Exhibit 4.(v)
ANALYSTS INTERNATIONAL CORPORATION
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NOTE PURCHASE AGREEMENT
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DATED AS OF DECEMBER 30, 1998
$20,000,000 7.00% SENIOR NOTES
DUE DECEMBER 30, 2006
TABLE OF CONTENTS
1. AUTHORIZATION OF NOTES.......................................................................................1
2. SALE AND PURCHASE OF NOTES...................................................................................1
3. CLOSING......................................................................................................1
4. CONDITIONS TO CLOSING........................................................................................2
4.1 Representations and Warranties..........................................................................2
4.2 Performance; No Default.................................................................................2
4.3 Compliance Certificates.................................................................................2
4.4 Opinions of Counsel.....................................................................................2
4.5 Purchase Permitted By Applicable Law, etc...............................................................3
4.6 Payment of Special Counsel Fees.........................................................................3
4.7 Private Placement Number................................................................................3
4.8 Changes in Corporate Structure..........................................................................3
4.9 UCC Searches; Releases..................................................................................3
4.10 Proceedings and Documents...............................................................................4
5. REPRESENTATIONS AND WARRANTIES OF THE COMPANY................................................................4
5.1 Organization; Power and Authority.......................................................................4
5.2 Authorization, etc......................................................................................4
5.3 Disclosure..............................................................................................4
5.4 Organization and Ownership of Shares of Subsidiaries; Affiliates........................................5
5.5 Financial Statements....................................................................................6
5.6 Compliance with Laws, Other Instruments, etc............................................................6
5.7 Governmental Authorizations, etc........................................................................6
5.8 Litigation; Observance of Agreements, Statutes and Orders...............................................6
5.9 Taxes...................................................................................................7
5.10 Title to Property; Leases...............................................................................7
5.11 Licenses, Permits, etc..................................................................................7
5.12 Compliance with ERISA...................................................................................7
5.13 Private Offering by the Company.........................................................................8
5.14 Use of Proceeds; Margin Regulations.....................................................................9
5.15 Existing Indebtedness; Future Liens.....................................................................9
5.16 Foreign Assets Control Regulations, etc.................................................................9
5.17 Status under Certain Statutes..........................................................................10
5.18 Environmental Matters..................................................................................10
5.19 Year 2000..............................................................................................11
6. REPRESENTATIONS OF THE PURCHASERS...........................................................................11
6.1 Purchase for Investment................................................................................11
6.2 Source of Funds........................................................................................11
7. INFORMATION AS TO COMPANY...................................................................................12
7.1 Financial and Business Information.....................................................................12
7.2 Officer's Certificate..................................................................................15
7.3 Inspection.............................................................................................15
8. PREPAYMENT OF THE NOTES.....................................................................................16
8.1 Required Prepayments...................................................................................16
8.2 Optional Prepayments with Make-Whole Amount............................................................17
8.3 Allocation of Partial Prepayments......................................................................17
8.4 Maturity; Surrender, etc...............................................................................17
8.5 Purchase of Notes......................................................................................17
8.6 Make-Whole Amount......................................................................................18
9. AFFIRMATIVE COVENANTS.......................................................................................19
9.1 Compliance with Law....................................................................................19
9.2 Insurance..............................................................................................19
9.3 Maintenance of Properties..............................................................................19
9.4 Payment of Taxes and Claims............................................................................20
9.5 Corporate Existence, etc...............................................................................20
9.6 Fixed Charges Ratio....................................................................................20
9.7 Minimum Current Ratio..................................................................................20
10. NEGATIVE COVENANTS.......................................................................................20
10.1 Transactions with Affiliates...........................................................................20
10.2 Nature of Business.....................................................................................21
10.3 Merger, Consolidation and Sales of Assets..............................................................21
10.4 Limitation on Investments..............................................................................22
10.5 Limitation on Funded Indebtedness......................................................................22
10.6 Limitation on Subsidiary Indebtedness..................................................................23
10.7 Limitation on Liens....................................................................................23
10.8 Consolidated Net Worth.................................................................................25
10.9 Restricted Payments....................................................................................25
10.10 Restrictions on Issuance and Sale of Subsidiary Stock...............................................25
10.11 Sale and Lease Back.................................................................................25
10.12 Subordination of Claims.............................................................................26
10.13 Sale of Accounts....................................................................................26
11. EVENTS OF DEFAULT........................................................................................26
12. REMEDIES ON DEFAULT, ETC.................................................................................28
12.1 Acceleration...........................................................................................28
12.2 Other Remedies.........................................................................................29
12.3 Rescission.............................................................................................29
12.4 No Waivers or Election of Remedies, Expenses, etc......................................................29
13. REGISTRATION; EXCHANGE; SUBSTITUTION OF NOTES............................................................30
13.1 Registration of Notes..................................................................................30
13.2 Transfer and Exchange of Notes.........................................................................30
13.3 Replacement of Notes...................................................................................30
14. PAYMENTS ON NOTES........................................................................................31
14.1 Place of Payment.......................................................................................31
14.2 Home Office Payment....................................................................................31
15. EXPENSES, ETC............................................................................................31
15.1 Transaction Expenses...................................................................................31
15.2 Survival...............................................................................................32
16. SURVIVAL OF REPRESENTATIONS AND WARRANTIES; ENTIRE AGREEMENT.............................................32
17. AMENDMENT AND WAIVER.....................................................................................32
17.1 Requirements...........................................................................................32
17.2 Solicitation of Holders of Notes.......................................................................33
17.3 Binding Effect, etc....................................................................................33
17.4 Notes held by Company, etc.............................................................................33
18. NOTICES..................................................................................................34
19. REPRODUCTION OF DOCUMENTS................................................................................34
20. CONFIDENTIAL INFORMATION.................................................................................34
21. SUBSTITUTION OF PURCHASER................................................................................35
22. MISCELLANEOUS............................................................................................36
22.1 Successors and Assigns.................................................................................36
22.2 Payments Due on Non-Business Days......................................................................36
22.3 Severability...........................................................................................36
22.4 Construction...........................................................................................36
22.5 Counterparts...........................................................................................36
22.6 Governing Law..........................................................................................37
SCHEDULE A -- INFORMATION RELATING TO PURCHASERS
SCHEDULE B -- DEFINED TERMS
SCHEDULE 5.3 -- Disclosure Materials
SCHEDULE 5.4 -- Subsidiaries of the Company and Ownership of Subsidiary Stock
SCHEDULE 5.5 -- Financial Statements
SCHEDULE 5.15 -- Existing Indebtedness
EXHIBIT 1 -- Form of 7.00% Senior Notes Due December 30, 2006
EXHIBIT 4.4(a) -- Form of Opinion of Special Counsel for the Company
ANALYSTS INTERNATIONAL CORPORATION
0000 Xxxxx Xxxxxxxxx
Xxxxxxxxxxx, Xxxxxxxxx 00000-0000
7.00% Senior Notes due December 30, 2006
December 30, 1998
TO EACH OF THE PURCHASERS LISTED IN
THE ATTACHED SCHEDULE A:
Ladies and Gentlemen:
Analysts International Corporation, a Minnesota corporation (the
"COMPANY"), agrees with you as follows:
1. AUTHORIZATION OF NOTES
The Company will authorize the issue and sale of $20,000,000 aggregate
principal amount of its 7.00% Senior Notes due December 30, 2006 (the "NOTES",
such term to include any such notes issued in substitution therefor pursuant to
Section 13 of this Agreement). The Notes shall be substantially in the form set
out in Exhibit 1, with such changes therefrom, if any, as may be approved by you
and the Company. Certain capitalized terms used in this Agreement are defined in
Schedule B; references to a "Schedule" or an "Exhibit" are, unless otherwise
specified, to a Schedule or an Exhibit attached to this Agreement.
2. SALE AND PURCHASE OF NOTES.
Subject to the terms and conditions of this Agreement, the Company will
issue and sell to each of you and each of you will purchase from the Company, at
the Closing provided for in Section 3, Notes in the principal amount specified
opposite your respective names in Schedule A at the purchase price of 100% of
the principal amount thereof. The obligations of each of you hereunder are
several and not joint obligations and each of you shall have no obligation or
liability to any Person for the performance or nonperformance by any other
purchaser hereunder.
3. CLOSING.
The sale and purchase of the Notes to be purchased by you shall occur
at the offices of Faegre & Xxxxxx, 2200 Norwest Center, 00 Xxxxx Xxxxxxx Xxxxxx,
Xxxxxxxxxxx, Xxxxxxxxx, 00000 at 10:00 a.m., Minneapolis time, at a closing (the
"CLOSING") on December 30, 1998 or on such other Business Day thereafter on or
prior to December 31, 1998 as may be agreed upon by the Company and you. At the
Closing the Company will deliver to each of you the Notes to be purchased by you
in the form of a single Note (or such greater number of Notes in denominations
of at least $100,000 as you may request) dated the date of the Closing and
registered in your name (or in the name of your nominee), against delivery by
you to the Company or its order of
immediately available funds in the amount of the purchase price therefor by wire
transfer of immediately available funds for the account of the Company to
account number 9939-43 at First Chicago NBD Bank, 000 Xxxxxxxx Xxxxxx, Xxxxxxx,
Xxxxxxxx 00000, Transit Routing 000000000. If at the Closing the Company shall
fail to tender such Notes to you as provided above in this Section 3, or any of
the conditions specified in Section 4 shall not have been fulfilled to your
satisfaction, you shall, at your election, be relieved of all further
obligations under this Agreement, without thereby waiving any rights you may
have by reason of such failure or such nonfulfillment.
4. CONDITIONS TO CLOSING.
Your obligation to purchase and pay for the Notes to be sold to you at
the Closing is subject to the fulfillment to your satisfaction, prior to or at
the Closing, of the following conditions:
4.1 REPRESENTATIONS AND WARRANTIES.
The representations and warranties of the Company in this Agreement
shall be correct when made and at the time of the Closing.
4.2 PERFORMANCE; NO DEFAULT.
The Company shall have performed and complied with all agreements and
conditions contained in this Agreement required to be performed or complied with
by it prior to or at the Closing and after giving effect to the issue and sale
of the Notes (and the application of the proceeds thereof as contemplated by
Section 5.14) no Default or Event of Default shall have occurred and be
continuing. Neither the Company nor any Subsidiary shall have entered into any
transaction since the date of the Memorandum that would have been prohibited by
Sections 10.1, 10.2, 10.3, 10.4, 10.5, 10.6, 10.7, 10.9, 10.10, 10.11, 10.12 or
10.13 hereof had such Sections applied since such date.
4.3 COMPLIANCE CERTIFICATES.
(a) OFFICER'S CERTIFICATE. The Company shall have
delivered to you an Officer's Certificate, dated the date of the Closing,
certifying that the conditions specified in Sections 4.1, 4.2 and 4.8 have
been fulfilled.
(b) SECRETARY'S CERTIFICATE. The Company shall have
delivered to you a certificate certifying as to the resolutions attached
thereto and other corporate proceedings relating to the authorization,
execution and delivery of the Notes and this Agreement.
4.4 OPINIONS OF COUNSEL.
You shall have received opinions in form and substance satisfactory to
you, dated the date of the Closing (a) from Xxxxxx X. Xxxxxx, Esq., counsel for
the Company, covering the matters set forth in Exhibit 4.4(a) and covering such
other matters incident to the transactions
contemplated hereby as you or your counsel may reasonably request (and the
Company hereby instructs its counsel to deliver such opinion to you) and (b)
from Faegre & Xxxxxx LLP, your special counsel in connection with such
transactions covering such matters incident to such transactions as you may
reasonably request.
4.5 PURCHASE PERMITTED BY APPLICABLE LAW, ETC.
On the date of the Closing your purchase of Notes shall (i) be
permitted by the laws and regulations of each jurisdiction to which you are
subject, without recourse to provisions (such as Section 1405(a)(8) of the New
York Insurance Law) permitting limited investments by insurance companies
without restriction as to the character of the particular investment, (ii) not
violate any applicable law or regulation (including, without limitation,
Regulation G, T or X of the Board of Governors of the Federal Reserve System)
and (iii) not subject you to any tax, penalty or liability under or pursuant to
any applicable law or regulation, which law or regulation was not in effect on
the date hereof. If requested by you, you shall have received an Officer's
Certificate certifying as to such matters of fact as you may reasonably specify
to enable you to determine whether such purchase is so permitted.
4.6 PAYMENT OF SPECIAL COUNSEL FEES.
Without limiting the provisions of Section 15.1, the Company shall have
paid on or before the Closing the fees, charges and disbursements of your
special counsel referred to in Section 4.4 to the extent reflected in a
statement of such counsel rendered to the Company at least one Business Day
prior to the Closing.
4.7 PRIVATE PLACEMENT NUMBER.
A Private Placement number issued by Standard & Poor's CUSIP Service
Bureau (in cooperation with the Securities Valuation Office of the National
Association of Insurance Commissioners) shall have been obtained for the Notes.
4.8 CHANGES IN CORPORATE STRUCTURE.
The Company shall not have changed its jurisdiction of incorporation or
been a party to any merger or consolidation and shall not have succeeded to all
or any substantial part of the liabilities of any other entity, at any time
following the date of the most recent financial statements referred to in
Schedule 5.5.
4.9 UCC SEARCHES; RELEASES
The Company shall have delivered to you Uniform Commercial Code and
State and Federal tax lien searches for the Company and its Subsidiaries from
the State of Minnesota, as of a date no more than fifteen days prior to the
Closing, certified by a reporting service satisfactory to you, and disclosing no
Liens other than Liens permitted by Section 10.7 and liens to be released on or
prior to the Closing. The Company shall deliver releases of all liens not
permitted by Section 10.7.
4.10 PROCEEDINGS AND DOCUMENTS.
All corporate and other proceedings in connection with the transactions
contemplated by this Agreement and all documents and instruments incident to
such transactions shall be satisfactory to you and your special counsel, and you
and your special counsel shall have received all such counterpart originals or
certified or other copies of such documents as you or they may reasonably
request.
5. REPRESENTATIONS AND WARRANTIES OF THE COMPANY.
The Company represents and warrants to you that:
5.1 ORGANIZATION; POWER AND AUTHORITY.
The Company is a corporation duly organized, validly existing and in
good standing under the laws of its jurisdiction of incorporation, and is duly
qualified as a foreign corporation and is in good standing in each jurisdiction
in which such qualification is required by law, other than those jurisdictions
as to which the failure to be so qualified or in good standing could not,
individually or in the aggregate, reasonably be expected to have a Material
Adverse Effect. The Company has the corporate power and authority to own or hold
under lease the properties it purports to own or hold under lease, to transact
the business it transacts and proposes to transact, to execute and deliver this
Agreement and the Notes and to perform the provisions hereof and thereof.
5.2 AUTHORIZATION, ETC.
This Agreement and the Notes have been duly authorized by all necessary
corporate action on the part of the Company, and this Agreement constitutes, and
upon execution and delivery thereof each Note will constitute, a legal, valid
and binding obligation of the Company enforceable against the Company in
accordance with its terms, except as such enforceability may be limited by (i)
applicable bankruptcy, insolvency, reorganization, moratorium or other similar
laws affecting the enforcement of creditors' rights generally and (ii) general
principles of equity (regardless of whether such enforceability is considered in
a proceeding in equity or at law).
5.3 DISCLOSURE.
The Company, through its agent, Norwest Bank Minnesota, N.A. has
delivered to you a copy of a Private Placement Memorandum, dated October, 1998
(the "MEMORANDUM"), relating to the transactions contemplated hereby. The
Memorandum fairly describes, in all material respects, the general nature of the
business and principal properties of the Company and its Subsidiaries. Except as
disclosed in Schedule 5.3, this Agreement, the Memorandum, the documents,
certificates or other writings delivered to you by or on behalf of the Company
in connection with the transactions contemplated hereby and the financial
statements listed in Schedule 5.5, taken as a whole, do not contain any untrue
statement of a material fact or omit to state any material fact necessary to
make the statements therein not misleading in light of the circumstances under
which they were made. Except as disclosed in the Memorandum or as
expressly described in Schedule 5.3, or in one of the documents, certificates or
other writings identified therein, or in the financial statements listed in
Schedule 5.5 or in the due diligence meeting of December 2, 1998, since
September 30, 1998, there has been no change in the financial condition,
operations, business, properties or prospects of the Company or any Subsidiary
except changes that individually or in the aggregate could not reasonably be
expected to have a Material Adverse Effect. There is no fact known to the
Company that could reasonably be expected to have a Material Adverse Effect that
has not been set forth herein or in the Memorandum or in the other documents,
certificates and other writings delivered to you by or on behalf of the Company
specifically for use in connection with the transactions contemplated hereby.
5.4 ORGANIZATION AND OWNERSHIP OF SHARES OF SUBSIDIARIES; AFFILIATES.
(a) Schedule 5.4 contains (except as noted therein) complete
and correct lists (i) of the Company's Subsidiaries, showing, as to
each Subsidiary, the correct name thereof, the jurisdiction of its
organization, and the percentage of shares of each class of its capital
stock or similar equity interests outstanding owned by the Company and
each other Subsidiary, (ii) of the Company's Affiliates, other than
Subsidiaries, and (iii) of the Company's directors and senior officers.
Except as set forth in Schedule 5.4, the Company does not own, directly
or indirectly, any equity interest in any other Person.
(b) All of the outstanding shares of capital stock or
similar equity interests of each Subsidiary shown in Schedule 5.4 as
being owned by the Company and its Subsidiaries have been validly
issued, are fully paid and nonassessable and are owned by the
Company or another Subsidiary free and clear of any Lien (except as
otherwise disclosed in Schedule 5.4).
(c) Each Subsidiary identified in Schedule 5.4 is a
corporation or other legal entity duly organized, validly existing and
in good standing under the laws of its jurisdiction of organization,
and is duly qualified as a foreign corporation or other legal entity
and is in good standing in each jurisdiction in which such
qualification is required by law, other than those jurisdictions as to
which the failure to be so qualified or in good standing could not,
individually or in the aggregate, reasonably be expected to have a
Material Adverse Effect. Each such Subsidiary has the corporate or
other power and authority to own or hold under lease the properties it
purports to own or hold under lease and to transact the business it
transacts and proposes to transact.
(d) No Subsidiary is a party to, or otherwise subject to
any legal restriction or any agreement (other than this Agreement,
the agreements listed on Schedule 5.4 and customary limitations
imposed by corporate law statutes) restricting the ability of such
Subsidiary to pay dividends out of profits or make any other similar
distributions of profits to the Company or any of its Subsidiaries
that owns outstanding shares of capital stock or similar equity
interests of such Subsidiary.
5.5 FINANCIAL STATEMENTS.
The Company has delivered to each of you copies of the financial
statements of the Company and its Subsidiaries listed on Schedule 5.5. All of
said financial statements (including in each case the related schedules and
notes) fairly present in all material respects the consolidated financial
position of the Company and its Subsidiaries as of the respective dates
specified in such Schedule and the consolidated results of their operations and
cash flows for the respective periods so specified and have been prepared in
accordance with GAAP consistently applied throughout the periods involved except
as set forth in the notes thereto (subject, in the case of any interim financial
statements, to normal year-end adjustments).
5.6 COMPLIANCE WITH LAWS, OTHER INSTRUMENTS, ETC.
The execution, delivery and performance by the Company of this
Agreement and the Notes will not (i) contravene, result in any breach of, or
constitute a default under, or result in the creation of any Lien in respect of
any property of the Company or any Subsidiary under, any indenture, mortgage,
deed of trust, loan, purchase or credit agreement, lease, corporate charter or
by-laws, or any other agreement or instrument to which the Company or any
Subsidiary is bound or by which the Company or any Subsidiary or any of their
respective properties may be bound or affected, (ii) conflict with or result in
a breach of any of the terms, conditions or provisions of any order, judgment,
decree, or ruling of any court, arbitrator or Governmental Authority applicable
to the Company or any Subsidiary or (iii) violate any provision of any statute
or other rule or regulation of any Governmental Authority applicable to the
Company or any Subsidiary.
5.7 GOVERNMENTAL AUTHORIZATIONS, ETC.
No consent, approval or authorization of, or registration, filing or
declaration with, any Governmental Authority is required in connection with the
execution, delivery or performance by the Company of this Agreement or the
Notes.
5.8 LITIGATION; OBSERVANCE OF AGREEMENTS, STATUTES AND ORDERS.
(a) There are no actions, suits or proceedings pending
or, to the knowledge of the Company, threatened against or affecting
the Company or any Subsidiary or any property of the Company or any
Subsidiary in any court or before any arbitrator of any kind or before
or by any Governmental Authority that, individually or in the
aggregate, could reasonably be expected to have a Material Adverse
Effect.
(b) Neither the Company nor any Subsidiary is in default under
any term of any agreement or instrument to which it is a party or by
which it is bound, or any order, judgment, decree or ruling of any
court, arbitrator or Governmental Authority or is in violation of any
applicable law, ordinance, rule or regulation (including without
limitation Environmental Laws) of any Governmental Authority, which
default or violation, individually or in the aggregate, could
reasonably be expected to have a Material Adverse Effect.
5.9 TAXES.
The Company and its Subsidiaries have filed all tax returns that are
required to have been filed in any jurisdiction, and have paid all taxes shown
to be due and payable on such returns and all other taxes and assessments levied
upon them or their properties, assets, income or franchises, to the extent such
taxes and assessments have become due and payable and before they have become
delinquent, except for any taxes and assessments (i) the amount of which is not
individually or in the aggregate Material or (ii) the amount, applicability or
validity of which is currently being contested in good faith by appropriate
proceedings and with respect to which the Company or a Subsidiary, as the case
may be, has established adequate reserves in accordance with GAAP. The Company
knows of no basis for any other tax or assessment that could reasonably be
expected to have a Material Adverse Effect. The charges, accruals and reserves
on the books of the Company and its Subsidiaries in respect of Federal, state or
other taxes for all fiscal periods are adequate. The Federal income tax
liabilities of the Company and its Subsidiaries have been determined by the
Internal Revenue Service and paid for all fiscal years up to and including the
fiscal year ended June 30, 1995.
5.10 TITLE TO PROPERTY; LEASES.
The Company and its Subsidiaries have good and sufficient title to
their respective properties that individually or in the aggregate are Material,
including all such properties reflected in the most recent audited balance sheet
referred to in Section 5.5 or purported to have been acquired by the Company or
any Subsidiary after said date (except as sold or otherwise disposed of in the
ordinary course of business), in each case free and clear of Liens prohibited by
this Agreement. All leases that individually or in the aggregate are Material
are valid and subsisting and are in full force and effect in all material
respects.
5.11 LICENSES, PERMITS, ETC.
(a) the Company and its Subsidiaries own or possess all licenses,
permits, franchises, authorizations, patents, copyrights, service marks,
trademarks and trade names, or rights thereto, that individually or in the
aggregate are Material, without known conflict with the rights of others;
(b) to the best knowledge of the Company, no product of the Company
infringes in any material respect any license, permit, franchise,
authorization, patent, copyright, service xxxx, trademark, trade name or
other right owned by any other Person; and
(c) to the best knowledge of the Company, there is no Material
violation by any Person of any right of the Company or any of its
Subsidiaries with respect to any patent, copyright, service xxxx,
trademark, trade name or other right owned or used by the Company or any of
its Subsidiaries.
5.12 COMPLIANCE WITH ERISA.
(a) The Company and each ERISA Affiliate have operated and
administered each Plan in compliance with all applicable laws except
for such instances of
noncompliance as have not resulted in and could not reasonably be
expected to result in a Material Adverse Effect. Neither the Company
nor any ERISA Affiliate has incurred any liability pursuant to Title I
or IV of ERISA or the penalty or excise tax provisions of the Code
relating to employee benefit plans (as defined in Section 3 of ERISA),
and no event, transaction or condition has occurred or exists that
could reasonably be expected to result in the incurrence of any such
liability by the Company or any ERISA Affiliate, or in the imposition
of any Lien on any of the rights, properties or assets of the Company
or any ERISA Affiliate, in either case pursuant to Title I or IV of
ERISA or to such penalty or excise tax provisions or to Section
401(a)(29) or 412 of the Code, other than such liabilities or Liens as
would not be individually or in the aggregate Material.
(b) The present value of the aggregate benefit liabilities
under each of the Plans (other than Multiemployer Plans), determined as
of the end of such Plan's most recently ended plan year on the basis of
the actuarial assumptions specified for funding purposes in such Plan's
most recent actuarial valuation report, did not exceed the aggregate
current value of the assets of such Plan allocable to such benefit
liabilities. The term "BENEFIT LIABILITIES" has the meaning specified
in section 4001 of ERISA and the terms "CURRENT VALUE" and "PRESENT
VALUE" have the meaning specified in section 3 of ERISA.
(c) The Company and its ERISA Affiliates have not incurred
withdrawal liabilities (and are not subject to contingent withdrawal
liabilities) under section 4201 or 4204 of ERISA in respect of
Multiemployer Plans that individually or in the aggregate are
Material.
(d) The expected postretirement benefit obligation (determined as
of the last day of the Company's most recently ended fiscal year in
accordance with Financial Accounting Standards Board Statement No.
106, without regard to liabilities attributable to continuation
coverage mandated by section 4980B of the Code) of the Company and its
Subsidiaries is not Material.
(e) The execution and delivery of this Agreement and the
issuance and sale of the Notes hereunder will not involve any
transaction that is subject to the prohibitions of section 406 of ERISA
or in connection with which a tax could be imposed pursuant to section
4975(c)(l)(A)-(D) of the Code. The representation by the Company in the
first sentence of this Section 5.12(e) is made in reliance upon and
subject to (i) the accuracy of your representation in Section 6.2 as to
the sources of the funds used to pay the purchase price of the Notes to
be purchased by you and (ii) the assumption, made solely for the
purpose of making such representation, that Department of Labor
Interpretive Bulletin 75-2 with respect to prohibited transactions
remains valid in the circumstances of the transactions contemplated
herein.
5.13 PRIVATE OFFERING BY THE COMPANY.
Neither the Company nor anyone acting on its behalf has offered the
Notes or any similar securities for sale to, or solicited any offer to buy any
of the same from, or otherwise approached
or negotiated in respect thereof with, any person other than you and not more
than five other Institutional Investors, each of which has been offered the
Notes at a private sale for investment. Neither the Company nor anyone acting on
its behalf has taken, or will take, any action that would subject the issuance
or sale of the Notes to the registration requirements of Section 5 of the
Securities Act.
5.14 USE OF PROCEEDS; MARGIN REGULATIONS.
The Company will apply the proceeds of the sale of the Notes to finance
the purchase of a new office building for the Company's headquarters and for
general corporate purposes. No part of the proceeds from the sale of the Notes
hereunder will be used, directly or indirectly, for the purpose of buying or
carrying any margin stock within the meaning of Regulation G of the Board of
Governors of the Federal Reserve System (12 CFR 207), or for the purpose of
buying or carrying or trading in any securities under such circumstances as to
involve the Company in a violation of Regulation X of said Board (12 CFR 224) or
to involve any broker or dealer in a violation of Regulation T of said Board (12
CFR 220). As used in this Section, the terms "MARGIN STOCK" and "PURPOSE OF
BUYING OR CARRYING" shall have the meanings assigned to them in said Regulation
G.
5.15 EXISTING INDEBTEDNESS; FUTURE LIENS.
(a) Schedule 5.15 sets forth a complete and correct list of
all outstanding Indebtedness of the Company and its Subsidiaries as of
December 15, 1998, since which date there has been no Material change
in the amounts, interest rates, sinking funds, installment payments or
maturities of the Indebtedness of the Company or its Subsidiaries.
Neither the Company nor any Subsidiary is in default and no waiver of
default is currently in effect, in the payment of any principal or
interest on any Indebtedness of the Company or such Subsidiary and no
event or condition exists with respect to any Indebtedness of the
Company or any Subsidiary that would permit (or that with notice or the
lapse of time, or both, would permit) one or more Persons to cause such
Indebtedness to become due and payable before its stated maturity or
before its regularly scheduled dates of payment.
(b) Except as disclosed in Schedule 5.15, neither the Company nor
any Subsidiary has agreed or consented to cause or permit in the
future (upon the happening of a contingency or otherwise) any of its
property, whether now owned or hereafter acquired, to be subject to a
Lien not permitted by Section 10.7.
5.16 FOREIGN ASSETS CONTROL REGULATIONS, ETC.
Neither the sale of the Notes by the Company hereunder nor its use of
the proceeds thereof will violate the Trading with the Enemy Act, as amended, or
any of the foreign assets control regulations of the United States Treasury
Department (31 CFR, Subtitle B, Chapter V, as amended) or any enabling
legislation or executive order relating thereto.
5.17 STATUS UNDER CERTAIN STATUTES.
Neither the Company nor any Subsidiary is subject to regulation under
the Investment Company Act of 1940, as amended, the Public Utility Holding
Company Act of 1935, as amended, the Interstate Commerce Act, as amended, or the
Federal Power Act, as amended.
5.18 ENVIRONMENTAL MATTERS.
Neither the Company nor any Subsidiary has knowledge of any claim or has
received any notice of any claim, and no proceeding has been instituted raising
any claim against the Company or any of its Subsidiaries or any of their
respective real properties now or formerly owned, leased or operated by any of
them or other assets, alleging any damage to the environment or violation of any
Environmental Laws, except, in each case, such as could not reasonably be
expected to result in a Material Adverse Effect. Except as otherwise disclosed
to you in writing,
(a) neither the Company nor any Subsidiary has knowledge of any facts
which would give rise to any claim, public or private, of violation of
Environmental Laws or damage to the environment emanating from, occurring
on or in any way related to real properties now or formerly owned, leased
or operated by any of them or to other assets or their use, except, in each
case, such as could not reasonably be expected to result in a Material
Adverse Effect;
(b) neither the Company nor any of its Subsidiaries has stored any
Hazardous Materials on real properties now or formerly owned, leased or
operated by any of them and has not disposed of any Hazardous Materials in
a manner contrary to any Environmental Laws in each case in any manner that
could reasonably be expected to result in a Material Adverse Effect; and
(c) all buildings on all real properties now owned, leased or operated
by the Company or any of its Subsidiaries are in compliance with applicable
Environmental Laws, except where failure to comply could not reasonably be
expected to result in a Material Adverse Effect.
5.19 YEAR 2000.
The Company has implemented a program for analyzing and addressing Year
2000 Issues. The Company has completed and delivered to the Purchasers a copy of
its responses to the NAIC Year 2000 Due Diligence Questions, and the Company's
responses thereto remain accurate and complete in all material respects.
6. REPRESENTATIONS OF THE PURCHASERS.
6.1 PURCHASE FOR INVESTMENT.
Each of you severally and not jointly represents, solely as to yourself
that you are purchasing a Note for your own account or for one or more separate
accounts maintained by you or for the account of one or more pension or trust
funds and not with a view to the distribution
thereof, PROVIDED that the disposition of your or their property shall at all
times be within your or their control. You understand that the Notes have not
been registered under the Securities Act and may be resold only if registered
pursuant to the provisions of the Securities Act or if an exemption from
registration is available, except under circumstances where neither such
registration nor such an exemption is required by law, and that the Company is
not required to register the Notes.
6.2 SOURCE OF FUNDS.
Each of you severally and not jointly represents, solely as to yourself
that at least one of the following statements is an accurate representation as
to each source of funds (a "Source") to be used by you to pay the purchase price
of the Notes to be purchased by you hereunder:
(a) the Source is an "insurance company general account" as
defined in Section V(e) of Prohibited Transaction Exemption ("PTE")
95-60 (issued July 12, 1995) and, except as you have disclosed to the
Company in writing pursuant to this section (a), the amount of reserves
and liabilities for the general account contract(s) held by or on
behalf of any employee benefit plan or group of plans maintained by the
same employer or employee organization do not exceed 10% of the total
reserves and liabilities of the general account (exclusive of separate
account liabilities) plus surplus as set forth in the NAIC Annual
Statement filed with the state of domicile of the insurer; or
(b) the Source is either (i) an insurance company pooled
separate account, within the meaning of PTE 90-l (issued January 29,
1990), or (ii) a bank collective investment fund, within the meaning of
the PTE 91-38 (issued July 12, 1991) and, except as you have disclosed
to the Company in writing pursuant to this paragraph (b), no employee
benefit plan or group of plans maintained by the same employer or
employee organization beneficially owns more than 10% of all assets
allocated to such pooled separate account or collective investment
fund; or
(c) the Source constitutes assets of an "investment fund"
(within the meaning of Part V of the QPAM Exemption) managed by a
"qualified professional asset manager" or "QPAM" (within the meaning of
Part V of the QPAM Exemption), no employee benefit plan's assets that
are included in such investment fund, when combined with the assets of
all other employee benefit plans established or maintained by the same
employer or by an affiliate (within the meaning of Section V(c)(1) of
the QPAM Exemption) of such employer or by the same employee
organization and managed by such QPAM, exceed 20% of the total client
assets managed by such QPAM, the conditions of Part I(c) and (g) of the
QPAM Exemption are satisfied, neither the QPAM nor a person controlling
or controlled by the QPAM (applying the definition of "control" in
Section V(e) of the QPAM Exemption) owns a 5% or more interest in the
Company and (i) the identity of such QPAM and (ii) the names of all
employee benefit plans whose assets are included in such investment
fund have been disclosed to the Company in writing pursuant to this
paragraph (c); or
(d) the Source is a governmental plan; or
(e) the Source is one or more employee benefit plans, or a separate
account or trust fund comprised of one or more employee benefit plans, each
of which has been identified to the Company in writing pursuant to this
paragraph (e); or
(f) the Source does not include assets of any employee benefit plan,
other than a plan exempt from the coverage of ERISA.
As used in this Section 6.2, the terms "EMPLOYEE BENEFIT PLAN",
"GOVERNMENTAL PLAN", "PARTY IN INTEREST" and "SEPARATE ACCOUNT" shall have the
respective meanings assigned to such terms in Section 3 of ERISA.
7. INFORMATION AS TO COMPANY.
7.1 FINANCIAL AND BUSINESS INFORMATION.
The Company shall deliver to each holder of Notes that is an
Institutional Investor:
(a) QUARTERLY STATEMENTS -- within 45 days after the end of each
quarterly fiscal period in each fiscal year of the Company (other than the
last quarterly fiscal period of each such fiscal year), duplicate copies
of,
(i) consolidated and consolidating balance sheets of
the Company and its Subsidiaries as at the end of such
quarter, and
(ii) consolidated and consolidating statements of
income, changes in shareholders' equity and cash flows of
the Company and its Subsidiaries, for such quarter and (in
the case of the second and third quarters) for the portion
of the fiscal year ending with such quarter,
setting forth in each case in comparative form the figures for the
corresponding periods in the previous fiscal year, all in reasonable
detail, prepared in accordance with GAAP applicable to quarterly
financial statements generally (including, without limitation, footnote
disclosure of any matters occurring after the end of the most recent
fiscal year which would be required to be disclosed in accordance with
GAAP), and certified by a Senior Financial Officer as fairly
presenting, in all material respects, the financial position of the
companies being reported on and their results of operations and cash
flows, subject to changes resulting from year-end adjustments;
(b) ANNUAL STATEMENTS -- within 120 days after the end of each
fiscal year of the Company, duplicate copies of,
(i) consolidated and consolidating balance sheets of
the Company and its Subsidiaries, as at the end of such
year, and
(ii) consolidated and consolidating statements of
income, changes in shareholders' equity and cash flows of
the Company and its Subsidiaries, for such
year,
setting forth in each case in comparative form the figures for the
previous fiscal year, all in reasonable detail, prepared in
accordance with GAAP, and accompanied
(A) by an opinion thereon of independent
certified public accountants of recognized national
standing, which opinion shall state that such
financial statements present fairly, in all material
respects, the financial position of the companies
being reported upon and their results of operations
and cash flows and have been prepared in conformity
with GAAP, and that the examination of such
accountants in connection with such financial
statements has been made in accordance with generally
accepted auditing standards, and that such audit
provides a reasonable basis for such opinion in the
circumstances, and
(B) a certificate of such accountants
stating that they have reviewed this Agreement and
stating further whether, in making their audit, they
have become aware of any condition or event that then
constitutes a Default or an Event of Default, and, if
they are aware that any such condition or event then
exists, specifying the nature and period of the
existence thereof (it being understood that such
accountants shall not be liable, directly or
indirectly, for any failure to obtain knowledge of
any Default or Event of Default unless such
accountants should have obtained knowledge thereof in
making an audit in accordance with generally accepted
auditing standards or did not make such an audit);
(c) SEC AND OTHER REPORTS -- promptly upon their becoming
available, one copy of (i) each financial statement, report, notice or
proxy statement sent by the Company or any Subsidiary to public
securities holders generally, and (ii) each regular or periodic report,
each registration statement (without exhibits except as expressly
requested by such holder), and each prospectus and all amendments
thereto filed by the Company or any Subsidiary with the Securities and
Exchange Commission (other than registrations of Company benefit plans
on form S-8 or similar forms) and of all press releases and other
statements made available generally by the Company or any Subsidiary to
the public concerning developments that are Material;
(d) NOTICE OF DEFAULT OR EVENT OF DEFAULT -- promptly, and in
any event within five days after a Responsible Officer becoming aware
of the existence of any Default or Event of Default or that any Person
has given any notice or taken any action with respect to a claimed
default hereunder or that any Person has given any notice or taken any
action with respect to a claimed default of the type referred to in
Section 11(f), a written notice specifying the nature and period of
existence thereof and what action the Company is taking or proposes to
take with respect thereto;
(e) ERISA MATTERS -- promptly, and in any event within five days
after a Responsible Officer becoming aware of any of the following, a
written notice setting
forth the nature thereof and the action, if any, that the Company or
an ERISA Affiliate proposes to take with respect thereto:
(i) with respect to any Plan, any reportable event, as
defined in Section 4043(b) of ERISA and the regulations
thereunder, for which notice thereof has not been waived
pursuant to such regulations as in effect on the date
hereof; or
(ii) the taking by the PBGC of steps to institute, or
the threatening by the PBGC of the institution of,
proceedings under Section 4042 of ERISA for the termination
of, or the appointment of a trustee to administer, any Plan,
or the receipt by the Company or any ERISA Affiliate of a
notice from a Multiemployer Plan that such action has been
taken by the PBGC with respect to such Multiemployer Plan;
or
(iii) any event, transaction or condition that could
result in the incurrence of any liability by the Company or
any ERISA Affiliate pursuant to Title I or IV of ERISA or
the penalty or excise tax provisions of the Code relating to
employee benefit plans, or in the imposition of any Lien on
any of the rights, properties or assets of the Company or
any ERISA Affiliate pursuant to Title I or IV of ERISA or
such penalty or excise tax provisions, if such liability or
Lien, taken together with any other such liabilities or
Liens then existing, could reasonably be expected to have a
Material Adverse Effect;
(f) NOTICES FROM GOVERNMENTAL AUTHORITY -- promptly, and in
any event within 30 days of receipt thereof, copies of any notice
to the Company or any Subsidiary from any Federal or state
Governmental Authority relating to any order, ruling, statute or
other law or regulation that could reasonably be expected to have
a Material Adverse Effect;
(g) RULE 144A - upon the request of the holder of any Note,
the Company will provide such holder such financial and other
information as such holder may reasonably determine to be
necessary to be delivered to a qualified institutional buyer in
order to permit compliance with the information requirements of
Rule 144A(4) under the Securities Act in connection with the
resale of the Notes; and
(h) REQUESTED INFORMATION -- with reasonable promptness,
such other data and information relating to the business,
operations, affairs, financial condition, assets or properties of
the Company or any of its Subsidiaries or relating to the ability
of the Company to perform its obligations hereunder and under the
Notes as from time to time may be reasonably requested by any
such holder of Notes.
7.2 OFFICER'S CERTIFICATE.
Each set of financial statements delivered to a holder of Notes
pursuant to Section 7.1(a) or Section 7.1(b) hereof shall be accompanied by a
certificate of a Senior Financial Officer
setting forth:
(a) COVENANT COMPLIANCE -- the information (including detailed
calculations) required in order to establish whether the Company was in
compliance with the requirements of Sections 9.6, 9.7, 10.3, 10.4,
10.5, 10.6, 10.7, 10.8, 10.9 and 10.11, during the quarterly or annual
period covered by the statements then being furnished (including with
respect to each such Section, where applicable, the calculations of the
maximum or minimum amount, ratio or percentage, as the case may be,
permissible under the terms of such Sections, and the calculation of
the amount, ratio or percentage then in existence); and
(b) EVENT OF DEFAULT -- a statement that such officer has
reviewed the relevant terms hereof and has made, or caused to be made,
under his or her supervision, a review of the transactions and
conditions of the Company and its Subsidiaries from the beginning of
the quarterly or annual period covered by the statements then being
furnished to the date of the certificate and that such review shall not
have disclosed the existence during such period of any condition or
event that constitutes a Default or an Event of Default or, if any such
condition or event existed or exists (including, without limitation,
any such event or condition resulting from the failure of the Company
or any Subsidiary to comply with any Environmental Law), specifying the
nature and period of existence thereof and what action the Company
shall have taken or proposes to take with respect thereto.
7.3 INSPECTION.
The Company shall permit the representatives of each holder of Notes
that is an Institutional Investor:
(a) NO DEFAULT -- if no Default or Event of Default then
exists, at the expense of such holder and upon reasonable prior notice
to the Company, to visit the principal executive office of the Company,
to discuss the affairs, finances and accounts of the Company and its
Subsidiaries with the Company's officers, and (with the consent of the
Company, which consent will not be unreasonably withheld) its
independent public accountants, and (with the consent of the Company,
which consent will not be unreasonably withheld) to visit the other
offices and properties of the Company and each Subsidiary, all at such
reasonable times and as often as may be reasonably requested in
writing; and
(b) DEFAULT -- if a Default or Event of Default then exists,
at the expense of the Company to visit and inspect any of the offices
or properties of the Company or any Subsidiary, to examine all their
respective books of account, records, reports and other papers, to make
copies and extracts therefrom, and to discuss their respective affairs,
finances and accounts with their respective officers and independent
public accountants (and by this provision the Company authorizes said
accountants to discuss the affairs, finances and accounts of the
Company and its Subsidiaries), all at such times and as often as may be
requested.
8. PREPAYMENT OF THE NOTES.
8.1 REQUIRED PREPAYMENTS.
On the prepayment dates set forth below, the Company will prepay the
principal amounts set forth below (or such lesser principal amount as shall then
be outstanding) of the Notes at par and without payment of the Make-Whole Amount
or any premium,
PREPAYMENT DATE AMOUNT OF PRINCIPAL PREPAYMENT
--------------- ------------------------------
December 30, 2001 $5,250,000
December 30, 2002 $4,000,000
December 30, 2003 $3,000,000
December 30, 2004 $3,000,000
December 30, 2005 $2,500,000
PROVIDED that (i) any partial prepayment of the Notes pursuant to Section 8.2
shall be deemed applied first to the amount due at maturity, and then to the
amount of the scheduled principal prepayments required by this Section 8.1 in
inverse order of their maturity, and (ii) upon any purchase of the Notes
permitted by Section 8.5 the principal amount of each required prepayment of the
Notes becoming due under this Section 8.1 on and after the date of such
prepayment or purchase shall be reduced in the same proportion as the aggregate
unpaid principal amount of the Notes is reduced as a result of such purchase.
8.2 OPTIONAL PREPAYMENTS WITH MAKE-WHOLE AMOUNT.
The Company may, at its option, on any interest payment date on or
after June 30, 1999, upon notice as provided below, prepay at any time all, or
from time to time any part of, the Notes, in an amount not less than $100,000 in
the case of a partial prepayment, at 100% of the principal amount so prepaid,
plus the Make-Whole Amount determined for the prepayment date with respect to
such principal amount. The Company will give each holder of Notes written notice
of each optional prepayment under this Section 8.2 not less than 30 days and not
more than 60 days prior to the date fixed for such prepayment. Each such notice
shall specify such date, the aggregate principal amount of the Notes to be
prepaid on such date, the principal amount of each Note held by such holder to
be prepaid (determined in accordance with Section 8.3), and the interest to be
paid on the prepayment date with respect to such principal amount being prepaid,
and shall be accompanied by a certificate of a Senior Financial Officer as to
the estimated Make-Whole Amount due in connection with such prepayment
(calculated as if the date of such notice were the date of the prepayment),
setting forth the details of such computation. Two Business Days prior to such
prepayment, the Company shall deliver to each
holder of Notes a certificate of a Senior Financial Officer specifying the
calculation of such Make-Whole Amount as of the specified prepayment date.
8.3 ALLOCATION OF PARTIAL PREPAYMENTS.
In the case of each partial prepayment of the Notes, the principal
amount of the Notes to be prepaid shall be allocated among all of the Notes at
the time outstanding in proportion, as nearly as practicable, to the respective
unpaid principal amounts thereof not theretofore called for prepayment.
8.4 MATURITY; SURRENDER, ETC.
In the case of each prepayment of Notes pursuant to this Section 8, the
principal amount of each Note to be prepaid shall mature and become due and
payable on the date fixed for such prepayment, together with interest on such
principal amount accrued to such date and the applicable Make-Whole Amount, if
any. From and after such date, unless the Company shall fail to pay such
principal amount when so due and payable, together with the interest and
Make-Whole Amount, if any, as aforesaid, interest on such principal amount shall
cease to accrue. Any Note paid or prepaid in full shall be surrendered to the
Company and canceled and shall not be reissued, and no Note shall be issued in
lieu of any prepaid principal amount of any Note.
8.5 PURCHASE OF NOTES.
The Company will not and will not permit any Affiliate to purchase,
redeem, prepay or otherwise acquire, directly or indirectly, any of the
outstanding Notes except upon the payment or prepayment of the Notes in
accordance with the terms of this Agreement and the Notes. The Company will
promptly cancel all Notes acquired by it or any Affiliate pursuant to any
payment, prepayment or purchase of Notes pursuant to any provision of this
Agreement and no Notes may be issued in substitution or exchange for any such
Notes.
8.6 MAKE-WHOLE AMOUNT.
The term "MAKE-WHOLE AMOUNT" means, with respect to any Note, an amount
equal to the excess, if any, of the Discounted Value of the Remaining Scheduled
Payments with respect to the Called Principal of such Note over the amount of
such Called Principal, PROVIDED that the Make-Whole Amount may in no event be
less than zero. For the purposes of determining the Make-Whole Amount, the
following terms have the following meanings:
"CALLED PRINCIPAL" means, with respect to any Note, the principal of
such Note that is to be prepaid pursuant to Section 8.2 or has become or is
declared to be immediately due and payable pursuant to Section 12.1, as the
context requires.
"DISCOUNTED VALUE" means, with respect to the Called Principal of any
Note, the amount obtained by discounting all Remaining Scheduled Payments with
respect to such Called Principal from their respective scheduled due dates to
the Settlement Date with respect to such Called Principal, in accordance with
accepted financial practice and at a discount factor (applied on the
same periodic basis as that on which interest on the Notes is payable) equal to
the Reinvestment Yield with respect to such Called Principal.
"REINVESTMENT YIELD" means, with respect to the Called Principal of any
Note, 0.50% over the yield to maturity implied by (i) the yields, as of 10:00
A.M. (New York City time) on the second Business Day preceding the Settlement
Date with respect to such Called Principal, as reported by Bloomberg Financial
Markets on the display called "Page PX1" for actively traded U.S. Treasury
securities having a maturity equal to the Remaining Average Life of such Called
Principal as of such Settlement Date, or (ii) if such yields are not reported as
of such time or the yields reported as of such time are not ascertainable, the
Treasury Constant Maturity Series Yields reported, for the latest day for which
such yields have been so reported as of the second Business Day preceding the
Settlement Date with respect to such Called Principal, in Federal Reserve
Statistical Release H.15 (519) (or any comparable successor publication) for
actively traded U.S. Treasury securities having a constant maturity equal to the
Remaining Average Life of such Called Principal as of such Settlement Date. Such
implied yield will be determined, if necessary, by (a) converting U.S. Treasury
xxxx quotations to bond-equivalent yields in accordance with accepted financial
practice and (b) interpolating linearly between (1) the actively traded U.S.
Treasury security with the duration closest to and greater than the Remaining
Average Life and (2) the actively traded U.S. Treasury security with the
duration closest to and less than the Remaining Average Life.
"REMAINING AVERAGE LIFE" means, with respect to any Called Principal,
the number of years (calculated to the nearest one-twelfth year) obtained by
dividing (i) such Called Principal into (ii) the sum of the products obtained by
multiplying (a) the principal component of each Remaining Scheduled Payment with
respect to such Called Principal by (b) the number of years (calculated to the
nearest one-twelfth year) that will elapse between the Settlement Date with
respect to such Called Principal and the scheduled due date of such Remaining
Scheduled Payment.
"REMAINING SCHEDULED PAYMENTS" means, with respect to the Called
Principal of any Note, all payments of such Called Principal and interest
thereon that would be due after the Settlement Date with respect to such Called
Principal if no payment of such Called Principal were made prior to its
scheduled due date, PROVIDED that if such Settlement Date is not a date on which
interest payments are due to be made under the terms of the Notes, then the
amount of the next succeeding scheduled interest payment will be reduced by the
amount of interest accrued to such Settlement Date and required to be paid on
such Settlement Date pursuant to Section 8.2 or 12.1.
"SETTLEMENT DATE" means, with respect to the Called Principal of any
Note, the date on which such Called Principal is to be prepaid pursuant to
Section 8.2 or has become or is declared to be immediately due and payable
pursuant to Section 12.1, as the context requires.
9. AFFIRMATIVE COVENANTS.
The Company covenants that so long as any of the Notes are outstanding:
9.1 COMPLIANCE WITH LAW.
The Company will and will cause each of its Subsidiaries to comply with
all laws, ordinances or governmental rules or regulations to which each of them
is subject, including, without limitation, Environmental Laws, and will obtain
and maintain in effect all licenses, certificates, permits, franchises and other
governmental authorizations necessary to the ownership of their respective
properties or to the conduct of their respective businesses, in each case to the
extent necessary to ensure that non-compliance with such laws, ordinances or
governmental rules or regulations or failures to obtain or maintain in effect
such licenses, certificates, permits, franchises and other governmental
authorizations could not, individually or in the aggregate, reasonably be
expected to have a Material Adverse Effect.
9.2 INSURANCE.
The Company will and will cause each of its Subsidiaries to maintain,
with financially sound and reputable insurers, insurance with respect to their
respective properties and businesses against such casualties and contingencies,
of such types, on such terms and in such amounts (including deductibles,
co-insurance and self-insurance, if adequate reserves are maintained with
respect thereto) as is customary in the case of entities of established
reputations engaged in the same or a similar business and similarly situated.
9.3 MAINTENANCE OF PROPERTIES.
The Company will and will cause each of its Subsidiaries to maintain
and keep, or cause to be maintained and kept, their respective properties in
good repair, working order and condition (other than ordinary wear and tear), so
that the business carried on in connection therewith may be properly conducted
at all times, PROVIDED that this Section shall not prevent the Company or any
Subsidiary from discontinuing the operation and the maintenance of any of its
properties if such discontinuance is desirable in the conduct of its business
and the Company has concluded that such discontinuance could not, individually
or in the aggregate, reasonably be expected to have a Material Adverse Effect.
9.4 PAYMENT OF TAXES AND CLAIMS.
The Company will and will cause each of its Subsidiaries to file all
tax returns required to be filed in any jurisdiction and to pay and discharge
all taxes shown to be due and payable on such returns and all other taxes,
assessments, governmental charges, or levies imposed on them or any of their
properties, assets, income or franchises, to the extent such taxes and
assessments have become due and payable and before they have become delinquent
and all claims for which sums have become due and payable that have or might
become a Lien on properties or assets of the Company or any Subsidiary, PROVIDED
that neither the Company nor any Subsidiary need pay any such tax or assessment
or claims if (i) the amount, applicability or validity thereof is contested by
the Company or such Subsidiary on a timely basis in good faith and in
appropriate proceedings, and the Company or a Subsidiary has established
adequate reserves therefor in accordance with GAAP on the books of the Company
or such Subsidiary or (ii) the nonpayment of all such taxes and assessments in
the aggregate could not reasonably be expected to have a
Material Adverse Effect.
9.5 CORPORATE EXISTENCE, ETC.
The Company will at all times preserve and keep in full force and
effect its corporate existence. Subject to Section 10.3, the Company will at all
times preserve and keep in full force and effect the corporate existence of each
of its Subsidiaries (unless merged into the Company or a Subsidiary) and all
rights and franchises of the Company and its Subsidiaries unless, in the good
faith judgment of the Company, the termination of or failure to preserve and
keep in full force and effect such corporate existence, right or franchise could
not, individually or in the aggregate, have a Material Adverse Effect.
9.6 FIXED CHARGES RATIO.
The Company will maintain, as of the end of each fiscal quarter of the
Company, Consolidated Net Income Available for Fixed Charges for the immediately
preceding twelve months at least equal to 300% of Consolidated Fixed Charges for
such twelve month period.
9.7 MINIMUM CURRENT RATIO.
The Company will at all times maintain a ratio of Consolidated Current
Assets to Consolidated Current Liabilities of at least 1.75 to 1.0.
10. NEGATIVE COVENANTS.
The Company covenants that so long as any of the Notes are outstanding:
10.1 TRANSACTIONS WITH AFFILIATES.
The Company will not and will not permit any Subsidiary to enter into
directly or indirectly any transaction or Material group of related transactions
(including without limitation the purchase, lease, sale or exchange of
properties of any kind or the rendering of any service) with any Affiliate
(other than the Company or another Subsidiary), except in the ordinary course
and pursuant to the reasonable requirements of the Company's or such
Subsidiary's business and upon fair and reasonable terms no less favorable to
the Company or such Subsidiary than would be obtainable in a comparable
arm's-length transaction with a Person not an Affiliate.
10.2 NATURE OF BUSINESS.
The Company will not and will not permit any Subsidiary to engage in
any business if, as a result, the general nature of the business, taken on a
consolidated basis, which would then be engaged in by the Company and its
Subsidiaries taken as a whole would be substantially changed from the general
nature of the business engaged in by the Company and its Subsidiaries taken as a
whole on the date of this Agreement, except as allowed by Section 10.3.
10.3 MERGER, CONSOLIDATION AND SALES OF ASSETS
The Company and its Subsidiaries will not consolidate with or be a
party to a merger with any Person or sell, lease, transfer or otherwise dispose
of all or any Substantial Part of the assets of the Company and its
Subsidiaries; provided, however, that:
(a) any Subsidiary may merge or consolidate with or into the
Company or any Wholly-Owned Subsidiary so long as for any such merger
or consolidation involving the Company, the Company shall be the
surviving and continuing corporation;
(b) the Company may merge with any other corporation if (i) the
Company shall be the surviving corporation or, if the Company shall
not be the surviving corporation, the surviving corporation is
organized under the laws of the United States and shall assume in
writing all obligations of the Company under this Agreement and the
Notes, and there shall have been delivered to the holders of the Notes
an opinion of independent counsel to such corporation to the effect
that such assumption has been duly authorized by all necessary
corporate action and is valid, binding and enforceable in accordance
with its terms, and (ii) at the time of such merger and after giving
effect thereto, no Default or Event of Default shall have occurred and
be continuing and the surviving corporation would be permitted to
incur at least $1 of additional Funded Indebtedness under Section 10.5
hereof; and
(c) any Subsidiary may sell, lease, transfer or otherwise dispose
of all or any part of its assets to the Company or any Wholly-Owned
Subsidiary.
As used in this Section 10.3, a sale or other disposition will be deemed to
involve a "Substantial Part" of the assets of the Company and its Subsidiaries
if the aggregate book value of all such assets sold during any fiscal year
exceeds 10% of Consolidated Total Assets determined at the close of the
immediately preceding fiscal year. Excluded from the computation of "Substantial
Part" is (i) any sale of inventory or rental equipment, as classified under
GAAP, in the ordinary course of business and (ii) any sale of equipment that the
Company determines in good faith is obsolete, worn-out or no longer useful in
the conduct of the business of the Company and its Subsidiaries.
10.4 LIMITATION ON INVESTMENTS.
The Company will not and will not permit any Subsidiary to, make any
Investment other than:
(a) Investments in property to be used in the ordinary course of
business of the Company and its Subsidiaries;
(b) current assets arising from the sale of goods and services in
the ordinary course of business of the Company and its Subsidiaries;
(c) Investments existing on the date hereof in Subsidiaries;
(d) Investments in direct obligations of the United States
government
maturing within three years from the date of issue thereof and
repurchase agreements of commercial banks having capital stock and
surplus aggregating not less than $100,000,000 to repurchase any such
obligations within 90 days of the acquisition thereof;
(e) certificates of deposit or banker's acceptances maturing
within one year from the date of issue thereof issued by banks having
capital and surplus aggregating not less than $100,000,000;
(f) commercial paper rated A-1 or P-1 or better by recognized
rating services and which matures not more than 270 days after the
date of creation thereof;
(g) Investments in tax-exempt obligation of any state of the
United States of America, or any municipality of any such state, in
each case rated "AA" or better by S&P, "AA2" or better by Xxxxx'x or
an equivalent rating by any other credit rating agency of recognized
national standing, provided that such obligations mature within three
years from the date of acquisition thereof; and
(h) Investments not otherwise permitted by paragraphs (a) through
(g) hereof; provided that the aggregate amount of all such Investments
at any time outstanding does not exceed 15% of Consolidated Net Worth.
10.5 LIMITATION ON FUNDED INDEBTEDNESS.
The Company will not and will not permit any Subsidiary to create,
assume, incur or suffer to exist, or in any manner be or become liable in
respect of any Funded Indebtedness, except:
(a) Funded Indebtedness evidenced by the Notes;
(b) other Funded Indebtedness of the Company and any Subsidiary
existing at the date of the Closing and set forth on Schedule 5.15
hereto, provided such Funded Indebtedness is paid or prepaid in
accordance with its terms; and
(c) additional Funded Indebtedness of the Company and its
Subsidiaries incurred after the date of the Closing; provided that
Consolidated Funded Indebtedness shall at no time exceed 30% of
Consolidated Total Capitalization.
10.6 LIMITATION ON SUBSIDIARY INDEBTEDNESS.
The Company will not at any time permit any Subsidiary to, directly or
indirectly, create, incur, assume, guarantee, have outstanding, or otherwise
become or remain directly or indirectly liable with respect to any Indebtedness
other than:
(a) Indebtedness of Subsidiaries existing at the date of the
Closing and set forth on Schedule 5.15 hereto, and any extension,
renewal or refunding thereof, provided
that the principal amount thereof is not increased;
(b) Indebtedness of a Subsidiary owed to the Company or a
Wholly-Owned Subsidiary; and
(c) Indebtedness of Subsidiaries in addition to that otherwise
permitted by paragraphs (a) and (b), provided that the sum of (i) the
aggregate outstanding principal amount of all Indebtedness incurred
pursuant to this paragraph (c), plus (ii) the aggregate outstanding
principal amount of all Indebtedness permitted by paragraph (a) of
this Section 10.6, plus (iii) the aggregate outstanding principal
amount of all other Indebtedness secured by Liens permitted by
paragraphs (d), (e), (g) and (h) of Section 10.7 shall not at any time
exceed 10% of Consolidated Total Capitalization.
10.7 LIMITATION ON LIENS.
The Company will not and will not permit any Subsidiary to create or
incur, or suffer to be incurred or to exist, any Lien on its or their property
or assets, including any capital stock of any Subsidiary, whether now owned or
hereafter acquired, or upon any income or profits therefrom, or transfer any
property for the purpose of subjecting the same to the payments of obligations
in priority to the payment of its or their general creditors, or acquire or
agree to acquire, or permit any Subsidiary to acquire, any property or assets
upon conditional sales agreements or other title retention devices, unless the
Notes are equally and ratably secured except:
(a) Liens for taxes and assessments or other governmental charges
or levies not yet due or which are being contested in good faith by
appropriate proceedings promptly initiated and diligently conducted in
accordance with Section 9.4 hereof, provided that payment thereof is
not at the time required by Section 9.4 hereof;
(b) Liens of or resulting from any judgment or award, the time
for the appeal or petition for rehearing of which shall not have
expired, or in respect of which the Company or a Subsidiary shall at
any time in good faith be prosecuting an appeal or a proceeding for a
review shall have been secured, provided that payment thereof is not
at the time required by Section 9.4 hereof;
(c) Liens incidental to the normal conduct of the business or the
ownership of properties and assets of the Company or any Subsidiary
(including Liens in connection with worker's compensation,
unemployment insurance, old age pensions, other social security
benefits or obligations and other like laws, warehousemen's,
mechanics', materialmen's and attorney's liens and statutory
landlord's liens) and Liens to secure statutory obligations, surety,
penalty or appeal bonds or other Liens of like general nature incurred
in the ordinary course of business and not in connection with the
incurrence of Indebtedness and which do not in the aggregate
materially impair the use of such property or assets in the operation
of the business of the Company, and the Company and its Subsidiaries
taken as a whole, or the value of such property or assets for the
purposes of
such business; provided in each case, the obligation secured is not
overdue (or, with respect to warehousemen's, mechanics' and
materialmen's lien, not overdue for a period longer than 30 days), or
if so overdue, is being contested in good faith by appropriate actions
or proceedings;
(d) Liens existing at the date of the Closing and set forth on
Schedule 5.15 hereto;
(e) any Lien renewing, extending or refunding any Lien permitted
by paragraph (d) of this Section 10.7, PROVIDED that (i) the principal
amount of Indebtedness secured by such Lien immediately prior to such
extension, renewal or refunding is not increased or the maturity
thereof reduced, (ii) such Lien is not extended to any other property,
and (iii) immediately after such extension, renewal or refunding no
Default or Event of Default would exist;
(f) Liens on property or assets of any Subsidiary securing
Indebtedness owing to the Company or to any of its Wholly-Owned
Subsidiaries;
(g) (i) any Lien in property (other than the land and
improvements comprising the Company's office building located at 0000
Xxxx 00xx Xxxxxx, Xxxxx, Xxxxxxxxx 55435) or in rights relating thereto
to secure any rights granted with respect to such property in
connection with the provision of all or a part of the purchase price or
cost of the construction of such property created contemporaneously
with, or within 180 days after, such acquisition or the completion of
such construction, or (ii) any Lien in property existing in such
property at the time of acquisition thereof, whether or not the
Indebtedness secured thereby is assumed by the Company or such
Subsidiary, or (iii) any Lien existing in the property of a corporation
at the time such corporation is merged into or consolidated with the
Company or a Subsidiary or at the time of a sale, lease or other
disposition of the properties of a corporation or firm as an entirety
or substantially as an entirety to the Company or a Subsidiary;
provided, however, that the Indebtedness secured by any Lien permitted
by this paragraph (g) shall not in the aggregate exceed 100% of the
fair market value of the related property; and
(h) Liens in addition to those permitted by paragraphs (a)
through (g) of this Section 10.7, provided that (A) the aggregate
principal amount of all Indebtedness permitted by this paragraph (h)
shall at no time exceed 10% of Consolidated Net Worth, and (B) the sum
of (i) the aggregate principal amount of all Indebtedness secured by
Liens permitted by this paragraph (h), PLUS (ii) the aggregate
principal amount of Indebtedness secured by Liens permitted by
paragraphs (d), (e), and (g) of this Section 10.7, PLUS (iii) the
aggregate amount of all Indebtedness of Subsidiaries permitted by
paragraphs (a) and (c) of Section 10.6 shall at no time exceed 10% of
Consolidated Total Capitalization.
10.8 CONSOLIDATED NET WORTH.
The Company will not permit Consolidated Net Worth to be an amount less
than the sum of (a) $74,261,100 plus (b) 50% of its cumulative Consolidated Net
Income, but, in each case, only if Consolidated Net Income is a positive number,
for each completed fiscal quarter beginning with the fiscal quarter ended
December 31, 1998.
10.9 RESTRICTED PAYMENTS.
The Company will not declare or pay in any fiscal year, dividends in
cash or property (other than dividends consisting of capital stock of the
Company or options, warrants and rights to acquire such capital stock), or
directly or indirectly purchase, redeem or otherwise retire, any shares of any
class of its capital stock (herein collectively called "Restricted Payments") if
immediately after giving effect thereto:
(a) The aggregate amount of such dividends, purchases or
redemptions made after the Closing Date would be greater than the sum
of (i) $10,000,000, PLUS (ii) 75% of cumulative Consolidated Net
Income earned after September 30, 1998, PLUS (iii) the aggregate net
cash proceeds to the Company from the issuance of capital stock after
September 30, 1998; or
(b) A Default or Event of Default would exist.
Notwithstanding the foregoing, the Company may (i) redeem fractional shares and
(ii) pay dividends within 60 days of declaration of such dividends so long as
the payment of such dividends would have been permitted at the time of
declaration.
10.10 RESTRICTIONS ON ISSUANCE AND SALE OF SUBSIDIARY STOCK.
The Company will not (i) permit any Subsidiary to issue or sell any
shares of its capital stock of any class to any other Person other than the
Company, or (ii) sell, transfer or otherwise dispose of any shares of capital
stock of any class of any Subsidiary, or permit any Subsidiary to sell, transfer
or otherwise dispose of any shares of the capital stock of any other Subsidiary;
provided, however, that the Company or any Subsidiary may sell, transfer or
dispose of shares of the stock of any Subsidiary subject to the limitations of
Section 10.3.
10.11 SALE AND LEASE BACK.
The Company will not, and will not permit any Subsidiary to enter into
any arrangement with any bank, insurance company or other lender or investor or
to which such lender or investor is a party providing for the leasing by the
Company or any Subsidiary of real or personal property which has been or is to
be sold or transferred by the Company or any Subsidiary to such lender or
investor or to any person to whom funds have been or are to be advanced by such
lender or investor on the security of such property or rental obligations of the
Company or any Subsidiary, unless: (i) the total market value of such sold or
transferred property is less than or equal to $1,500,000, or (ii) the sale
proceeds are at least
equal to fair market value of such sold or transferred property and are applied
to the acquisition of assets or the prepayment of the Notes and other Funded
Indebtedness of the Company then outstanding, pro rata, based upon the
outstanding principal amount thereof.
10.12 SUBORDINATION OF CLAIMS.
The Company will not, and will not permit any Subsidiary to subordinate
or permit to be subordinated any claim against, or obligation of, another Person
held or owned by the Company or any of its Subsidiaries to any other claim
against, or obligation of, such other Person.
10.13 SALE OF ACCOUNTS.
The Company will not, and will not permit any Subsidiary to, (i) sell
with recourse, (ii) discount or otherwise sell for less than 100% of the face
value thereof, or (iii) grant any Lien on, any notes receivable or accounts
receivable.
11. EVENTS OF DEFAULT.
An "EVENT OF DEFAULT" shall exist if any of the following conditions or
events shall occur and be continuing:
(a) the Company defaults in the payment of any principal or
Make-Whole Amount, if any, on any Note when the same becomes due and
payable, whether at maturity or at a date fixed for prepayment or by
declaration or otherwise; or
(b) the Company defaults in the payment of any interest on any
Note for more than five days after the same becomes due and payable;
or
(c) the Company defaults in the performance of or compliance with
any term contained in Article 7, Section 9.6 or 9.7, or Article 10; or
(d) the Company defaults in the performance of or compliance with
any term contained herein (other than those referred to in paragraphs
(a), (b) and (c) of this Section 11) and such default is not remedied
within 30 days after the earlier of (i) a Responsible Officer
obtaining actual knowledge of such default and (ii) the Company
receiving written notice of such default from any holder of a Note
(any such written notice to be identified as a "notice of default" and
to refer specifically to this paragraph (d) of Section 11); or
(e) any representation or warranty made in writing by or on
behalf of the Company or by any officer of the Company in this
Agreement or in any writing furnished in connection with the
transactions contemplated hereby proves to have been false or
incorrect in any material respect on the date as of which made; or
(f) (i) the Company or any Subsidiary is in default (as principal
or as guarantor or other surety) in the payment of any principal of or
premium or make-whole
amount or interest on any Indebtedness that is outstanding in an
aggregate principal amount of at least $500,000 beyond any period of
grace provided with respect thereto, or (ii) the Company or any
Subsidiary is in default in the performance of or compliance with any
term of any evidence of any Indebtedness in an aggregate outstanding
principal amount of at least $500,000 or of any mortgage, indenture or
other agreement relating thereto or any other condition exists, and as
a consequence of such default or condition such Indebtedness has
become, or has been declared (or one or more Persons are entitled to
declare such Indebtedness to be), due and payable before its stated
maturity or before its regularly scheduled dates of payment, or (iii)
as a consequence of the occurrence or continuation of any event or
condition (other than the passage of time or the right of the holder
of Indebtedness to convert such Indebtedness into equity interests),
(x) the Company or any Subsidiary has become obligated to purchase or
repay Indebtedness before its regular maturity or before its regularly
scheduled dates of payment in an aggregate outstanding principal
amount of at least $500,000 or (y) one or more Persons have the right
to require the Company or any Subsidiary so to purchase or repay such
Indebtedness; or
(g) the Company or any Subsidiary (i) is generally not paying,
or admits in writing its inability to pay, its debts as they become
due, (ii) files, or consents by answer or otherwise to the filing
against it of, a petition for relief or reorganization or arrangement
or any other petition in bankruptcy, for liquidation or to take
advantage of any bankruptcy, insolvency, reorganization, moratorium or
other similar law of any jurisdiction, (iii) makes an assignment for
the benefit of its creditors, (iv) consents to the appointment of a
custodian, receiver, trustee or other officer with similar powers with
respect to it or with respect to any substantial part of its property,
(v) is adjudicated as insolvent or to be liquidated, or (vi) takes
corporate action for the purpose of any of the foregoing; or
(h) a court or governmental authority of competent
jurisdiction enters an order appointing, without consent by the Company
or any of its Subsidiaries, a custodian, receiver, trustee or other
officer with similar powers with respect to it or with respect to any
substantial part of its property, or constituting an order for relief
or approving a petition for relief or reorganization or any other
petition in bankruptcy or for liquidation or to take advantage of any
bankruptcy or insolvency law of any jurisdiction, or ordering the
dissolution, winding-up or liquidation of the Company or any of its
Subsidiaries, or any such petition shall be filed against the Company
or any of its Subsidiaries and such petition shall not be dismissed
within 60 days; or
(i) a final judgment or judgments for the payment of money
aggregating in excess of $500,000 are rendered against one or more of
the Company and its Subsidiaries and which judgments are not, within
30 days after entry thereof, bonded, discharged or stayed pending
appeal, or are not discharged within 30 days after the expiration of
such stay; or
(j) if (i) any Plan shall fail to satisfy the minimum funding
standards of
ERISA or the Code for any plan year or part thereof or a waiver of
such standards or extension of any amortization period is sought or
granted under section 412 of the Code, (ii) a notice of intent to
terminate any Plan shall have been or is reasonably expected to be
filed with the PBGC or the PBGC shall have instituted proceedings
under ERISA section 4042 to terminate or appoint a trustee to
administer any Plan or the PBGC shall have notified the Company or any
ERISA Affiliate that a Plan may become a subject of any such
proceedings, (iii) the aggregate "amount of unfunded benefit
liabilities" (within the meaning of section 4001(a)(18) of ERISA)
under all Plans, determined in accordance with Title IV of ERISA,
shall exceed $500,000, (vi) the Company or any ERISA Affiliate shall
have incurred or is reasonably expected to incur any liability
pursuant to Title I or IV of ERISA or the penalty or excise tax
provisions of the Code relating to employee benefit plans, (v) the
Company or any ERISA Affiliate withdraws from any Multiemployer Plan,
or (vi) the Company or any Subsidiary establishes or amends any
employee welfare benefit plan that provides post-employment welfare
benefits in a manner that would increase the liability of the Company
or any Subsidiary thereunder; and any such event or events described
in clauses (i) through (vi) above, either individually or together
with any other such event or events, could reasonably be expected to
have a Material Adverse Effect;
As used in Section 11(j), the terms "EMPLOYEE BENEFIT PLAN" and
"EMPLOYEE WELFARE BENEFIT PLAN" shall have the respective meanings assigned to
such terms in Section 3 of ERISA.
12. REMEDIES ON DEFAULT, ETC.
12.1 ACCELERATION.
(a) If an Event of Default with respect to the Company described
in paragraph (g) or (h) of Section 11 (other than an Event of Default
described in clause (i) of paragraph (g) or described in clause (vi)
of paragraph (g) by virtue of the fact that such clause encompasses
clause (i) of paragraph (g)) has occurred, all the Notes then
outstanding shall automatically become immediately due and payable.
(b) If any other Event of Default has occurred and is continuing,
any holder or holders of more than 50% in principal amount of the
Notes at the time outstanding may at any time at its or their option,
by notice or notices to the Company, declare all the Notes then
outstanding to be immediately due and payable.
(c) If any Event of Default described in paragraph (a) or (b) of
Section 11 has occurred and is continuing, any holder or holders of
Notes at the time outstanding affected by such Event of Default may at
any time, at its or their option, by notice or notices to the Company,
declare all the Notes held by it or them to be immediately due and
payable.
Upon any Notes becoming due and payable under this Section 12.1,
whether automatically or by declaration, such Notes will forthwith mature and
the entire unpaid principal
amount of such Notes, plus (x) all accrued and unpaid interest thereon and (y)
the Make-Whole Amount determined in respect of such principal amount (to the
full extent permitted by applicable law), shall all be immediately due and
payable, in each and every case without presentment, demand, protest or further
notice, all of which are hereby waived. The Company acknowledges, and the
parties hereto agree, that each holder of a Note has the right to maintain its
investment in the Notes free from repayment by the Company (except as herein
specifically provided for) and that the provision for payment of a Make-Whole
Amount by the Company in the event that the Notes are prepaid or are accelerated
as a result of an Event of Default, is intended to provide compensation for the
deprivation of such right under such circumstances.
12.2 OTHER REMEDIES.
If any Default or Event of Default has occurred and is continuing, and
irrespective of whether any Notes have become or have been declared immediately
due and payable under Section 12.1, the holder of any Note at the time
outstanding may proceed to protect and enforce the rights of such holder by an
action at law, suit in equity or other appropriate proceeding, whether for the
specific performance of any agreement contained herein or in any Note, or for an
injunction against a violation of any of the terms hereof or thereof, or in aid
of the exercise of any power granted hereby or thereby or by law or otherwise.
12.3 RESCISSION.
At any time after any Notes have been declared due and payable pursuant
to clause (b) or (c) of Section 12.1, the holders of not less than 51% in
principal amount of the Notes then outstanding, by written notice to the
Company, may rescind and annul any such declaration and its consequences if (a)
the Company has paid all overdue interest on the Notes, all principal of and
Make-Whole Amount, if any, on any Notes that are due and payable and are unpaid
other than by reason of such declaration, and all interest on such overdue
principal and Make-Whole Amount, if any, and (to the extent permitted by
applicable law) any overdue interest in respect of the Notes, at the Default
Rate, (b) all Events of Default and Defaults, other than non-payment of amounts
that have become due solely by reason of such declaration, have been cured or
have been waived pursuant to Section 17, and (c) no judgment or decree has been
entered for the payment of any monies due pursuant hereto or to the Notes. No
rescission and annulment under this Section 12.3 will extend to or affect any
subsequent Event of Default or Default or impair any right consequent thereon.
12.4 NO WAIVERS OR ELECTION OF REMEDIES, EXPENSES, ETC.
No course of dealing and no delay on the part of any holder of any Note in
exercising any right, power or remedy shall operate as a waiver thereof or
otherwise prejudice such holder's rights, powers or remedies. No right, power or
remedy conferred by this Agreement or by any Note upon any holder thereof shall
be exclusive of any other right, power or remedy referred to herein or therein
or now or hereafter available at law, in equity, by statute or otherwise.
Without limiting the obligations of the Company under Section 15, the Company
will pay to the holder of each Note on demand such further amount as shall be
sufficient to cover all costs and expenses of such holder incurred in any
enforcement or collection under this Section 12, including, without
limitation, reasonable attorneys' fees, expenses and disbursements.
13. REGISTRATION; EXCHANGE; SUBSTITUTION OF NOTES.
13.1 REGISTRATION OF NOTES.
The Company shall keep at its principal executive office a register for the
registration and registration of transfers of Notes. The name and address of
each holder of one or more Notes, each transfer thereof and the name and address
of each transferee of one or more Notes shall be registered in such register.
Prior to due presentment for registration of transfer, the Person in whose name
any Note shall be registered shall be deemed and treated as the owner and holder
thereof for all purposes hereof, and the Company shall not be affected by any
notice or knowledge to the contrary. The Company shall give to any holder of a
Note that is an Institutional Investor promptly upon request therefor, a
complete and correct copy of the names and addresses of all registered holders
of Notes.
13.2 TRANSFER AND EXCHANGE OF NOTES.
Upon surrender of any Note at the principal executive office of the
Company for registration of transfer or exchange (and in the case of a surrender
for registration of transfer, duly endorsed or accompanied by a written
instrument of transfer duly executed by the registered holder of such Note or
his attorney duly authorized in writing and accompanied by the address for
notices of each transferee of such Note or part thereof), the Company shall
execute and deliver, at the Company's expense (except as provided below), one or
more new Notes (as requested by the holder thereof) in exchange therefor, in an
aggregate principal amount equal to the unpaid principal amount of the
surrendered Note. Each such new Note shall be payable to such Person as such
holder may request and shall be substantially in the form of Exhibit 1. Each
such new Note shall be dated and bear interest from the date to which interest
shall have been paid on the surrendered Note or dated the date of the
surrendered Note if no interest shall have been paid thereon. The Company may
require payment of a sum sufficient to cover any stamp tax or governmental
charge imposed in respect of any such transfer of Notes. Notes shall not be
transferred in denominations of less than $100,000, PROVIDED that if necessary
to enable the registration of transfer by a holder of its entire holding of
Notes, one Note may be in a denomination of less than $100,000. Any transferee,
by its acceptance of a Note registered in its name (or the name of its nominee),
shall be deemed to have made the representation set forth in Section 6.2.
13.3 REPLACEMENT OF NOTES.
Upon receipt by the Company of evidence reasonably satisfactory to it
of the ownership of and the loss, theft, destruction or mutilation of any Note
(which evidence shall be, in the case of an Institutional Investor, notice from
such Institutional Investor of such ownership and such loss, theft, destruction
or mutilation), and
(a) in the case of loss, theft or destruction, of indemnity
reasonably
satisfactory to it (provided that if the holder of such Note is, or is
a nominee for, an original Purchaser or another holder of a Note with
a minimum net worth of at least $50,000,000, such Person's own
unsecured agreement of indemnity shall be deemed to be satisfactory),
or
(b) in the case of mutilation, upon surrender and cancellation
thereof,
the Company at its own expense shall execute and deliver, in lieu thereof, a new
Note, dated and bearing interest from the date to which interest shall have been
paid on such lost, stolen, destroyed or mutilated Note or dated the date of such
lost, stolen, destroyed or mutilated Note if no interest shall have been paid
thereon.
14. PAYMENTS ON NOTES.
14.1 PLACE OF PAYMENT.
Subject to Section 14.2, payments of principal, Make-Whole Amount, if
any, and interest becoming due and payable on the Notes shall be made at the
principal office of the Company.
14.2 HOME OFFICE PAYMENT.
So long as you or your nominee shall be the holder of any Note, and
notwithstanding anything contained in Section 14.1 or in such Note to the
contrary, the Company will pay all sums becoming due on such Note for principal,
Make-Whole Amount, if any, and interest by the method and at the address
specified for such purpose below your name in Schedule A, or by such other
method or at such other address as you shall have from time to time specified to
the Company in writing for such purpose, without the presentation or surrender
of such Note or the making of any notation thereon, except that upon written
request of the Company made concurrently with or reasonably promptly after
payment or prepayment in full of any Note, you shall surrender such Note for
cancellation, reasonably promptly after any such request, to the Company at its
principal executive office or at the place of payment most recently designated
by the Company pursuant to Section 14.1. Prior to any sale or other disposition
of any Note held by you or your nominee you will, at your election, either
endorse thereon the amount of principal paid thereon and the last date to which
interest has been paid thereon or surrender such Note to the Company in exchange
for a new Note or Notes pursuant to Section 13.2. The Company will afford the
benefits of this Section 14.2 to any Institutional Investor that is the direct
or indirect transferee of any Note purchased by you under this Agreement and
that has made the same agreement relating to such Note as you have made in this
Section 14.2.
15. EXPENSES, ETC.
15.1 TRANSACTION EXPENSES.
Whether or not the transactions contemplated hereby are consummated,
the Company will pay all costs and expenses (including reasonable attorneys'
fees of a special counsel and, if
reasonably required, local or other counsel, rating fees payable to the NAIC,
and expenses incurred in obtaining a private placement number for the Notes)
incurred by you and each other holder of a Note in connection with such
transactions and in connection with any amendments, waivers or consents under or
in respect of this Agreement or the Notes (whether or not such amendment, waiver
or consent becomes effective), including, without limitation: (a) the costs and
expenses incurred in enforcing or defending (or determining whether or how to
enforce or defend) any rights under this Agreement or the Notes or in responding
to any subpoena or other legal process or informal investigative demand issued
in connection with this Agreement or the Notes, or by reason of being a holder
of any Note, and (b) the costs and expenses, including financial advisors' fees,
incurred in connection with the insolvency or bankruptcy of the Company or any
Subsidiary or in connection with any work-out or restructuring of the
transactions contemplated hereby and by the Notes. The Company will pay, and
will save you and each other holder of a Note harmless from, all claims in
respect of any fees, costs or expenses if any, of brokers and finders (other
than those retained by you).
15.2 SURVIVAL.
The obligations of the Company under this Section 15 will survive the
payment or transfer of any Note, the enforcement, amendment or waiver of any
provision of this Agreement or the Notes, and the termination of this Agreement.
16. SURVIVAL OF REPRESENTATIONS AND WARRANTIES; ENTIRE AGREEMENT.
All representations and warranties contained herein shall survive the
execution and delivery of this Agreement and the Notes, the purchase or transfer
by you of any Note or portion thereof or interest therein and the payment of any
Note, and may be relied upon by any subsequent holder of a Note, regardless of
any investigation made at any time by or on behalf of you or any other holder of
a Note. All statements contained in any certificate or other instrument
delivered by or on behalf of the Company pursuant to this Agreement shall be
deemed representations and warranties of the Company under this Agreement.
Subject to the preceding sentence, this Agreement and the Notes embody the
entire agreement and understanding between you and the Company and supersede all
prior agreements and understandings relating to the subject matter hereof.
17. AMENDMENT AND WAIVER.
17.1 REQUIREMENTS.
This Agreement and the Notes may be amended, and the observance of any
term hereof or of the Notes may be waived (either retroactively or
prospectively), with (and only with) the written consent of the Company and the
Required Holders, except that (a) no amendment or waiver of any of the
provisions of Section 1, 2, 3, 4, 5, 6 or 21 hereof, or any defined term (as it
is used therein), will be effective as to you unless consented to by you in
writing, and (b) no such amendment or waiver may, without the written consent of
the holder of each Note at the time
outstanding affected thereby, (i) subject to the provisions of Section 12
relating to acceleration or rescission, change the amount or time of any
prepayment or payment of principal of, or reduce the rate or change the time of
payment or method of computation of interest or of the Make-Whole Amount on, the
Notes, (ii) change the percentage of the principal amount of the Notes the
holders of which are required to consent to any such amendment or waiver, or
(iii) amend any of Sections 8, 11(a), 11(b), 12, 17 or 20.
17.2 SOLICITATION OF HOLDERS OF NOTES.
(a) SOLICITATION. The Company will provide each holder of the
Notes (irrespective of the amount of Notes then owned by it) with
sufficient information, sufficiently far in advance of the date a
decision is required, to enable such holder to make an informed and
considered decision with respect to any proposed amendment, waiver or
consent in respect of any of the provisions hereof or of the Notes.
The Company will deliver executed or true and correct copies of each
amendment, waiver or consent effected pursuant to the provisions of
this Section 17 to each holder of outstanding Notes promptly following
the date on which it is executed and delivered by, or receives the
consent or approval of, the requisite holders of Notes.
(b) PAYMENT. The Company will not directly or indirectly pay or
cause to be paid any remuneration, whether by way of supplemental or
additional interest, fee or otherwise, or grant any security, to any
holder of Notes as consideration for or as an inducement to the
entering into by any holder of Notes of any waiver or amendment of any
of the terms and provisions hereof unless such remuneration is
concurrently paid, or security is concurrently granted, on the same
terms, ratably to each holder of Notes then outstanding even if such
holder did not consent to such waiver or amendment.
17.3 BINDING EFFECT, ETC.
Any amendment or waiver consented to as provided in this Section 17 applies
equally to all holders of Notes and is binding upon them and upon each future
holder of any Note and upon the Company without regard to whether such Note has
been marked to indicate such amendment or waiver. No such amendment or waiver
will extend to or affect any obligation, covenant, agreement, Default or Event
of Default not expressly amended or waived or impair any right consequent
thereon. No course of dealing between the Company and the holder of any Note nor
any delay in exercising any rights hereunder or under any Note shall operate as
a waiver of any rights of any holder of such Note. As used herein, the term
"THIS AGREEMENT" and references thereto shall mean this Agreement as it may from
time to time be amended or supplemented.
17.4 NOTES HELD BY COMPANY, ETC.
Solely for the purpose of determining whether the holders of the
requisite percentage of the aggregate principal amount of Notes then outstanding
approved or consented to any amendment, waiver or consent to be given under this
Agreement or the Notes, or have directed the taking of any action provided
herein or in the Notes to be taken upon the direction of the holders of a
specified percentage of the aggregate principal amount of Notes then
outstanding,
Notes directly or indirectly owned by the Company or any of its Affiliates shall
be deemed not to be outstanding.
18. NOTICES.
All notices and communications provided for hereunder shall be in
writing and sent (a) by telecopy if the sender on the same day sends a
confirming copy of such notice by a recognized overnight delivery service
(charges prepaid), or (b) by registered or certified mail with return receipt
requested (postage prepaid), or (c) by a recognized overnight delivery service
(with charges prepaid). Any such notice must be sent:
(i) if to you or your nominee, to you or it at the
address specified for such communications in Schedule A, or
at such other address as you or it shall have specified to
the Company in writing,
(ii) if to any other holder of any Note, to such holder
at such address as such other holder shall have specified to
the Company in writing, or
(iii) if to the Company, to the Company at its address
set forth at the beginning hereof to the attention of Xxxxxx
X. XxXxxxx, or at such other address as the Company shall
have specified to the holder of each Note in writing.
Notices under this Section 18 will be deemed given only when actually
received.
19. REPRODUCTION OF DOCUMENTS.
This Agreement and all documents relating thereto, including, without
limitation, (a) consents, waivers and modifications that may hereafter be
executed, (b) documents received by you at the Closing (except the Notes
themselves), and (c) financial statements, certificates and other information
previously or hereafter furnished to you, may be reproduced by you by any
photographic, photostatic, microfilm, microcard, miniature photographic or other
similar process and you may destroy any original document so reproduced. The
Company agrees and stipulates that, to the extent permitted by applicable law,
any such reproduction shall be admissible in evidence as the original itself in
any judicial or administrative proceeding (whether or not the original is in
existence and whether or not such reproduction was made by you in the regular
course of business) and any enlargement, facsimile or further reproduction of
such reproduction shall likewise be admissible in evidence. This Section 19
shall not prohibit the Company or any other holder of Notes from contesting any
such reproduction to the same extent that it could contest the original, or from
introducing evidence to demonstrate the inaccuracy of any such reproduction.
20. CONFIDENTIAL INFORMATION.
For the purposes of this Section 20, "CONFIDENTIAL INFORMATION" means
information delivered to you by or on behalf of the Company or any Subsidiary in
connection with the
transactions contemplated by or otherwise pursuant to this Agreement that is
proprietary in nature and that was clearly marked or labeled or otherwise
adequately identified when received by you as being confidential information of
the Company or such Subsidiary, PROVIDED that such term does not include
information that (a) was publicly known or otherwise known to you prior to the
time of such disclosure, (b) subsequently becomes publicly known through no act
or omission by you or any person acting on your behalf, (c) otherwise becomes
known to you other than through disclosure by the Company or any Subsidiary or
(d) constitutes financial statements delivered to you under Section 7.1 that are
otherwise publicly available. You will maintain the confidentiality of such
Confidential Information in accordance with procedures adopted by you in good
faith to protect confidential information of third parties delivered to you,
PROVIDED that you may deliver or disclose Confidential Information to (i) your
directors, officers, employees, agents, attorneys and affiliates (to the extent
such disclosure reasonably relates to the administration of the investment
represented by your Notes), (ii) your financial advisors and other professional
advisors who agree to hold confidential the Confidential Information
substantially in accordance with the terms of this Section 20, (iii) any other
holder of any Note, (iv) any Institutional Investor to which you sell or offer
to sell such Note or any part thereof or any participation therein (if such
Person has agreed in writing prior to its receipt of such Confidential
Information to be bound by the provisions of this Section 20), (v) any Person
from which you offer to purchase any security of the Company (if such Person has
agreed in writing prior to its receipt of such Confidential Information to be
bound by the provisions of this Section 20), (vi) any federal or state
regulatory authority having jurisdiction over you, (vii) the National
Association of Insurance Commissioners or any similar organization, or any
nationally recognized rating agency that requires access to information about
your investment portfolio or (viii) any other Person to which such delivery or
disclosure may be necessary or appropriate (w) to effect compliance with any
law, rule, regulation or order applicable to you, (x) in response to any
subpoena or other legal process, (y) in connection with any litigation to which
you are a party or (z) if an Event of Default has occurred and is continuing, to
the extent you may reasonably determine such delivery and disclosure to be
necessary or appropriate in the enforcement or for the protection of the rights
and remedies under your Notes and this Agreement. Each holder of a Note, by its
acceptance of a Note, will be deemed to have agreed to be bound by and to be
entitled to the benefits of this Section 20 as though it were a party to this
Agreement. On reasonable request by the Company in connection with the delivery
to any holder of a Note of information required to be delivered to such holder
under this Agreement or requested by such holder (other than a holder that is a
party to this Agreement or its nominee), such holder will enter into an
agreement with the Company embodying the provisions of this Section 20.
21. SUBSTITUTION OF PURCHASER.
You shall have the right to substitute any one of your Affiliates as
the purchaser of the Notes that you have agreed to purchase hereunder, by
written notice to the Company, which notice shall be signed by both you and such
Affiliate, shall contain such Affiliate's agreement to be bound by this
Agreement and shall contain a confirmation by such Affiliate of the accuracy
with respect to it of the representations set forth in Section 6. Upon receipt
of such notice,
wherever the word "you" is used in this Agreement (other than in this Section
21), such word shall be deemed to refer to such Affiliate in lieu of you. In the
event that such Affiliate is so substituted as a purchaser hereunder and such
Affiliate thereafter transfers to you all of the Notes then held by such
Affiliate, upon receipt by the Company of notice of such transfer, wherever the
word "you" is used in this Agreement (other than in this Section 21), such word
shall no longer be deemed to refer to such Affiliate, but shall refer to you,
and you shall have all the rights of an original holder of the Notes under this
Agreement.
22. MISCELLANEOUS.
22.1 SUCCESSORS AND ASSIGNS.
All covenants and other agreements contained in this Agreement by or on
behalf of any of the parties hereto bind and inure to the benefit of their
respective successors and assigns (including, without limitation, any subsequent
holder of a Note) whether so expressed or not.
22.2 PAYMENTS DUE ON NON-BUSINESS DAYS.
Anything in this Agreement or the Notes to the contrary
notwithstanding, any payment of principal of or Make-whole Amount or interest on
any Note that is due on a date other than a Business Day shall be made on the
next succeeding Business Day without including the additional days elapsed in
the computation of the interest payable on such next succeeding Business Day.
22.3 SEVERABILITY.
Any provision of this Agreement that is prohibited or unenforceable in
any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of
such prohibition or unenforceability without invalidating the remaining
provisions hereof, and any such prohibition or unenforceability in any
jurisdiction shall (to the full extent permitted by law) not invalidate or
render unenforceable such provision in any other jurisdiction.
22.4 CONSTRUCTION.
Each covenant contained herein shall be construed (absent express
provision to the contrary) as being independent of each other covenant contained
herein, so that compliance with any one covenant shall not (absent such an
express contrary provision) be deemed to excuse compliance with any other
covenant. Where any provision herein refers to action to be taken by any Person,
or which such Person is prohibited from taking, such provision shall be
applicable whether such action is taken directly or indirectly by such Person.
22.5 COUNTERPARTS.
This Agreement may be executed in any number of counterparts, each of
which shall be an original but all of which together shall constitute one
instrument. Each counterpart may consist of a number of copies hereof, each
signed by less than all, but together signed by all, of
the parties hereto.
22.6 GOVERNING LAW.
This Agreement shall be construed and enforced in accordance with, and
the rights of the parties shall be governed by, the law of the State of
Minnesota excluding choice-of-law principles of the law of such State that would
require the application of the laws of a jurisdiction other than such State.
*****
If you are in agreement with the foregoing, please sign the form of
agreement on the accompanying counterpart of this Agreement and return it to the
Company, whereupon the foregoing shall become a binding agreement between you
and the Company.
Very truly yours,
ANALYSTS INTERNATIONAL CORPORATION
By
Its
The foregoing is hereby
agreed to as of the
date thereof.
GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY
By
Its
and
By
Its
NORTHERN LIFE INSURANCE COMPANY
By
Its
RELIASTAR LIFE INSURANCE COMPANY
By
Its
RELIASTAR UNITED SERVICES LIFE INSURANCE COMPANY
By
Its
SECURITY CONNECTICUT LIFE INSURANCE COMPANY
By
Its
SCHEDULE A
----------
INFORMATION RELATING TO PURCHASERS
Principal Amount of
Name and Address of Purchaser Notes to be Purchased
----------------------------- ---------------------
GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY $10,000,000
(1) Payments of Principal and Interest:
WIRE INSTRUCTIONS:
------------------
ABA #000-000-000
NW MPLS/TRUST CLEARING ACCT #00-00-000
GWLA HEALTH ACCOUNT #00000000
Special Instructions: 1) security description (PPN #)
2) allocation of payment between
principal and interest, and
3) confirmation of principal
balance
(2) Notice of such payments:
Norwest Bank Minnesota, N.A.
000 Xxxxxxxxx Xxxxxx, Xxxxxxxxx Xxxx., 0xx Xxxxx
Xxxxxxxxxxx, Xxxxxxxxx 00000-0000
Telecopier: (000) 000-0000
Attention: Income Collections
(3) All other communications:
Great-West Life & Annuity Insurance Company
0000 Xxxx Xxxxxxx Xxxx
0xx Xxxxx, Xxxxx 0
Xxxxxxxxx, Xxxxxxxx 00000
Attention: Corporate Finance Investments
Telecopier: (000) 000-0000
(4) Tax Identification Number:
00-0000000
A-
SCHEDULE A
----------
INFORMATION RELATING TO PURCHASERS
Principal Amount of
Name and Address of Purchaser Notes to be Purchased
----------------------------- ---------------------
NORTHERN LIFE INSURANCE COMPANY $3,000,000
(1) All payments by wire transfer of
immediately available funds to:
XX Xxxx X.X./Xxxx.
000 Xxxxxx Xxxxxx Xxxxx
Xxxx. #1602-3237-6105
Bank ABA #000000000
ATTN: Securities Accounting
Ref: Issuer, Cusip, Coupon & Maturity
(2) All notices of payments and written
confirmations of such wire transfers:
ReliaStar Investment Research, Inc.
000 Xxxxxxxxxx Xxxxxx Xxxxx, Xxxxx 000
Xxxxxxxxxxx, XX 00000-0000
ATTN: Private Placements
Tel # 000-000-0000
Fax # 000-000-0000
(3) All other communications:
ReliaStar Investment Research, Inc.
000 Xxxxxxxxxx Xxxxxx Xxxxx, Xxxxx 000
Xxxxxxxxxxx, XX 00000-0000
Attn: Private Placements
(4) Tax Identification Number:
00-0000000
A-
SCHEDULE A
----------
INFORMATION RELATING TO PURCHASERS
Principal Amount of
Name and Address of Purchaser Notes to be Purchased
----------------------------- ----------------------
RELIASTAR LIFE INSURANCE COMPANY $3,000,000
(1) All payments by wire transfer of
immediately available funds to:
XX Xxxx X.X./Xxxxxxxxxxx
000 Xxxxxx Xxxxxx Xxxxx, Xxxxxxxxxxx, XX
Bank ABA #000000000
Acct. Name: ReliaStar Life Insurance Company
Acct. #110240014461
ATTN: Securities Accounting
Ref: Issuer Name, PPN, Coupon,
Maturity and P & I Breakdown
(2) All notices of payments and written
confirmations of such wire transfers:
ReliaStar Investment Research, Inc.
000 Xxxxxxxxxx Xxxxxx Xxxxx, Xxxxx 000
Xxxxxxxxxxx, XX 00000-0000
ATTN: Private Placements
Tel # 000-000-0000
Fax # 000-000-0000
(3) All other communications:
ReliaStar Investment Research, Inc.
000 Xxxxxxxxxx Xxxxxx Xxxxx, Xxxxx 000
Xxxxxxxxxxx, XX 00000-0000
Attn: Private Placements
(4) Tax Identification Number:
00-0000000
A-
SCHEDULE A
----------
INFORMATION RELATING TO PURCHASERS
Principal Amount of
Name and Address of Purchaser Notes to be Purchased
----------------------------- ---------------------
RELIASTAR UNITED SERVICES LIFE INSURANCE COMPANY $2,000,000
(1) Register Note in the name of XXXXXXX & CO.
(2) All payments by wire transfer of immediately
available funds to:
Bankers Trust
New York, NY
ABA #000000000
A/C #99000739
FBO ReliaStar United Service Life Ins
Acct. 92574
Ref: Security Description, PPN # & P & I Breakdown
(3) Address for all notices relating to payments:
c/o ReliaStar Investment Research, Inc.
000 Xxxxxxxxxx Xxxxxx Xxxxx, Xxxxx 000
Xxxxxxxxxxx, XX 00000-0000
ATTN: Private Placements
Tel # 000-000-0000
Fax # 000-000-0000
(4) Address for all other communications and notices:
c/o ReliaStar Investment Research, Inc.
000 Xxxxxxxxxx Xxxxxx Xxxxx, Xxxxx 000
Xxxxxxxxxxx, XX 00000-0000
Attn: Private Placements
(5) Tax Identification Number:
00-0000000
A-
SCHEDULE A
----------
INFORMATION RELATING TO PURCHASERS
Principal Amount of
Name and Address of Purchaser Notes to be Purchased
----------------------------- ---------------------
SECURITY-CONNECTICUT LIFE INSURANCE COMPANY $2,000,000
(1) Register Note in the name of XXXXXX & CO.
(2) All payments by wire transfer of
immediately available funds to:
Chase Manhattan Bank
New York, NY
ABA #000000000
Beneficiary Acct. #544755102
Reference: Xxxxxx & Co. (Nominee Name)
Tax I.D. #00-0000000
F/C #G54426
Cusip #, Security Description and P & I Breakdown
(3) Correspondence Contact:
ReliaStar Investment Research, Inc.
000 Xxxxxxxxxx Xxxxxx Xxxxx, Xxxxx 000
Xxxxxxxxxxx, Xxxxxxxxx 00000-0000
Ref: (Analyst Name)
Tel #000-000-0000
Fax #000-000-0000
(4) Tax Identification Number:
00-0000000
A-
SCHEDULE B
----------
DEFINED TERMS
As used herein, the following terms have the respective meanings set
forth below or set forth in the Section hereof following such term:
"AFFILIATE" means, at any time, and with respect to any Person, (a) any
other Person that at such time directly or indirectly through one or more
intermediaries Controls, or is Controlled by, or is under common Control with,
such first Person, and (b) any Person beneficially owning or holding, directly
or indirectly, 5% or more of any class of voting or equity interests of the
Company or any Subsidiary or any corporation of which the Company and its
Subsidiaries beneficially own or hold, in the aggregate, directly or indirectly,
5% or more of any class of voting or equity interests. As used in this
definition, "CONTROL" means the possession, directly or indirectly, of the power
to direct or cause the direction of the management and policies of a Person,
whether through the ownership of voting securities, by contract or otherwise.
Unless the context otherwise clearly requires, any reference to an "Affiliate"
is a reference to an Affiliate of the Company.
"BUSINESS DAY" means (a) for the purposes of Section 8.6 only, any day
other than a Saturday, a Sunday or a day on which commercial banks in New York
City are required or authorized to be closed, and (b) for the purposes of any
other provision of this Agreement, any day other than a Saturday, a Sunday or a
day on which commercial banks in Minneapolis, Minnesota are required or
authorized to be closed.
"CAPITAL LEASE" means, at any time, a lease with respect to which the
lessee is required concurrently to recognize the acquisition of an asset and the
incurrence of a liability in accordance with GAAP.
"CLOSING" is defined in Section 3.
"CODE" means the Internal Revenue Code of 1986, as amended from time to
time, and the rules and regulations promulgated thereunder from time to time.
"COMPANY" means Analysts International Corporation, a Minnesota
corporation.
"CONFIDENTIAL INFORMATION" is defined in Section 20.
"CONSOLIDATED CURRENT ASSETS" shall mean, as of any date, the
consolidated current assets of the Company and its Subsidiaries determined in
accordance with GAAP.
"CONSOLIDATED CURRENT LIABILITIES" shall mean, as of any date,
consolidated current liabilities of the Company and its Subsidiaries (including
the current portion of Funded Indebtedness) determined in accordance with GAAP.
"CONSOLIDATED FIXED CHARGES" shall mean for any period, consolidated
interest expense (including capitalized interest and the interest component of
capitalized leases) for the period
B-1
plus actual rent payments under operating leases for such period.
"CONSOLIDATED FUNDED INDEBTEDNESS" means the aggregate outstanding
principal amount of all Funded Indebtedness of the Company and its Subsidiaries
determined on a consolidated basis in accordance with GAAP.
"CONSOLIDATED NET INCOME" means for any period the net income (or loss)
of the Company and its Subsidiaries for such period, as determined on a
consolidated basis in accordance with GAAP, after excluding (i) any equity
interest of the Company on the unremitted earnings of any corporation not a
Subsidiary; (ii) net income or loss of any Subsidiary for any period prior to
the date it became a Subsidiary; (iii) net income or loss of any corporation
(other than a Subsidiary) merged into or consolidated with the Company or a
Subsidiary for any period prior to the date of such merger or consolidation;
(iv) any net gain or loss (net of applicable tax effect) realized in the
disposition of capital assets other than in the ordinary course of business; (v)
extraordinary gains or losses; (vi) any net income resulting from any
reappraisal, revaluation or write-up of assets; (vii) proceeds of any property
insurance policy; and (viii) reversal of any contingency reserves not created
during the period
"CONSOLIDATED NET INCOME AVAILABLE FOR FIXED CHARGES" shall mean for
any period, the sum of (a) Consolidated Net Income for such period, PLUS (b)
provision for any applicable income taxes deducted in computing Consolidated Net
Income for such period, PLUS (c) Consolidated Fixed Charges for such period.
"CONSOLIDATED NET WORTH" means, at any time,
(a) the total assets of the Company and its Subsidiaries which
would be shown as assets on a consolidated balance sheet of the
Company and its Subsidiaries as of such time prepared in accordance
with GAAP, after eliminating all amounts properly attributable to
minority interests, if any, in the stock and surplus of Subsidiaries,
MINUS
(b) the total liabilities of the Company and its which would be
shown as liabilities on a consolidated balance sheet of the Company
and its Subsidiaries as of such time prepared in accordance with GAAP.
"CONSOLIDATED TOTAL ASSETS" means, at any time, the total assets of the
Company and its Subsidiaries which would be shown as assets on a consolidated
balance sheet of the Company and its Subsidiaries as of such time prepared in
accordance with GAAP, after eliminating all amounts properly attributable to
minority interests, if any, in the stock and surplus of Subsidiaries.
"CONSOLIDATED TOTAL CAPITALIZATION" means the sum of Consolidated
Funded Indebtedness, PLUS Consolidated Net Worth.
"DEFAULT" means an event or condition the occurrence or existence of
which would, with the lapse of time or the giving of notice or both, become an
Event of Default.
B-
"DEFAULT RATE" means that rate of interest that is the greater of (i)
2% per annum above the rate of interest stated in clause (a) of the first
paragraph of the Notes or (ii) 2% over the rate of interest publicly announced
by Norwest Bank Minnesota, National Association in Minneapolis, Minnesota as its
"base" or "prime" rate.
"ENVIRONMENTAL LAWS" means any and all Federal, state, local, and
foreign statutes, laws, regulations, ordinances, rules, judgments, orders,
decrees, permits, concessions, grants, franchises, licenses, agreements or
governmental restrictions relating to pollution and the protection of the
environment or the release of any materials into the environment, including but
not limited to those related to hazardous substances or wastes, air emissions
and discharges to waste or public systems.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended from time to time, and the rules and regulations promulgated thereunder
from time to time in effect.
"ERISA AFFILIATE" means any trade or business (whether or not
incorporated) that is treated as a single employer together with the Company
under Section 414 of the Code.
"EVENT OF DEFAULT" is defined in Section 11.
"EXCHANGE ACT" means the Securities Exchange Act of 1934, as amended.
"FUNDED INDEBTEDNESS" means, for any Person as of the date of
determination thereof, (i) Indebtedness of such Person (x) which matures more
than one year after the date of determination (including principal payments due
within one year of the date of determination on Indebtedness having a final
maturity more than one year from the date of determination), or (y) which is
directly or indirectly renewable or extendible at the option of the debtor to a
date more than one year from the date of determination; and (ii) Guaranties by
such Person of Funded Indebtedness of other Persons.
"GAAP" means generally accepted accounting principles as in effect from
time to time in the United States of America.
"GOVERNMENTAL AUTHORITY" means
(a) the government of
(i) the United States of America or any State or other political
subdivision thereof, or
(ii) any jurisdiction in which the Company or any Subsidiary
conducts all or any part of its business, or which asserts
jurisdiction over any properties of the Company or any Subsidiary, or
(b) any entity exercising executive, legislative, judicial,
regulatory or
administrative functions of, or pertaining to, any such government.
"GUARANTY" means, with respect to any Person, any obligation (except
the endorsement in the ordinary course of business of negotiable instruments for
deposit or collection) of such Person guaranteeing or in effect guaranteeing any
indebtedness, dividend or other obligation of any other Person in any manner,
whether directly or indirectly, including (without limitation) obligations
incurred through an agreement, contingent or otherwise, by such Person:
(a) to purchase such indebtedness or obligation or any property
constituting security therefor;
(b) to advance or supply funds (i) for the purchase or payment of
such indebtedness or obligation, or (ii) to maintain any working
capital or other balance sheet condition or any income statement
condition of any other Person or otherwise to advance or make
available funds for the purchase or payment of such indebtedness or
obligation;
(c) to lease properties or to purchase properties or services
primarily for the purpose of assuring the owner of such indebtedness
or obligation of the ability of any other Person to make payment of
the indebtedness or obligation; or
(d) otherwise to assure the owner of such indebtedness or
obligation against loss in respect thereof.
In any computation of the indebtedness or other liabilities of the
obligor under any Guaranty, the indebtedness or other obligations that are the
subject of such Guaranty shall be assumed to be direct obligations of such
obligor.
"HAZARDOUS MATERIAL" means any and all pollutants, toxic or hazardous
wastes or any other substances that might pose a hazard to health or safety, the
removal of which may be required or the generation, manufacture, refining,
production, processing, treatment, storage, handling, transportation, transfer,
use, disposal, release, discharge, spillage, seepage, or filtration of which is
or shall be restricted, prohibited or penalized by any applicable law
(including, without limitation, asbestos, urea formaldehyde foam insulation and
polychlorinated biphenyls).
"HOLDER" means, with respect to any Note, the Person in whose name such
Note is registered in the register maintained by the Company pursuant to Section
13.1.
"INDEBTEDNESS" with respect to any Person means, at any time,
without duplication,
(a) its liabilities for borrowed money and its redemption
obligations in respect of mandatorily redeemable Preferred Stock;
(b) its liabilities for the deferred purchase price of property
acquired by such Person (excluding accounts payable arising in the
ordinary course of business but including all liabilities created or
arising under any conditional sale or other title retention agreement
with respect to any such property);
B-
(c) all liabilities appearing on its balance sheet in accordance
with GAAP in respect of Capital Leases;
(d) all liabilities for borrowed money secured by any Lien with
respect to any property owned by such Person (whether or not it has
assumed or otherwise become liable for such liabilities);
(e) all its liabilities in respect of letters of credit or
instruments serving a similar function issued or accepted for its
account by banks and other financial institutions (whether or not
representing obligations for borrowed money);
(f) all contingent liabilities arising from the sale of assets
with recourse to such Person;
(g) Swaps of such Person; and
(h) any Guaranty of such Person with respect to liabilities of a
type described in any of clauses (a) through (g) hereof.
Indebtedness of any Person shall include all obligations of such Person
of the character described in clauses (a) through (h) to the extent such Person
remains legally liable in respect thereof notwithstanding that any such
obligation is deemed to be extinguished under GAAP.
"INSTITUTIONAL INVESTOR" means (a) any original purchaser of a Note,
(b) any holder of a Note holding more than 10% of the aggregate principal amount
of the Notes then outstanding, and (c) any bank, trust company, savings and loan
association or other financial institution, any pension plan, any investment
company, any insurance company, any broker or dealer, or any other similar
financial institution or entity, regardless of legal form.
"INVESTMENT" means any investment, made in cash or by delivery of
property, made directly or indirectly (i) in any Person, whether by acquisition
of shares capital stock, Indebtedness or other obligations or securities, or by
loan, advance, capital contribution or otherwise, and all Guaranties of the
obligations of any other Person or (ii) in any property.
"LIEN" means, with respect to any Person, any mortgage, lien, pledge,
charge, security interest or other encumbrance, or any interest or title of any
vendor, lessor, lender or other secured party to or of such Person under any
conditional sale or other title retention agreement or Capital Lease, upon or
with respect to any property or asset of such Person (including in the case of
stock, stockholder agreements, voting trust agreements and all similar
arrangements).
"MAKE-WHOLE AMOUNT" is defined in Section 8.6.
"MATERIAL" means material in relation to the business, operations,
affairs, financial condition, assets, properties, or prospects of the Company
and its Subsidiaries taken as a whole.
"MATERIAL ADVERSE EFFECT" means a material adverse effect on (a) the
business, operations, affairs, financial condition, assets or properties of the
Company and its Subsidiaries
B-
taken as a whole, or (b) the ability of the Company to perform its obligations
under this Agreement and the Notes, or (c) the validity or enforceability of
this Agreement or the Notes.
"MEMORANDUM" is defined in Section 5.3.
"MULTIEMPLOYER PLAN" means any Plan that is a "multiemployer plan" (as
such term is defined in Section 4001(a)(3) of ERISA).
"NOTES" is defined in Section 1.
"OFFICER'S CERTIFICATE" means a certificate of a Senior Financial
Officer or of any other officer of the Company whose responsibilities extend to
the subject matter of such certificate.
"PBGC" means the Pension Benefit Guaranty Corporation referred to and
defined in ERISA or any successor thereto.
"PERSON" means an individual, partnership, corporation, limited
liability company, association, trust, unincorporated organization, or a
government or agency or political subdivision thereof.
"PLAN" means an "employee benefit plan" (as defined in Section 3(3) of
ERISA) that is or, within the preceding five years, has been established or
maintained, or to which contributions are or, within the preceding five years,
have been made or required to be made, by the Company or any ERISA Affiliate or
with respect to which the Company or any ERISA Affiliate may have any liability.
"PREFERRED STOCK" means any class of capital stock of a corporation
that is preferred over any other class of capital stock of such corporation as
to the payment of dividends or the payment of any amount upon liquidation or
dissolution of such corporation.
"PROPERTY" or "PROPERTIES" means, unless otherwise specifically
limited, real or personal property of any kind, tangible or intangible, xxxxxx
or inchoate.
"QPAM EXEMPTION" means Prohibited Transaction Class Exemption 84-14
issued by the United States Department of Labor.
"REQUIRED HOLDERS" means, at any time, the holders of more than 50% in
principal amount of the Notes at the time outstanding (exclusive of Notes then
owned by the Company or any of its Affiliates).
"RESPONSIBLE OFFICER" means any Senior Financial Officer and any other
officer of the Company with responsibility for the administration of the
relevant portion of this agreement.
"SECURITIES ACT" means the Securities Act of 1933, as amended from time
to time.
"SENIOR FINANCIAL OFFICER" means the chief financial officer, principal
accounting officer, treasurer or comptroller of the Company.
B-
"SUBSIDIARY" means, as to any Person, any corporation, association or
other business entity in which such Person or one or more of its Subsidiaries or
such Person and one or more of its Subsidiaries owns sufficient equity or voting
interests to enable it or them (as a group) ordinarily, in the absence of
contingencies, to elect a majority of the directors (or Persons performing
similar functions) of such entity, and any partnership or joint venture if more
than a 50% interest in the profits or capital thereof is owned by such Person or
one or more of its Subsidiaries or such Person and one or more of its
Subsidiaries (unless such partnership can and does ordinarily take major
business actions without the prior approval of such Person or one or more of its
Subsidiaries). Unless the context otherwise clearly requires, any reference to a
"Subsidiary" is a reference to a Subsidiary of the Company.
"SWAPS" means, with respect to any Person, payment obligations with
respect to interest rate swaps, currency swaps and similar obligations
obligating such Person to make payments, whether periodically or upon the
happening of a contingency. For the purposes of this Agreement, the amount of
the obligation under any Swap shall be the amount determined in respect thereof
as of the end of the then most recently ended fiscal quarter of such Person,
based on the assumption that such Swap had terminated at the end of such fiscal
quarter, and in making such determination, if any agreement relating to such
Swap provides for the netting of amounts payable by and to such Person
thereunder or if any such agreement provides for the simultaneous payment of
amounts by and to such Person, then in each such case, the amount of such
obligation shall be the net amount so determined.
"VOTING STOCK" means the capital stock of any class or classes of a
corporation having power under ordinary circumstances to vote for the election
of members by the board of directors of such corporation, or person performing
similar functions (irrespective of whether or not at the time stock of any of
the class or classes shall have or might have special voting power or rights by
reason of the happening of any contingency).
"WHOLLY-OWNED SUBSIDIARY" means, at any time, any Subsidiary one
hundred percent (100%) of all of the equity interests (except directors'
qualifying shares) and voting interests of which are owned by any one or more of
the Company and the Company's other Wholly-Owned Subsidiaries at such time.
"YEAR 2000 ISSUES" shall mean anticipated costs, problems and
uncertainties associated with the inability of certain computer applications to
effectively handle data including dates on and after January 1, 2000, as such
inability affects the business, operations, and financial condition of the
Company and its Subsidiaries and of the Company's and its Subsidiaries' material
customers, suppliers and vendors.
B-
SCHEDULE 5.3
------------
DISCLOSURE MATERIALS
None.
Exhibit 1
SCHEDULE 5.4
------------
SUBSIDIARIES OF THE COMPANY AND OWNERSHIP OF SUBSIDIARY STOCK
Jurisdiction of
Entity Organization Ownership
------ ------------ ---------
AiC Analysts Ltd. United Kingdom 100%
AFFILIATES OF THE COMPANY
Name or Entity Ownership
-------------- ---------
X.X. Xxxxx 1,178,484
Xxxxxx Investments, Inc. 1,299,489
X. Xxxx Price Associates, Inc. 1,261,350
DIRECTORS AND SENIOR OFFICERS OF THE COMPANY
Name Positions Held
---- --------------
X.X. Xxxx Chairman, CEO and Director
X.X. Xxxxx President, COO and Director
Xxxxx Xxxxxx Executive Vice President
Xxxxxx X. Xxxxxx Corporate Secretary and General Counsel
Xxxxxx X. XxXxxxx Vice President Finance and Treasurer
Xxxxxx X. Xxxxx Director
Xxxxxxxx Xxxxxx Director
Xxxxxx X. Xxxxxxx Director
Xxxx Xxxxxx Director
SCHEDULE 5.5
------------
FINANCIAL STATEMENTS
o Analysts International Corporation - June 30, 1998 and 1997
o Analysts International Corporation - June 30, 1997 and 1996
o Analysts International Corporation - June 30, 1996 and 1995
Exhibit 1
SCHEDULE 5.15
-------------
EXISTING INDEBTEDNESS AND LIENS
None.
EXHIBIT 1
FORM OF NOTE
THIS NOTE HAS BEEN PURCHASED FOR INVESTMENT AND NOT WITH A VIEW TO DISTRIBUTION.
NO SALE, OFFER TO SELL, PLEDGE, TRANSFER OR OTHER DISPOSITION OF THIS NOTE SHALL
BE MADE UNLESS A REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933, AS
AMENDED, WITH RESPECT TO THIS NOTE IS THEN IN EFFECT OR UNLESS SUCH DISPOSITION
MAY BE EFFECTED WITHOUT VIOLATION OF THE SECURITIES ACT OF 1933, AS AMENDED, AND
APPLICABLE STATE SECURITIES LAWS.
ANALYSTS INTERNATIONAL CORPORATION
7.00% SENIOR NOTE DUE DECEMBER 30, 2006
No. [___] [Date]
$[_____] PPN 032681 A*9
FOR VALUE RECEIVED, the undersigned, ANALYSTS INTERNATIONAL CORPORATION
(herein called the "Company"), a corporation organized and existing under the
laws of the State of Minnesota, hereby promises to pay to [______________], or
registered assigns, the principal sum of [_________________] DOLLARS on December
30, 2006, with interest (computed on the basis of a 360-day year of twelve
30-day months) (a) on the unpaid balance thereof at the rate of 7.00% per annum
from the date hereof, payable semiannually, on the 30th day of June and December
in each year, commencing with the June or December next succeeding the date
hereof, until the principal hereof shall have become due and payable, and (b) to
the extent permitted by law on any overdue payment (including any overdue
prepayment) of principal, any overdue payment of interest and any overdue
payment of any Make-Whole Amount (as defined in the Note Purchase Agreement
referred to below), payable semiannually as aforesaid (or, at the option of the
registered holder hereof, on demand), at a rate per annum from time to time
equal to the greater of (i) 9.00% or (ii) 2% over the rate of interest publicly
announced by Norwest Bank Minnesota, National Association from time to time in
Minneapolis, Minnesota as its "base" or "prime" rate.
Payments of principal of, interest on and any Make-Whole Amount with
respect to this Note are to be made in lawful money of the United States of
America at the principal office of the Company or at such other place as the
Company shall have designated by written notice to the holder of this Note as
provided in the Note Purchase Agreement referred to below.
This Note is one of a series of Senior Notes (herein called the
"Notes") in the aggregate principal amount of $20,000,000 issued pursuant to the
Note Purchase Agreement, dated as of December 30, 1998 (as from time to time
amended, the "Note Purchase Agreement"), between the Company and the respective
Purchasers named therein and is entitled to the benefits thereof. Each holder of
this Note will be deemed, by its acceptance hereof, (i) to have agreed to the
confidentiality provisions set forth in Section 20 of the Note Purchase
Agreement and (ii) to have
made the representation set forth in Section 6.2 of the Note Purchase Agreement.
This Note is a registered Note and, as provided in the Note Purchase
Agreement, upon surrender of this Note for registration of transfer, duly
endorsed, or accompanied by a written instrument of transfer duly executed, by
the registered holder hereof or such holder's attorney duly authorized in
writing, a new Note for a like principal amount will be issued to, and
registered in the name of, the transferee. Prior to due presentment for
registration of transfer, the Company may treat the person in whose name this
Note is registered as the owner hereof for the purpose of receiving payment and
for all other purposes, and the Company will not be affected by any notice to
the contrary.
The Company will make required prepayments of principal on the dates
and in the amounts specified in the Note Purchase Agreement. This Note is also
subject to optional prepayment, in whole or from time to time in part, at the
times and on the terms specified in the Note Purchase Agreement, but not
otherwise.
If an Event of Default, as defined in the Note Purchase Agreement,
occurs and is continuing, the principal of this Note may be declared or
otherwise become due and payable in the manner, at the price (including any
applicable Make-Whole Amount) and with the effect provided in the Note Purchase
Agreement.
This Note shall be construed and enforced in accordance with, and the
rights of the parties shall be governed by, the law of the State of Minnesota
excluding choice-of-law principles of the law of such State that would require
the application of the laws of a jurisdiction other than such State.
ANALYSTS INTERNATIONAL CORPORATION
By:
Its:
Exhibit 1
EXHIBIT 4.4(a)
FORM OF OPINION OF SPECIAL COUNSEL
TO THE COMPANY
Matters To Be Covered In
OPINION OF SPECIAL COUNSEL TO THE COMPANY
1. Each of the Company and its Subsidiaries being duly incorporated,
validly existing and in good standing and having requisite corporate power and
authority to issue and sell the Notes and to execute and deliver the documents.
2. Each of the Company and its Subsidiaries being duly qualified and in
good standing as a foreign corporation in appropriate jurisdictions.
3. Due authorization and execution of the documents and such documents
being legal, valid, binding and enforceable.
4. No conflicts with usury laws.
5. No conflicts with charter documents, laws or other agreements.
6. All consents required to issue and sell the Notes and to execute and
deliver the documents having been obtained.
7. No litigation questioning validity of documents.
8. The Notes not requiring registration under the Securities Act of 1933,
as amended; no need to qualify an indenture under the Trust Indenture Act of
1939, as amended.
9. No violation of Regulations G, T or X of the Federal Reserve Board.
10. Company not an "investment company", or a company "controlled" by an
"investment company", under the Investment Company Act of 1940, as amended.
