Exhibit 10.16
SECURITIES PURCHASE AGREEMENT
dated as of March 25, 2003
BETWEEN
PLIANT CORPORATION
and
X.X. Xxxxxx Partners (BHCA), L.P.
SECURITIES PURCHASE
AGREEMENT dated as of March 25,
2003, between PLIANT
CORPORATION, a Utah corporation
(the "Company"), and X.X. XXXXXX
PARTNERS (BHCA), L.P., a
Delaware limited partnership
(the "Purchaser").
WHEREAS, the Company is in the business of manufacturing and
selling value-added films and flexible packaging for food, personal care,
medical, agricultural and industrial applications (the "Business").
WHEREAS, concurrently with the execution and delivery of this
Agreement, the Purchaser has purchased from the Company 10,000 shares of Series
A Cumulative Exchangeable Redeemable Preferred Stock of the Company, no par
value (the "Series A Preferred Stock"), and warrants to purchase 153,857 shares
of Common Stock of the Company, no par value, for an aggregate purchase price of
$10,000,000.
WHEREAS, the Company desires to issue and sell to the Purchaser,
and the Purchaser desires to purchase from the Company, additional equity
securities for an aggregate purchase price equal to $25,000,000 on the terms and
subject to the conditions provided herein.
WHEREAS, the Company, JPMorgan Chase Bank, as syndication agent,
Deutsche Bank Trust Company Americas, as administrative agent (in such capacity,
the "Administrative Agent") and collateral agent and the lenders party thereto
have entered into Amendment No. 5 (the "Credit Agreement Amendment") dated as of
March 24, 2003, in respect of the Credit Agreement (as defined herein).
WHEREAS, the execution and delivery of this Agreement is, among
other things, a condition precedent to the effectiveness of the Credit Agreement
Amendment.
NOW THEREFORE, in consideration of the foregoing and the
covenants, agreements, representations and warranties contained in this
Agreement, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged by the parties, the parties hereto
hereby agree as set forth below.
ARTICLE I
DEFINED TERMS; RULES OF CONSTRUCTION
1.1 Defined Terms.
Capitalized terms used and not otherwise defined in this Agreement
shall have the meanings given to them below or in the other locations of this
Agreement specified below (or, if not defined herein, have the meanings ascribed
to them in the Credit Agreement as in effect on the date hereof and proposed to
be modified by the Credit
Agreement Amendment or as such term is amended or modified from time to time,
solely for the purposes of this Agreement, if such amendment or modification
adversely affects the rights or obligations of the Purchaser under this
Agreement, with the consent of the Purchaser):
"Administrative Agent" has the meaning given to such term in the
recitals to this Agreement.
"Affiliate" of any specified Person means any other Person,
directly or indirectly, controlling or controlled by or under direct or indirect
common control with such specified Person. For the purposes of this definition,
"control" when used with respect to any Person means the power to direct the
management and policies of such Person, directly or indirectly, whether through
the ownership of voting securities, by contract or otherwise; and the terms
"controlling" and "controlled" have meanings correlative to the foregoing.
"Agreement" has the meaning given to such term in Section 1.2.
"Business" has the meaning given to such term in the recitals to
this Agreement.
"Business Day" means any day that is not (a) a Saturday, Sunday,
or legal holiday or (b) a day on which banks are not required to be open in New
York, New York.
"Charter" means the Third Amended and Restated Articles of
Incorporation of the Company, as amended, modified, supplemented or restated
from time to time.
"Closing" has the meaning given to such term in Section 3.1.
"Commission" means the Securities and Exchange Commission or any
other Federal agency at the time administering the Securities Act.
"Company" has the meaning given to such term in the caption to
this Agreement.
"Credit Agreement" shall mean the Credit Agreement dated as of
May 31, 2000 among the Company, ASPEN Industrial, S.A. de C.V., the Lenders
party thereto, the Administrative Agent, the Collateral Agent, The Chase
Manhattan Bank, as Syndication Agent and The Bank of Nova Scotia, as
Documentation Agent, including the Credit Agreement Amendment, and as otherwise
amended, modified, supplemented or restated from time to time.
"Credit Agreement Amendment" has the meaning given to such term
in the recitals to this Agreement.
"Delivery Day Amount" means, with respect to any Delivery Day,
the amount (if positive), rounded-up to the nearest $1,000, equal to (a) the
Compliance
2
Amount with respect to the last day of the fiscal quarter ending immediately
prior to such Delivery Day minus (b) the aggregate amount of all Specified
Equity Offering Proceeds received by the Company (or the Administrative Agent
pursuant to Section 2.3) during the Interim Period ending on such Delivery Day
including, without limitation, Specified Equity Offering Proceeds paid by any
other Qualified Equity Provider to the Company (or the Administrative Agent
pursuant to Section 2.3) at a Closing occurring on such Delivery Day. For
purposes of this definition, the purchase price paid by the Purchaser or any
other Qualified Equity Provider for the purchase of any Participation Interest
pursuant to Section 2.4 will be deemed to constitute Specified Equity Offering
Proceeds received by the Company on the date of such purchase.
"Designated Account" has the meaning given to such term in
Section 2.3(a).
"Equity Unit" means (a) initially an investment unit consisting
of (i) one share of Series A Preferred Stock and (ii) warrants to purchase
4.3962 shares of common stock (as such number of shares of common stock may be
adjusted from time to time in accordance with any agreements between the
Purchaser and the Company applicable to such warrants) and (b) from time to time
any other investment unit consisting solely of Qualified Equity Securities
specified by the Company and the Purchaser by notice to the Administrative Agent
that the Company and the Purchaser, by the execution and delivery of such
notice, agree shall, in lieu of the investment unit referred to in clause (a) of
this definition, be subject to purchase and sale as an Equity Unit under this
Agreement, provided that, prior to designating any investment unit to be an
"Equity Unit" pursuant to clause (b) above, the Company will authorize and
reserve for issuance a sufficient number of the Securities comprising such
investment unit to ensure compliance with Section 2.1 on the date of such
designation.
"Expiration Date" has the meaning given to such term in Section
2.2(c).
"Fundamental Documents" means the documents by which any Person
(other than an individual) establishes its legal existence or which govern its
internal affairs.
"Interim Period" means the period beginning on the first day
following the last day of the most recently ended fiscal quarter of the Company
and ending on the Delivery Day for such fiscal quarter.
"LC Reserve Account" has the meaning set forth in Section 2.4(b).
"Lenders" has the meaning given to such term in the Credit
Agreement.
"Participation Interest" has the meaning set forth in Section
2.4(a).
"Participation Purchase Time" has the meaning set forth in
Section 2.4(a).
"Person" shall be construed as broadly as possible and shall
include an individual or natural person, a partnership (including a limited
liability partnership), a
3
corporation, an association, a joint stock company, a limited liability company,
a trust, a joint venture, an unincorporated organization and a governmental
authority.
"Prohibited Contribution" has the meaning set forth in Section
2.4(a).
"Purchaser" has the meaning given to such term in the caption to
this Agreement.
"Purchaser Maximum Amount" has the meaning given to such term in
Section 2.2(b).
"Qualified Equity Securities" means one or more Securities issued
by the Company consisting solely of (a) common stock, (b) Qualified Preferred
Stock, (c) warrants to acquire common stock or Qualified Preferred Stock or (d)
any combination of Securities referred to in clauses (a), (b) and (c) above.
"Reallocation Amount" has the meaning set forth in Section
2.4(e).
"Security" has the meaning given to the term "security" in
Section 2(1) of the Securities Act.
"Series A Preferred Stock" has the meaning given to such term in
the recitals to this Agreement.
"Securities Act" means the Securities Act of 1933, as amended, or
any successor Federal statute, and the rules and regulations of the Commission
promulgated thereunder, all as the same shall be in effect from time to time.
"Subsidiary" or "subsidiary" means, with respect to any Person,
any other Person of which more than fifty percent (50%) of the shares of stock
or other interests entitled to vote in the election of directors or comparable
Persons performing similar functions (excluding shares or other interests
entitled to vote only upon the failure to pay dividends thereon or other
contingencies) are at the time owned or controlled, directly or indirectly
through one or more Subsidiaries, by such Person. Unless the context otherwise
requires, the term "Subsidiary" means a Subsidiary of the Company.
"Unfunded LC Portion" has the meaning set forth in Section
2.4(a).
1.2 Rules of Construction.
The term this "Agreement" means this agreement together with all
schedules and exhibits hereto, as the same may from time to time be amended,
modified, supplemented or restated in accordance with the terms hereof. The use
in this Agreement of the term "including" means "including, without limitation."
The words "herein," "hereof," "hereunder" and other words of similar import
refer to this Agreement as a whole, and not to any particular section,
subsection, paragraph, subparagraph or clause contained in this Agreement. All
references to sections mean the sections of this Agreement except where
otherwise stated. The title of and the section and paragraph headings in this
4
Agreement are for convenience of reference only and shall not govern or affect
the interpretation of any of the terms or provisions of this Agreement. The use
herein of the masculine, feminine or neuter forms shall also denote the other
forms, as in each case the context may require or permit. Where specific
language is used to clarify by example a general statement contained herein,
such specific language shall not be deemed to modify, limit or restrict in any
manner the construction of the general statement to which it relates. The
language used in this Agreement has been chosen by the parties to express their
mutual intent, and no rule of strict construction shall be applied against any
party. Unless expressly provided otherwise, the measure of a period of one month
or year for purposes of this Agreement shall be that date of the following month
or year corresponding to the starting date, provided that if no corresponding
date exists, the measure shall be that date of the following month or year
corresponding to the next day following the starting date. For example, one
month following February 18 is March 18, and one month following March 31 is May
1.
ARTICLE II
PURCHASE AND SALE OF EQUITY UNITS
2.1 Reservation of Equity Units.
At all times during the term of this Agreement, the Company will have
reserved for issuance a number of Securities comprising the Equity Units that is
greater than or equal to the sum of (a) the maximum number of Securities that
the Purchaser could be required to purchase hereunder and (b) the maximum number
of such Securities that, under all other agreements in effect at such time, the
Company could be required to issue at or after such time (determined without
giving effect to potential future increases in the number of Securities required
to be issued under such other agreements if the maximum amount of such increases
cannot be determined at the time of calculation).
2.2 Sale of Equity Units.
(a) Subject to the further provisions of this Section 2.2, if
a Trigger Event exists with respect to any fiscal quarter of the Company ending
on or before December 31, 2004, the Company shall as soon as practicable
following knowledge of such Trigger Event, but in no event later than 5 Business
Days prior to the applicable Delivery Day, notify the Purchaser of the
Compliance Amount and the Delivery Day Amount, if any, and the number of Equity
Units required to be issued by the Company and purchased by the Purchaser on the
applicable Delivery Day; provided that no failure or delay by the Company to
provide such notice to the Purchaser shall discharge the Purchaser's obligations
under this Agreement. The Purchaser will advise its general partner of each
Trigger Event promptly following the Purchaser's receipt of notice of such
Trigger Event from the Company, and will include in such notice a request that
such partner provide, or cause to be provided, to the Purchaser the cash
required by the Purchaser in order for the Purchaser to satisfy its obligations
under this Agreement with respect to such Trigger Event. On each Delivery Day on
which Equity Units are required to be issued and purchased, the Company shall
issue to the Purchaser, and the Purchaser
5
shall purchase from the Company, a number of Equity Units equal to the quotient
obtained by dividing (x) the Delivery Day Amount by (y) 1,000.
(b) Notwithstanding anything to the contrary contained in this
Agreement, the maximum aggregate amount (the "Purchaser Maximum Amount") that
the Purchaser shall be required to pay under this Agreement in respect of the
purchase of Equity Units or the purchase of Participation Interests shall be
$25,000,000; provided, however, that the Purchaser Maximum Amount shall be
reduced by (i) the aggregate purchase price paid to the Administrative Agent (on
behalf of the Lenders) for Participation Interests purchased by Qualified Equity
Providers (other than the Purchaser) and (ii) the aggregate amount of all
Specified Equity Offering Proceeds received by the Company (including, without
limitation, Specified Equity Offering Proceeds paid by any Qualified Equity
Provider to the Company (or the Administrative Agent pursuant to Section 2.3) at
any Closing) other than pursuant to this Section 2.2, provided that such
Specified Equity Offering Proceeds have been designated as (or otherwise become)
Mandatory Equity Offering Proceeds. At no time shall the Purchaser have any
monetary obligation hereunder other than to purchase Equity Units and
Participation Interests in accordance with the terms hereof.
(c) The obligation of the Purchaser to purchase Equity Units
hereunder shall expire on the date (the "Expiration Date") that is the earlier
of (x) April 1, 2005; (y) the date (the "Cutoff Date") that is the later of (1)
91 days after the date on which all the Obligations (except for contingent
obligations and liabilities in respect of which no claim has been made against
the Company) have been paid in full, the Commitments have been terminated and
the LC Exposure has been reduced to zero, (2) if any payment by any Loan Party
was made in respect of the Obligations within 91 days prior to any bankruptcy or
similar proceeding in respect of such Loan Party, the date on which such
proceedings are completed, (3) 91 days after the date on which any Participation
Interest is purchased (or deemed purchased) pursuant to Section 2.4 and (4) if
any Participation Interest is purchased (or deemed purchased) pursuant to
Section 2.4 within 91 days prior to any bankruptcy or similar proceeding in
respect of any Loan Party, the date on which such proceedings are completed; and
(z) such other time that the Required Lenders agree in writing to release the
Purchaser from its obligations hereunder. Notwithstanding the foregoing, any
obligation to purchase Equity Units which arises prior to the Expiration Date
shall continue until such time as such obligation is satisfied in full.
2.3 Purchase Price.
(a) As payment for the Equity Units to be purchased by the
Purchaser from the Company at each Closing, the Purchaser shall pay to the
Company a price per Equity Unit equal to $1,000. All consideration payable
pursuant to this Section 2.3 shall be paid in cash by wire transfer of
immediately available funds to an account (the "Designated Account") designated
by the Administrative Agent. The Company acknowledges that payment of the
foregoing consideration to the Designated Account in accordance with the terms
hereof shall satisfy the obligations of the Purchaser to make payment of the
purchase price with respect to such Equity Units.
6
(b) The Company agrees that the Designated Account will be an
account with the Administrative Agent in the name of the Administrative Agent
(for the benefit of the Lenders) and that all of the proceeds from the sale of
the Equity Units deposited in the Designated Account will be applied to prepay
Loans or cash collateralize Letters of Credit pursuant to Section 2.11(b) of the
Credit Agreement; provided that the portion of such proceeds that the Company
notifies the Administrative Agent would not, pursuant to the definition of the
term Net Proceeds, be required to be applied as aforesaid will be transferred by
the Administrative Agent to the Company.
2.4 Purchase of Participation Interests.
(a) In the event and on each occasion that any purchase of
Equity Units by the Purchaser from the Company (or any payment by the Purchaser
in connection with any such purchase) is required by the terms of this Agreement
to be made at a time when (i) any Default with respect to any event with respect
to the Company or the Mexico Borrower described in paragraph (h) or (i) of
Article VII of the Credit Agreement has occurred or (ii) such purchase or
contribution (or such payment) is prohibited by law or any injunction, decree or
similar legal restraint (a "Prohibited Contribution"), then at such time (such
time, the "Participation Purchase Time"), in lieu of effecting such Prohibited
Contribution, the Purchaser shall purchase for cash, at par (which, in the case
of undrawn Letters of Credit, will mean the undrawn face amount of such Letters
of Credit), an undivided participation in the Loans, LC Disbursements and
undrawn portion (the "Unfunded LC Portion") of the Letters of Credit (all such
participations, collectively, the "Participation Interest") outstanding at such
time, from the Lenders at such time for an aggregate purchase price equal to the
amount of such Prohibited Contribution; provided that all interest accrued in
respect of such Loans and LC Disbursements, and all participation fees accrued
in respect of such participations in Letters of Credit, under the Credit
Agreement prior to the purchase of such Participation Interest shall be for the
account of the Lenders from which such Participation Interest is acquired. Each
Participation Interest will be allocated on a pro rata basis to the Loans, LC
Disbursements and Unfunded LC Portion outstanding at the Participation Purchase
Time.
(b) The Purchaser shall pay the purchase price for each
purchase of a Participation Interest pursuant to this Section 2.4 on the date of
purchase by a wire transfer of immediately available funds directly to the
Administrative Agent (acting on behalf of the Lenders), into such account as the
Administrative Agent may specify, in the amount of the Prohibited Contribution
that gave rise to the Purchaser's obligation to acquire such Participation
Interest; provided that the portion, if any, of the purchase price for any
Participation Interest that relates to any Unfunded LC Portion shall be
deposited by the Administrative Agent into an account (the "LC Reserve Account")
with the Administrative Agent in the name of the Administrative Agent (and for
the benefit of the Lenders).
(c) The Purchaser's rights under each Participation Interest
(including in respect of any LC Disbursements subject to the Participation
Interest that are made in respect of the Unfunded LC Portion after the
Participation Purchase Time) will be fully
7
subordinated to each Lender's retained interest in the Loans, LC Disbursements
and participations in Letters of Credit, and distributions in respect of such
Participation Interest will be made only after the Cutoff Date.
(d) On the date of any purchase of a Participation Interest,
the Purchaser will execute and deliver a participation agreement with respect to
such Participation Interest, in the standard form employed by the Administrative
Agent for loan participation agreements (modified to reflect the subordination
referred to above and to eliminate all voting rights of the participant
thereunder). Upon entering into such a participation agreement with respect to a
Participation Interest and making payment of the purchase price for such
Participation Interest as provided above, the Purchaser will be relieved of its
obligation hereunder to make the Prohibited Contribution that gave rise to the
Purchaser's obligation to acquire such Participation Interest.
(e) Unless otherwise agreed to by Revolving Lenders with LC
Exposure representing greater than 50% of the total LC Exposure, amounts held in
the LC Reserve Account will be released only as provided in this Section.
(i) If at any time after the Participation Purchase
Time there is a reduction in the LC Exposure (other than by reason of
the Company's reimbursement of an LC Disbursement), then at such time
(A) a portion of the Participation Interest that was allocated at the
Participation Purchase Time to the Unfunded LC Portion equal in amount
to the product (such product, the "Reallocation Amount") of (x) the
quotient obtained by dividing (1) the amount of such reduction in the
LC Exposure by (2) the amount of the Unfunded LC Portion at the
Purchase Participation Time multiplied by (y) the aggregate amount of
cash required to be deposited in the LC Reserve Account at the
Participation Purchase Time will be reallocated on a pro rata basis to
the Loans and LC Disbursements outstanding at such time and (B) an
amount of cash deposited in the LC Reserve Account equal to the
Reallocation Amount will be released to the Lenders pro rata based on
the amount of Loans and LC Disbursements held by or owed to such
Lenders, in satisfaction of the Purchaser's obligation to pay the
purchase price for such reallocated Participation Interest.
(ii) If at any time after the Participation Purchase
Time any LC Disbursement is made, then at such time an amount of cash
deposited in the LC Reserve Account equal in amount to the product of
(x) the quotient obtained by dividing (1) the amount of such LC
Disbursement by (2) the amount of the Unfunded LC Portion at the
Participation Purchase Time multiplied by (y) the aggregate amount of
cash required to be deposited in the LC Reserve Account at the
Participation Purchase Time will be released to the Issuing Bank in
satisfaction of the Purchaser's obligation pursuant to Section 2.05(d)
of the Credit Agreement.
(f) Notwithstanding the foregoing, (i) if any purchase by the
Purchaser of a Participation Interest pursuant to this Section occurs prior to
the time when the maturity of the Loans has been accelerated in accordance with
Article VII of the Credit
8
Agreement, such Participation Interest will not be allocated in accordance with
the second sentence of Section 2.4(a) at the Participation Purchase Time but
will instead be allocated at such time among the Loans, LC Disbursements and
Unfunded LC Portion that would have been prepaid and cash collateralized, as
applicable, if the applicable Prohibited Contribution had been made when
required pursuant to the Credit Agreement and the gross proceeds received by the
Company in respect of such Prohibited Contribution had been applied by the
Company in accordance with the second sentence of Section 2.11(b) of the Credit
Agreement, (ii) if any reallocation of any portion of a Participation Interest
is required pursuant to Section 2.4(e) at any time prior to the time when the
maturity of the Loans has been so accelerated, then such portion of such
Participation Interest will not be reallocated pro rata among the Loans and LC
Disbursements but will instead be reallocated among the Loans that would have
been prepaid if Net Proceeds in an amount equal to the amount of the
Participation Interest being reallocated had been applied by the Company to
prepay Term Loans pursuant to Section 2.11(b) of the Credit Agreement and (iii)
if any purchase by the Purchaser of a Participation Interest pursuant to this
Section occurs prior to the time when the Revolving Commitments have been
terminated, then (A) such Participation Interest will also include a
participation in the Revolving Commitments equal to the portion of the
Participation Interest allocated to the Revolving Loans, LC Disbursements and
Unfunded LC Portion at the Participation Purchase Time, (B) any payments in
respect of Revolving Loans or participations in Swingline Loans or LC
Disbursements subject to such Participation Interest to which the Purchaser
would be entitled will be held in a collateral account with the Administrative
Agent in the name of the Administrative Agent (for the benefit of the Lenders)
and (C) amounts so deposited in the collateral account referred to in clause (B)
above will be released to satisfy the obligations of the Purchaser to fund its
pro rata share of Revolving Loans and participations in Swingline Loans and
Letters of Credit based on the unfunded portion of such Participation Interest
in the Revolving Commitments from time to time; provided, however, that all
obligations of the Purchaser under or in respect of such participation in the
Revolving Commitments shall be deemed satisfied in full by the payment by the
Purchaser of the purchase price for the applicable Participation Interest.
2.5 Delivery and Execution of Agreement.
This Agreement has been duly executed and delivered by the
Company.
ARTICLE III
CLOSINGS
3.1 Closings.
Each closing (each, a "Closing") of the sale of Equity Units which
occurs from time to time pursuant to Section 2.2 shall take place on such date
as agreed to by the parties (but in no event later than the applicable Delivery
Day) at the offices of O'Melveny & Xxxxx LLP at 00 Xxxxxxxxxxx Xxxxx, Xxx Xxxx,
Xxx Xxxx 00000, or such other place agreed to by the Company and the Purchaser.
9
3.2 Closing Deliverables.
At each Closing, (a) the Company shall deliver to the Purchaser one or
more certificates registered in the name of the Purchaser, representing, in the
aggregate, the Securities evidencing the Equity Units being purchased by the
Purchaser at such Closing and (b) the Purchaser shall deliver to the Company the
purchase price (calculated and payable in accordance with Section 2.3) for the
Equity Units being purchased by the Purchaser at such Closing.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF THE PURCHASER
The Purchaser represents and warrants, as of the date hereof, as
set forth below.
4.1 Organization Etc.
The Purchaser has been duly formed and is validly existing and is in
good standing under the laws of its jurisdiction of formation, is duly qualified
to do business and is in good standing in each jurisdiction in which its
ownership or lease of property or the conduct of its businesses requires such
qualification, and has all power and authority necessary to own or hold its
properties and to conduct the businesses in which it is engaged, except in each
case where the failure to so qualify or have such power or authority could not
reasonably be expected to adversely affect the ability of the Purchaser to
perform its obligations under Section 2.2, 2.3 or 2.4 or any other material
obligations under this Agreement.
4.2 Authorization of the Documents.
The Purchaser has all requisite power and authority to execute, deliver
and perform this Agreement and the transactions contemplated hereby, and the
execution, delivery and performance by the Purchaser of this Agreement have been
duly authorized by all requisite action by the Purchaser and its partners. This
Agreement has been duly executed and delivered by the Purchaser and this
Agreement constitutes a valid and binding obligation of the Purchaser,
enforceable against the Purchaser in accordance with its terms, subject to
applicable bankruptcy, insolvency, reorganization, fraudulent conveyance,
moratorium or other similar laws and subject to general principles of equity.
4.3 No Conflict; Consents.
The execution, delivery and performance by the Purchaser of this
Agreement and the consummation of the transactions contemplated hereby will not
(a) result in any violation of the provisions of the Fundamental Documents of
the Purchaser; (b) except as could not reasonably be expected to adversely
affect the ability of the Purchaser to perform its obligations under Section
2.2, 2.3 or 2.4 or any other material obligations under this Agreement (i)
conflict with or result in a breach or violation of any of the terms or
provisions of, or constitute a default under, or result in the creation or
imposition
10
of any lien upon any property or assets of the Purchaser pursuant to, any
material indenture, mortgage, deed of trust, loan agreement or other material
agreement or instrument to which the Purchaser is a party or by which the
Purchaser is bound or to which any of the property or assets of the Purchaser is
subject or (ii) result in any violation of any statute or any judgment, order,
decree, rule or regulation of any court or arbitrator or governmental agency or
body having jurisdiction over the Purchaser; or (c) require the consent,
approval, authorization or order of, or filing or registration with, any such
court or arbitrator or governmental agency or body under any such statute,
judgment, order, decree, rule or regulation is required for the execution,
delivery and performance by the Purchaser of this Agreement and the consummation
of the transactions contemplated by hereby, except for such consents, approvals,
authorizations, filings, registrations or qualifications (i) which shall have
been obtained or made on or prior to the date hereof, and (ii) as may be
required under state or foreign securities and blue sky laws and the rules and
regulations of the National Association of Securities Dealers, Inc.
4.4 Litigation.
There are no legal or governmental proceedings pending to which the
Purchaser is a party or of which any of its property or assets is the subject
which question the validity or enforceability of this Agreement or any action
taken or to be taken pursuant hereto; and to the knowledge of the Purchaser, no
such proceedings are threatened or contemplated by governmental authorities or
threatened by others.
ARTICLE V
CONDITIONS TO CLOSING
5.1 Conditions to Purchaser's Obligations.
The obligation of the Purchaser to purchase and pay for Equity Units to
be purchased hereunder at each Closing occurring prior to the Expiration Date is
subject to the occurrence of a Trigger Event with respect to the fiscal quarter
ending immediately prior to the date of such Closing.
5.2 Conditions to the Company's Obligations.
The obligation of the Company to issue the Equity Units to the
Purchaser at each Closing is subject to payment by the Purchaser of the
consideration set forth in Section 2.3 in accordance with the terms thereof.
5.3 No Conditions to Certain Obligations.
Notwithstanding the provisions of Sections 5.1 and 5.2 or any other
provision herein, the Company expressly acknowledges and agrees that its
obligation under Section 2.2(a) to issue the Equity Units, and the Purchaser
expressly acknowledges and agrees that its obligations under Section 2.2(a) to
acquire and pay the purchase price for the Equity Units (and its obligations
under Section 2.4 to acquire and pay the purchase price
11
for Participation Interests), in each case from time to time upon the occurrence
of a Trigger Event shall be absolute and unconditional in any and all
circumstances, notwithstanding the breach by any party hereto of this Agreement
or any other agreement between the parties hereto (including any failure by the
Company to deliver certificates evidencing the Equity Units purchased by the
Purchaser in accordance with Section 3.2) and notwithstanding any acceleration
of Loans or termination of Commitments under the Credit Agreement (but
nevertheless subject to Section 2.2(c)) or any bankruptcy, reorganization,
liquidation, insolvency or similar proceeding instituted by or against the
Company; provided, however, that the foregoing shall not relieve the Company
from any obligations it may have to the Purchaser hereunder or under any other
agreement.
ARTICLE VI
MISCELLANEOUS
6.1 Information.
The Purchaser assumes all responsibility for being and keeping itself
informed of the Company's and its subsidiaries' financial condition and assets,
and of all other circumstances bearing upon the risk of nonpayment of the Loans
and the nature, scope and extent of the risks that the Purchaser assumes and
incurs hereunder, and agrees that none of the Administrative Agent, the
Syndication Agent or the Lenders will have any duty to advise the Purchaser of
information known to it or any of them regarding such circumstances or risks.
6.2 Specific Performance; Remedies.
Damages in the event of breach of this Agreement by either party hereto
would be difficult, if not impossible, to ascertain, and it is therefore agreed
that each party hereto, in addition to and without limiting any other remedy or
right it may have, will have the right to an injunction or other equitable
relief in any court of competent jurisdiction, enjoining any such breach, and
enforcing specifically the terms and provisions hereof, and each party hereto
hereby waives any and all defenses it may have on the ground of lack of
jurisdiction or competence of the court to grant such an injunction or other
equitable relief. The existence of this right to specific performance will not
preclude any party hereto from pursuing any other rights and remedies at law or
in equity which the such party may have.
6.3 Successors and Assigns.
(a) This Agreement shall bind and inure to the benefit of the
Company and the Purchaser and their respective successors, permitted assigns,
heirs and personal representatives; provided, however, that (i) the Company
shall not be permitted to assign its rights or obligations hereunder without the
prior written consent of the Required Lenders and the Purchaser and (ii) except
as set forth in Section 6.3(b), the Purchaser shall not be permitted to assign
its obligations hereunder without the prior written consent of the Required
Lenders.
12
(b) The Purchaser shall be permitted to assign its rights to
receive the Equity Units at any Closing to any Qualified Equity Provider. No
assignment by the Purchaser of its right to receive any Equity Units at any
Closing shall relieve the Purchaser of its obligations hereunder.
(c) Notwithstanding anything herein to the contrary, the
Company shall be entitled to grant to the Administrative Agent, for the benefit
of the Secured Parties, a security interest in the Company's rights hereunder.
6.4 Notices.
(a) All notices, claims, requests, demands or other
communications which are required or otherwise delivered hereunder shall be
deemed to be sufficient and duly given if contained in a written instrument (i)
personally delivered or sent by telecopier, (ii) sent by nationally-recognized
overnight courier guaranteeing next Business Day delivery or (iii) sent by first
class, registered or certified mail, postage prepaid, return receipt requested,
addressed as follows:
(i) if to the Company, to:
Pliant Corporation
0000 Xxxxxxxxx Xxxx, Xxxxx 000
Xxxxxxxxxx, Xxxxxxxx 00000
Attention: Xxxx X. Xxxxx
Xxxxxxx Xxxxx
Telephone No.: (000) 000-0000
Telecopier No.: (000) 000-0000
with a copy to:
Stoel Rives LLP
One Utah Center
000 X. Xxxx Xxxxxx, Xxxxx 0000
Xxxx Xxxx Xxxx, Xxxx 00000-0000
Attention: Xxxxxx X. Xxxxxxx
Telephone No.: (000) 000-0000
Telecopier No.: (000) 000-0000
and
Deutsche Bank Trust Company Americas
000 X. Xxxxxxxxx Xxxxx
XX CH105-2900
Xxxxxxx, Xxxxxxxx 00000
Attention: Xxxxx Xxxxxx Xxxxxx
Telephone No.: (000) 000-0000
Telecopier No.: (000) 000-0000
13
(ii) if to the Purchaser, to:
XX Xxxxxx Partners (BHCA), L.P.
c/o X.X. Xxxxxx Partners, LLC
1221 Avenue of the Americas, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
Attention: Official Notices Clerk
Telephone No.: (000) 000-0000
Telecopier No.: (000) 000-0000
with copies to:
O'Melveny & Xxxxx LLP
00 Xxxxxxxxxxx Xxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxx X. Nissan
Telephone No.: (000) 000-0000
Telecopier No.: (000) 000-0000
and
Deutsche Bank Trust Company Americas
000 X. Xxxxxxxxx Xxxxx
XX CH105-2900
Xxxxxxx, Xxxxxxxx 00000
Attention: Xxxxx Xxxxxx Xxxxxx
Telephone No.: (000) 000-0000
Telecopier No.: (000) 000-0000
(b) Any notice, demand or request so delivered shall
constitute valid notice under this Agreement and shall be deemed to have been
received (i) on the day of actual delivery in the case of personal delivery, if
delivered on a Business Day (otherwise on the next Business Day), (ii) on the
next Business Day after the date when sent in the case of delivery by
nationally-recognized overnight courier, (iii) on the fifth Business Day after
the date of deposit in the U.S. mail in the case of mailing or (iv) upon receipt
in the case of a telecopier transmission if received on a Business Day
(otherwise on the next Business Day). Any party hereto may from time to time by
notice in writing served upon the other as aforesaid designate a different
mailing address or a different Person to which all such notices, demands or
requests thereafter are to be addressed; provided that no such change with
respect to the Administrative Agent will be made unless directed by the
Administrative Agent.
14
6.5 Amendments, Modifications and Waivers.
(a) The terms and provisions of this Agreement may not be
modified or amended, nor may any of the provisions hereof be waived, temporarily
or permanently, except pursuant to a written instrument executed by the Company,
the Purchaser and, only to the extent that such modification, amendment or
waiver is adverse to the interests of the Lenders, the Required Lenders (or the
Administrative Agent with the consent of the Required Lenders).
(b) No waiver by any party shall operate or be construed as a
waiver of any subsequent breach by any other party.
6.6 Governing Law.
THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH
THE LAWS OF THE STATE OF NEW YORK (WITHOUT GIVING EFFECT TO PRINCIPLES OF
CONFLICTS OF LAWS EXCEPT TO THE EXTENT THAT THE NEW YORK CONFLICTS OF LAWS
PRINCIPLES WOULD APPLY THE APPLICABLE LAWS OF THE STATE OF THE COMPANY'S
ORGANIZATION TO INTERNAL MATTERS RELATING TO ENTITIES SUCH AS THE COMPANY
ORGANIZED THEREUNDER).
6.7 Third Party Reliance.
(a) Except as provided in Section 6.7(b), no third party
(including, without limitation, any holder of Securities of the Company) or
anyone acting on behalf of any thereof shall be a third party or other
beneficiary of this Agreement.
(b) The parties hereto acknowledge and agree that their
respective obligations pursuant to this Agreement, and the representations and
warranties contained in this Agreement, as applicable, were an inducement for
the Lenders to enter into the Credit Agreement Amendment and that the
Administrative Agent (for and on behalf of the Lenders) shall be entitled to
enforce such obligations, including to compel specific performance, and to rely
on such representations and warranties, in each case as a third party
beneficiary. The provisions of this Agreement inure to the benefit of the
Administrative Agent, the Syndication Agent and the Lenders (including any
Person that hereafter becomes a Lender under the Credit Agreement and any
successor Administrative Agent or Syndication Agent under the Credit Agreement).
6.8 Nature of Liability; Independent Obligation.
The Purchaser agrees that this Agreement may be enforced by the
Administrative Agent without the necessity at any time of resorting to or
exhausting any proceedings or actions under the Credit Agreement or any other
Loan Document or otherwise, or resorting to any other guarantees or attempting
first to collect any Obligations (or to enforce the performance of any such
Obligations) of the Company or any other Loan Party. The Purchaser hereby waives
the right to require the Administrative Agent to join the Company or any other
Loan Party in any action brought hereunder or to commence
15
any action against or obtain any judgment against the Company or any other Loan
Party or to pursue any other remedy or enforce any other right. To the extent
permitted by applicable law, the Purchaser further agrees that nothing contained
herein or otherwise shall prevent the Administrative Agent or any Lender from
pursuing concurrently or successively all rights and remedies available to the
Administrative Agent or any Lender at law and/or in equity, hereunder or under
the other Loan Documents, and the exercise of any of its rights or the
completion of any of its remedies shall not constitute a discharge of any of the
Purchaser's obligations hereunder, it being the purpose and intent of the
Purchaser that, except as expressly provided herein, its obligations hereunder
shall be absolute, independent and unconditional under any and all circumstances
whatsoever without regard to the validity, regularity or enforceability of the
Credit Agreement or any other Loan Document. Neither the Purchaser's obligations
under this Agreement nor any remedy for the enforcement thereof shall be
impaired, modified, changed or released in any manner whatsoever by any
impairment, modification, change, release or limitation of the liability of any
Loan Party under the Credit Agreement or any other Loan Document or by reason of
the Purchaser's or any Loan Party's bankruptcy or by reason of any creditor or
bankruptcy proceeding instituted by or against the Purchaser or any Loan Party.
6.9 Submission to Jurisdiction.
Any legal action or proceeding with respect to this Agreement may be
brought in the courts of the State of New York and the United States of America
for the Southern District of New York and, by execution and delivery of this
Agreement, each of the Company and the Purchaser hereby accepts for itself and
in respect of its property, generally and unconditionally, the jurisdiction of
the aforesaid courts. Each of the Company and the Purchaser hereby irrevocably
waives, in connection with any such action or proceeding, any objection,
including, without limitation, any objection to the venue or based on the
grounds of forum non conveniens, which it may now or hereafter have to the
bringing of any such action or proceeding in such respective jurisdictions. Each
of the Company and the Purchaser hereby irrevocably consents to the service of
process of any of the aforementioned courts in any such action or proceeding by
the mailing of copies thereof by registered or certified mail, postage prepaid,
to it at its address as set forth herein. Nothing herein shall affect the right
of any party hereto or any specifically designated third party beneficiary
hereunder to serve process in any other manner permitted by law or to commence
legal proceedings or otherwise proceed against any other party hereto in any
other jurisdiction.
6.10 Severability.
It is the desire and intent of the parties that the provisions of this
Agreement be enforced to the fullest extent permissible under the law and public
policies applied in each jurisdiction in which enforcement is sought.
Accordingly, in the event that any provision of this Agreement would be held in
any jurisdiction to be invalid, prohibited or unenforceable for any reason, such
provision, as to such jurisdiction, shall be ineffective, without invalidating
the remaining provisions of this Agreement or affecting the validity or
enforceability of such provision in any jurisdiction. Notwithstanding the
foregoing, if
16
such provision could be more narrowly drawn so as not be invalid, prohibited or
unenforceable in such jurisdiction, it shall, as to such jurisdiction, be so
narrowly drawn, without invalidating the remaining provisions of this Agreement
or affecting the validity or enforceability of such provision in any other
jurisdiction.
6.11 Survival of Representation, Warranties, Etc.
The representations, warranties, covenants and agreements contained in
this Agreement or any other instrument delivered pursuant to this Agreement
shall survive indefinitely. Notwithstanding the foregoing, the Purchaser hereby
acknowledges and agrees that, until the date that is the later of (a) 91 days
after the payment in full of all the Obligations(except contingent obligations
and liabilities in respect of which no claim has been made against the Company),
the termination of the Commitments and the reduction of the LC Exposure to zero
and (b) if any payment by any Loan Party was made in respect of the Obligations
within 91 days prior to any bankruptcy or similar proceeding in respect of such
Loan Party, the date on which such proceedings are completed, neither the
Purchaser nor any of its Affiliates shall be entitled to exercise or attempt to
exercise any rights or remedies against the Company whatsoever arising from any
breach by the Company of its agreements or representations and warranties
hereunder or under any other instrument delivered pursuant to this Agreement,
except for any exercise of rights or remedies solely for damages payable in the
form of Equity Units.
6.12 Counterparts; Facsimile Signatures.
This Agreement may be executed in any number of counterparts, and each
such counterpart hereof shall be deemed to be an original instrument, but all
such counterparts together shall constitute but one agreement. Facsimile
counterpart signatures to this Agreement shall be acceptable and binding.
6.13 Loan Document.
The Purchaser acknowledges receipt of a copy of the Credit Agreement
and agrees that this Agreement shall constitute a Loan Document for all purposes
(other than Section 9.02 of the Credit Agreement).
6.14 Inconsistencies with Other Agreements.
In the event of any conflict or inconsistency between the terms of this
Agreement and the terms of (a) the Securities Purchase Agreement dated as of the
date hereof among the Company, the Purchaser, the Initial Purchasers identified
on Schedule I thereto and the Additional Purchasers signatory thereto from time
to time or (b) any other agreement to which the Company and the Purchaser are
parties, with respect to the Administrative Agent (for the benefit of the
Lenders) only, the terms of this Agreement shall govern.
* * * *
17
IN WITNESS WHEREOF, the parties hereto have executed this
Securities Purchase Agreement as of the date first above written.
PLIANT CORPORATION
By: /s/ Xxxxx X. Xxxxxxx
-------------------------------------
Name: Xxxxx X. Xxxxxxx
Title: Executive Vice President and
Chief Financial Officer
X.X. XXXXXX PARTNERS (BHCA), L.P.
By: JPMP Master Fund Manager, L.P.,
its General Partner
By: JPMP Capital Corp.,
its General Partner
By: /s/ Xxxxxxx Xxxxx
-------------------------------------
Name:
Title: