights or agreements of any kind (other then the Agreement) for the
purchase or acquisition from, or the sale or issuance by, the Shareholder or the
Company of any shares of stock of the Company, and no authorization therefor has
been given.
4. SUBSIDIARIES. Each of Accuride Texas, Inc. and Accuride
Ventures, Inc. is a corporation duly incorporated, validly existing and in good
standing under the laws of Delaware. AKW, L.P. is a limited partnership, duly
formed, validly existing and in good standing under the laws of the state of
Delaware. AKW General Partner, L.L.C. is a limited liability company duly
formed, validly existing and in good standing under the laws of the state of
Delaware.
The Company has no Subsidiaries other than the Subsidiaries listed in
Section 2.5 of the Shareholder's Disclosure Schedule. All of the outstanding
shares of capital stock of each of Accuride Texas, Inc. and Accuride Ventures,
Inc. are duly authorized, validly issued, fully paid and non-assessable
IB-1
and, to my knowledge, owned, directly or indirectly, by the Company free and
clear of all liens. To my knowledge, there are no outstanding options,
warrants, conversion, exchange or other rights or agreements of any kind (other
than the Agreement) for the purchase or acquisition from, or the sale or
issuance by, the Shareholder or the company of any shares of stock of any of the
Company's Subsidiaries, and no authorization therefor has been given. Each of
Accuride Texas, Inc., Accuride Ventures, Inc., AKW L.P. and AKW General Partner
L.L.C. has all requisite corporate power to conduct its business and to own or
lease its properties, as now conducted, owned or leased. Each of Accuride
Texas, Inc., Accuride Ventures, Inc., AKW, L.P. and AKW General Partner L.L.C.
is duly qualified to do business in each jurisdiction except where the failure
to be so qualified would not reasonably be expected to have a Material Adverse
Effect.
5. LITIGATION. Except as otherwise set forth in Section 2.13 of the
Shareholder's Disclosure Schedule, there are no Actions pending or, to the
knowledge of the Shareholder, threatened, against the Company or any of its
Subsidiaries, to the shareholder's knowledge, any officers or directors of the
Company and its Subsidiaries as such or the Shareholder in the Shareholder's
capacity as a shareholder of the Company, whether at law or in equity, whether
civil or criminal in nature and whether before or by any Governmental Authority,
(i) which have a stated damage claim greater than, or which have had a demand
made in excess of or which involve an amount in controversy greater than $1
million or, if no such damage claim is stated, demand is made or the amount in
controversy does not involve more than $1 million, would reasonably be expected
to have, individually or in the aggregate, a Material Adverse Effect or would,
individually or in the aggregate, reasonably be expected to materially impair
the ability of the Shareholder or the Company to perform their respective
obligations under, or to consummate the transactions contemplated by, the
Agreement and the Documents, or (ii) which question the validity of the
Agreement or any action taken or to be taken by the Shareholder, the Company or
any of the Subsidiaries in connection herewith.
IB-2
ANNEX I-C
Opinion of Osler, Xxxxxx & Harcourt
Referred to in Section 7(a) hereof
1. The Canadian Subsidiary is a corporation incorporated and validly
existing under the laws of Ontario.
2. The Canadian Subsidiary has full corporate power and authority to
own, lease and operate its properties and to conduct its business as described
in the Final Memorandum.
IC-1
